By Hannah Wiley, SACRAMENTO BEE
July 18, 2019
An advocacy group is demanding that California’s insurance commissioner release records about his business meetings following a report that he accepted tens of thousands of dollars in campaign contributions from insurance leaders and their spouses.
Insurance Commissioner Ricardo Lara has refused the request from Consumer Watchdog, which first asked him to disclose his calendars in early June.
Consumer Watchdog renewed its request after a July 7 report in The San Diego Union-Tribune that detailed $54,000 in campaign contributions from the industry he regulates.
The advocacy group charges that Lara’s campaign contributions raise questions about “influence-peddling” in the department.
Contributions came from Stephen and Carole Acunto, who each donated the maximum allowed $15,500. Stephen Acunto is a spokesperson for Applied Underwriters, a worker’s compensation insurer.
Theresa DeBarbrie maxed out her donation as well, and is the wife of another company executive. Nearly $8,000 came from Darlene Graber, whose husband is also in the insurance industry.
Lara pledged to return the $54,000 within hours of the Union-Tribune’s story publishing. He said he planned to fill his role as campaign treasurer with a new appointment. During his 2018 election, Lara also returned $50,000 from medical malpractice insurers.
Applied Underwriters is seeking an acquisition approval from Lara, and formerly settled with the Department of Insurance for “bait and switch” marketing tactics in 2017.
In a July 8 letter to Lara, Consumer Watchdog asked the insurance commissioner to provide an “explanation of how and why” the contributions were made, and continued that “the public deserves to know whether the donors acted unilaterally, or if the contributions were solicited and by whom.”
Jerry Flanagan, litigation director for the group, said the donations could be “motive for the companies to grease the oversight process by making contributions.”
“These companies have a checkered past,” he said. “That’s why the merger approval piece and the past conduct of (these companies) is so important here.”
Michael Soller, spokesman for Lara’s office, said the commissioner will not be involved in any decision regarding Applied Underwriters.
Lara, 44, is a former member of the California Assembly and state Senate. The department is the “largest consumer protection agency in the state” and oversees 1,300 insurance companies and $310 billion in premiums per year.
Chuck Quackenbush was the last insurance commissioner known to break the multi-decade norm of rejecting such contributions. He resigned in 2000 amid political scandal for directing insurance contributions to nonprofits he was connected to.
“I pledged to not accept insurance money during my campaign, and it is a pledge I intend to keep,” Lara said in a statement. “I am proud of my record protecting California’s consumers and will continue my work to curtail the impacts of wildfires linked to climate change and deter insurance fraud against injured workers and their families.”
Consumer Watchdog filed a Public Records Act request on June 4 asking Lara’s office for a schedule of meetings with industry representatives. After back-and-forth communication with the department’s legal analyst, according to Consumer Watchdog, the request to release the calendars was denied.
The commissioner’s office said it denied the request based on a law that qualifies certain records as “privileged or confidential.”
It’s customary for the governor’s office to release redacted versions of calendar meetings, but lawmakers typically do not because they are subject to a different open government law.
“It’s crucial to the public interest that they provide these documents,” Consumer Watchdog Executive Director Carmen Balber said. “That they disclose what, if anything, the commissioner or his staff had to do with soliciting the contributions.”
In a July 11 letter obtained by The Sacramento Bee, Consumer Watchdog narrowed its original request to records of meetings with the company executives and their spouses who donated the money described by The San Diego Union-Tribune.
“We received a Public Records Act request and we’ll respond appropriately,” Soller told The Bee.
Hannah Wiley joined The Bee as a legislative reporter in 2019. She produces the morning newsletter for Capitol Alert and previously reported on immigration, education and criminal justice. She’s a Chicago-area native and a graduate of Saint Louis University and Northwestern.