New York's former attorney general, Eliot Spitzer, who took the oath of office as the state's new governor last week, will bring along a former colleague with firsthand experience to serve as his insurance industry watchdog.
Mr. Spitzer–whose legacy as attorney general includes probes exposing insurer bid-rigging, contingency fee abuse and misuse of finite reinsurance to artificially bolster balance sheets–tapped Eric R. Dinallo, formerly his chief prosecutor investigating allegations of financial industry misconduct, to become the state's new insurance superintendent.
Mr. Dinallo is no stranger to the industry, having most recently served as general counsel of Willis Group Holdings, responsible for the firm's legal and regulatory affairs globally. Before joining Willis last March, he was a managing director and head of regulatory matters at Morgan Stanley, where he worked since September 2003.
Before his last two jobs, he was chief of the Investment Protection Bureau for then Attorney General Spitzer's office, responsible for heading up a series of investigations into unethical practices of the financial services industry.
Until Mr. Dinallo's appointment is confirmed by the legislature, Gov. Spitzer named Louis W. Pietroluongo as acting insurance superintendent, replacing Republican appointee Howard Mills, whose resignation took effect at the end of December.
Mr. Pietroluongo was named first deputy superintendent in 2002, and has worked at the department since 1998. He serves as the chief operating officer of the department and oversees the human resources office, administration, disaster preparedness and the fraud bureau.
Prior to joining the department he served for 32 years with the New York City Police Department, rising to the rank of deputy chief.
In reaction to the news of Mr. Dinallo's appointment, Joe Plumeri, chairman and chief executive officer for Willis, said in a statement that while he is sorry to see his general counsel leave, he believed he would make an important contribution to promoting regulatory reform in the state.
"There is near universal agreement that the regulation of the insurance industry needs reform, and Eric is well suited, given his time with Willis, and previously with Morgan Stanley, to oversee this effort in New York," Mr. Plumeri said.
Richard A. Poppa, president and CEO for the Independent Insurance Agents and Brokers of New York, said: "We are delighted that the governor-elect has moved so quickly to fill the spot of insurance superintendent, and have a point person in the administration we can work with for improving the coastal market and workers' compensation issues that need to be reformed."
Of the wrongdoing exposed in the industry, and Mr. Dinallo's connection with those prosecutions, Mr. Poppa said he believed both Gov. Spitzer and Mr. Dinallo understand that the problem was with a few individuals and not the entire industry.
"[They understand] that the activity of a few does not apply to the vast majority of the system," he said. "I believe the new superintendent understands that distinction."
Outgoing Insurance Superintendent Mills said in a statement that Gov. Spitzer "made an outstanding choice for superintendent of insurance in Eric Dinallo. Along with his experience in and knowledge about this critical industry, his demonstrated commitment to consumer rights will serve all New Yorkers well. I extend my heartiest congratulations to Mr. Dinallo, and look forward to working with him to ensure a smooth transition."
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