Chooch? There's your problem

The Los Angeles Times has an article by Jim Puzzanghera and Walter Hamilton about the latest politico with his wang in the wringer:

Investment banker Steven Rattner came to Washington in February to help the Obama administration bail out General Motors Corp. and Chrysler— and maybe even find a larger role in government for himself. But any larger ambitions are now clouded by a pay-for-play scandal that links the New York state pension fund, a low-budget movie called Chooch, and Rattner's former private-equity firm.
There are no allegations of wrongdoing by Rattner or his former company, Quadrangle Group. Even so, the ongoing investigation by the New York state attorney general and the Securities and Exchange Commission could complicate Rattner's chances of advancing to a higher administration position, said Norman Ornstein, a resident scholar at the American Enterprise Institute, a Washington think tank. "He has not been a highly visible figure," Ornstein said. "The last thing you want when you become a highly visible public figure is to have it come in this context."
White House Press Secretary Robert Gibbs said Friday that President Obama continues to have full confidence in Rattner, who had made administration officials aware of the pending investigation before he was appointed as auto industry advisor to Treasury Secretary Timothy Geithner. Rattner is head of the administration's auto industry task force, which is involved in high-stakes negotiations over the fate of GM and Chrysler.
Before taking the Treasury position in February, one of Rattner's focuses on Wall Street was the media business, and he sat on the board of Barry Diller's IAC/InterActiveCorp. It was those media connections in part that have raised questions as part of the state and federal investigation. Last month, the SEC and New York Attorney General Andrew Cuomo charged two former officials in the state comptroller's office, Henry Morris and David Loglisci, with taking millions of dollars in kickbacks from firms looking to manage assets from New York's $122-billion public pension fund.
Loglisci, the former deputy comptroller and chief investment officer for the fund, also dabbled in the movie business. He and his brothers produced Chooch, a comedy about two cousins from Queens who get in trouble in Mexico and have to be rescued by friends from their neighborhood. The 2004 movie grossed $31,015, according to BoxOfficeMojo.
According to an amended court complaint filed by the SEC on Wednesday, Loglisci arranged a meeting with an unnamed Quadrangle senior executive to discuss a DVD distribution deal for the film. In January of 2005, a Quadrangle affiliate, GT Brands, agreed to acquire the DVD distribution rights for $88,841. Three weeks later, Loglisci informed the Quadrangle executive that the state retirement fund would make a $100-million investment in a fund managed by another Quadrangle affiliate, the complaint said. Neither Loglisci nor anyone else disclosed the DVD deal.
The complaint also alleges that that same Quadrangle executive met with Morris, who was the top advisor and chief fundraiser for then-New York State Comptroller Alan Hevesi. Quadrangle agreed to pay a company affiliated with Morris a $1.1-million finder's fee for the state investment.
The Wall Street Journal has reported that Rattner was the senior Quadrangle executive. Rattner did not respond to an email seeking comment Friday and a Treasury spokeswoman said he was unavailable. The SEC and New York attorney general's office would not comment.
Rattner is known on Wall Street for his financial acumen and reservoir of political contacts. "He is regarded in the private-equity world as a very well-connected person," said Mario Giannini, chief executive of Hamilton Lane, which advises institutional investors on private-equity investments. "People often want him involved in a deal because he can open so many doors, either in business or in politics."
After an early career as a New York Times reporter, Rattner decamped to Wall Street in the 1980s as an investment banker. He worked at Lehman Bros. Holdings Inc. and Morgan Stanley before becoming a top executive at Lazard in the 1990s. In 2000, he co-founded Quadrangle, which focuses on the media and communications industry. Rattner and his wife, Maureen White, are major supporters of the Democratic Party, throwing fundraisers for New York glitterati at their opulent Fifth Avenue apartment. They were overnight guests at the White House during the Clinton administration, and raised money for Al Gore, John Kerry, and Hillary Rodham Clinton. Rattner has given $257,150 to Democratic candidates and organizations since 2000, according to the nonpartisan Center for Responsive Politics. White was national finance chair for the Democratic National Committee from 2001 to 2006, and served in the same position for Hillary Clinton's presidential campaign. Rattner was a supporter of Clinton's bid for the Democratic nomination. After Obama defeated Clinton, Rattner contributed $4,600 to his campaign.

Rico says politics makes for strange bedfellows, and some you wish would get out of your bed...