According to campaign disclosures through mid-January, Dinallo received at least $290,000 of his $1.78 million in donations from companies, people and trade groups with ties to the industry. Hedge-fund manager David Einhorn, chairman of reinsurer Greenlight Capital Re Ltd., gave the maximum of $55,900. So did Joseph Plumeri, chief executive officer of insurance broker Willis Group Holdings Plc, where Dinallo worked in 2006.
"It’s an industry that knew his work when he was in the attorney general's office, they knew his work when he was regulator," said Russ Haven, an attorney for the New York Public Interest Research Group, which has proposed limiting the size of donations. “Campaign contributions are really an investment. It’s a business decision.”
Marsh & McLennan, XL
Dinallo's other donors include Brian Duperreault, CEO of broker Marsh & McLennan Cos., who gave $18,100; the political action committee of Medical Liability Mutual Insurance Co., which provided $15,000; and XL Capital Ltd. CEO Michael McGavick, who gave $10,000. Ajit Jain, who runs a reinsurance unit and bond guarantor for Warren Buffett’s Berkshire Hathaway Inc., gave $5,000, while the company’s Geico unit gave $2,500.
Trial attorney Sean Coffey, with the third-largest donation total among Democratic contenders for attorney general in the past year, listed four individuals contributing the maximum allowed by state law. They were Patrick Coughlin, founding partner of law firm Coughlin Stoia Geller Rudman & Robbins LLP, A.R. Thane Ritchie, founder of Ritchie Capital Management LLC, and Caroline Fitzgibbons and Thomas Smith of Bronxville, New York. Coffey’s donations totaled $1.67 million as of January.
New York Democrats will select candidates in a primary on Sept. 14. The leading candidate reporting donations for an attorney general campaign is Andrew Cuomo, who is allowed to use the funds for a gubernatorial campaign. The disclosures were made by the campaigns in January to comply with a state law. Cuomo raised $8.31 million in 2006, the year he was elected attorney general. Under state election laws, he was also able to spend money raised during a previous run for governor in 2002.
AIG, Berkshire
As the state’s insurance regulator, Dinallo advocated for the regulation of credit-default swaps as insurance. He spoke about the need for cooperation between state and federal regulators in the aftermath of the U.S. bailout of American International Group Inc. When bond guarantors faltered, he engineered Omaha, Nebraska-based Berkshire’s entrance into the business of backing municipal debt.
Jack Downey, a spokesman for Dinallo, said in an e-mailed statement that the candidate had “a record of holding insurance companies accountable” and was “proud of contributions he received from New Yorkers from all walks of life.”
Dinallo’s candidacy presents a “unique opportunity” to insurers because of his understanding of the industry, said Howard Mills, a Republican who preceded Dinallo as superintendant of insurance. Mills gave $150 to Dinallo’s campaign in January, while saying he plans to vote for the Republican nominee in the general election.
Understanding Insurance
“Understanding the industry does not mean you are going to get preferential treatment,” said Mills. “By understanding the industry, you bring a better appreciation to the job and are able to discharge your duties in a way that the industry understands is really, truly, being fair.”
At the attorney general’s office, Dinallo headed the probe into misleading Wall Street research. Then Attoreny General Eliot Spitzer later targeted suspected collusion between insurers and brokers, saying middlemen steered business to carriers that paid hidden fees. As part of brokers’ settlements, Marsh & McLennan agreed to pay $850 million and Willis, $50 million. Willis reiterated last month it won’t accept the types of payments scrutinized by Spitzer, even after the reversal of a regulatory ban.
Dinallo left Spitzer’s office in 2003, before the investigation into the brokers was announced, to work at Morgan Stanley. He would later become general counsel at Willis, and stepped down a year later when Spitzer tapped him to head the state insurance office.
Former New York Insurance Superintendent Eric Dinallo who is running for the state attorney general, has received more than 15 percent of his campaign donations from insurance industry.