Georgia Regulator: No Wrongdoing in Oscars Trip, Insurance Intervention

Georgia Insurance Commissioner John Oxendine maintains he did nothing improper in accepting trips, including to an Academy Awards party hosted by Elton John, in the past few years that were initially funded by a friend and campaign contributor on whose behalf he intervened in an insurance dispute.

Oxendine, a candidate for the Republican nomination for governor, said he did nothing illegal in accepting a 2007 trip to Los Angeles for a party hosted by John -- an Atlanta resident -- and later repaid Dr. Jeffrey Gallups thousands of dollars. Gallups paid on behalf of himself, Oxendine, their wives and at least one more couple and the others repaid him.

"This is the silliest story I ever heard of," Oxendine said. "I went on a personal trip with friends, like I do all the time."

However, the commissioner declined to provide evidence that he repaid Gallups. "I'm not going to open up that vein of opening up my personal finances," he said.

The trip surfaced in a federal civil litigation between Indianapolis Life Insurance Co. on one side and Gallups, his wife Dr. Nancy Gallups and Gallups Services Inc. on the other. While enmeshed in a separate dispute with the Gallups, Indianapolis Life sought information about Oxendine's earlier involvement in getting Gallups back on a list of Blue Cross Blue Shield approved physicians. The insurer sought additional information on the Gallups/Oxendine relationship in light of a market conduct investigation of Indianapolis Life that Georgia regulators are conducting.

"The Gallups, through very substantial campaign contributions and other items of value they provided or caused to be provided to Mr. Oxendine, appear to have influenced him to have his agency institute an examination of Indianapolis Life to force Indianapolis Life to capitulate to the demands of the Gallups," the insurer asserted in an April 2009 filing in federal court in Indiana.

Oxendine said he assisted Jeffrey Gallups in a dispute with his health insurer, "like I have hundreds and hundreds of doctors." Oxendine said he and Gallups have a friendship that predates any campaign contributions or trips. The Gallups have donated at least $50,000 to Oxendine's campaigns since 2006, according to state campaign-finance records.

"If I set a standard that I couldn't socialize with any doctor who had a dispute with his insurance company, that means I couldn't socialize with any doctor," he said.

The now-ended legal fight between the Gallups and Indianapolis Life is "completely separate," the commissioner said. Oxendine is listed in court papers as a potential witness in the case, but said he was never called to testify or deposed.

"We resolved the matter with the Gallups. The litigation with them is no longer ongoing," Indianapolis Life spokeswoman Catherine Huggins said.

Georgia regulators are continuing a market conduct investigation of Indianapolis Life. Preliminary findings show illegal actions on the part of at least one agent, state Department of Insurance spokesman Glen Allen said. Oxendine said there is evidence the company knew about an agent's actions.

"We have found wrongdoing on the part of that company and it is a pending case," Oxendine said.

Huggins disputed the commissioner's characterization, but did not elaborate. Indianapolis Life is part of Aviva USA.

Citing the Gallups trips, The Georgia Democratic Party listed "John 'Oscar' Oxendine" among a handful of Republican officials who "are working overtime to line their pockets at taxpayer expense."

Oxendine's gubernatorial campaign referred all questions to the insurance commissioner's office.

Attempts to reach Jeffrey Gallups were not successful.

(By Sean P. Carr, Washington Correspondent: [email protected])