Jim was kind enough to share this week’s column with us including fresh rumors from the Louisiana Department of Insurance that explains why they did not cooperate with the investigation that lead to the indictment of Citizens former CEO Terry Lisotta. – sop
Thursday, December 11th, 2008
Baton Rouge, Louisiana
LOUISIANA CITIZENS INSURANCE SCANDALS CONTINUE TO GROW
A year ago, it would have been hard to imagine that conditions at Citizens Property Insurance Company could get any worse. The state created and state run company was in debt by over $1 billion. The Rouge Business Report called Citizens the biggest financial disaster in the state’s history. But never underestimate the ability of some state agencies to make a dysfunctional situation go from bad to worse. The Board governing Citizens, that includes statewide elected officials, has shown little oversight of the Companies’ spending and management decisions, sparking not only criticism from the Legislative Auditor in Louisiana, but also provoking major investigations by both state and federal law-enforcement agencies.
The latest Citizens scandal boiled over last week when the former CEO was indicted with 14 counts of theft by fraud, filled with allegations that he spent more than $285,000 on questionable expenses including airline tickets, meals, retirement gifts and stays at lavish hotels. But his attorney said last week that his client is being singled out and “used as a scapegoat” in the poor management of the insurance company. Sources close to the investigation seemed to agree, saying that the latest indictments are just “the tip of the iceberg.”
The whole controversy has significantly elevated due to the resistance of Louisiana’s Insurance Commissioner to turning over some 2000 e-mails requested by the Legislative Auditor’s office. Continue reading “Jim Brown on Louisiana Citizen”