Published on June 24, 2009 | by LawNews
Prof. Monroe Freedman on Bloomberg.com
Cuomo’s Money Manager Received Funds Linked to Pension Scandal
By Karen Freifeld
June 24, 2009
June 24 (Bloomberg) — EnTrust Capital Inc., a hedge fund firm that’s handled New York Attorney General Andrew Cuomo’s personal and campaign money, received state pension funds to invest from a company he has identified as paying possible illegal kickbacks.
The investment presents a potential conflict of interest for Cuomo, legal ethics experts said. Cuomo spokesman Richard Bamberger declined to respond to detailed e-mails about whether EnTrust has been or is under investigation by Cuomo, a Democrat. Given his relationship with EnTrust, Cuomo shouldn’t decide whether it should be a target of any probe, the experts said.
Starting in 2006, EnTrust’s Capital Waters Fund Ltd. received more than $20 million from Liberty Oak Capital Fund LP, according to Robert Whalen, spokesman for New York state comptroller Thomas DiNapoli. Liberty Oak’s parent got access to state pension money after signing an agreement that paid Henry “Hank” Morris about $1 million in kickbacks to get the business, the U.S. Securities and Exchange Commission said in a complaint against Morris.
“It appears that Cuomo does have a conflict of interest,” said Monroe Freedman, a legal ethics professor at Hofstra University Law School in Hempstead, New York. “When you’re personally involved, it’s too easy to persuade yourself that this case can go forward without investigating them.”
Freedman said Cuomo, 51, who has been leading a nationwide probe of corruption involving public pension funds, should recuse himself from the case and an independent counsel or special prosecutor should take over.