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Business Observer Friday, Nov. 2, 2012 9 years ago

Probe of Citizens should be widened

Total transparency appears to be missing at Citizens Property Insurance. The governor should investigate Citizens' closing of its Office of Corporate Integrity.

There is a lack of oversight and accountability at Citizens Property Insurance Corp.

Citizens President Barry Gilway recently terminated every employee within the Office of Corporate Integrity. These firings came after reports of lavish, non-mission critical spending. Abusing travel expenditures is unacceptable; gutting the watchdog inside the insurer of last resort is incomprehensible.

We find it especially troubling that the four terminated employees were asked to sign additional confidentiality agreements beyond the code of ethics they already signed. The ethics code already addresses handling of confidential information related to claims and underwriting files, personnel files, information technology resources and other information of a sensitive or privileged nature.

What else might be covered in the new confidentiality agreements? What do these individuals know that Citizens wants to keep secret? Were these investigators let go because they were doing their job too well?

Accountability was missing from the Citizens Board of Governors meeting on Oct. 19. None of the board members questioned the move to eliminate the Office of Corporate Integrity. Citizens sent out a press release on Oct. 18 stating that the audit committee approved the changes, but Citizens changed its story in a follow-up release.

We appreciate Gov. Rick Scott's public concern and his request that Florida's chief inspector general scrutinize the wasteful travel expenditures. However, the focus of that investigation should be expanded to review the disbanding of the Office of Corporate Integrity.

Integrity Florida and Policyholders of Florida sent a letter to Gov. Scott asking him to do just that. State Sen. Mike Fasano, R-New Port Richey, echoed our call. Florida Chief Financial Officer Jeff Atwater also supports broadening the investigation to find out why the four internal government watchdogs at Citizens were terminated.

In an interview with the Associated Press, Citizens responded that it welcomed an investigation. We are encouraged that Gov. Scott and Gilway are open to an investigation into the closure of the Office of Corporate Integrity. We believe this independent review should be conducted as soon as possible, because Floridians deserve to know why four internal government watchdogs lost their jobs in the middle of the governor's investigation.

It is time for a closer look at Citizens' accountability, ethics, transparency, and compliance. As consumer advocate and government watchdog coalitions, we only can scrutinize and protect policyholders and taxpayers with public information. We rely on internal watchdogs, inspectors, investigators, auditors and a transparent process to prevent corrupt use of public money and to safeguard the integrity of the public sector.

It's also important not to lose sight of what's at stake — our recovering housing market. Floridians expect premiums to be used responsibly, and the market demands confidence in Citizens. Without this confidence, fewer new homeowners will enter the market. It will be too expensive and carry too much risk. We can't afford this scenario.

We must get to the bottom of why the culture at Citizens is so out of touch with its mission as the insurer of last resort. As a government-run corporation, Citizens needs a thorough review of its management practices and policies by the governor's chief inspector general. That's why Gov. Scott must expand this investigation.

Dan Krassner is executive director of Integrity Florida, a nonpartisan, nonprofit research institute and government watchdog whose mission is to promote integrity in government and expose public corruption. Sean Shaw is a former state insurance consumer advocate and the founder of Policyholders of Florida. He is an attorney with Merlin Law Group, a national firm that represents policyholders in insurance cases and has offices in Tampa, Coral Gables and West Palm Beach.

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