Hevesi’s Advice Stirs Questions On the Coast

The New York state comptroller, Alan Hevesi, encouraged California public pension managers to invest in a private venture capital fund founded by a man whose wife has been a generous donor to his political campaigns, according to a news report and public records.On May 19, 2003, Mr.Hevesi attended a meeting at the Sacramento headquarters of the California Public Employees’ Retirement System, CalPers, along with one of the founders of Markstone Capital Group, Elliot Broidy, and California’s state comptroller, Steve Westly, a spokesman for Mr. Westly confirmed yesterday after a reference to the session appeared in the Los Angeles Times.The newspaper said the purpose of the meeting was for Mr. Broidy to make a “pitch” to CalPers for an investment in Markstone, a new fund devoted to investments in Israeli companies. A few months later, the California pension fund invested $25 million in Markstone. CalPers anted up another $25 million earlier this year.A spokesman for CalPers, Brad Pacheco, confirmed the $50 million investment, but said he had no information about what transpired at the May 2003 session or why Mr. Hevesi attended a meeting in California with the apparent goal of ginning up more money for Mr. Broidy’s fund, Markstone.In June 2003, Mr. Hevesi, who oversees New York’s public employee pension funds, announced a $200 million investment in Markstone.Mr. Broidy, a Los Angeles resident, is a major donor to Republican political campaigns and raised at least $200,000 for President Bush’s re-election bid in 2004. According to New York state campaign finance records, Mr. Broidy has not given direct financial support to Mr. Hevesi’s campaigns in recent years.However, Mr. Broidy’s wife, Robin Rosenzweig, has given $80,000 to those campaigns since 2002. Ms. Rosenzweig gave a total $30,000, before the May 2003 meeting and $50,000 afterwards.In addition, Mr. Broidy and Ms. Rosenzweig each gave $3,400 in 2005 to Mr. Hevesi’s son, Andrew, for his successful campaign to represent Queens in the state assembly.A spokesperson for the elder Mr. Hevesi, John Chartier, did not return calls from the Sun seeking comment for this article. The Los Angeles Times reported that Mr. Hevesi said that he maintains a “wall between political contributions and investment decisions.”Mr. Westly’s spokesman, Yusef Robb, said his boss had little recollection into what transpired at the May 19, 2003 session. An appointment schedule for Mr. Westly, obtained by the Los Angeles Times through a public records request and provided to the Sun yesterday by Mr. Westly’s office, indicates a half-hour meeting at 3:30 p.m. described as “Alan Hevesi/Elliot Brody…CalPers executive office.”“It’s our understanding that Mr. Brody and Mr. Hevesi had a meeting set up with CalPers. Controller Westly’s office is a block up from there and he decided to drop in,” Mr. Robb said. “Our insight into the meeting is pretty limited.”Asked why Mr. Hevesi would have attended, Mr. Robb noted Mr. Hevesi’s role as a fiduciary for New York’s state pension funds. “The New York common fund and California retirement fund have worked together on a number of issues,” Mr. Robb said. “It’s definitely not uncommon.”A secretary at Markstone’s offices took a message seeking comment for this article, but later said officials there were “not interested in calling back.” The Los Angeles Times said Mr. Broidy issued a statement denying any link between his wife’s contributions and the CalPers investments. Mr. Broidy told the newspaper that there was a “clear separation” between his family’s political and business efforts.Mr. Westly’s involvement with private investment firms and CalPers is receiving scrutiny because he is a candidate for the Democratic nomination for governor of California. Mr. Westly has a small lead over his main opponent, the state treasurer, Phil Angelides, in public opinion polls, but Mr. Angelides has garnered endorsements from the Democratic Party and major public employee unions.Both men sit on the CalPers board and have received substantial donations from friends connected to the investment business, including many who live in New York or other states.Ms. Rosenzweig, who is described as a homemaker in campaign finance records, gave almost $180,000 to Mr. Westly’s campaign fund in recent years, according to a Los Angeles Times tally. The newspaper said state records showed Mr. Westly regularly urged CalPers managers to invest in funds run by his political allies and Mr. Angelides also referred such proposals to CalPers.However, Mr. Westly’s office said his influence over individual investments is negligible.“Investment professionals at those funds make the decisions to invest. The notion that board members are pulling strings at a several hundred billion dollar fund is laughable,” Mr. Robb said.Asked why those pitching investments didn’t simply contact CalPers directly instead of enlisting state officials like Messrs. Westly and Angelides, Mr. Robb said, “It’s an incredibly large bureaucracy…Sometimes people have trouble getting through to the right person.”

Hevesi’s Advice Stirs Questions On the Coast

Hevesi’s Advice Stirs Questions On the Coast

More from the New York Sun

Colorado Democrats Denying Catholic Parents’ Religious Freedom in State-Funded Pre-K Programs

The Best Advice for Republicans After Midterm Drubbing Is To Keep Calm

Ram Has Resurrected a V8-Powered Flying Dinosaur

Anti-Jeffries Petition Tops 1 Million Signatures as Progressives Seek a More Combative Speaker

Hochul and Mamdani Celebrate Democratic Election Gains, Not at Home but in Puerto Rico

Zoo Atlanta’s New Pandas Steal the Spotlight in Public Debut

GOP Lawmakers Erupt Over Trump’s Promotion of Stephen Miller

Incoming Texas Democrats May Flip Policies on Abortion, Data Centers, Schools

More from the New York Sun

Colorado Democrats Denying Catholic Parents’ Religious Freedom in State-Funded Pre-K Programs

The Best Advice for Republicans After Midterm Drubbing Is To Keep Calm

Ram Has Resurrected a V8-Powered Flying Dinosaur

Anti-Jeffries Petition Tops 1 Million Signatures as Progressives Seek a More Combative Speaker

Hochul and Mamdani Celebrate Democratic Election Gains, Not at Home but in Puerto Rico

Zoo Atlanta’s New Pandas Steal the Spotlight in Public Debut

GOP Lawmakers Erupt Over Trump’s Promotion of Stephen Miller

Incoming Texas Democrats May Flip Policies on Abortion, Data Centers, Schools