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Ethics panel cancels Oxendine hearing, waits on judge’s ruling
Insurance Commissioner John Oxendine’s much-awaited ethics hearing was postponed today. But it still may be held before the July 20 Republican primary.
Charges that two Rome insurance companies used intermediaries to direct excessive amounts of cash to Oxendine’s campaign for governor — and that Oxendine knowingly accepted it — were filed with the State Ethics Commission a year ago.
The companies gave $120,000 in 2008 to 10 Alabama-based political action committees, which deposited the checks and redirected the money to Oxendine on the same day. Legally, the businesses could give no more than $11,900 to a statewide political campaign at the time and, because they are regulated by the insurance commissioner, could give no campaign money whatsoever to someone holding or seeking that office.
The ethics investigation has been held up by those companies’ refusal to turn over financial records requested under a subpoena.
The Rome businesses — State Mutual Insurance Co. and a wholly owned affiliate, Admiral Life Insurance Co. of America — filed court papers May 28 to challenge the commission’s subpoenas as unauthorized and overly broad. They argued that state law does not prohibit the companies from donating money to political action committees, or PACs, and that the ethics investigation would “unduly chill” their participation in the political process.
Said the Ethics Commission in response:
Contributions to PACs by regulated entities is not the subject [of] the Commission’s investigation nor is it otherwise subject to prohibition … Instead, what is prohibited and the subject of investigation are contributions made to regulated entities through PACs to the extent they are made to circumvent the prohibitions against direct contribution to a regulatory executive officer. Prohibiting a regulated entity from using a PAC as a proxy to make donations to a regulatory executive officer does not unduly infringe on the free speech or other constitutional rights of the entities in the political process.
Late last month, the insurance companies asked Fulton County Superior Court Judge Kimberly Adams to issue a restraining order to prevent enforcement of the subpoenas. Adams issued an interim order last week asking both sides to agree on a date — on or before July 2 — when she could hear their arguments.
The commission planned to proceed Thursday with a hearing on the Oxendine case but canceled it this afternoon because of uncertainty over the implications of Adams’ order. The commission also questioned whether it could render a fair decision without access to the financial records that Admiral and State Mutual have refused to produce.
Adams could rule on the requested injunction at the court hearing or shortly thereafter. If she does, officials say, the commission could still reschedule its hearing before the July 20 primary.
Oxendine leads the Republican field for governor, but his lead has narrowed. No Republican candidate is expected to grab the nomination without a runoff.