Dan Primack

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Rattner responds... and it's ridiculous

November 18, 2010: 12:35 PM ET

Steve Rattner has responded to today's developments in the New York pay-to-play scandal, including his settlement with the SEC and charges brought against him by the NY Attorney General Andrew Cuomo. Here it is (via Dealbook):

While settling with the S.E.C. begins the process of putting this matter behind me, I will not be bullied simply because the attorney general's office prefers political considerations instead of a reasoned assessment of the facts.

This episode is the first time during 35 years in business that anyone has questioned my ethics or integrity — and I certainly did not violate the Martin Act. That's why I intend to clear my name by defending myself vigorously against this politically motivated lawsuit.

Really Steve? Really?

What exactly are the "political considerations" in play here? Maybe you could have played this card before November's elections, but not today. Cuomo won't be on the campaign trail until 2014, at which point no one will remember this episode one way or the other.

In fact, the only "political considerations" that even make vague sense are the ones that kept you from being charged for the past two years. You know, the idea that Cuomo didn't want to piss off New York's Democratic establishment (read: Hillary) before his gubernatorial run.

But that is almost besides the point. Your settlement with the SEC is a tacit admission that you've done wrong. Even your former partners have called your actions "inappropriate, wrong and unethical."

We're well past the point where you can "clear your name."

Look, I understand your complaint about The Martin Act. It's a comically blunt weapon for attorneys general to wield, but that doesn't mean that you're being treated unfairly in this particular situation. Your actions were reprehensible, even if it seemed like business as usual at the time (and even if the investments in Quadrangle did not really harm New York pensioner pocketbooks).

Cuomo has been trying to settle with you for more than a year, with rumors that he would let you off the hook for around $20 million. That's the same amount David Leuschen of Riverstone paid, but your attorneys told Cuomo to pound sand. Another option would have been to say: "I accept, and thank you for not trying to throw me in jail."

To borrow an old phrase: You've already established what you did. Now you're just haggling over price.

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Dan Primack
Dan Primack
Senior Editor, Fortune

Dan Primack joined Fortune.com in September 2010 to cover deals and dealmakers, from Wall Street to Sand Hill Road. Previously, Dan was an editor-at-large with Thomson Reuters, where he launched both peHUB.com and the peHUB Wire email service. In a past journalistic life, Dan ran a community paper in Roxbury, Massachusetts. He currently lives just outside of Boston.

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