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Exodus of Citizens executives to companies with contracts raises questions

In the past three years, at least three senior executives at Citizens Property Insurance who were in charge of multimillion-dollar contracts awarded to private companies went to work months later for those same companies.

Florida’s ethics laws ban state employees from going to work for a company for two years if their duties for the state job involved a contract related to that company. But Citizens, the state-run insurer of last resort, reads the statute more narrowly. Its executives say no one has done anything wrong.

Critics, however, say the situation is evidence of a revolving-door mentality at the public company that handles millions of dollars in contracts each year, and add that it raises serious questions about the fiscal management of the company, whose claims will be paid by taxpayers if Citizens runs out of money after a storm.

“Every dollar you don’t spend is a dollar that goes to pay somebody’s claim,” said Sean Shaw, the former Florida Insurance Consumer Advocate from 2008-10. “They should have a moral compass that says, ‘This is taxpayer money. We are going to be as careful as we should with our own pocketbook.’ ”

The head of the Florida Senate Banking and Insurance Committee, Sen. David Simmons, is calling for the ethics law to be tightened relating to Citizens’ contracts and has ordered Senate staff members to draft legislation to do that.

The exodus of senior staff members from Citizens — the state’s largest insurer — to companies hired to handle Citizens claims or provide services includes:

• Yong Gilroy, former chief insurance officer at Citizens, who while working for the state signed two five-year contracts in 2013 with Bankers Insurance Group — one for $209 million divided among five companies to provide telephone and other communication services after a major storm, and another for $9.1 million for temporary staffing services. In January 2014 Gilroy went to work for Bankers Financial Services, a subsidiary of Bankers Insurance.

• Lance Malcolm, former vice president of claims at Citizens, who in May 2013 supervised and presented to the Citizens board the renewal of a contract with Crawford & Co. worth $8 million for adjuster services. In September 2013, he was hired by the company.

• Eric Ordway, former head of claims at Citizens, who supervised an $8 million contract under an emergency exemption in 2010 to hire BrightClaim for claims management, oversight and supervisory services for large policy holders. The contract was effective through June 2013. Ordway was hired by BrightServ, a subsidiary of BrightClaim, in January 2013.

The Herald/Times asked Citizens and its general counsel, Dan Sumner, to review each of these circumstances, and in each case Citizens concluded the employee broke no ethics laws. More here.


Read more here: http://www.miamiherald.com/2014/05/31/4150359/conflict-laws-different-for-citizens.html#storylink=cpy

Comments

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Bill Thompson

Citizens is a GOP cesspool of corruption and thievery. They confiscate policyholders money and use it as their own and live high off of it. There is little or no oversight by the GOP controlled legislature and directors are not exercising their responsibilities. Pigs chowing down at the trough of policyholders confiscated money.

ed jenkins

This type of article is exactly why the citizens do not want their government involved in anything but the bare minimums of law enforcement, courts, schools and transportation infrastructure because all government activities are subject to corruption and waste. The citizens have long called for an end to this most terribly conceived idea of government backing of insurance companies which can subject taxpayers to great risks of loss that they had no idea they were even taking on and is an activity that can be done and is done in many other places by private businesses.

Bill Thompson

The scumbag Scott should be impeached for allowing this unethical activity to take place under the oversight of his cronies with his blessing in the cesspool that is Citizens. complete lack of integrity in this horrible man's administration. The pam lady is no better. I would mention the insurance commissioner too, but we don't have one since the position was emasculated.

MarvinM

Bill's right about the insurance commissioner being 'emasculated' by the current governor.

http://www.huffingtonpost.com/wendell-potter/florida-insurers-are-now_b_3785206.html?utm_hp_ref=rick-scott

This one thing alone is reason enough for me to not vote for RS in the upcoming election.

But RS compounds it with many more things I find offensive, such as continuing to waste money on lawsuits to try to have his "drug test the poor" laws found constitutional and now the AG pursuing (at Floridian's expense) a suit to not recognize same-sex marriages legally performed in other states.

Then there's not extending unemployment benefits, and then creating a website that everyone who wanted UBs couldn't actually use because of 'glitches', and not expanding Medicaid and not going ahead with high-speed rail (a good portion of which would have been funded by federal dollars, which, when Scott refused them went to other states, not back into the pockets of taxpaying Americans).

We thought the fact that RS was chief involved in a huge Medicare scam fraud and escaped conviction essentially by pleading the 5th would be enough to keep him out of the governor's chair, but sadly we were wrong.

How much more does it take to convince people that Rick Scott is no friend of the backbone of the Floridian economy, the everyday working guy (and gal)?

His policies have only enriched himself and his fellow wealthy buddies and/or positioned them to be kept in power to keep that money and influence (redistricting lawsuit currently in progress is an example).

Get out and vote. Write in your dog's name for governor if you really feel you have to, but get out and vote!


ed jenkins

As we have seen there are a small minority of citizens who wish to mooch off their neighbors either by having government confiscate more of their money after massive storms that they did not realize they were on the hook for because some irresponsible citizens do not want to pay market rates for insurance which would result in proper decisions when buying homes.

It is even more distressing that are still a small amount of citizens that want moochers to be able to use taxpayer confiscated money for illegal drug use, to pay citizens not to work, to pay for their medical bills, transportation bills or other bills when the citizens have set up charities for those truly in need. The citizens do not consider those in need to be those that poorly budget, spent large sums of moneu on extravagant meals, luxury homes and autos or even worse dangerous illegal drugs.

Thankfully the citizens have this scott who will uphold their views and values and was initially doubted as a political novice but has won over the citizens with his exemplary fiscal stewardship.

joe blow

Vote for Charlie Crist and vote OUT many Republicans as you can!

Anti-Tallahassee

The Republicans have been in power WAY TOO LONG. They believe they are above the law, outside the Constitution, and accountable to no one. Once they saw someone as corrupt as Scott get elected, they knew the people were too foolish to understand their greedy goals of using public resources for personal gain. Let's hop the people of Florida have woken up and they are a lot smarter than ed jenkins.

Bill Thompson

The scumbag Scott will be signing a record spending budget this week for Florida that is full of GOP pork projects, instead of being a great steward of taxpayer confiscated funds and using it to pay down the state's debt instead of borrowing more in order to fund these pet GOP pork projects. This horrible man claims to be a fiscally prudent caretaker of the taxpayers funds, but it's not true; he is spending like a drunk sailor on GOP pork projects and granting favors to his favorite corporate campaign donors.

Think before you complain!

You people are dilusional if you think there is waste and excess at Citizens.

While there may be cases of people taking jobs here and there... I seriously doubt anyone will find any decisions by those leaving that went unchecked by at least one or two other people before a contract was finalized.

That said, these folks don't have expense accounts, auto allowances, or private jets like the big private insurance companies have....

So if you want to compare administrative expense percentages - at least do so on an apples to apples basis before you complain and show your ignorance.

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