Obama's Car Czar in Pay-to-Play probe (updated)

Wall Street financier and former auto czar Steven Rattner is in settlement talks to resolve his role in the "pay to play" investigation at the New York state pension fund, according to people familiar with the matter.

Mr. Cuomo's investigation of Mr. Rattner focuses on his activities at Quadrangle Group, the private-equity firm he co-founded a decade ago. The New York-based firm obtained a $100 million investment from the New York pension fund three weeks after a DVD company owned by Quadrangle agreed to distribute "Chooch," a low-budget movie co-produced by Mr. Loglisci and his brother, according to court papers.

Quadrangle also paid a $1.1 million finder's fee to Hank Morris in exchange for securing the investment from the New York fund. Mr. Loglisici said Wednesday he had "effectively ceded" his authority over the fund's private-equity investment decisions to Mr. Morris, a former top New York political adviser.

Mr. Rattner left Quadrangle a year ago to join the Obama administration.

A number of money managers have been ensnared by the attorney general's probe. Riverstone Holdings LLC and Carlyle Group paid $30 million and $20 million in restitution, respectively, to resolve their roles in the case. Both firms paid Mr. Morris finder's fees for helping secure investments from the pension fund. In addition, David Leuschen, co-founder of Riverstone, paid a $20 million fine to resolve his role in the investigation. Mr. Leuschen personally invested $100,000 in "Chooch."

Three money managers -- Elliott Broidy, formerly of Markstone Capital Group in Los Angeles; Saul Meyer of Aldus Equity in Dallas; and Barrett Wissman, formerly of HFV Asset Management in Dallas -- have pleaded guilty to criminal charges related to the investigation.