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Is Hochul the unlikely hero of Adams’ world indictments?

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Gov. Kathy Hochul has been urging the state legislature to pass auto-insurance reform proposals.

FRAUDTUITOUS: Gov. Kathy Hochul has spent the last four months beating the auto-insurance affordability drum and fighting the trial lawyers and unconvinced lawmakers who stand in her way.

She’s proposing limiting the ways car crash victims — especially those deemed at fault for the collision — can sue for damages, a move she says will cut the cost of auto insurance. She also wants to target insurance fraud and staged crashes.

It’s been a massive sticking point in negotiations to finish her now-late budget.

“If, God forbid, you are the majority reason that there’s an accident, you will no longer be entitled to pain and suffering,” Assembly Speaker Carl Heastie told reporters Wednesday. “That’s a pretty serious thing for people to accept. I mean, accidents do happen.”

But as Hochul hopes to draw the Assembly and Senate to her side, it just so happens that federal prosecutors in the Southern District of New York dropped indictments this week targeting a close personal friend of former Mayor Eric Adams and alleging a massive car-crash-victim-fraud scheme.

Perfect! Timing!

“This alleged scheme is exactly the type of fraud Governor Hochul’s auto insurance reforms are designed to curb in New York State,” Hochul spokesperson Kristin Devoe told Playbook in a statement.

Her office is arguing that the scheme might never have happened had Hochul’s proposed changes been in place.

“The Governor’s proposals would strengthen enforcement, allow more time to investigate suspected fraudulent claims and crack down on the networks and providers that make this type of fraud possible in the first place,” Devoe said.

Our colleague Chris Sommerfeldt reported this morning that federal prosecutors dropped a superseding indictment Thursday in their fraud case against Zhan “Johnny” Petrosyants, the man who hobnobbed, dined and clubbed with Adams during his tenure, as Hizzoner tested New York City’s nightlife “product.” The superseder alleged businessmen Vladislav Stoyanovsky and Dmitriy Khavko participated in the scheme as well. All three men pleaded not guilty.

Prosecutors claim the men had car crash victims in medical clinics undergo dubious procedures conducted by clinicians who were part of the scheme. The indictment also alleges the men behind the operation billed insurers for procedures that never happened.

Petrosyants, Stoyanovsky and Khavko then allegedly filed no-fault claims to the insurance companies, who, under state law, are required to pay out the claims in just 30 days. The scheme brought in tens of millions of dollars, prosecutors said.

Hochul’s office wants to change that. The governor says she’d give insurers more time to investigate whether a no-fault claim is fraudulent. Right now, if an insurer delays a payout, it can’t defend itself in court by saying it was busy investigating the claim. Insurers would still have to pay interest on delayed payouts. And if someone sues to force a reluctant insurer to pay up, the insurer would have to cover attorneys fees.

The cost of paying out bogus insurance claims is a main factor in the high cost of auto insurance in New York, contends Team Hochul. Last year, insurance carriers reported 43,811 incidents of suspected auto insurance fraud to regulators, an 80 percent jump compared to 2020.

The Trial Lawyers Association says Hochul’s proposals would give insurance companies more time to delay and deny claims.

“Stripping away consumer rights while insurers rake in record profit is a giveaway to the industry that leaves New Yorkers to pick up the tab,” association spokesperson Sabrina Rezzy said in a statement. — Jason Beeferman

From the Capitol

Gov. Kathy Hochul initiates next step for I-787 makeover.

TIGHTENING ALBANY’S BELTWAY: The much-derided I-787 — an asphalt apron familiar to Capital Region drivers who commute downtown to the statehouse — is one step closer to a makeover.

Hochul announced Thursday the state is opening a community outreach center amid an environmental review focused on how to improve waterfront access. I-787 runs parallel to the Hudson River.

“Reimagining the I-787 corridor is a once-in-a-generation opportunity to shape the future of downtown Albany, so it is imperative that the people who live and work in the area have a major voice in how this project progresses,” Hochul said. — Nick Reisman

FROM THE CAMPAIGN TRAIL

Conrad Blackburn, a democratic socialist candidate for state Assembly, previously interned for Florida Attorney General Pam Bondi.

BLACKBURN’S BONDI PAST: In 2016, years before she became one of the Trump administration’s most prominent and polarizing officials, then-Florida Attorney General Pam Bondi had a young intern in her office named Conrad Blackburn.

That fact is now being seized on by Blackburn’s critics as he runs for a Harlem-based Assembly seat as a democratic socialist and unabashed enemy of Trump.

