State Insurance Commissioner Defends Intervening in Cases Involving His Donors

State Insurance Commissioner Ricardo Lara defended himself on Wednesday against allegations that he improperly intervened in cases involving companies linked to donors to his 2020 campaign.

Lara has acknowledged that he took more than $50,000 in campaign contributions from insurance executives and their spouses, even after previously pledging not to take funds from those with ties to the industry he was elected to regulate. In an interview with KQED's The California Report, he said accepting those contributions was a mistake.

"When I found out, I immediately returned the money, and I put a third-party person to make sure we review all checks that come in," Lara said from his office in Los Angeles. "This was an honest mistake that fell through the cracks. My mom says own up to your mistakes and correct them, and that's what I did."

The San Diego Union-Tribune reports Lara's interventions included trying to overrule decisions by an administrative law judge in his own department in cases related to workers' compensation provider Applied Underwriters, Inc. — which is controlled by investor Warren Buffett's Berkshire Hathaway.

Lara acknowledged these interventions were uncommon, saying these cases are the only ones in which he has taken such steps.

"I did reverse the ruling from the law judge because I wanted it to be consistent with my predecessor's rulings," Lara said, adding his move was aimed at protecting consumers and stopping injured workers from losing their coverage.

Calls to the previous insurance commissioner, Dave Jones, weren't immediately returned.

Critics disagree with Lara's rationale.

"The interventions here were on behalf of [Applied Underwriters] to overturn the administrative law judge's rulings that the company needed to pay out on its policies and should not get out of that obligation," said Jamie Court, president of Consumer Watchdog. "This was a way of saving the insurance company tens of millions of dollars."

Lara also pledged to release his calendars, which Consumer Watchdog has requested from his office in an effort to examine potential influence-peddling.

"They have totally denied our public records requests in writing. We haven't heard anything. But we're pleased if the commissioner is finally agreeing to share his calendar," Court said.

Lara's office didn't provide a date for when the calendars would be released.

Lara told KQED he has met with Steven M. Menzies, president and CEO of Applied Underwriters, since taking office. Lara has now recused himself from any decisions having to do with the company.

When pressed, Lara said his office was asked to review the cases involving the company by the head of Applied Underwriters — but was not specifically asked to intervene.

"I met with him. It was a casual meeting, and nothing in that meeting that came out changed the course of my decision," Lara said. "I have always had an open-door policy to meet with everyone."