CHICAGO -- The National Association of Bond Lawyers has launched a campaign to get its members' law firms to adopt a six-month-old policy statement calling for the disclosure of political contributions.
The campaign was announced at an association meeting Wednesday night in Chicago after a discussion of the policy statement indicated that only one bond counsel had adopted it and few firms are considering it.
Howard Zucker, a partner with Hawkins, Delafield & Wood in New York who helped draft the policy statement, told reporters at the meeting that only about half of the NABL board members' firms are currently considering the statement.
Association president Drew Kintzinger, an attorney with Briggs and Morgan in Minneapolis, said after a board meeting yesterday where the issue was discussed that he may send a letter to all association members next week asking them for their reaction to the policy statement and whether they plan to consider adopting it.
The policy statement, or "Statement of Professional Principles," urges bond law firms to disclose any political contributions they make under state or local laws or in annual reports that are submitted to state or federal repositories. Firms could still make political contributions, but not if they are designed to obtain or retain bond business.
The association's board adopted the statement in March.
However, so far only One bond law firm, Friday, Eldredge-& Clark in Little Rock, Ark., has informed the board that it has adopted the statement.
In a letter to former association president Neil Arkuss, the firm said that it plans to disclose its political contributions under state and local laws.
At the group's meeting, Zucker urged lawyers to consider the policy statement and cited three major reasons for adopting it.
First, he said, the statement "strikes the correct balance" between protecting a firm's right to participate in the political process and severing the connection between campaign contributions and municipal finance engagements.
In addition, Zucker said, widespread adoption of the statement will "respond to allegations that certain lawyers may be participating in pay-to-play schemes."
Finally, he said, if a significant number of bond law firms do not adopt the statement; they "may invite an attempt by the Securities and Exchange Commission to directly or indirectly regulate bond lawyers."
Widespread adoption of the statement, he said, would be an appropriate response to SEC chairman Arthur Levitt Jr., who has been urging the association to take some action on political contributions.
Zucker also told reporters at the meeting that he believes firms have been slow to respond to the policy statement because they are waiting for developments in the court challenge to the Municipal Securities Rulemaking Board's Rule G-37, which governs political contributions.
Rule G-37, which the SEC approved earlier this year, bars municipal dealers that make political contributions to issuer clients from doing business with those clients for two years after making' such contributions.
Alabama bond dealer William Blount has sued to block the rule. The case, Blount v. SEC, is currently pending in a federal appeals court.
Zucker also said the lawyers association faces some limitations in pushing such a policy statement. The group is not a regulatory organization and can only recommend voluntary compliance with such a policy, he said.
Another problem, several lawyers said, is that the association's members are individual lawyers, not law firms. Typically, bond lawyers represent only a small percentage of the lawyers in a large firm.
In a large full-service law firm, the lawyers who are not involved in public finance law and who may have a long-standing practice of making political contributions do not understand why the entire firm should begin disclosing such contributions because of a policy adopted for bond lawyers.