A lobbyist hired to help PaineWeber Inc. win a top underwriting role from Florida Comptroller Gerald Lewis purchased his lobbying firm from the son of the state's Democratic governor, Lawton Chiles.
James Eaton, a former assistant comptroller, bought Chiles Communications in August 1993 from Lawton Chiles 3d, executives at the firm said. Chiles had served as a lobbyist in Florida for a variety of businesses, including the municipal bond unit of Merrill Lynch & Co.
Officials at PaineWebber said Eaton's political connections alone did not secure PaineWebber's appointment as a co-manager on a $60 million certificate of participation issue that was canceled Tuesday by Lewis.
Executives at the firm said they had no relationship with Chiles Communications, and that Eaton had not worked with Chiles before purchasing the lobbying company.
"We know we were awarded the business based on our performance," said Peter Casey, a spokesman for PaineWebber. Between 1992 and 1994, PaineWebber has ranked among the top three underwriters of certificates of participation in the municipal bond market.
A spokesman for the governor did not return a telephone call.
Revelations about Eaton's political connections emerged as Lewis decided yesterday not to complete the COP issue.
Lewis's assistant comptroller Craig Meyer said the office will not complete the transaction before Lewis leaves office in January. Lewis, a Democrat, was defeated in the November election by Republican Bob Milligan.
The delay follows several reports that Lewis appointed several politically connected bond underwriters, including PaineWebber, to sell the issue.
While PaineWebber hired Eaton, Bear Stearns & Co., the deal's senior manager, relied on municipal finance executive Bill Gunter to win its appointment, according to published reports. Bear Stearns did not return phone calls. Gunter is a former state treasurer.
Eaton, a close friend of Lewis and a former banker at Lazard Freres & Co., also served as the state's assistant comptroller, and raised money for Lewis's successful 1990 campaign. Also serving as financial adviser on the COP deal is Richard Poirier of Lazard Freres. A Lazard spokesman could not be reached for comment.
New federal restrictions on campaign contributions were put in place this year, and Eaton did not raise money for Lewis in 1994, PaineWebber executives said. According to Meyer, Eaton played no official role in the 1994 campaign, but occasionally gave Lewis campaign-related advise.
Eaton's lobbying firm, Capital Strategies Inc., is registered with the Florida Secretary of State's office as Eaton Communications, Inc. According to state records, the firm, located in the state capital of Tallahassee, changed its name from Chiles Communications on Jan. 12, 1994.
State records list Eaton as the firm's president and director, Records also list Martha Edenfield as the firm's vice president, secretary, and treasurer.
Janet Howarth, who identified herself as Eaton's administrative assistant, said Eaton purchased the firm from Chiles in August 1993. Howarth said Eaton was not available for comment, and that Chiles plays no role in the firm's business activities.
Casey, the PaineWebber spokesman, also said Chiles has no role in the firm. Casey said Chiles lives "in the Northeast," but he didn't know where.