Hedge fund executive pleads guilty in New York pension fund investigation

A hedge fund executive has pleaded guilty and a former New York political leader plans to surrender on charges related to a state pension fund investigation.

Records unsealed Tuesday show Dallas-based Barrett Wissman pleaded guilty on 31 March to securities fraud. His lawyer says Wissman is cooperating. Ray Harding's lawyer says the former head of New York's Liberal party is surrendering Wednesday. The charges were not immediately known. Attorney David Frankel says Harding hasn't broken any laws.

The ongoing inquiry, which is examining the activities of a number of investment companies, focuses on what has been a widespread practice among hedge funds and private equity firms - paying so-called placement agents to gain business managing the pension funds run by states for public employees. Such payments often raise questions about conflicts of interest and concerns that they lead placement agents to bribe public officials.

The New York Attorney General's office confirmed Wednesday that Wissman, who was a managing director of HFV Asset Management LP and who worked for a time as a placement agent for Access Capital Partners, had entered a guilty plea in the case and declined further comment. The New York Times reported Wissman's guilty plea in its editions Wednesday. He is the first fund executive to plead guilty in the case.

Two of former Comptroller Alan Hevesi's aides were previously charged. They're accused of taking payments to steer billions of dollars in pension fund investments to favoured companies.

New York Attorney General Andrew Cuomo has alleged the men essentially sold access to billions of dollars in money held by the New York State Common Retirement Fund to favoured investment firms in exchange for kickbacks and other payments for personal and political gain.