Former Top Aide Defends Quackenbush at Hearing

As one of Insurance Commissioner Charles Quackenbush’s closest confidants, Bill Palmer was among the most anticipated witnesses Tuesday before the state Senate Insurance Committee investigating the actions that threaten the commissioner’s political career.

He was Quackenbush’s chief attorney and chief of staff, drawing a $200,000 annual salary that made him one of California’s highest paid officials.

But despite his close relationship with Quackenbush dating to 1995, Palmer emerged from more than two hours of testimony having revealed little about his former boss or his own role in negotiations with insurance companies over their handling of Northridge earthquake claims. Instead, he took the opportunity to defend his boss.

“He did a good job,” Palmer said of Quackenbush. “He may have made a few mistakes. He should atone for them and move on.”

Palmer portrayed himself as an extraordinarily hard worker who took extra efforts to make sure he followed the law. “I’m coming here on my own time,” he told the committee, speaking softly and calmly throughout his testimony.

If he was flustered by any of the senators’ questions, he didn’t show it.

Like Quackenbush, Palmer is tall and athletic-looking. He is a graduate of UCLA and McGeorge Law School, and lives in Sacramento with his wife and three kids. When he was working in the insurance department, he was dealing with 30 to 60 calls a day and 100 to 300 e-mails, traveling the country and renting an apartment in Los Angeles, where he was doing much of his work.

“I routinely make strenuous demands on Mr. Palmer and without exception he has performed beyond my expectation,” Quackenbush said last year.

On Tuesday, Palmer was not accompanied by an attorney at the witness table. He offered no prepared remarks. He repeatedly told senators that he left the department July 23, before the most controversial decisions about how to spend insurance company money were made.

Palmer emphasized his proudest moment: his role in settling claims against insurance companies that had roots in the Holocaust era, one of Quackenbush’s most popular actions. Palmer told the senators that as a result of his work on the Holocaust insurance cases, the president of Israel sent him a “personal letter” of appreciation.

But he said he had little say on the California Research and Assistance Fund. The foundation established by Quackenbush received $11.6 million in insurance company money donated in lieu of fines, and doled it out to organizations that had nothing to do with earthquakes or insurance. Some of it paid for television commercials featuring Quackenbush.

Palmer said he did recommend the hiring of an Oakland law firm to write the foundation’s articles of incorporation. But responding to questions from state Sen. Jackie Speier (D-Daly City), he said he was not aware that the one of the Oakland firm’s most senior partners was a member of the board of directors of Farmers Insurance Co.

“If I had been aware of that fact, I probably would have gone elsewhere,” Palmer said.

Palmer came to Speier’s attention last year when The Times revealed he was working on a lawsuit on his own time--and that he was holding four jobs in the Department of Insurance.

Eleven days after his multiple roles surfaced, Palmer resigned, saying he wanted to devote himself “fully to his private professional interests.”