Want to catch up on what your colleagues found most interesting on peHUB this week? Here are the posts written by our staff that garnered the most pageviews from March 21 to March 25.

1. Slideshow: Top 10 Largest First Rounds Of Internet Companies This Year by Larry Aragon

2. Meet the First ‘Social Media Analyst on Wall Street’ by Connie Loizos

3. Which Buyout-backed IPO in 2010 is the Best Performer? by Eamon Beltran

4. And the Winner of Mid-market Deal of the Year Is… by David Toll

5. Andreessen Horowitz Brings Aboard a Face Familiar to the VC Industry by Connie Loizos

6. By the Numbers: Washington State Investment Board’s Buyout Performance by David Toll

7. Yuri Milner Said To Purchase $70M Silicon Valley Home by Mark Boslet

8. If It’s Pizza You’re Ordering, MidOcean’s Had Enough by Bernard Vaughan

9. Looking For High-Growth, Low-Profile Startups? Check out Momentum Index by Connie Loizos

10. Did StepStone’s PCG ties Cost It The New Mexico Advisor Deal by Jon Marino

The New Mexico State Investment Council reversed its decision to hire Calif.-based StepStone Group to help it manage its $1.3 billion PE portfolio, and is now in final negotiations to hire LP Advisors as its private equity advisor instead. The council was “unable to reach a mutually satisfying agreement” with StepStone Group, its chief information [...]

The California Public Employees’ Retirement System announced today that it is dissolving its connections to long-time private equity consultant Pacific Corporate Group, known as PCG.

The nation’s largest pension fund did not explain why it was severing ties with its former adviser. But questions about the relationship have arisen in the wake of a PE pay-to-play scandal that began last year.

Specifically, concerns have surfaced regarding PCG’s relationship with former CalPERS board member turned placement agent Alfred Villalobos. According to an Aug. 19 story in the Sacramento Bee, Villalobos helped PCG in 2007 when CalPERS became worried over the departure of three PCG executives.

Carried interest payments can make for a nice annuity for executives long after they leave a private equity shop. They can also be a source of nasty disputes.

Such is the case at Pacific Corporate Group, a La Jolla, Calif.-based private equity advisory firm, where a former executive has filed a lawsuit claiming he hasn’t been paid all of the investment gains owed him. The firm has counter-sued, arguing it should not have to pay someone whom it believes engaged in an “illegal kick-back scheme,” according to PCG’s cross-complaint.

Subscribers can read more at Buyouts.

In 2007, I reported extensively on the relationship between CalPERS and Pacific Corporate Group, a private equity advisory and investment firm based in La Jolla, California. PCG had just suffered a massive personnel shakeup, but still got two new mandates from CalPERS after agreeing to alter its organizational structure.

It was a classic quid pro quo, and showed that CalPERS would go out of its way to give PCG the benefit of its doubts. Not illegal. Just old-boys cozy.

All of this came rushing back yesterday, when reading an LA Times piece about possible conflicts of interest between CalPERS, PCG and placement agent Alfred Villalobos. I tried creating a graphical representation of the relationship, but it was simply too messy (triangle-shaped, with arrows going every which way). So let’s try this:

Andrew Cuomo vexes me. For the third time since the New York pension fund scandal began, he has allowed a private equity player to buy its way out of trouble. I know the state has a fiscal crisis, but is this really the best way to move from red to black?

The latest insult to legal accountability came yesterday, when Cuomo announced that PE consultant Pacific Corporate Group had agreed to: (a) Pay $2 million, and (b) Sign Cuomo’s much-ballyhooed Code of Conduct. In exchange, PCG was promised that Cuomo would not pursue criminal or civil prosecution related to PCG’s past activities in New York or anywhere else (like, say, California – although sources say that Jerry Brown is beginning to look into that state’s placement agent skeletons).

What had PCG done wrong? Well, officially nothing – since PCG was required to neither confirm nor deny any of the AG’s findings. Kind of like how The Carlyle Group didn’t do anything wrong, even though it cut a $20 million check. That Cuomo must be awfully persuasive. Maybe he actually could resolve the budget mess, by squeezing cash out of every other PE firm doing business in New York, given that no actual wrongdoing is needed as a prerequisite…

Unofficially, PCG was accused of helping enrich indicted “placement agent” Hank Morris. Specifically, Morris was given an undisclosed 5% ownership stake in a $750 million co-investment vehicle funded by

Pacific Corporate Group, a La Jolla, Calif.-based private equity consultant, has agreed to pay $2 million as part of a settlement related to the New York state pension kickback scandal.

PCG also has agreed not to use placement agents to solicit business from public pension funds, although it can continue to use placement agents when securing fund commitments for public pension clients (except when banned by a client, like the New York State Common Retirement Fund). In exchange, NY Attorney General Andrew Cuomo said that he has ended the investigation into PCG, although did not specify if the termination was to all of PCG’s activities or only to its New York dealings (PCG has major business with state and municipal pension systems in California, and word is that Cuomo was taking a look via The Martin Act).

In a statement, PCG said: “We are taking these steps to make the public whole for the improper actions of a former executive, to put this episode behind us and to move our business forward.”

That former executive is Steve Moseley, who in late 2006 helped form a $750 million co-investment vehicle funded by the New York State Common Retirement Fund. It was done in partnership with hedge fund The Clinton Group (where Moseley later went to work), and allegedly included an undisclosed participation by indicted “placement agent” Hank Morris. The vehicle also included a partial ownership, and investment committee seat, for Barrett Wissman, a Texas hedge fund manager who has plead guilty to securities fraud.