GOP wants probe into AIG donation

ALBANY, N.Y. (AP) | New York’s Republican Party says the Democrat-controlled state government is ignoring calls for an investigation into a $100,000 donation to the state Democratic Party from American International Group days before officials initiated the bailout of the insurance giant.

State Republican Chairman Joseph Mondello accuses Democrats of a duck-and-cover response to disclosure of the donation, first reported Thursday by the Associated Press.

“Several public calls have been issued for a thorough investigation into the matter, yet the all-Democrat state government continues to stonewall and refuses a thorough and independent investigation,” Mr. Mondello said.

“The appearance of this type of gross impropriety demands a thorough investigation, particularly now, as Democrats in Albany and Washington, D.C., are reaching into the wallets of taxpayers to fund massive bailouts and executive pensions while average families struggle to survive,” he said.

Campaign finance records show AIG donated $100,000 on Aug. 29 to the Democrats, by far its largest donation to the party since at least 1999. Insurance Superintendent Eric Dinallo said that he started negotiating with AIG and federal officials days later, but that the governor hadn’t been informed.

On Sept. 16, Gov. David A. Paterson, in a televised news conference, announced the “great news” that New York officials helped the giant insurer strike a historic loan deal with the Federal Reserve to keep AIG afloat.

That led to what was initially an $85 billion bailout of the company (now $170 billion) by the federal government. Washington lawmakers are now blasting AIG for paying millions of dollars in bonuses to employees of a division primarily responsible for AIG’s meltdown.

AIG and the state Democratic Committee say Mr. Paterson and his insurance superintendent knew nothing of the donation before initiating marathon sessions in the first week in September to save AIG. The governor said his interest was saving jobs in a major New York company.

Republican Assemblyman Greg Ball of Putnam County said his formal request for an investigation into the chamber’s corporations committee has gone unanswered since Thursday.

“It looks increasingly like there was pay-to-play methods used here,” Mr. Ball said Saturday. “We as New Yorkers need a full investigation. If this wasn’t the case, we need to know. If it was the case, we need to act.”

Corporations Committee Chairman Richard Brodsky, Westchester Democrat, hasn’t responded to requests for comment.

Paterson spokesman Marissa Shorenstein said Saturday that there would be no comment beyond last week’s statement that the governor knew nothing of the donation until it was reported by the AP. She wouldn’t comment on calls for an investigation.

Party spokesman Carly Lindauer also refused to comment on Saturday.

Democrats control the executive branch and both legislative houses as well as all statewide offices.