Friday, September 16, 2005

An Independent Investigation Is Needed (Updated x 2)

"I've asked for my office to inquire," Bush said. "That was news to me, and it shouldn't be news to me, to be honest with you. I shouldn't read it in the paper, which I did."
The blossoming Citizens Property claims adjusting scandal ought to be the last straw in what has been a 13-month long display by Citizens Property Insurance Co. of incompetence, mismanagement, and worse. At a minimum, the state-owned corporation's claims adjusting practices have been thoroughly incompetent and deliberately indifferent to the legitimate claims of policy holders whose homes and businesses, in many instances, still lie in ruin.

At worst, it now appears possible they've been criminal, as well.

Every person is to be presumed innocent until proven guilty. That is a bedrock principle of our legal system and for sound reasons everyone should honor it. The principle applies to R. Paul Hulsebusch as firmly as it does to everyone else. Merely because allegations have been made that someone accepted a bribe or extended favored treatment to a previous business associate does not mean he is guilty. Not until and unless it is proven in court.

If the charges prove to be true, of course, heads should roll. But whose heads? The allegations reach so high up into the structure of the state-owned Citizens Property Insurance Corp. that there are only a very few heads left that could go on the block besides that of Mr. Hulesbusch himself.

The most obvious one belongs to Bob Ricker, CEO of Citizens Property Insurance Co. According to news reports, he's the one who initially hired Paul Hulsebusch. He certainly was the only person in a position to supervise Hulebusch on a day to day basis. He had to have been central to the decision-making process of recommending him for promotion as head of all Citizens Property's operations. And Ricker above all others should have known well in advance about the allegations being made by Universal Risk Insurance Services of Houston against his own subordinate.

Members of the Citizens' Board of Directors doubtless played a part, too -- a part that is equally deserving of close scrutiny. But they're unlikely to fire themselves. As for the state's Chief Financial Officer, Tom Gallagher, only the voters can get rid of him. He holds an elective cabinet-level office. (The people will have their chance next year in the gubernatorial primary and -- if Gallagher makes it that far -- the general election.)

Today's St. Petersburg Times reports that unnamed "Citizens' officials... said Thursday they have taken the allegations seriously. They hired former South Florida U.S. Attorney Marcos Jimenez and Miami accounting firm Lewis B. Freeman & Partners to investigate the allegations last week."

Who could those unnamed "Citizens officials" be? It's difficult to imagine, other than Bob Ricker himself or perhaps some committee of the board of directors. Yet, both have an obvious personal interest in seeing that any such investigation doesn't reach them.

Now that allegations of corruption and "bribery" of a Florida state official have surfaced, the matter warrants a thorough and scrupulously independent investigation into whether any Florida criminal laws have been broken -- and, if so, by whom. Good as they may be, Jimenez and Lewis N. Freeman & Partners can hardly be considered independent if they were picked by the very people who may share responsibility for this fiasco.

Governor Jeb Bush seems understandably irritated that he had to learn the week-old news "in the paper." He ought to be far more concerned that one of the highest-ranking executives of the state-owned Citizens Property Insurance Co. is being accused of corruption in the award of state business.

The governor had no hesitancy in asking state prosecutors to investigate whether criminal misconduct committed 15 years ago somehow contributed to Terri Schiavo's vegetative state. He certainly has it in his power to direct state prosecutors to investigate whether, in the here and now, any executives or directors connected with Citizens Property Insurance violated Florida criminal or civil laws while adjusting property claims over the last year.

The governor ought to insist on such an investigation at once.


Two hours after this post went up, the Associated Press reported that "Florida Chief Financial Officer Tom Gallagher opened a criminal fraud investigation Thursday into whether the head of the state's insurer for people who can't get private homeowners coverage took bribes to steer business to adjusters."

Thursday? Odd that Mr. Gallager didn't mention it until Friday evening. Odd, too, that he's using his own "agency's fraud investigators." [Update x 2: Ok, now the Dept. of Financial Services has posted an abbreviated press release dated Thursday, Sept. 15.]

So that would make two investigations pending so far, neither by a state's attorney or a full-fledged prosecutor with the power to put anyone away: one by Bob Ricker's chosen folk and the other by Tom Gallagher's subordinate employees. In the world of politics, timing is everything.

Here's another oddity: Mr. Gallagher is quoted as saying "[I]t's important we investigate whether or not there was some kind of things going on among the claims company and maybe an employee at Citizens."

An employee? Why investigate at all if you already know in advance there's room for only one person to be held accountable?

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