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Ex-New York state comptroller sentenced to prison

By Chris Kokenes, CNN
  • Alan Hevesi is ordered to spend one to four years in prison.
  • He pleaded guilty to one count of felony corruption
  • He was accused of receiving payments in return for an investment of state money

New York (CNN) -- Former New York State Comptroller Alan Hevesi was sentenced Friday to the maximum sentence of one to four years in prison after pleading guilty to a felony corruption charge for his key role in a wide-ranging state pension fund scandal.

Hevesi will be eligible for parole after one year.

As part of a plea agreement, the 71-year-old Hevesi, who served as comptroller from 2003 to 2006, pleaded guilty in October 2010 to a charge of "receiving reward for official misconduct."

Hevesi, who spoke briefly before he was sentenced by Judge Michael Obus, was joined in court by his two sons and a daughter.

Hevesi's lawyer, Bradley Simon, said his client accepted the sentence of the court and accepted responsibility for his transgressions.

Hevesi was to be transferred later Friday to Fishkill, New York, where the Department of Corrections will determine the facility he'll serve his sentence in.

He admitted receiving nearly $1 million in benefits for his family, friends and political allies in exchange for improperly approving a $250 million investment in Markstone Capital Partners from the state's Common Retirement Fund, according to a statement released by state Attorney General Eric Schneiderman.

These benefits consisted of $75,000 in travel expenses for Hevesi and his family, $380,000 in sham consulting fees for a lobbyist friend, and over $500,000 in campaign contributions, the statement said.

Elliott Broidy, a Hevesi fundraiser and principal of Markstone Capital, "concealed his payment of some of the travel expenses through the use of charitable organizations and false invoices submitted to the comptroller's office," according to the attorney general's office.

The attorney general's office said Broidy pleaded guilty in December 2009 to a felony charge of rewarding official misconduct in connection with his dealings in the case and is expected to be sentenced in the next couple of months.

The case stems from an extensive investigation by then-state Attorney General Andrew Cuomo, New York's governor, into abuses of the state pension fund by state officials.

As the highest-ranking government official involved in the pension scheme, Hevesi's guilty plea is seen by many in New York as evidence that corruption had invaded state government in Albany in recent years.

In a statement issued after the sentencing, Cuomo said it is a new day in Albany and the old way of doing business will not be tolerated.

"My public integrity bureau spent four years investigating and prosecuting those who had corrupted the integrity of the New York State Comptroller's Office under Alan Hevesi," Cuomo said. "In the beginning, skeptics said it was business as usual, not a crime. It was assumed to be typical Albany corruption. At the end of the day, eight guilty pleas resulted, including those of Hevesi's chief investment officer, David Loglisci, and chief political consultant, Hank Morris, and ultimately by Hevesi himself, and we recovered $170 million for the people and the state pension fund."

This was the second time Hevesi had pleaded guilty to a felony corruption charge. After he was re-elected as comptroller in 2006, he entered a guilty plea and resigned before the new term began to avoid indictment on more serious charges.