Markstone Capital switches chairman following guilty plea in NY pension scandal

Attorney General Andrew Cuomo said that Broidy admitted paying $1m to officials at the New York State Common Retirement Fund in return for a $250m commitment to Markstone Capital’s Israel-focused venture capital fund.

The shamed chairman pleaded guilty to a felony charge of rewarding official misconduct and will cooperate in the Attorney General’s ongoing investigation. Broidy will also forfeit $18m in connection with his plea.

Attorney General Cuomo said, “Broidy paid nearly a million dollars in bribes to get a quarter billion dollar investment. For Broidy, this was a small price to pay. For New York taxpayers, the harm is incalculable. Corruption corrodes the integrity of the pension system and the public’s trust in government. That is too high a price to bear.”

Markstone expects these events to have no effect on the value of investors’ investments and has now replaced Broidy with Ambassador Dan Gillerman.

Gillerman is the former Israeli Ambassador to the UN and Chairman of the Israel Association of Chambers of Commerce.

Markstone’s fund has invested $562m in ten companies, with an overall gross internal rate of return of 11 per cent, according to the firm.

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