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Spitzer Looks Into Merrill Payments

The request for details relates to whether the brokerage firm sought to discredit the New York attorney general.

August 04, 2003|Walter Hamilton | Times Staff Writer

New York Atty. Gen. Eliot Spitzer has asked Merrill Lynch & Co. for details of payments by the company to an outside consultant, as part of Spitzer's questioning into whether the giant brokerage firm tried to organize a media campaign to discredit the attorney general.

Spitzer's office has asked Merrill for information and documents about the work done by Cambridge Group, a Chicago-based management-consulting firm, and its founder, Rick Kash, said Darren Dopp, a Spitzer spokesman. In 2002, Merrill agreed to pay Cambridge Group about $800,000 for consulting work, according to sources with knowledge of the matter.

"We really are focusing on the payments and asking what are they for and what did they produce," Dopp said.

Cambridge Group's work for Merrill included analysis of how stock research would function after a Spitzer-led crackdown on stock analysts, sources said.

A Merrill spokesman declined to comment Sunday.

Kash would discuss neither his firm's compensation from Merrill nor the nature of its work for the brokerage.

A Merrill internal investigation earlier this year focused on whether Thomas H. Patrick, who resigned last week as Merrill's executive vice chairman, funneled money through Kash to fund the production of a cable TV show that would disparage Spitzer. The probe centered on whether a $75,000 payment that Kash gave to Chicago-based TV journalist Bill Kurtis was connected to an alleged effort to discredit Spitzer, sources have said. A TV program attacking Spitzer apparently was never made.

Kash and Kurtis have said that the $75,000 payment to Kurtis was for a business deal between them involving a video project intended for the Chicago Symphony Orchestra.

The payment was unrelated to Merrill Lynch or Spitzer, they have said.

"These were independent events," Kash said Sunday night. "My agreement with Bill to support the Chicago Symphony has no relationship to any activities with Merrill."

Kurtis, an Emmy-winning journalist who hosts the weekly "American Justice" program on the A&E cable network, has said he met with Merrill Lynch officials in New York last November on his own initiative to discuss a possible story on whether Spitzer was overstepping his bounds in his crackdown on analysts. He has stressed that there was no discussion of money with Merrill and that he did not receive any payment from Merrill.

Kurtis and Kash have said the symphony project involved a 23-minute high-definition video of national parks that was to be set to music and used for fund-raising events.

If the symphony agreed to the project, Kurtis said, he would collect half of the proceeds from DVD sales.

Kurtis pitched the video to the orchestra in November 2001, but the idea was tabled in early 2002, said Synneve Carlino, an orchestra spokeswoman.

There have been some renewed discussions recently, Kurtis said.

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