N.J. Attorney General Probing Forrester Campaign Donations

September 5, 2005

The New Jersey Attorney General’s Office will investigate whether Doug Forrester, the Republican candidate for governor, violated a state law prohibiting insurance company owners from contributing to political campaigns.

Lee Moore, a spokesman for Attorney General Peter Harvey, said the matter was referred to the Division of Criminal Justice since the law in question is a criminal statute. However, Moore cautioned that the referral to criminal justice staff was procedural.

“No qualitative assessment of the allegations has been done to date, and the referral is not to be construed as a determination or suggestion that wrongdoing occurred,” Moore said.

The attorney general’s involvement follows a request by Forrester’s Democrat opponent, U.S. Sen. Jon S. Corzine, for an investigation after a split opinion by state insurance regulators failed to settle the matter.

The Department of Banking and Insurance last Wednesday said Heartland Fidelity Insurance Co., in which Forrester holds a 51 percent stake, falls outside New Jersey regulations because the company was licensed as a captive insurer in Washington, D.C. But the department also found that Heartland does business in New Jersey through another Forrester-owned business, BeneCard Services Inc.

BeneCard is a medical benefits provider with hundreds of government clients in New Jersey. Heartland insures the price of prescription plans from BeneCard.

Each campaign claimed the insurance department ruling as a victory, but Corzine’s camp sent a letter the same day to Harvey’s office seeking the investigation. Forrester’s campaign maintains he has complied with the law.

New Jersey law expressly prohibits insurance companies, banks, utilities and other regulated industries from making political contributions to candidates or political organizations in the state. The law also covers those individuals with majority ownership in those companies.

The law does not apply to insurance brokers or insurance company employees, who may contribute to political action committees.

Forrester has made more than $416,000 in state campaign contributions since establishing Heartland Fidelity three years ago.

Copyright 2005 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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