After a series of high-profile actions in his position as New York’s top insurance regulator–the most powerful regulator’s post in the country, thanks to its proximity to Wall Street–Eric Dinallo is leaving the job at the New York State Insurance Department effective July 3, amid a swirl of rumors that he may intend to seek the position of state Attorney General.
While his immediate destination, according to the office of New York Governor David Paterson, is the classroom (Dinallo will be the Henry Kaufman visiting professor of finance at New York University’s Stern School of Business) there is talk that if current Attorney General Andrew Cuomo decides to run against David Paterson for the governorship, that will create a vacancy Dinallo would like to fill.
Dinallo, a former prosecutor, is no stranger to the courtroom. Previously chief of the Securities Bureau under former Attorney General Eliot Spitzer, he led investigations in a number of headline-grabbing cases involving the financial services industry, including matters of conflict of interest regarding IPOs and analysts. He was also instrumental in investigations of the mutual fund industry.
In 2002, when he was head of the investor protection bureau under Spitzer, Dinallo prevailed over Merrill Lynch in requiring the company to overhaul its research practices, and to disclose in its analysts’ reports whether it sought business from the companies being evaluated.
Prior to that, Dinallo had been an assistant district attorney in the New York County District Attorney’s office. There he worked on matters ranging from insider trading to securities fraud.
Dinallo also logged time as a senior regulatory lawyer at Morgan Stanley in 2003. But in mid-2005, his responsibilities changed in the wake of the departure of Philip Purcell, Morgan Stanley’s embattled CEO. Purcell was replaced by John J. Mack.