To those of us who have watched Matt Rosendale appoint a former insurance company lobbyist to a critical oversight role at the Auditor’s office, drop fines against a top campaign donor within days of taking office, and beg the insurance execs his office regulates for campaign cash, it’s hard to be shocked by his lack of ethics, but even I was surprised to see that Rosendale is bringing a bill to the legislature that would allow the commissioner, deputies, examiners, and employee of the commissioner to receive gifts, fees, loans and other compensation from people involved in the insurance and securities industries they regulate.
HB 92, introduced by Republican Julie Dooling at the request of the Auditor’s Office would strike a provision outlawing these gifts currently located in Section 33-1-305 of the MCA:
Conflicts of interest and certain compensation prohibited. (1) The commissioner or any deputy, examiner, assistant, or employee of the commissioner shall not be financially interested, directly or indirectly, in any insurer, insurance agency, or insurance transaction except as a policyholder or claimant under a policy.
The commissioner or any deputy, examiner, or employee of the commissioner shall not be given or receive any fee, compensation, loan, gift, or other thing of value in addition to the compensation and expense allowance provided by law for any service rendered or to be rendered as such commissioner, deputy, examiner, or employee or in connection therewith.”
That provision was added to the Montana Code in 1959, suggesting that for over half a century, the State Auditor and his staff have been guided by a sensible prohibition that certainly would have to eliminate the temptation for people employed by the agency that regulates insurance to take money from those who provide it.
I reached out to the Auditor’s Office for comment and was told by Kyle Schmauch, Communications Director, that the language in the MCA is “superseded by newer state ethics laws that apply to ALL officeholders and government employees,” but that’s not really true.
The general rules of conduct for all public employees in the state of Montana are less restrictive and, in fact, allow public officials to receive loans and gifts that are not of “substantial economic benefit” something quite different from the blanket prohibition on gifts and loans restricting the Auditor’s office today.
And it’s disingenuous to claim that neither the authors of Section 2-2-104 referenced by Schmauch nor the subsequent holders of the office of State Auditor were aware of the restrictions Rosendale hopes to strike from the MCA.
Rosendale’s proposal offers a significant and important difference. Given the position the Auditor and his deputies hold, the more stringent standard from 33-1-305 should absolutely remain in place. The generic law for all public officers was last amended in 1997, meaning that no Auditor in the past twenty years has felt the need to create more confusion about what gifts and loans should be permitted.
It’s not a good look for someone who spent the better part of the past year hollering about “draining the swamp” while partially funding a Senate campaign using what amounted to an elaborate money laundering scheme to come to the Legislature asking for less oversight and more freedom to take gifts from those who he regulates.
I hope the legislators who hear this bill on Friday ask Rosendale and his representatives hard questions about why Montana would possibly want to increase the likelihood of a conflict of interest in the office that regulates insurance and securities. The last thing Montanans need is an Auditor’s office that is more compromised than the one Rosendale currently leads.