Who is Ira Brody? State treasurer hopeful has extensive GOP ties

As Tennessee Republicans over the last two election cycles moved closer to winning a majority in the state legislature, the offices of state government created by Tennessee’s constitution increasingly became partisan political footballs.

GOP lawmakers sat out the elections of the offices of state treasurer, comptroller and secretary of state last year, citing the current office holders’ campaigning in the 2006 election cycle for Democratic members of Tennessee’s General Assembly.

Now that the GOP holds a majority in the legislature, Republicans may be about to appoint a high-dollar fundraiser and donor from their own party whose company has engaged in extensive — and occasionally controversial — lobbying and political activity involving other state governments.

Businessman and New York transplant Ira Brody is openly campaigning for the job of state treasurer, a post that among other things oversees state government’s investment and retirement funds as well as Tennessee’s workers compensation pool. He is one of six applicants seeking the job.

Helping Brody make the pitch to Republican members of the legislature is former 4th District U.S. Congressman Van Hilleary, seen on the Hill with Brody in recent weeks. GOP sources also say former Tennessee Republican Party chairman Bob Davis has made calls on Brody’s behalf.

According to a resume Brody distributed to GOP members of the state legislature, he is a Rutherford County resident who is a partner and chief operation officer in a Nashville based investment bank called InsCap Management, LLC.

He goes on to tell legislators that prior to his current job he served as an assistant secretary to former New York Governor George Pataki, responsible for monitoring the finances of New York City and served as the executive director of a committee charged with trying to secure the 2012 Olympic Games for the Big Apple.

Brody is not your run-of-the-mill transplant who has just happens to want to serve his new home state. He has already run for offices here and in New York, entering contests shortly after moving into each community.

In 2006, he ran for a seat on the Rutherford County Commission and lost to Robert Peay where he garnered just 39 percent of the vote. Ten years earlier he ran for New York State Senate and picked up 35 percent of the vote in that race.

He also chaired the Tennessee Republican Party's coordinated campaign this year, Victory '08.

Brody told The City Paper he wanted to be state treasurer simply out of a desire to enter public service, saying management of the state retirement fund was one of his top draws to the job.

“I think with my experience I have the potential of going to work for the people of this state and making that a stronger and safer retirement fund,” Brody said Friday. “Many of those folks are senior citizens or soon will be. I view it as a sacred duty to protect their funds.”

While he may not have been successful in his bids for office so far, that hasn’t kept him from spreading money around to other candidates. A survey of campaign finance records in Tennessee and from the Federal Election Commission show Brody has contributed over $100,000 to Republican campaigns and causes during the 2008 election cycle alone.

One of the largest chunks of money was a set of in-kind contributions to the Tennessee House Republican Caucus totaling just over $31,000.

According to Tennessee Registry of Election Finance records, the contributions paid for polling. Another $10,000 went to the Tennessee Republican Party’s state campaign account along with a $10,000 contribution to former U.S. Sen. Bill Frist’s Volunteer PAC Tennessee.

On the federal side, Brody gave about $72,000 in political contributions over 2007 and 2008, all to Republican PACs and candidates including both Tennessee U.S. Senators Bob Corker and Lamar Alexander. There was also another $10,000 donation to the Tennessee Republican Party, this time to the party’s federal account.

Brody told The City Paper his generosity to Republican candidates and causes was “not a negative” despite GOP lawmakers in the state being heavily critical of the current Democratic constitutional officers’ political activity.

“On my application for state treasurer it says I will have to refrain from that kind of activity because I think it clearly would be a conflict,” Brody said. “The problem was that the current incumbents were using their positions to help Democrats. If that’s what the legislature so instructs I intend to follow that. If they ”

InsCap has also seen its fair share of battles in other states relative to its business of financing premiums for the life insurance policies of affluent families, individuals and institutions. InsCap is closely associated in the minds of the insurance industry with viatical settlements, though Brody says that is not the service InsCap offers.

According to the U.S. Securities and Exchange Commission, “a viatical settlement allows you to invest in another person's life insurance policy. With a viatical settlement, you purchase the policy (or part of it) at a price that is less than the death benefit of the policy. When the seller dies, you collect the death benefit. Your return depends upon the seller's life expectancy and the actual date he or she dies.”

Inscap’s own Web site says their business makes it possible for “affluent households and large institutions to finance the acquisition of life insurance as an asset.”

Brody explained his company has entered into lobbying and other government relation work in a variety of states when the legislative climate was to attempt “to limit the settlement of life insurance.”

“We never lobbied, we just informed. We wanted to make sure if that was their intent they didn’t catch us up in it because that is not what we do,” Brody said. “We didn’t want to be the dolphin caught up in the tuna net.”

Brody and InsCap, which in the past has also done business as LILAC Capital LLC, have fought hard in several states to bring about changes to laws that would either allow them to enter into a new market or improve their business environment. The tactics they have employed to affect change has raised eyebrows in some states.

According to published reports, consumer watchdogs in North Dakota argued in 2007 that a North Dakota Insurance Commissioner Jim Poolman changed his stance on rules affecting Brody’s business shortly after Brody’s wife, Sara Bachrach, donated $25,000 to his re-election campaign and Brody donated $15,000 to the North Dakota Republican Party.

Poolman, who has since resigned to enter the private sector as an insurance consultant, denied that the donations affected his decision but rather it was changes made in proposals from Brody’s company that addressed his concerns.

In Virginia, Brody and his team employed a cadre of 11 lobbyists in 2005 in a futile effort to stop legislation that further regulated the settlement of life insurance policies.

Despite those setbacks Brody did have success in Tennessee. In 2004, Brody’s company InsCap employed nine lobbyists to work to change state law to make the Volunteer State a more favorable place for the company to do business. Among the lobbyists hired were former senior aides to Governor Don Sundquist, Justin Wilson and Courtney Pearre.

Wilson is largely considered to be the frontrunner at this time to fill the position of State Comptroller.

Brody said he was aware InsCap’s name and business was closely associated with the viatical industry within the insurance business.

“I spend a lot of my time explaining the difference,” Brody admitted.

If appointed treasurer by a majority vote of the members of the state House and Senate, Brody said he would no longer work at InsCap.

“I am in the process now of resigning from the company,’ Brody said. “I believe it would be a conflict. We are trying to time the two things so they happen in succession.”

State Sen. Randy McNally (R-Oak Ridge), who served as chair of the Senate Finance Committee this past legislative session, said that the possibility of Brody as state treasurer has raised some concern for his GOP colleagues.

“Some of my colleagues have expressed concern to me about the business he is involved in and his qualifications,” McNally said. “I look forward to him addressing those concerns at the upcoming hearing where we will interview all of the candidates for the constitutional offices.”

Brody said he looks forward “to participating in the hearing process and answering any and all questions as presented.”

“I do believe I have the experience and the qualifications necessary to do the job well,” he added.

State Representative Henry Fincher of Cookeville, who serves as vice chairman of the House Democratic Caucus, echoed McNally’s concerns over Brody.

“I have heard his name being floated, and I understand many people, Republicans and Democrats alike, have concerns about his qualifications,” Fincher said. “We need someone with proven experience, we don't need someone learning on the job with the state pension fund. Peoples futures are too important.”

Davis did not return telephone calls for this story. Hilleary when reached had no comment.