Martin Act Gives New York Politicians Way Too Much National Power

On Thursday, a few hundred thousand Democrats in New York will elect their party’s nominee for the next national regulator of every publicly-traded company in America: the state’s attorney general. In almost every respect, New York’s top lawyer has greater prosecutorial authority than any other state attorney general—or even the Securities and Exchange Commission—to investigate potential corporate fraud.

The office’s unique authority is derived from a century-old law called the Martin Act. It gives the attorney general total discretion to sue or seek indictments of companies without even having to prove intent to defraud.

Democrats vying for the nomination include Fordham law school professor Zephyr Teachout, Rep. Sean Patrick Maloney, D-N.Y., and New York City public advocate Letitia James. Gov. Andrew Cuomo appointed Barbara Underwood acting attorney general in May after then-Attorney General Eric Schneiderman resigned amid domestic abuse allegations. She is not seeking election to the post.

Republicans tapped corporate lawyer Keith Wofford as their nominee. He faces tough odds in a state that hasn’t elected a Republican as attorney general in more than two decades. Wofford says that past Democratic attorneys general have too often ignored political corruption while pursuing flimsy cases that foster an anti-business climate.

“You have an environment of hostility to business,” he told a local newspaper Friday. “The concrete example is settlement after settlement after settlement, fine after fine… the power of the state is sort of a machine gun spraying everywhere.”

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