"Nothing in my entire professional life had been as painful” as getting caught up in the New York state pension scandal, Mr. Rattner writes in his recent book about his work in leading the government’s auto-industry bailout.  Beyond that, financier and former “car czar” Steven Rattner has kept mum about his proposed settlement with the SEC investigation over his role in a pension-fund kickback scheme – a deal that grows stranger by the moment [C-I:  see related story on SEC's delayed vote on the settlement.] 

In “Overhaul,” an account of his work leading the government’s auto-industry bailout, Rattner doesn’t say whether he did anything wrong.  But he does describe the personal toll of the “pay-for-play” investigation, and he lays out how he met the former political adviser at the center of Quadrangle’s controversial interactions with New York’s public pension fund - Hank Morris.  They both worked on Chuck Schumer’s 1998 campaign for Senate and Rattner writes that years later, he asked Sen. Schumer for advice as Quadrangle was weighing whether to hire Morris to help secure business with public investment funds.  The New York senator “confirmed my impression that, in a realm filled with shady characters, Hank was a straight shooter.  That wasn’t how it turned out.”

Rattner, himself a onetime NYTimes reporter, also said in his book that the media’s handling of the investigation surrounding Quadrangle was “sensationalistic.”  Rattner, who was tapped to lead the Obama administration’s auto industry rescue in February 2009, wrote that the investigation into the pay-to-play probe - as it pertained to him - remained relatively quiet in the media until April of that year, when the SEC amended its lawsuit to detail the alleged role in the kickbacks scheme of a Quadrangle executive, later identified in news reports as Rattner. It was then than the case consumed his professional and personal lives, prompting him to say, "Nothing in my entire professional life had been as painful as that episode.” 

Quadrangle agreed this April to settle the investigation with the SEC and the New York attorney general. At the time, the firm publicly, and harshly, distanced itself from Rattner.  Separately, the SEC office of inspector general said Wednesday the SEC held up by a day its announcement of a fraud lawsuit against Goldman Sachs in April, in part to maximize media attention for the settlement with Quadrangle, and to preserve friendly relations with the state regulator. 

“Let’s make sure we don’t announce Goldman same day,” SEC Chairman Mary Schapiro wrote in an email, according to the inspector general’s report. “I was a little worried that the Attorney General would be very upset if we announced multiple cases the same day,” she said later, according to the report.  [WSJ Deal Blog, 10/14]