A state ethics unit said it found that Thomas Gallagher,Florida's chief financial officer, violated the state's ethics codeby trading in shares of insurance companies his department oversawwhile he was insurance commissioner.

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The Florida Commission On Ethics issued a report findingevidence that the infractions took place prior to Mr. Gallagher'selection to the state's Department of Financial Services, whichtoday regulates Florida's insurance industry.

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According to the commission's records, Mr. Gallagher owned 3,000shares of Conseco and as much as 7,000 shares in Penn TreatyAmerican Corporation in 2002. In that year, he sold his holdings,losing $1,020 from the sale of Conseco and making a profit of$7,207 from his Penn Treaty sale.

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Under Florida's law, officials are barred from having a"contractual relationship" with companies that have business beforetheir departments.

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His stock holdings in Nextel Communications and EMC Corporationwere also held to be violations of the law, since the state wasdoing business with the companies at the time. But the commissionsaid Mr. Gallagher's holdings in those company's was so small thatthe violation was not worth pursuing.

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Allegations that he used state resources to pursue day tradingactivities and held stock interests in other companies in violationof the state's ethics law were dismissed, as were allegations thathe used the influence of his office for his own gain.

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Mr. Gallagher is currently seeking the Republican nomination forgovernor in Florida, which holds its primary on Sept. 5.

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A spokesperson from Mr. Gallagher's campaign committee, AlbertMartinez, said the candidate cooperated with the commission and wasgratified to find that there was no finding of misuse of hisposition. "We will live with the commission's findings, though wedisagree with them," said Mr. Martinez. Mr. Gallagher "always madehis decisions with the best interests of Floridians in mind."

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Mr. Gallagher could have fought the findings with a publichearing, but Mr. Martinez indicated he declined to do so.

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