Steven Rattner, the financier and former Obama car czar, is being sued by New York Attorney General Andrew Cuomo for his alleged involvement in a kickback scheme to secure investments from a New York pension fund. The timing couldn't be worse for Rattner, who is making the rounds on TV news programs promoting the success of General Motors' IPO. "Steve Rattner was willing to do whatever it took to get his hands on pension fund money including paying kickbacks, orchestrating a movie deal, and funneling campaign contributions," Cuomo said in a press release.

• What's This All About?  Rachel Slajda at Talking Points Memo explains:

Rattner is accused of paying kickbacks to get his private equity firm, Quadrangle, millions in business from the New York state pension fund. According to the SEC and Cuomo, the kickbacks include $1 million in sham fees to an aide for former New York State Comptroller Alan Hevesi and $50,000 in campaign donations to Hevesi. He also allegedly arranged for a distribution deal for a movie, called "Chooch," made by the brother of the head of the pension fund. For his trouble, the pension fund allegedly upped its investment in Quadrangle from $100 million to $150 million, an increase which benefited Rattner personally to the tune of $3 million.

• Bad Timing, notes Shira Ovide at The Wall Street Journal:

The charges come at an awkward time for Rattner. He’s been on tour promoting his book, “Overhaul,” about the rescue of the U.S. auto industry. And he’s been interviewed many times in recent days about the GM IPO.

• This Is Politically Motivated, says Rattner in a statement. He also addressed the two suits in a segment on CNBC in which he says he was open to a settlement:

While settling with the S.E.C. begins the process of putting this matter behind me, I will not be bullied simply because the attorney general’s office prefers political considerations instead of a reasoned assessment of the facts.

This episode is the first time during 35 years in business that anyone has questioned my ethics or integrity — and I certainly did not violate the Martin Act. That’s why I intend to clear my name by defending myself vigorously against this politically motivated lawsuit.

• Bloomberg Should Denounce Rattner, writes Dan Primack at Fortune:

The SEC also has filed suit, and disclosed details of a previously-reported settlement. It says that Rattner has agreed to pay a $6.2 million penalty, and accept a two-year ban from "associating with any investment adviser or broker-dealer."

Got to wonder how that last part will square with his role in the firm that manages the fortune of Rattner friend/apologist Mike Bloomberg... Yes the firm is (intentionally?) structured as an asset manager instead of a broker-dealer, but doesn't the Mayor at some point have a responsibility to speak out against public corruption. I've put in a call to Bloomberg's office, but have not yet received comment.

• The SEC Is Growing Some Teeth Finally, writes Felix Salmon at Reuters:

the SEC, egged on by the likes of Cuomo and emboldened by its success in extracting half a billion dollars from Goldman Sachs over the Abacus affair, has started to grow some teeth for the first time in living memory.

This means significantly heightened regulatory risk for just about everybody in the financial-services industry. And it could, conceivably, be the beginning of a national process of holding firms and individuals accountable for their excesses in the run-up to the financial crisis. The SEC is certainly taking its time, here: these suits and settlements are dribbling out very slowly. But you can be quite sure that they’ve only just begun.

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John Hudson