Let's be realistic about New York Governor Eliot Spitzer, a man many in the mutual fund industry detest for launching the timing and late-trading investigations.

Facing resistance in his efforts to reform Albany, it is entirely feasible that Spitzer ordered two of his aides to get state troopers to dredge up whatever dirt they could on his archrival, Republican New York State Senate Majority Leader Joseph Bruno, and to leak it to the press.

What was discovered about Bruno turned out to be somewhat insignificant, that he used state aircraft to attend three major fundraisers and improperly ordered state police to accompany him.

What is significant, however, is that one of Spitzer's former aides, Communications Director Darren Dopp, citing executive privilege, is refusing to cooperate with a subpoena from the Albany County district attorney's office to turn over scandal-related documents. It was also leaked last week, from an inside source, that Dopp's sworn testimony that it was members of the media, not Spitzer, who asked him to spy on Bruno, doesn't jibe with personal records, in which he cites a command from Spitzer to discredit Bruno.

What is also significant is that while Spitzer saw fit to suspend Dopp, he didn't fire him.

Now the New York State Senate is also looking into whether Dopp perjured himself. It is also probing inconsistencies between Dopp's statements and those of Spitzer's former state police liaison, William Howard.

Separately, the New York Commission on Public Integrity is also conducting its own investigation, and the district attorney's office wants to speak to an attorney in the governor's office who helped draft the sworn statement that Dopp provided to New York State Attorney General Andrew M. Cuomo.

Cuomo already concluded in July that Spitzer's aides launched the attack against Bruno. To think that a man with as much power, ambition and bite as Spitzer had close aides operating a smear campaign and manipulating the media without his knowledge is ludicrous. And if it is at all possible that they did so without his knowledge, at best, Spitzer is an ineffective leader.

Either way, Troopergate continues to haunt him.

(c) 2007 Money Management Executive and SourceMedia, Inc. All Rights Reserved.

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