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N.Y. Pension Official Allegedly Bribed With Prostitutes, Drugs

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Mark Lennihan
/
AP
U.S. Attorney Preet Bharara announces charges on Wednesday in New York against Navnoor Kang, a former portfolio manager at the New York State Common Retirement Fund and two broker-dealers for participating in a "pay-for-play" scheme.

U.S. Attorney Preet Bharara is bringing charges against a former portfolio manager in the state’s pension fund, saying he accepted bribes, which included prostitutes and illegal drugs, from two hedge fund brokers.

State Comptroller Tom DiNapoli, who is not implicated in the case, says in a statement that he’s “outraged” by the “shocking betrayal” of the former portfolio manager, Navnoor Kang, who was fired in February. And DiNapoli thanked the U.S. Attorney for bringing the charges.

But Governor Cuomo, a long-time political rival of the comptroller, says it raises questions about the state comptroller’s role as sole trustee of one of the largest pension funds in the nation.

Cuomo says hedge fund managers are eager for a share of the lucrative fund.

“The temptation for corruption, and bribery and bid rigging is very, very high,” Cuomo said. “Given the system we have.”

Cuomo compared the case to his successful prosecution of a former state comptroller, when Cuomo was state attorney general. Alan Hevesi served jail time for corruption.

In response to the governor’s comments, a spokeswoman for the comptroller says the crimes were the work of a “rogue employee,” and that pension fund boards have also had scandals.  

Governor Cuomo’s administration is also facing its own scandal from a federal probe. The governor’s former top aide, a lobbyist close to the Cuomo family, the former head of SUNY Polytechnic, and several others have been charged with or pleaded guilty to bribery and bid rigging in connection with an economic development contract scandal that includes Buffalo Billion projects. 

Karen has covered state government and politics for New York State Public Radio, a network of 10 New York and Connecticut stations, since 1990. She is also a regular contributor to the statewide public television program about New York State government, New York Now. She appears on the reporter’s roundtable segment, and interviews newsmakers.