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New York political consultant in pension fund scandal granted parole

By Karen Freifeld

NEW YORK (Reuters) - Henry "Hank" Morris, once chief political adviser to disgraced ex-New York State Comptroller Alan Hevesi, will be out of prison by June 3 after serving more than two years for his role in a "pay-to-play" scheme at the state pension fund.

A board granted Morris parole after a hearing on Monday, about four months after Hevesi was released from prison.

The scandal revealed how politics and placement fees resulted in favored treatment by pension funds nationwide.

Eight people pleaded guilty in the New York scheme. Others, including Steve Rattner, co-founder of private equity firm Quadrangle Group LLC, agreed to civil settlements.

Morris, 59, was sentenced in February 2011 to up to four years behind bars for his role at the heart of the scheme. He acted as a middleman for investment firms who wanted access to the New York State Common Retirement Fund, valued last year at $150 billion.

Morris forfeited $19 million in fees he received as part of his guilty plea.

As state comptroller, Hevesi ran the pension fund from 2003 to 2006. He resigned as comptroller after pleading guilty to using state employees to drive his wife around, and went to prison in 2011 in connection with the pension fund corruption.

Morris, who was granted the parole after being rejected three times, will remain under community supervision until February 2015. He cannot work on the campaign of any public official without permission of his parole officer.

Morris told the parole board the biggest thing he learned from his crime is, "You don't go over the line," according to a transcript of the hearing. "You don't even go to the line."

He said he had written a pilot for a television show, a screenplay and a "large chunk of a book" while behind bars. He did not say what they were about.

"Maybe I have one campaign left in me, I doubt it," he said.

He said he could earn "several hundred thousand" dollars at a business, the details of which were redacted in the transcript.

He is being held at Hudson Correctional Facility, a medium-security prison in upstate New York.

(Reporting by Karen Freifeld)

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