“It is unconscionable that Conrad Blackburn chose to work for Pam Bondi at the very moment she was leading the charge to keep more than a million Floridians, including one in five Black adults, permanently locked out of the voting booth,” Uptown Democratic Club President Donna-Marie Gibbons told Playbook, referencing Bondi’s effort to preserve a Florida law that made it difficult for felons to regain voting rights after serving time. “Anyone who signed up to work in that office while she was fighting to preserve this racist, Jim Crow-era machinery has questions to answer about their commitment to our community.”

Trump fired Bondi as his U.S. attorney general Thursday.

Blackburn, who grew up in Florida, said criticism of his stint with the attorney general there says more about his haters than it does about him.

He told Playbook he took the unpaid, two-month internship in Bondi’s criminal appeals bureau while in law school — and the experience drove him to become a public defender, a role he continues to serve in to this day.

“I did not need very long to say that the system was broken and I needed to spend my time working to protect Black folks from it, with actions, not just words,” Blackburn said.

“I am happy to debate my record on its merits,” he continued. “But harkening back to my days as a 1L, as a poor kid trying to work in the criminal appeals bureau of the Florida AG’s office as some kinda gotcha? That is everything wrong with politics now. If the powers that be in this district focused on the issues, they would have to explain the lack of meaningful change in the community…Heck, if the powers that be did their jobs, I may not be running in this race at all.”

Blackburn is facing off in June’s Democratic primary against Assemblymember Jordan Wright, the son of Manhattan Democratic Party head Keith Wright.

New York Focus reported today that Charlie King, a longtime aide to former Gov. Andrew Cuomo, is launching a super PAC to boost Wright, whose district Mayor Zohran Mamdani comfortably won in last year’s election. — Chris Sommerfeldt

IN OTHER NEWS

ARRESTS SURGE: ICE arrested more New Yorkers between November and January than in any comparable period since 2022, according to federal data. (Times Union)

ONE MAN’S TRASH: Reports show that progress in New York’s composting push slowed after officials halted fines and enforcement efforts. (Gothamist)

BLESS THIS MESS: Competing lobbying groups in Hochul’s car insurance reform fight are clashing over dueling clergy letters and even disputing who actually signed which. (City and State)

Missed this morning’s New York Playbook? We forgive you. Read it here.

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Poll: Americans uneasy with AI, crypto even as they spend big on midterms

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Deep-pocketed political groups tied to artificial intelligence and cryptocurrency are rapidly reshaping the midterm money landscape — but many Americans are uneasy with the industries behind the spending.

New results from The POLITICO Poll find broad public skepticism about crypto and AI, creating a possible conflict for candidates benefitting from an influx of contributions from the two industries. These groups are pouring millions of dollars into competitive 2026 races to elevate politicians who they believe will support their agendas in Washington.

Meanwhile, Americans have been slow to embrace either technology.

A 45 percent plurality of Americans say investing in cryptocurrency is not worth the risk, even if it can yield high returns, and a 44 percent plurality say AI is developing too quickly, according to the April survey conducted by independent firm Public First.

Nearly half of Americans say they trust a traditional bank with their money more than a cryptocurrency platform, while just 17 percent say the opposite. And two-thirds support lawmakers either imposing strict regulations or setting broad principles for the AI industry.

The results raise an emerging challenge for the industries as their aligned super PACs seek to translate financial might into political influence. Several of these groups are already becoming the most dominant players on the political battlefield, spending heavily for candidates on both sides of the aisle and in some cases rivaling the fundraising of long-established party groups.

It’s too early to say how candidates associated with these groups will fare in November — and the two industries could draw different reactions from voters. Still, in hypothetical head-to-head matchups, poll respondents were much less likely to choose candidates backed by a campaign group seeking looser regulations on artificial intelligence than candidates backed by a group advocating for more stringent rules on AI and tech companies. Those polled were also more likely to support a group advocating for policies to protect the environment and prevent climate change.

Skepticism of the industries, those results suggest, could turn into voter backlash if Americans grow fed up with the heavy spending.

“Democrats’ best approach is to make their spending an issue,” said Sen. Chris Murphy (D-Conn.), who has been outspoken about the need for AI regulation. “People do not want AI companies to run them over culturally and economically. They don’t trust crypto.”

Some of the resistance to the AI and crypto groups may reflect broader American dissatisfaction with special interest groups’ spending. A 41 percent plurality say special interest groups have too much influence over politics in the U.S., while 23 percent say they have the right amount. Just 12 percent say they have too little influence.

But the AI and crypto super PACs are on a new level, and the rise of these groups is creating shockwaves throughout politics. These groups could easily become the biggest spender in any House or Senate race that they choose — or several.

