Task Force Leader Steven Rattner Linked to SEC Probe

Joshua Duval
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Steven Rattner, the leader of President Obama's Task Force on Autos, is one of several investment company executives involved with payments linked to an alleged kickback scheme.

A Securities and Exchange Commission complaint says that a "senior executive" from Quadrangle, Rattner's investment firm, met with a politically-connected consultant about a finder's fee, agreeing to pay a $1.1 million fee after receiving a $100 million investment from New York's $122 billion State Common Retirement Fund. The Wall Street Journal says a source claims the executive is Rattner.

The issue is whether the investment companies should have known or did know that the finders' fees, which are usually legal, were part of an illegal kickback scheme. So far, former comptroller Alan Hevesi has pleaded guilty, and two of his aides, Hank Morris and David Loglisci, have been indicted. Rattner met with both Morris and Loglisci.

Quadrangle does not expect any action will be taken against it. The Obama administration apparently knew about the investigation before it tapped Rattner to head the automotive task force.

"During the transition Mr. Rattner made us aware of the pending investigation," a U.S. Treasury Department spokesperson said.

Rattner left Quadrangle to head the President Obama's automotive task force, where he has been working to shrink GM and partner Chrysler with Fiat. So far, he does not face any criminal or civil charges.

Sources: Reuters, The Wall Street Journal

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