Oppenheimer maintains ties with investor accused of fraud

December 3, 2013, 12:22 AM UTC

FORTUNE — We’re written a lot over the past couple of years about how a private equity unit of Oppenheimer & Co. once inflated the valuation of one of its investments, in order to help market a new fund. The SEC later charged Oppenheimer with misleading investors, and the firm agreed to pay a penalty, return money to investors and be censured. Also charged by the SEC was group head Brian Williamson, who is fighting the allegations.

When Williamson was charged back in August, I publicly wondered why Oppenheimer was continuing to let him manage firm assets via a third-party platform Williamson formed after spinning out of Oppenheimer. Oppenheimer said it was reviewing the complaint and allegations, but never issued a follow-up.

Now Fortune has obtained an investor letter that contains three new pieces of information:

  1. 1. Oppenheimer assumed control of the GP back in August;
  2. 2. The fund is fully committed, with a March 2013 IRR of 1.23%;
  3. 3. Oppenheimer has signed a consulting agreement with Williamson, to advise “on the various operational matters concerning the fund’s portfolio.”

In short, Oppenheimer just can’t quit this guy.

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