Leading the Future, a pro-AI super PAC founded in August, has already raised more than $75 million since its launch, according to recent filings with the Federal Election Commission. Through a network of PACs, it has deployed money on primaries in North Carolina, Texas, Illinois and New York for Democratic and Republican candidates. Fairshake, a pro-crypto group primarily funded by Coinbase, Andreessen Horowitz and Ripple Labs, is expected to back candidates in both parties and has already spent $28 million across several competitive primaries through its network of PACs.

Both industries are also spending big on Washington lobbyists to ensure their influence continues past Election Day. The AI lobby in particular has ballooned in recent years; OpenAI and Anthropic spent record amounts of money on lobbyists in the first quarter of 2026. The crypto industry has also poured millions into lobbying efforts in recent years to push Congress to enact a sweeping overhaul of how digital assets are regulated.

“The universal thread, from their perspective, is, I think an attempt to maintain a degree of bipartisanship and identify people whom they think will be champions on these issues,” said Jason Thielman, former executive director of the National Republican Senatorial Committee, of the crypto-aligned groups.

For the crypto industry, the super PAC spending is aimed at pushing through a market structure bill called the CLARITY Act that is pending in the Senate. Industry executives and lobbyists hope the proposed law would give the industry a stamp of legitimacy from Washington and deliver long-term certainty about how digital tokens will be overseen by market regulators.

The super PAC money acts as both carrot and stick: It could benefit lawmakers facing competitive reelection campaigns in 2026 who back the industry’s goals — and threaten those who stand in the way.

In 2024, a Fairshake-affiliated super PAC spent more than $40 million to help defeat then-incumbent Democratic Sen. Sherrod Brown in Ohio. Brown, a longtime crypto critic, is running again and could again be a major target for the crypto PAC network.

“Crypto groups are absolutely becoming a disruptive force in political spending, including in Ohio,” said former Ohio Republican Rep. Jim Renacci, who unsuccessfully challenged Brown in 2018. “But let’s face it, they’re not unique. It’s just the latest version of outside money.”

Fairshake declined to comment.

The AI groups spending big in elections want to ensure their nascent industry is regulated by one set of federal rules, not a state-by-state patchwork, as state legislators rapidly pass new laws regulating the technology. The White House and congressional Republicans have generally supported that goal, but have so far floated light-touch regulations that most Democrats believe don’t go far enough. While the tech sector leans toward the GOP’s deregulatory approach, some lobbyists are open to strong federal rules on AI in exchange for a ban on state laws.

“A national framework will prevent a patchwork of conflicting state laws from harming our ability to win the global AI race against China,” Leading the Future spokesperson Jesse Hunt said in a statement.

But the polling suggests these industries’ efforts may run into broader public skepticism.

More than half of Americans say they have never and would not consider buying or trading cryptocurrency. On artificial intelligence, nearly half of respondents say it is likely to eliminate more jobs than it creates, and a 43 percent plurality say the risks of the technology outweigh the benefits.

“There is a lot of work that needs to be done to help the voting public fully appreciate the national security threat that we face if we are not first in [the AI] race,” Thielman said of AI-affiliated groups. “It’s essential that [the] industry continue to invest very aggressively here, both to increasingly educate the public, educate policy makers because the issue is somewhat mixed from a public opinion perspective.”

The skepticism cuts across partisan lines, with pluralities of voters for both Trump and former Vice President Kamala Harris in 2024 saying that investing in crypto is not a risk worth taking, even if it gives high returns. A near majority of both groups — 49 percent of Harris voters and 46 percent of Trump voters — say AI is developing too quickly.

For now, many of the super PACs tied to the AI and crypto industries remain relatively unknown to many voters, allowing them to fly under the radar.

Americans associate political spending with more established industries, with a 29 percent plurality incorrectly identifying groups representing the oil and natural gas industry as the highest spenders in the midterms — ahead of AI and tech groups or crypto-backed organizations.

Just nine percent of Americans say they have heard of Leading the Future, the pro-AI super PAC, and only three percent have heard of Fairshake, the pro-crypto PAC. Meanwhile, 48 percent of Americans say they have heard of the National Rifle Association and 36 percent say they’ve heard of Planned Parenthood Action Fund.

“Until people realize where the money’s coming in from, a lot of people don’t judge it,” Renacci said. “But I do think if they see somebody is backed by crypto, that’s always going to be a problem, because, let’s face it, the people that I talk to in Ohio, they don’t understand crypto, and most say they’re not comfortable with [it].”

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Congress ends record-shattering DHS shutdown

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Congress ends record-shattering DHS shutdown

The House acted after weeks of delay to fund most Homeland Security agencies, which have gone unfunded for 76 days…
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House Republicans eye passage of Senate-backed DHS funding bill

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House Republicans eye passage of Senate-backed DHS funding bill

Speaker Mike Johnson has delayed a vote on the bill for more than a month…
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