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Apr 21, 2000

CONTACT: Doug Heller 310-392-0522 ext.309


On "Damage Control Tour," Commissioner Blames Elected Office for Scandal
Embattled Insurance Commissioner Quackenbush, on a statewide media tour intended as damage control, yesterday blamed his election to office for the corruption scandal surrounding him. Quackenbush told reporters that the elective office he occupies forced him to engage in the conduct for which he is being investigated by various state law enforcement agencies. "It's an elected office, which I tell you is unfortunate," he told AP; if it was not elected, he could "do this sort of work without having to think about the political implications," he told the LA Times yesterday.

Consumer advocates called Quackenbush's remarks "bizarre," but part of a deliberate public relations effort to (1) portray his actions as typical of politicians rather than illegal and (2) divert lawmakers' attention from his conduct and that of State Farm and other major insurance companies, which Quackenbush's own staff recommended pay fines of over $3 billion for cheating their policyholders in Northridge claims.

"In his desperate quest to escape responsibility for the growing evidence that he broke the law, Mr. Quackenbush is blaming voters for making the office he holds an elected position and for twice electing him to that office," said Harvey Rosenfield, the President of FTCR and the author of Proposition 103, which made the office elective.

"In doing so, he suggested that all politicians engage in the kind of behavior for which he is being investigated. That, and his answer to the scandal -- returning the office to an appointed position -- amounts to: 'Stop me before I kill again.' It's a foolish suggestion that can only please the insurance industry, which has had to spend so much money to keep the office out of the hands of a commissioner who would make them obey the law."

"It is understandable that, at this juncture, the Commissioner would prefer to be seen as an untrustworthy politician rather than a lawbreaker, but that determination must await completion of a thorough examination of his conduct by the Attorney General and the Legislature," Rosenfield continued. "It is crucial that the Legislature's examination be professional and non-partisan; otherwise the public will reach precisely the conclusion that Mr. Quackenbush is promoting: that politicians cannot be trusted."

"If Mr. Quackenbush wants to earn a little goodwill from the public at this sorry point in his career, he ought to immediately turn over the Market Conduct Examinations and Proposed Orders prepared by his staff, along with all the information about the non-profit foundations he established with insurance company money in lieu of fines. We have requested this information under the state's Public Records Act, but he has so far refused to provide it," Rosenfield concluded.


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