New York Insurance Superintendent Howard Mills, who was takingcampaign contributions without being a candidate for any office,has been told by Gov. George Pataki to halt the practice.

The actions of the Republican appointee also drew criticism froma Democratic assemblyman, who called them “atrocious.”

Mr. Mills, while halting his fundraising, defended the practicetoday a perfectly legal.

Kevin Quinn, a spokesman for Republican Gov. Pataki, said thatduring a press conference Tuesday the governor indicated he did notbelieve it was appropriate for anyone in his administration toaccept campaign contributions if they are not actively pursuingelective office.

Mr. Mills' fundraising activities had been reported in The NewYork Times last week.

Mr. Quinn said the governor indicated that he expects Mr. Millsand any other member of his administration to cease suchactions.

He said the governor has received clear indication from Mr.Mills that he has stopped the practice.

Mr. Mills, a former state assemblyman who created a fund duringan unsuccessful run for U.S. Senate, was continuing to takecampaign contributions into his campaign fund. The contributions,totaling $15,000 last year, were from individuals not doingbusiness with the insurance department.

The fund currently stands at $38,000.

The money was spent on cell phone bills, meals, flowers,political donations, gifts for volunteers, and a monthly payment of$588.55 for a Chrysler 300 that Mr. Mills said was only used forpolitical functions.

Assemblyman Alexander B. “Pete” Grannis, D-Manhattan, who ischairman of the Assembly Committee on Insurance, called thepractice “totally inappropriate, but it is something that isbetween the governor and Mr. Mills.”

He commended Gov. Pataki for “laying down the law” incriticizing Mr. Mills, but said the entire issue has broaderimplications for state officials. He said the legislature willbegin working on legislation to end such practices in thefuture.

“I take some comfort that he did not take funds from anyone inthe industry, but the appearance is so atrocious,” said Mr.Grannis. “Anyone who holds such a position should not ask or acceptcontributions. There is too much risk involved and the appearancelooks very, very bad.”

Mr. Grannis said he felt that those who contributed to Mr.Mills' fund were looking for influence later on should thesuperintendent as expected stage a run for a state Senate seat.

Mr. Mills defended his actions, saying that the money was spentprimarily on campaign contributions to support Republicancauses.

He said he has an extensive travel schedule on the weekends andif he used his state vehicle for those purposes he would be roundlycriticized for its use. He does have a personal vehicle that hesaid is used primarily by his wife on the weekends.

Mr. Mills said he did not solicit or actively pursue any fundsand the money came from well-established donors who collected thefunds on his behalf without his knowledge.

The practice of state officials using their campaign funds forpolitical purposes is nothing new, he added.

“It's perfectly legal,” said Mr. Mills, who plans to continuethe spending but said he has stopped accepting contributions whilesuperintendent.

“The Board of Elections has ruled time and time again that thisis perfectly appropriate. It will be up to the legislature tochange the campaign laws in New York State,” he said.