ALBANY, N.Y. (AP) — A parole board has agreed to release former New York Comptroller Alan Hevesi from prison, where he has spent 19 months for accepting gifts and campaign donations from people trying to do business with the state pension fund.
As comptroller, Hevesi was sole trustee of the fund for a million state and local government workers and beneficiaries, now valued at nearly $150 billion. He pleaded guilty to official misconduct in 2010 and was sentenced to one to four years in prison. He was denied parole last year.
The 72-year-old former assemblyman and New York City comptroller was entangled in an investigation of so-called "pay to play" practices at the fund. Comptroller Thomas DiNapoli, who followed Hevesi, instituted rules banning the use of paid placement agents and comptroller campaign contributors from fund business.
"Your statement of remorse for damage caused to the state of New York, the Office of State Comptroller and its employees is acknowledged," board member Kevin Ludlow wrote. He also acknowledged Hevesi's personal and health issues, noted that there was no official opposition and that Hevesi had served "significant time" beyond his minimum sentence, and concluded he was a low risk for reoffending.
His parole interview was Wednesday. He was notified Thursday, according to corrections officials. Hevesi, now at Midstate Correctional Facility in central New York, will be released by Dec. 19, with parole supervision to follow until April 14, 2015, the decision said. Other board members were William Smith Jr. and Michael Hagler.
Release conditions include not associating with three other men convicted in the investigation: political consultant Henry Morris, investor Elliot Broidy and former fund investment officer David Loglisi.
"He's obviously very happy to be going home to his family," attorney Bradley D. Simon said. He's doing well despite various health conditions, served the prison sentence without complaint and accepted responsibility for all his actions, he said.
"He will be able to put this behind him and move on with his wife, go home to his family, to his children and his grandchildren," Simon said. "It's important to remember that prior to this unfortunate series of events he had a very distinguished career in public service for over 35 years on both the city and state levels."
Transcripts of Hevesi's Wednesday parole interview were not immediately available. He told the parole board last year that letting a venture capitalist pay $75,000 of expenses for trips to Israel, primarily on fund business, which the state could have paid, represented an "unprecedented" level of stupidity for him. He said that all campaign contributions were spent on his re-election and that he didn't personally receive any money.
DiNapoli said Thursday it's hard to judge the financial effect from prohibiting New York's public pension fund from using placement agents since 2009, a practice some other funds subsequently followed.
"We took a look at some of the investments made in the deals that ended up being part of the prosecution and investigation. It kind of runs the gamut. Some performed better, some worse, and many pretty much as expected," DiNapoli said. "It would be hard to quantify in terms of bottom-line impact. But it gives greater confidence that decisions are being made because of the value of the investment decision, not because someone's getting personal enrichment."
The 2009 restrictions on campaign contributions to New York comptroller candidates, followed by a related Securities and Exchange Commission rule the following year, may have hurt his own fundraising, DiNapoli acknowledged.
"It certainly didn't make it any easier," he said, adding that it sent a reform message about the appearance of conflicts of interest. He has advocated public election financing for the comptroller's office.