A former New York state pension fund manager was accused in a sweeping federal indictment Wednesday that alleges rampant corruption and extravagant bribes -which included cash, drugs and prostitutes -in exchange for granting brokerage firms millions of dollars in government business.
The former New York Common Retirement Fund manager, Navnoor Kang, is charged along with broker Deborah Kelley -in a case involving multiple counts of conspiracy, fraud and obstruction of justice for the scheme, which prosecutors say lasted for at least two years.
According to the charging documents, Kang, 37, who served as the office’s director of fixed income and head of portfolio security, repeatedly accepted bribes from Kelley and other brokers in exchange for millions of dollars worth of fixed-income business to their brokerage firms from the pension fund -which, with $184 billion in assets, is the United States’ third largest.
In the wake of alleged fraud committed by New York state pension fund’s former director of fixed income and head of portfolio strategy Navnoor Kang, an Indian American, the state controller’s office is making reforms to its hiring practices and other policies.
Controller Thomas DiNapoli released a report on April 6th outlining the findings of an internal review he ordered after Kang was charged in 2016 by then-Manhattan U.S. Attorney Preet Bharara with accepting more than $100,000 worth of bribes.
Kang is accused of accepting cash, cocaine, prostitutes, fancy watches and trips from two brokerage firms that wanted to do business with the $184 billion state pension fund, reported the New York Daily News. Kang had previously been fired from his last job for accepting gifts, according to the feds — something he misled hiring managers about and that the third-party company hired by the state to vet its employees, Korn Ferry, missed.
Going forward, all candidates will have to list all former employers, along with contact information for supervisors, provide three references including their most recent employers, and reference checks must be performed by a Common Retirement Fund staff member — not an outside company. Relevant employers over the last decade must be contacted and asked, among other things, if they’d hire the employee again, the report says.