TRENTON, N.J. – Republican Douglas Forrester (search) has spent millions of his own dollars running for governor and supporting GOP candidates, but he is now fighting questions about whether that spending violated a New Jersey law designed to prevent undue corporate influence.
Forrester holds a 51 percent ownership interest in Heartland Fidelity Insurance Co., which insures the price of prescription plans from BeneCard Services Inc., BeneCard spokesman Pete McDonough said on Sunday.
BeneCard, an affiliated health-benefits company of Forrester's, has hundreds of government clients in New Jersey.
At issue is a state law that bars insurance companies, banks and other regulated industries that do business in New Jersey and individuals with majority ownership in the companies from contributing to candidates or political organizations.
Forrester's campaign, responding to questions from the Philadelphia Inquirer (registration required), says the rules do not apply to his case because he licensed Heartland Fidelity in the District of Columbia, not New Jersey.
"All of the kinds of things we've done with regard to contributions have been done appropriately and have been examined by appropriate legal counsel," Forrester told the Inquirer for its Sunday editions.
But Anne Marie Narcini, manager of consumer protection at the New Jersey Department of Banking and Insurance, said the issue is where Heartland does business.
"If Heartland is selling insurance to New Jersey entities through BeneCard, they're conducting the business of insurance in New Jersey," she said.
The state Attorney General's Office declined to comment.
Forrester campaign spokeswoman Sherry Sylvester said Sunday that Forrester's lawyers assured him he is not violating the law.
"This is a political diversionary tactic on the part of Democrats," she said. "This is a District of Columbia company that is not regulated by New Jersey and the statute does not apply."
Forrester's campaign has already spent more than $11 million, according to recent campaign finance reports.
Forrester, who has made more than $50 million from his insurance ventures, is mostly using his own money to finance his gubernatorial campaign. He also has contributed several hundred thousand dollars to various GOP candidates and committees in the state since forming Heartland Fidelity.
His Democratic challenger in the governor's race is another millionaire businessman, U.S. Sen. Jon Corzine (search). Gov. Dick Codey, the former state Senate president who became governor when James McGreevey resigned amid a gay sex scandal a year ago this week, is not running and has thrown his support to Corzine.