HARDING ALLOCUTION

I, Raymond B. Harding, served as the leader and as a State Vice Chairman of the Liberal Party of New York State between 1977 and 1983 and again between 1986 and 2002. Between 1983 and 1986, I served as a member of the State Committee of the Party. Under my leadership, the Liberal Party endorsed Alan Hevesi in various political campaigns, including his re-election to the New York City Comptroller’s Office, his run for , and in his successful race for New York State Comptroller in 2002. During this period, I also developed a relationship with Alan Hevesi’s political advisor Hank Morris.

During Alan Hevesi’s tenure as State Comptroller, Hank Morris inserted me as a placement agent on certain investment transactions with the New York State Common Retirement Fund (or the “CRF”) so that I could receive hundreds of thousands of dollars in fees to reward me for my political support of Alan Hevesi. With respect to these transactions, I understood that Hank Morris had influence over the investment process at the CRF, and along with David Loglisci corrupted the CRF investment process to favor the investments on which I was to receive fees, such that the investment decisions were not based exclusively on the best interests of the CRF. Together with Hank Morris, David Loglisci, and others, I did not disclose my involvement in some of these transactions, or our illicit arrangement to the New York State Common Retirement Fund, the Office of the State Comptroller, and related private equity and hedge funds, among others.

From in or about June 2003 through in or about July 2008, acting in concert with Hank Morris and David Loglisci, among others, I intentionally engaged in fraud and deception while engaged in inducing and promoting the exchange, sale, negotiation and purchase within and from New York of securities, including investments in Paladin Homeland Security Fund (NY), Pequot Diversified Offshore Fund, LTD., and Pequot Private Equity Fund IV, L.P. As a result of this, I wrongfully obtained over $800,000 in fees relating to these transactions.

Paladin Homeland Security Fund (NY)

In or about late 2002, I began working as a placement agent through Potomac Capital Markets (“Potomac”), a Maryland-based broker-dealer. I formally affiliated with Potomac in July 2003. During this time, in my role as placement agent with Potomac, I frequently communicated with a certain OSC official in order to market private equity investments to the State pension fund, although none of these marketing efforts was successful.

In or around June of 2003, Hank Morris explained to me that he and others wanted to generate placement fees for me to reward me for my past political support of Alan Hevesi without benefiting others at Potomac, whom they did not know.

Shortly thereafter, Hank Morris arranged to insert me as a placement agent into a private equity deal so that I would receive fees when the CRF funded the deal. At Hank Morris’s direction, a partner of Paladin Capital Group contacted me and agreed to pay me 1.5% of any capital committed by the CRF to the Paladin Homeland Security Fund. In or about May of 2004, the CRF committed $20 million to the Paladin Homeland Security Fund, and, as a result, Paladin paid me $300,000. I understood that because of his connections at the Office of the State Comptroller, Hank Morris was able to and did skew the CRF investment process to favor this investment for Paladin in order to generate fees for me and therefore the investment decision was not based solely on the best interests of the CRF.

Assembly Seat

In or around November 2004, I learned that Alan Hevesi was seeking to help a certain New York State Assemblyman find employment in the private sector in order to create a vacancy in the Assembly for his son, , to fill. To facilitate this, I arranged for the CEO of a health insurance company to meet the Assemblyman. The Assemblyman was hired by the health insurance company and resigned from the Assembly in or about March 2005. In or about May 2005, Andrew Hevesi was elected to the vacant Assembly seat. Alan Hevesi later thanked me for my assistance.

Pequot Diversified Offshore Fund

Soon after, Hank Morris arranged to insert me into a second investment pending before the CRF. Hank Morris introduced me to a finder who represented Pequot Capital Management, an alternative investment firm that was expecting a $50 million investment from the CRF. The finder later explained that Hank Morris had instructed him to insert me in the deal in a way to ensure that I was paid $150,000 per year. The finder instructed me not to do anything with respect to the marketing of the proposed Pequot investment, but told me that once CRF invested in one or more of the Pequot funds, I would receive the fees. The CRF later invested with Pequot, and I received personal checks from the finder totaling more than $500,000 associated with these investments. I understood that because of his connections at the Office of the State Comptroller, Hank Morris was able to and did skew the CRF investment process to favor the Pequot investments in order to generate fees for me. I further understood that David Loglisci recommended that the CRF make the investments in Pequot, at least in part, to benefit me and not based solely on the best interests of the CRF.