US - Henry "Hank" Morris, the chief political advisor to former New York comptroller Alan Hevesi, has been sentenced to four years in prison for his involvement in a pay-to-play scandal.
Morris was charged with exploiting his connection with Hevesi in order to reap the fees paid by firms hoping to invest in the $132.8bn New York Common Retirement Fund.
Through this scheme, Hevesi, Morris, and a number of their political allies and friends reaped tens of millions of dollars in kickbacks, bribes, and sham consulting and finder fees connected to pension fund investments.
Morris pleaded guilty to felony in November, forfeiting $19m of the fees he was paid by investment firms and money managers. (Global Pensions: 23 November 2010).
He was also permanently banned from the New York securities industry and prohibited from holding any public position or entering into any contractual relationship with the State of New York or any governmental entity within the State.
His was the eighth guilty plea in New York Attorney General Andrew Cuomo's three-year investigation into corruption involving the Office of the New York State Comptroller and the state pension fund. Hevesi himself pleaded guilty to his involvement in the scandal in October and also faces up to four years in prison, although his agreement to cooperate fully with Cuomo's investigation could see him go free. (Global Pensions: 08 October 2010).
In addition to the guilty pleas, Cuomo's investigation has resulted in agreements with sixteen firms and three individuals, garnering more than $170m in recoveries for the state, including today's case.
Current New York Comptroller Thomas DiNapoli (pictured) said: "Hank Morris has received a fitting sentence. Jail time should help serve as a deterrent for anyone looking to rip off the state pension fund.
"Since taking office, I've worked hard to restore faith in the Office of the State Comptroller after the abuses of the Hevesi administration. I banned placement agents so that corrupt middlemen could never again run the type of pay-to-play scheme that Mr. Morris did. We must ensure that the pension fund is protected against this kind of criminal behaviour."
Last month, DiNapoli proposed a bill that would strip convicted former public officials of their pensions. "Public officials who commit a felony related to their duties shouldn't be rewarded," he said. "There are better ways to spend New York's tax dollars than to support retired felons who ripped off the public."
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