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NEWS RELEASE
Feb 17, 2004


CONTACT: Doug Heller - 310-392-0522 x309

Questions About Senator Perata's Personal Enrichment Should Be Investigated

Perata Was Paid $100K+ in Fees From Firm Tied to Corporations Whose Interests Perata Has Advanced in the Legislature
Santa Monica, CA -- The Foundation for Taxpayer and Consumer Rights (FTCR) has asked the State Senate Rules Committee to investigate a series of political contributions to an Oakland-based political committee linked to State Senator Don Perata and personal income to Perata from consultants associated with the Oakland committee. In a letter to Senate pro Tempore John Burton, FTCR called for a hearing into the allegations that would be conducted under oath and would seek testimony from Senator Perata as well as officials with Mercury Insurance, Ameriquest and a group of political allies and consultants to Perata.

A news report in today's San Francisco Chronicle identified a series of political contributions made by four large corporations to Community Leaders for Neighborhood Preservation, the Oakland-based political committee, which paid much of its money to a consulting firm owned by Tim Staples. That firm, Ascendant Solutions, along with another firm controlled by Staples, has paid hundreds of thousands of dollars in private consulting fees to Oakland Senator Don Perata.

The top donor to the Oakland committee was Mercury Insurance, also a big donor to Perata's campaign.

Perata authored SB 841, which was sponsored by Mercury Insurance and allowed the company to surcharge motorists who were previously uninsured or had a lapse in coverage. The law, opposed by the advocates for the poor and consumer groups, was recently thrown out by a Los Angeles Judge who ruled that the bill violates voter approved insurance reform Proposition 103.

"After Perata carried the legislation on behalf of the insurance company, Mercury donated tens of thousands of dollars that appear to have made its way into Perata's own pocket," FTCR wrote.

Other donors to the "Community Leaders" committee are Ameriquest, PG&E and Zenith Insurance.

In the letter, FTCR highlighted a series of disturbing questions that arise from the allegations and should be answered through an investigation:

Did Senator Perata use his official duties and powers for his own personal enrichment?

Were Perata's political allies asked to contribute to Community Leaders in order to avoid campaign finance limits or to deceive the public about the extent of certain contributors' support of Perata?

Was the relationship between Community Leaders and Ascendant Solutions established as a scheme for laundering money to Perata, either for personal reasons or, perhaps, to advance his effort to become Senate pro Tempore?

"It is hard to believe that Senator Perata had know knowledge of these transactions, since he admits that he helped steer donations to one of the groups and got paid by another. But it is clear that these revelations demand a full investigation," said FTCR's senior consumer advocate Douglas Heller.

The letter is available at http://www.consumerwatchdog.org/insurance/fs/fs004015.php3 . It was also copied to the California Fair Political Practices Commission.

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