New York, Dec 22, 2016: An Indian-origin former official of one of the largest pension funds has been charged in a prostitutes and drugs bribery scheme involving billions of dollars in business, prosecutors said.
A director and strategist at the New York State Common Retirement Fund (NYCRF), Navnoor Kang “allegedly steered billions of dollars of business to broker-dealers who bribed him with luxury vacations, high-priced watches, drugs, cash and more”, Preet Bharara, the New York Federal prosecutor, said on Wednesday.
Court documents seen by IANS also listed the services of prostitutes and strippers, “night club bottle service” and a Panerai watch worth $17,420 among the bribes allegedly received by Kang.
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He was arrested in Portland in Oregon state and was to be produced before a federal judge there, Bharara said.
Kang, 38, is a former tennis pro who played in international tournaments in 2005 and 2006.
From 2014 to 2016, he was the Director of Fixed Income and Head of Portfolio Strategy at NYCRF, the third largest pension fund in the US with $184 billion in assets.
He was responsible for investing $53 billion in fixed income securities.
According to prosecutors, Kang colluded with employees of at least two brokerages to divert business from the NYCRF in exchange for the bribes.
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The two companies, which were not identified, did not do any business with NYCRF in 2013. But by 2016 their combined annual volume of business was $2.557 billion after Kang had started sending them business, according to court documents.
This netted the companies millions of dollars in commissions, prosecutors said.
One brokerage employee, Deborah Kelley, is charged in the same case as Kang. They face charges of fraud, conspiracy, obstruction of justice and “wire fraud” for electronic transfer of funds.
They face a maximum sentence of 20 years in prison.
Kelley is alleged to have paid for Kang’s concert ticket and holidays, in one of which his former girlfriend went along.
The employee of the other company, Gregg Schornhorn, was charged in a separate case. Bharara said that last week he admitted he was guilty of fraud and obstructing justice.
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Prosecutors said Schornhorn gave Kang the Panerai watch and paid for prostitutes and strippers and they used WhatsApp to communicate to prevent law enforcement from monitoring them.
Earlier when Kang was working at another company, Schornhorn had given him a Rolex watch costing $8,000, prosecutors said.
Kang was fired from that company but he lied about it to NYCRF, prosecutors said. (IANS)