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Spitzer Comes to Town Seeking Donations

Last month, New York Attorney General Eliot Spitzer (D) indicted eight executives at Marsh & McLennan, the world’s largest insurance broker, as part of his ongoing investigation into the company.

Next month, when Spitzer comes to Washington, D.C., to raise money for his gubernatorial run, a Marsh & McLennan lobbyist will host a fundraiser designed to raise as much as $250,000 for the candidate.

The lobbyist, the company and Spitzer’s campaign all said the two events are totally unrelated, and therefore not inappropriate.

But the upcoming event highlights a tricky issue as Spitzer shakes the Beltway money tree. Democratic lobbyists may have to reconcile their interest in a candidate they see as a rising star in their national party with the enmity some of their clients have for an official who has aggressively policed Wall Street and big corporations.

One of two dozen co-hosts of the Nov. 1 event is Joel Jankowsky, a partner at Akin Gump Strauss Hauer & Feld, which made $1.28 million last year lobbying for Marsh & McLennan.

“I’m doing this personally and not really on behalf of the firm,” Jankowsky said.

Company spokeswoman Barbara Perlmutter added, “It’s got nothing to do with us. These kinds of things go on all the time, and people do what they need to do.”

At the event — which will be held at the Bethesda, Md., home of Spitzer’s sister — Jankowsky won’t be the only lobbyist who represents a company under fire from New York’s top cop.

Another co-host will be Larry Sidman, a lobbyist at the law firm Paul, Hastings, Janofsky and Walker LLP. Sidman lobbies for Clear Channel Communications, which this month fired two programming executives and disciplined several others for misconduct discovered after Spitzer launched an investigation into the company’s alleged “pay-for-play” activities.

“My interest in him and his candidacy is entirely personal and comes through a network of personal friends,” Sidman said. “It has nothing to do with anything I’m doing for any client.”

Spitzer, the clear frontrunner to succeed Gov. George Pataki (R), has endured a drumbeat of criticism from Empire State Republicans for accepting campaign checks from sources in industries his office regulates.

The Spitzer camp has brushed off the attacks by pointing to what they call stronger-than-average controls put in place by the campaign for all contributors. For example, in giving, donors must affirm they do not own or control any entities that have business before the attorney general.

Spitzer campaign officials argued that it is only fair to welcome money from all who meet that standard. They include companies within targeted industries that are not themselves the subject of any inquiries, as well as outside lawyers for companies under investigation.

The allowance for outside lawyers extends to outside lobbyists, said Cindy Darrison, managing director of Spitzer’s campaign.

Lobbyists supporting Spitzer added that their contributions to a candidate for state office have nothing to do with their work for companies at the federal level.

In the case of Jankowsky’s client, neither the House or Senate banking committees appear poised to weigh in on Spitzer’s charges that Marsh & McLennan engaged in anticompetitive practices.

“I don’t think one has much to do with the other, because Congress will look at whatever it wants to look at, and if it involves a client, we’ll advise them with regard to that inquiry,” Jankowsky said.

Still, some Washington watchdog groups said that Spitzer’s coziness with the lobbyists of companies he targets raises questions about appearances.

“The same appearance issue that arises if he accepts money from a corporation he’s investigating arises to only a slightly lesser degree from accepting money for lobbyists representing those companies,” said Larry Noble, executive director of the Center for Responsive Politics. “Whether or not it actually influences his behavior, when a settlement is reached or a case is dropped, many in the public will wonder whether there is any apparent conflict.”

The event next month will not be Spitzer’s first in the District. He made his debut here in May, rounding up dollars from labor unions at a downtown lunch before heading to the elegant Northwest Washington home of Ronald and Beth Dozoretz, longtime Democratic fundraisers.

Helping to host the cocktail and dinner function that evening was Tony Podesta, a partner in the lobbying firm PodestaMattoon, which lobbies for Clear Channel, and the Investment Company Institute, the trade association for the mutual fund industry, which was targeted in a wide-ranging Spitzer probe.

“If you crossed everybody off your list who had ever disagreed with one of your clients, you’d have a very short list,” Podesta said.

Between the two events in May, the attorney general netted $250,000 for his run, said Darrison, the campaign’s managing director. She said they expect to raise at least $200,000 at the event next month.

Since most companies’ federal political action committees, the ones typically controlled by a company’s Washington office, are prohibited from contributing to candidates for state office, the campaign has focused on attracting donors who can give out of their own wallets, said Kristie Stiles, Spitzer’s national finance director.

If the results so far are any indication, Spitzer has had no trouble finding support among prominent K Streeters, including those representing companies who have been caught in his cross hairs.

Tommy Boggs, partner at lobbying giant Patton Boggs, and Virginia Pape, wife of the firm’s managing director, Stuart Pape, have pitched in $1,000 each to the attorney general’s campaign. Pape and Boggs are both listed on the firm’s lobbying contract with Bristol-Myers Squibb, a drug company that was forced to pay the state of New York $13 million this spring as part of an antitrust settlement.

Not all of corporate America’s Washington representatives are fans, though.

Business trade groups that ordinarily don’t pay much attention to gubernatorial races are paying extraordinary attention to Spitzer’s race, and some are waiting for the Republican primary field to jell in order to get behind Spitzer’s competition.

The U.S. Chamber of Commerce in particular has been a vocal critic of Spitzer’s term in the attorney general’s office. Bill Miller, the group’s political director, said the race “deserves a high degree of scrutiny.”

“New York is the financial center of the world, and a place in which capital markets in this country need to be protected, not prosecuted,” he said.

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