Pataki, Spitzer Spar Over AIG Lawyer Contributions

The Insurance Journal
April 13, 2005


Political war broke out this week between Republican New York Gov. George Pataki and Democratic state Attorney General Eliot Spitzer as the two sides traded charges over campaign contributions related to insurance giant American International Group.

Pataki and Spitzer are potential rivals in the 2006 governor's race. Spitzer has said he is running while the governor hasn't yet said if he will seek re-election.

The sparring began after the New York Post reported that Spitzer's gubernatorial campaign committee has been taking campaign contributions from partners at a law firm representing AIG in investigations by the New York attorney general.

Spitzer spokesman Darren Dopp told the New York Post that while Spitzer will not accept contributions from companies and individuals under investigation by his office, the ban does not apply to law firms representing those being probed.

The Spitzer spokesman told The Associated Press "the attorney general's campaign fundraising policy is more restrictive than required by law and goes well beyond that of any other elected official in New York.''

"It just doesn't pass the smell test,'' said state Republican Chairman Stephen Minarik. "It's just not right.''

The tabloid's report, citing state Board of Elections campaign finance records, noted that between late November of last year and mid-January of this year, Spitzer's campaign committee received at least $18,500 from 16 lawyers who work for the New York City-based Paul, Weiss, Rifkind, Wharton & Garrison law firm.

The firm has been representing AIG in connection with investigations by Spitzer and federal officials into the activities of the insurance giant.

"The contributions were received in connection with a Dec. 9 fundraising lunch,'' said Cindy Darrison, Spitzer's campaign manager. "They came from people who are long-standing contributors and supporters of Eliot.''

Spitzer once worked at the law firm and Dopp said the attorney general still has good friends there who have long been supported his political career.

After the Post story appeared, the Spitzer camp countered by noting that Pataki's campaign committee had taken at least $80,000 over the past two years from AIG and related companies while the Pataki-controlled Republican State Committee had taken almost $30,000 from those companies.

The Spitzer spokesman said the attorney general has been aggressive in his pursuit of the AIG investigation.

"It would be a story if we took contributions and didn't do anything,'' said Dopp. "In fact, people should wonder where the administration was on this issue.''

The Pataki-controlled state Insurance Department has been participating in the AIG investigation, although its role has been far less evident than Spitzer's.

State Democratic Party spokesman Howard Wolfson, noting the AIG-linked contributions to Pataki, said: "The guys who made pay-for-play an art form in Albany should clean up their own house before throwing mud at the one man who has done more than any other to hold corporations accountable to investors and New Yorkers.''

"That's pretty ironic given that the AIG probe was started by the Insurance Department when they referred the case to the attorney general because the law limited the department's ability to pursue it,'' Pataki spokesman Kevin Quinn responded. "We allow the regulators to regulate, period.''

Told about Quinn's comment, Dopp said no AIG referral came from the Insurance Department until the Spitzer probe was already underway.

"The (Insurance) Department was clueless and everybody knows it,'' the Spitzer aide said.

"Eliot Spitzer got caught with his hand in the cookie jar, and now he is shamefully trying to divert attention away from his lapse in professional ethics,'' the GOP's Minarik said.

"He is used to being held to a higher standard, and he welcomes it,'' Dopp said. "At the same time, it's not fair to suggest connections where there are none.''

Spitzer, who has gained international attention with his investigations of Wall Street investment houses, mutual fund managers and the insurance industry, announced late last year that he would run for governor in 2006. Pataki has not yet said if he will seek a fourth term next year.

 
Copyright 2005 Associated Press



Click here to return to our homepage