Los Angeles venture capitalist pleads guilty
Broidy paid $1m in gifts to New York pension fund officials to win business for his firm
Los Angeles/Sacramento: Los Angeles venture capitalist and philanthropist Elliott Broidy pleaded guilty Thursday to charges that he paid $1 million (Dh3.6 million) in gifts to New York public pension officials to win $250 million in investment capital for his private equity fund.
Broidy, 52, faces a possible prison sentence of up to four years at his sentencing, scheduled for June 10.
New York Attorney General Andrew Cuomo characterised Broidy's actions as bribery, saying he sent a top state official and relatives on trips to Israel and Italy and paid the rent and hospital bills of a bureaucrat's girlfriend to get the investment money for his Century City firm, Markstone Capital Partners.
Broidy even bankrolled a movie production for the brothers of one official, authorities said. "This is an old-fashioned payoff of state officials," Cuomo said. "This is effectively bribery."
Commitments
Broidy's New York guilty plea is the latest development in a series of enquiries into investment decisions by public pension funds including the California Public Employees' Retirement System (CalPERS), which has made $50 million in investment commitments with Broidy's company.
Over the last decade, Broidy and his wife made nearly $900,000 in campaign contributions, including donations to two CalPERS board members, to officials who were seeking or held statewide political offices at the time.
CalPERS says it is evaluating its partnership with Markstone and looking at its legal options. It has asked a legal adviser, who is conducting an investigation of the pension fund's relationships with investment managers, to look into Markstone's dealings with the board and staff, CalPERS spokesman Brad Pacheco said.
