Should Wall Street Fear A “Comptroller” Spitzer?
The Sheriff of Wall Street is attempting a comeback.
Eliot Spitzer, the former New York State Attorney General who sued investment banks for inflating stock prices and the former NYSE Chairman for excessive pay, is running for New York City Comptroller. That's if he can get enough signatures to get on the primary ballot.
He’s re-entering politics five years after resigning as New York governor following a sex scandal. In the interim he was a cable TV host and worked in his family’s real estate business.
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He told The New York Times over the weekend that the Comptrollers Office, like the AG’s office before, is “ripe for greater and more exciting use of [its] jurisdiction.”
Michael Santoli, senior columnist at Yahoo! Finance, says Spitzer’s “brand is about being aggressive about Wall Street practices” and he expects Spitzer will try to play that role again, “at least rhetorically.”
We don’t know yet exactly what Spitzer has in mind but here are a few efforts he might undertake, using history as a guide:
1. Tax Wall Street Bonuses
The Daily Ticker’s Aaron Task says Spitzer could potentially push for a tax on Wall Street bonuses as part of an annual report on salaries from the Comptroller’s office.
“That report typically is meant to trumpet just exactly how lucrative Wall Street is for the city, “ says Santoli, but ”if he wanted to, he could say we have this massive disparity of wealth in this city , in this country… and tack on a tax.”
2. Become a Shareholder Activist.
The NYC Comptroller oversees $139 billion worth of assets in New York City pension funds, which own “every publicly traded stock because they own the indexes,” says Santoli. He says Spitzer can use those assets as his instrument “to go after companies.”
The Comptroller’s office is currently suing BP (BP) for investment losses due to the Deep Water Horizon oil spill in the Gulf.
So should Wall Street be worried about Spitzer?
“I don’t think it’s worry number one, but… I do think it will be one additional headache,” says Santoli.
One industry that may not have to worry is the real estate industry. Spitzer “comes from a very big New York real estate family—the other big rainmaker for the city,” says Santoli.
“You wonder how he would treat property owners and commercial real estate as well,” says Santoli. Then again, given Spitzer’s history, all industries—even one he and his family has profited from— could be fair game. For more on Spitzer's potential political comeback, watch the video above.
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