Friday, May 15, 2009

Placement Agents: Carlyle Agrees to Restrictions on Use of Placement Agents

The New York Times reports that the New York State Attorney General, Andrew M. Cuomo, has reached a settlement with The Carlyle Group relating to Mr. Cuomo's investigation into the activities of placement agents involving New York State pension funds. Carlyle agreed to pay $20 million and make significant changes to its use of placement agents and other intermediaries that it uses to attract investments in its investment funds. Carlyle will be prohibited from using intermediaries in order to gain introduction or access to officials at public pension funds. In addition, Carlyle's executives and their family members may not make campaign contributions to officials who have oversight responsibility with respect to pension funds for a period of two years after having done business with the pension fund. Carlyle will also have to disclose any contributions it makes to a politician in a state in which it does pension fund business.