Citizens records show employees involved in bank fraud, viewing porn and gambling

sfrater@bradenton.comFebruary 28, 2013 

Citizens Insurance has released a 28-page report detailing nearly 500 cases of employee misconduct, including abuse, crimes and/or misjudgments since 2008.

The release Wednesday, as first reported by the Bradenton Herald, does not mention specific employee's names. But it could have far-reaching implications as the details are examined by the public and media in the coming days.

The move is part of a campaign touted by Citizens' President and CEO Barry Gilway to restore public confidence in the state-owned insurer, after a series of embarrassing disclosures involving Citizen employees, including some expense policy violations by Gilway himself.

The spreadsheet includes brief summaries of complaints received between 2008 and 2012 and their resolutions.

The documents include allegations of illegal gambling, pornography on workplace computers, employee falsification of academic credentials and criminal history, bank fraud, an employee "who drove a corporate vehicle and/or drove on corporate business with a suspended driver license and no auto insurance coverage," and an employee who "threatened to bring a firearm to work and kill the employees that she dislikes."

This comes as Citizens is working on legislation designed to move more policy holders into private insurance.

A member of the Florida Senate banking and insurance committee, Jeremy Ring, D-Broward, said he "was glad" Citizens released the details of the ethical inquires, but considered them "separate from the policy issues we're trying to deal with which are a real challenge."

Rep. Bryan Nelson, chair

of the House insurance and banking subcommittee, and an insurance agent from Apopka, called the ethics report "water under the bridge," saying he'd prefer to focus on the legislative support Citizens will need to achieve many of the reforms set out by the insurer's senior executives.

The new legislation, which may ultimately lead to a hike in insurance rates for Citizens' customers, is designed to offer homeowners more insurance choices.

State Sen. David Simmons, R-Altamonte Springs, chair of the Senate banking and insurance committee, said "Citizens is trying to drink from a fire hose," and that it is "lacking in controls and needs a solution to reduce its size and scope" back to being the insurer of last resort.

Simmons said he is meeting Thursday with Gilway with "a goal of giving him some legislative help, which I think is possible after discussions with Rep. Nelson."

Simmons said that the report released by Citizens today cataloging almost 500 inquiries into complaints or ethical lapses going back as far as 2008 is but "a symptom of a bigger problem. Citizens has lost its mission and focus."

Joe Martins, Citizens Property Insurance Corp.'s internal auditor, said a comprehensive review of 474 cases investigated since 2008 found that all complaints were addressed and corrective action taken in accordance with Citizen's policies in place at the time.

The majority of the investigations were prompted by calls and emails submitted by employees to the company's "Tell Citizens" hotline between 2008 and 2012.

"Where we found weaknesses, we are making necessary improvements to strengthen our complaints and disciplinary procedures," Martins said.

In October 2012, a revised complaint intake process was established that specifies Citizens' ethics and compliance officer reviews complaints as they are received and then refers them to the appropriate department. If deemed necessary, they are then sent to the Office of the Internal Auditor. The review was conducted following published concerns over the handling of internal complaints before changes were made last summer.

Gilway said the review is part of a comprehensive effort to identify areas where improvements can be made.

"This review is an important piece of Citizens' ongoing efforts to strengthen internal policies to ensure that our employees are held to the highest standards of corporate integrity," Gilway said.

Other steps taken since last summer include a restructuring of Citizens internal audit capabilities to more closely mirror to corporate best practices. Citizens is also bolstering travel and procurement policies to better conform to state guidelines.

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