Allegations of Fake Mailings Arise in High-Priced Insurance Contests

Allegations of fake mailings marked the insurance initiative battle Friday as new insurance industry and trial lawyer contributions pushed the industry’s Proposition 104 campaign to the $58.4 million level and the lawyer-financed Proposition 100 campaign beyond $15 million.

Checks at the California secretary of state’s office showed that $1.1 million of new insurer and nearly $600,000 of new trial lawyer contributions had been reported in the last 24 hours, adding to what is already by far the most expensive political campaign in state history.

The two biggest controversies of the day involved mailings to black voters against Proposition 103, the sweeping rollback measure offered by consumer advocate Ralph Nader.

In one case, Los Angeles Mayor Tom Bradley demanded an investigation by the state Fair Political Practices Commission after thousands of households received a mailing that contained a purported bylined article by him that endorsed Proposition 100 and opposed Proposition 103 and several other measures.

Mayor Supports 103

Bradley said that, in fact, he has decided to support Proposition 103 as well as Proposition 100, and that he had never written any such article nor authorized any use of his name. The mayor charged that the mailing, a tabloid called “The Community Democrat,” amounted to “blatant, fraudulent, misuse of the public (trust).”

Later, a spokeswoman for the Proposition 100 campaign, Patti Le Vine, and an attorney for the political consulting firm of Berman and D’Agostino, Jim Tucker, said those two groups had helped pay for preparation of “The Community Democrat,” but they denied responsibility for its exact contents.

Associates identified Willard Murray, a Democratic candidate for the state Assembly in Southeast Los Angeles County, as having put together the tabloid. Murray did not return calls for comment.

In the second case, a mailing of more than 200,000 pieces, financed by $87,500 of insurance company contributions, was sent to South Los Angeles homes opposing all four insurance initiatives.

The apparent purpose was to dampen apparently strong community sentiment for both Propositions 100 and 103, while lending credibility to the mailer by also opposing the insurers’ own Propositions 101 and 104.

The mailing, among other things, asserted that the Nader measure, Proposition 103, would “benefit mostly insurance companies.” This is the first time such a suggestion has been made on any side. In fact, the insurance industry’s campaign has been focused in recent days on defeating the measure, which most insurers charge would bankrupt many companies with its rate rollbacks.

Adam Burton, a former congressional aide who had unsuccessfully sought to qualify his own consumer-oriented insurance initiative for the ballot earlier in the year, acknowledged preparing the materials that went into the mailing, but he denied knowing that insurance companies were financing it.

According to contribution reports filed with state authorities, 10 different insurance companies, including Mercury Casualty, Sequoia, California Casualty and 20th Century, contributed to the mailing.

Bear Party Labels

Millions of pieces of mail paid for by the competing interests were reported arriving in the homes of registered voters all over the state Friday, often bearing Democratic or Republican party labels when they, in fact, represent the insurance industry or the trial lawyers more than the political parties.

For instance, one piece of mail urging a “yes” vote on the insurer-sponsored Propositions 104 and 106 and a “no” vote on Propositions 100 and 103, appeared in thousands of homes under the label of “California Democratic Voter Manual.”

The address given on the mailing, 704 Sansome St. in San Francisco, is the address of the Clint Reilly campaign firm coordinating the insurance industry campaign. A spokesman for that office acknowledged Friday this was a Reilly-prepared slate. “We have a Republican one too,” he said.

In another development, a new California Field Poll on the insurance initiative contests indicated that Proposition 103 remains in the lead, with 49% of those surveyed supporting it, 37% opposed and 14% undecided.

The poll also showed Proposition 100 supported 44% to 43% with 13% undecided; Proposition 106 narrowly opposed, with 42% for it, 44% against and 16% undecided; Proposition 104 going down, with 31% for, 55% against and 14% undecided; and Proposition 101 going down with 18% for, 64% against and 18% undecided.

Poll Called ‘Inaccurate’

The poll results were assailed as “hopelessly inaccurate” by the insurance industry campaign, which maintained that Proposition 104 will pass and Proposition 103 be defeated.

About the chances of his measure, Nader said, “Complacency must be avoided. This grass-roots campaign has challenged the largest industry in the nation . . . We need the volunteer support of citizens throughout the state, if we are to make sure (of our victory).”

Times staff writer Douglas Shuit contributed to this story.