Chevron Corp. (NYSE: CVX) filed a complaint before the New York State Joint Commission on Public Ethics today, seeking an investigation of New York State Comptroller Thomas DiNapoli as well as current and past members of his staff for multiple violations of New York Public Officers Law.
Chevron’s complaint relates to ongoing litigation in Ecuador and demonstrates how Comptroller DiNapoli, who oversees the New York State Common Retirement Fund, which, according to SEC filings, owns more than $800 million of Chevron stock, apparently breached his ethical and fiduciary duties. Under New York Public Officers Law, public officials are prohibited from having “any interest, financial or otherwise…which is in substantial conflict with the proper discharge of his duties in the public interest.” Evidence shows that Comptroller DiNapoli used his office to support the Ecuadorian plaintiffs’ lawyers’ scheme to pressure Chevron into settling the lawsuit in exchange for benefits received from the plaintiffs’ representatives.
The plaintiffs’ supporters, amongst other things, have made direct financial contributions to DiNapoli’s campaign in excess of $60,000 and have given him other political benefits. In an apparent quid pro quo exchange, DiNapoli has given his unwavering support and used his public office to take actions on behalf of the plaintiffs, such as sponsoring shareholder resolutions and making public statements against Chevron that were explicitly intended to pressure the company to settle the fraudulent lawsuit.
“The Comptroller’s continued advocacy has come despite repeated findings by U.S. federal courts that the Ecuador litigation is tainted by fraud,” said Hewitt Pate, Chevron vice president and general counsel. “Mr. DiNapoli’s actions serve only his political patrons, not the citizens of the State of New York or the beneficiaries of the Common Retirement Fund. This type of quid pro quo behavior is an apparent breach of ethical and legal responsibilities that warrants investigation.”Comptroller DiNapoli took office in 2007 after his predecessor, Alan Hevesi, left office under allegations of misconduct, including a pay-for-play scandal that ultimately resulted in prison time.
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