Georgia Gov. Candidate Goes from Safe Republican Win to Toss up

It has been an endless run for governor in Georgia. For about two years, John Oxendine, a Republican and the state’s insurance commissioner has been running.  When Lt. Governor Casey Cagle pulled out of the race last year due to health problems, Oxendine became the front runner.

Until last week, most people thought the Ox would be the top vote getter in Georgia’s primary in July and that the second place runoff spot would go to Rep. Nathan Deal but things have changed quickly.

In Georgia, as around the country, ethics is an issue. The electorate is not patient with ethics issues in this election cycle. Legislatures, including Georgia’s are dealing with ethics and ethics reform. Late last year, Southeastern United Insurance Company (SEUS) was liquidated under a court order because the company didn’t have the resources to cover its claims. About 5000 Georgians were covered by SEUS, mostly in municipalities.  It regularly sold workman’s compensation policies well below market value. The former CEO, M. Clark Fain, is under criminal investigation.

After a gubernatorial candidates forum in Atlanta in late January, Oxendine said he was sure Fain “was not the only person that knew [the books and records] were fraudulent.”  He then named Rep. Lynn Westmoreland (R.-Ga) and others as serving on the SEUS advisory board. “They are not persons of interest,” Oxendine says, adding, but “We are looking at anybody that had any involvement.”

Westmoreland (who is supporting Nathan Deal for Governor rather than Oxendine) is one of the most conservative members in Congress.  He’s currently one of the Vice Chairs of the NRCC and has been traveling the country recruiting candidates for Congress.  Many thought when Lt. Gov. Casey Cagle dropped out of the race for governor last year, Lynn would run, but he told me at the time, “I’m making a difference here [in Washington], so I won’t be running for Governor.”
Brian Robinson, Westmoreland’s communications director said, “Late last year, [Oxendine} called Lynn’s cell phone and said there is an investigation into SEUS, and your name keeps popping up. We’re just giving you a friendly heads up.”

December 9, 2009, Oxendine called Westmoreland again to tell him Southeastern U.S. Insurance was being shut down and Oxendine questioned Westmoreland’s involvement.  

Westmoreland pointed out that he had left the advisory board in 2002. Oxendine claimed to be satisfied and said “it would just be terrible” were it made public that Westmoreland had such a connection.

Oxendine did not mention then or last week to the GPB that Fain had given $1500 to Oxendine’s campaign for governor. The campaign plans on giving the money back to the receivership estate of SEUS.

I caught up with Rep. Westmoreland last week and he said, “John Oxendine knows good and well that I had nothing to do with the downfall of Southeast U.S. Insurance. I never took any trips, I never had any fiduciary responsibility and I left the advisory board long before the company experienced problems. I can only surmise that the purpose of his call was to send me a message. I received the message. I heard it loud and clear.”

Glenn Allen, spokesman for John Oxendine told me this week, “There is no statement on Westmoreland at this time. I can tell you that the reporters John Sepulvado and Emily Green at GPB denies ever telling Westmoreland or his people that he was a target of a criminal investigation. There was no "shakedown" attempt by the Commissioner, only a courtesy call to the Congressman in December. The Congressman had no problem with the call or Oxendine until he thought he was a target of the investigation. This story is about an insurance company who was cooking their books and got caught.”

And so it goes.  It’s a battle between titans in the Georgia Republican Party.  Oxendine has got to know that when you’ve been on top for so long, everyone is gunning for you and if he’s elected Governor, he will be working with Westmoreland on redistricting. But more importantly, the political prognosticator, Charlie Cook, has moved the Georgia governor’s race from a safe Republican win to a tossup due to this and other ethics issues involving former Speaker Glenn Richardson. Former Governor Roy Barnes is the leading Democrat and is hoping to see these controversies continue and expand.