DiNapoli issues exec order on CRF use of advisers
US - New York State comptroller Thomas DiNapoli has prohibited New York State Common Retirement Fund (CRF) from doing business with any investment adviser who made a political contribution to the state comptroller or a candidate for state comptroller.
The ban - issued through an executive order - will last for two years from the date of contribution and mirrors proposals by the Securities and Exchange Commission (SEC) proposed in July (Global Pensions, July 23, 2009).
DiNapoli said: "I've met with the chair of the SEC to urge the implementation of a national ban on pay-to-play political contributions, but we don't have to wait for the SEC to finalize its proposed rule."
The order states: "The executive order and the associated interim policy are designed to eradicate opportunities for corruption, prevent conflicts of interests or the appearance of conflicts of interest in the CRF's investment decision-making process."
The move comes as the investigation on alleged pay-to-play practices at CRF continues.
Last week, four private equity firms - HM Capital Partners I, Levine Leichtman Capital Partners, Access Capital Partners and Falconhead Capital -agreed to return over US$4.5m to the CRF to resolve their roles in the ongoing investigation on alleged pay-to-play practices at the scheme (Global Pensions, September 21, 2009).
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