Giuliani Transformed into Lobbyist

U.S. largest security company Merrill Lynch & Co., which is under investigation for the suspicion of misleading investors by selecting wrong active stocks, hired former New York City Mayor Rudolph Giuliani as adviser in order to help the negotiation with the police.

Wall Street Journal reported on the 24th that former mayor Giuliani met New York Attorney General Eliot Spitzer just before the prosecutor`s office opens principal evidences including e-mails of analysts, and said, “we should try to find a solution that corrects the tradition and that really requires more than one player, not just one attorney general taking action. ”

Former mayor Giuliani, who once attacked Wall Street companies during his days of federal prosecutor at Manhattan, New York in 1980s, founded a consulting firm `Giuliani Parters` immediately after completing his term, and has advised Merrill Lynch for legal problems.

Additionally, Merrill Lynch hired the law firm, for which Attorney General Spitzer once worked, and requested New York State senator Charles Schumer (Democratic Party) to cooperate.

Bloomberg L. P. reported that Wall Street is tense, as Attorney General Eliot Spitzer will allegedly prosecute Merrill Lynch by New York State’s `Martin law`, which punishes securities related frauds more severely than federal law does.

Bloomberg added that prosecutors` offices of New Jersey State and California State started supporting New York State prosecutors` office by investigating whether security companies including Merrill Lynch misled investors with slanted reports.

konihong@donga.com