CALIFORNIA ELECTIONS GOVERNOR : Feinstein’s Husband Lists Clients, Threatens to Sue Wilson Over ‘Lies’

Investment banker Richard C. Blum, the husband of Democratic gubernatorial candidate Dianne Feinstein, released a full list of his business clients on Monday and publicly threatened to sue Pete Wilson if the Republican continues his barrage of criticism against him.

The release of the list--which had been sought during the Democratic primary by Feinstein competitor John K. Van de Kamp and in recent weeks by Wilson--yielded the names of 56 individuals and trusts, including some extremely wealthy clients such as investor Robert M. Bass and composer Gordon Getty, son of the late financier J. Paul Getty.

Also included were individuals who represent a cross-section of American finance: Robert S. Salomon Jr. of New York firm Salomon Bros., venture capitalist Arthur Rock of San Francisco and investment banker F. Warren Hellman of San Francisco.

Blum, who earlier in the campaign had adamantly refused to name individual clients, said he hoped that his change of heart would “dispel any notion that there are any hidden agendas here.”

The banker also said his attorney has sent Wilson, vying for the governorship against Feinstein, a “cease and desist” letter requesting an end to the questions Wilson’s campaign has raised about Blum.

“If he’s going to say anything about me--and if I’m fair game, so be it--do it with some degree of integrity,” Blum told reporters at a Los Angeles press conference, where he repeated remarks made earlier in San Francisco.

“He’s been put on notice that what he’s doing is injurious to our business. . . . I don’t think we’re fair game when someone maliciously lies about our activities and he has done that rather consistently,” Blum added.

In response, Wilson’s campaign director, Otto Bos, said Wilson had made every effort to be truthful in characterizing Blum’s financial dealings. “We believe the campaign should be fought on the stump, not in the courts,” Bos said.

Blum, who has been married to Feinstein for a decade, released his records in the face of Wilson advertisements that said the couple “own” an Oregon savings and loan. The Wilson commercial itself was a response to a Feinstein ad that suggested Wilson had voted for the thrift industry as a U.S. senator because he had received more than $243,000 in campaign contributions from industry officials.

The two candidates have been battling to see who can muddy up the other in the minds of voters, who they believe are highly concerned about government ethics and the spiraling savings-and-loan bailout now facing the federal government.

According to a Times Poll released Saturday, Feinstein and Wilson are running dead even just days before the campaign’s traditional Labor Day kickoff.

Monday’s release of Blum’s individual clients complements his disclosures nearly six months ago of his corporate clients, which include Bankamerica Corp., Executive Life Insurance Co., Northwest Airlines, Sumitomo Bank of California and others. Overall, Blum said he controls about $400 million in marketable and private securities.

In remarks to reporters, Blum echoed previous comments by Feinstein that the couple keep their finances separate. He said his firm, Richard C. Blum & Associates, through which he makes investments, was founded before their marriage and is not community property. According to state law, however, all income gained from the investments is community property, he said.

Because Feinstein does not have a share in the firm, she does not have any personal holdings in Jackson County Savings & Loan, which the Wilson commercial says the couple own, Blum said.

Further, Blum said that he does not “own” the institution either. He said his firm owns 24.9% of the Oregon firm, a percentage deliberately chosen because it is just under the 25% mark that would constitute a controlling interest.

Wilson’s campaign countered that other Blum clients have holdings in the savings and loan that--combined with Blum’s--constitute ownership. But Blum said he neither controls those investments nor votes their shares.

Overall, he said, he personally owns one quarter of 1% of the thrift, which he said has yet to be profitable.

That holding is his only current investment in a savings and loan, Blum said. He previously bought, and has since sold, shares in a second thrift, and a trust set up for his adult children owns shares in American Savings & Loan.

Besides hitting Blum on the Oregon holdings, the Wilson camp has criticized him for an investment he has in National Education Corp., whose subsidiary does business with South Africa. As the Wilson camp has pointed out, that runs counter to Blum’s statements that he will not do business with any firm that has South African connections.

Blum described the subsidiary’s connection as short-term. He said he learned of the corporation’s South African dealings when it attempted to merge two years ago with a company in which he had an interest.

“I made it very clear that we had no interest in pursuing the merger if they were going to continue to do business with South Africa,” he said.

National Educational Corp. sold off one South African subsidiary upon his request, Blum said. Another subsidiary has a licensing agreement with South Africa that it cannot legally abridge, he said, adding that the firm will not renew the contract.

If his wife is elected, Blum said, he will forward listings of his holdings to the attorney general for a legal opinion as to whether they would constitute a conflict of interest with Feinstein’s duties. To his knowledge, he said, only one of the firms in which he has invested now does business with the state.

Blum and Feinstein supplemented her fund raising with about $3 million of their own money during the primary, but he expressed hopes Monday that they could in the future depend on outside sources for backing.

“Our fund-raising efforts today are very encouraging . . . and hopefully that will suffice,” he said with a wry smile.

Times political writer Bill Stall contributed to this article.