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Campaign donations lead to arrest

Two former employees say they were used to funnel campaign donations to state Insurance Commissioner Bill Nelson.


© St. Petersburg Times, published February 24, 2000

ST. PETERSBURG -- A Pinellas County insurance executive has been charged with a felony violation of state campaign finance laws, after two former employees said he used them to disguise contributions to state Insurance Commissioner Bill Nelson.

David H. Smith, president of Allied Specialty Insurance Inc. of Treasure Island, turned himself in at the Pinellas County Jail on Tuesday afternoon and was released on his own recognizance shortly after.

In political circles, Smith is best known as a major contributor to Republican causes. He, his various companies and people from the same corporate address gave $249,985 to the state Republican Party and several Republican candidates between January 1996 and October 1998, according to campaign reports filed with the Florida Secretary of State.

So it may seem odd that Smith would run into trouble with two relatively small contributions to Nelson, a Democrat.

According to the arrest affidavit, Smith asked two Allied employees to give $500 apiece to Nelson's campaign and said the company would reimburse them. The employees "wrote the checks in accordance with David H. Smith's instructions, and they, in return, received a $500 check as reimbursement from Allied," the affidavit said.

Making indirect campaign contributions through another person is illegal. A single episode is a misdemeanor. Two or more constitute a third-degree felony, said Rick Hoover, a Florida Department of Law Enforcement investigator.

Hoover said the investigation began when a former employee complained to state officials in late 1998.

The investigation remains open, Hoover said.

Smith's attorney, Norman Cannella, said neither he nor Smith would comment Wednesday.

Dan McLaughlin, who was Nelson's campaign spokesman during his 1998 re-election campaign, said the campaign team was aware of Smith's major contributions to Republicans.

But no one remembers soliciting Smith to give money to Nelson, he said.

State records do not indicate that Smith ever gave money to the Nelson campaign himself. The two employees named in the arrest affidavit, Jayne Wainwright and Cindy Circello, used their home addresses on the required contribution statement. They listed their occupations as "executive assistant" and "clerical."

Neither woman could be reached for comment Wednesday.

State records do show that Smith, Allied and other companies from the same Treasure Island address gave the Republican Party $237,700 in so-called soft-money donations between 1996 and 1998.

Nelson's Republican predecessor, Tom Gallagher, also received 18 individual contributions of $500 from companies or individuals at that address. The contributions came within five days of each other, late in Gallagher's successful campaign for state Education Commissioner.

Republican Sandy Mortham, who lost her 1998 bid for re-election as Secretary of State primary, received $1,500 from Allied Insurance or related donors.

Smith-related companies also gave Jeb Bush and Tom Feeney $4,100 during their unsuccessful governor's race in 1994.

Federal election reports show that Smith and a woman at his home address gave $1,000 apiece to George W. Bush's presidential campaign last year.

Other Republicans who got $500 apiece were state Sen. Don Sullivan, state Rep. Deborah Tamargo, then-Education Commissioner Frank Brogan and Pinellas Circuit Judge Irene Sullivan.

State Republican Party officials did not return calls for comment.

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