Taproots develop from the radicle of the seed, which forms the primary root. It produces branches called the secondary roots, and they in turn produce branches to form tertiary roots…very difficult to uproot – the plant itself gives way, but the root stays in the ground and may sprout again.
Who better than Judge Sarah Vance to do the digging and get to the fact of the Branch Consultants qui tam claim? None that I can think of considering the depth of research evident in the Order that Sop reported in Judge Sarah Vance Educates Insurers about Federal Court Jurisdiction in False Claims Act Cases – A Branch Qui Tam Update.
However, shortly after Judge Vance’s well-reasoned 69-page Order was issued, the Defendants filed for certification of an Interlocutory Appeal to the Fifth Circuit:
Relying on pre-Rockwell out-of-circuit decisions, this Court has reached a different conclusion, finding that Branch’s investigation of a publicly disclosed fraud provides direct and independent knowledge such that Branch is an “original source” whose allegations provide this Court subject matter jurisdiction. It is this question Defendants seek to have certified for interlocutory appeal: whether a “sleuth” like Branch, without first-hand involvement in an alleged fraud, can qualify as an “original source” by providing additional examples of a publicly disclosed, alleged fraudulent scheme.
Naturally, the Branch Consultants responded in Opposition:
…whether a particular case was decided pre-Rockwell or post-Rockwell misses the point. Instead, the relevant question is whether Rockwell overruled any of the legal points on which the Court based its decision. It did not, and Defendants do not argue otherwise. Continue reading “taproot – digging out the fact of Branch qui tam UPDATED”
Readers who asked to see the scheme series combined into single document will find it on the left sidebar under legal qui tam.
Although I don’t believe in Santa Claus or the Tooth Fairy, as one commenter suggested, I do believe the Rigsby sisters.
The scheme is not a fairy tale, as the commenter suggested. Instead, it represents the application of my experience to the evidence.
Contrary to comments made suggesting I find something amiss about the use of technology as a management tool, I wholeheartedly support such efforts and believe they are even more valuable when Six Sigma and similar measurement systems are integrated.
However, “systemic underpayment” of claims becomes even more likely when success is measured in terms of reduction of loss. When fortunes are made by investors swapping paper, there is nothing far fetched at all about the idea of swapping data to reduce loss.
The final post on the scheme follows; but, the end of the series is not the last word.
Then, in late August, Hurricane Katrina hit the Gulf States, where Allstate had significant exposure. Because Allstate had been in discussions with the rating agencies before Katrina and was able to demonstrate the outcomes of its modeling, the groundwork had been laid for frank discussions about the company’s capital management options following Katrina, Rita and Wilma. As a result of these discussions and strong underlying performance, even in the face of substantial losses, Allstate was able to demonstrate an effective post-hurricane capital management strategy and maintain its ratings.
With this quote left in comments fresh on my mind (h/t Steve), news of the new rules adopted by the SEC caught my eye.
We told you last month about the under-reported role of the credit ratings agencies in helping to cause the financial crisis. The problem, in a nutshell, is that the major ratings agencies — Moody’s, Standard & Poor’s, and Fitch — are paid by the insurers (often investment banks) who are issuing the bonds. That gives the agencies a clear incentive to produce favorable ratings, or risk seeing the banks hire a different ratings agency that’s willing to offer a better rating. (emphasis added)
Continue reading “SEC adopts new rules for credit rating agencies to protect against conflict of interest”
When Steve dropped by yesterday and mentioned the broad subject of the so called “science” behind the Slabberator (also known as an Enterprise Risk Management dashboard) being a target rich environment he was not kidding. Stick with me on this post folks – some of the concepts get complex but I think if we can connect enough dots, especially in light of the recent financial meltdown, it will make some sense to even the most financially challenged among us.
By now we have produced enough links to verify that the existence of this contraption dubbed the Slabberator by Editilla is a given including it’s use in risk management at the enterprise level.
To me this begs some questions about whether the logic behind the dashboard holds water, especially in light of the current financial meltdown and whether or not it could explain some of the kookier recent P&C industry moves such Allstate’s unsuccessful rate and document battle with noncaptured insurance commissioner Kevin McCarty and State Farm’s subsequent request for 47% rate increase in Florida despite it’s withdrawal from coastal markets there. IMHO the science behind the slabberator is bogus and ultimately results in ordinary people being slabbed through denial of claims or very high insurance rates. Let’s start with the link left by Steve last night here on slabbed and a bit more from the article on ERM itself.
In 2004, the company “officially went live” with ERM and committed to this quantitative approach to risk management. Allstate appointed a CRO who oversees both ERM and Six Sigma. Allstate believes that Six Sigma is an excellent set of tools to help reduce defects in processes and to help develop future leaders, thereby reducing the level of operational risk. Continue reading “The Scheme Chapter 6.1: Thoughts on the “Logic” Behind the Slabberator”
Yes folks it is real. We had to sell Nowdy’s youngest child into slavery to come by the screen capture.
Actually Rick was not lying about Greenberg’s buddy eating oysters at Drago’s with us.
We slabbers have spies everywhere. 😉
I hope Nowdy doesn’t mind but I took a peek at Chapter 6 of the Scheme series and thought I’d give out an advance teaser as it is so good. Look for the full post soon:
Technology dominated the market for handling claims of property damage following Hurricane Katrina with an on-going off-board version of the monopoly game – played with the insurance industry’s usual three-pronged response when a significant liability risk begins to emerge:
…limit its financial exposure under policies it has already sold by mounting an aggressive litigation campaign against coverage;
…influence public policy and legislation in a manner that limits its potential financial and legal exposure to such claims; and Continue reading “A Sneak Peek at the Scheme Part 6”