By Edith Honan

NEW YORK (Reuters) - Eric Schneiderman's rivals are painting the New York state attorney general candidate as the ultimate insider, a state senator in a corrupt institution who has won the endorsement of some of the state's leading Democrats.

Schneiderman practically embraces the idea, agreeing that the state government in Albany is "an absolute mess" and that his in-depth knowledge makes him the best candidate to restore public confidence in state government and Wall Street.

"The notion that someone who doesn't understand how Albany works can come in and start reforming it is absurd," Schneiderman, 55, told Reuters in an interview.

"The job of the next attorney general is to restore confidence in the markets and in the financial services industry. We need to get rid of this public sense that all the games are rigged," he said.

Schneiderman is one of five Democrats competing for the nomination to succeed Andrew Cuomo and before him, Eliot Spitzer, as the state's chief prosecutor after Spitzer turned the office into an aggressive enforcer of financial crimes.

The winner of Tuesday's primary will face Staten Island District Attorney Dan Donovan, the lone Republican running in the heavily Democratic state, in the November 2 general election.

Schneiderman has the endorsements of the New York Times, the Albany Times Union, good government group Citizens Union as well as prominent black, Latino and labor leaders.

He has also been endorsed by, and has accepted money from, many of his senate colleagues, a fact his opponents say should disqualify him for attorney general.

Recent polls show that New Yorkers are disgusted by what they see as dysfunction and corruption in the state capital, and ethics reform has figured prominently in the race.

Schneiderman said disparaging legislators for their association with state government "is sort of like saying that anyone who has worked on Wall Street is a crook," and said he has a proven track record as a reformer.

TRAINING AND TEMPERAMENT

Schneiderman said he has not only the right training but the right temperament to be attorney general and that the "Sheriff of Wall Street" tag is as important as ever, given the fragility of the economic recovery.

"I think the New York attorney general will always be the Sheriff of Wall Street. I think it's something that is now a part of the job description," Schneiderman said.

"I do draw a distinction, though, between pursuing the bad actors in the financial services industry and sliding into the generalized attack on capitalism," he said.

Schneiderman's rivals for the nomination are state Assemblyman Richard Brodsky, Nassau County District Attorney Kathleen Rice and two lawyers with long histories taking on white collar crime: Eric Dinallo, a former assistant attorney general under Spitzer, and Sean Coffey, a former Wall Street lawyer who has represented wronged investors and firms.

Before entering the senate in 1998, Schneiderman, a Manhattan native, attended Harvard Law School and spent 15 years in private practice, where he took on white collar and public interest cases.

In the senate, he has pushed for ethics reforms, overhauling the state's archaic Rockefeller drug laws and expanding legal recourse for the wrongfully convicted.

"I have been acknowledged for ... being a fighter for reform even in the chaos that is the state senate," Schneiderman said.

Since Spitzer held the job from 1998 to 2007, the post of New York attorney general has been among the most high profile in the country, and for Spitzer and Attorney General Andrew Cuomo it also became a launching pad for higher state office.

Spitzer successfully ran for governor in 2006 and Cuomo is the Democratic front-runner this year, though Spitzer resigned in 2008 when he was caught in a prostitution scandal.

(Reporting by Edith Honan, Daniel Trotta, Grant McCool, Joan Gralla and Basil Katz; Editing by Padraic Cassidy)