The announcement in the Sun Herald mentioned Deputy Commissioner of Insurance Lee Harrell was leaving the Department to join a law firm.
The Mississippi Insurance Department’s deputy commissioner, Lee Harrell, is leaving after 16 years to work for Baker, Donelson, Bearman, Caldwell and Berkowitz law firm…Harrell spent most of his career under former Insurance Commissioner George Dale, who was defeated for re-election in 2007. Dale, the nation’s longest-serving commissioner, now works in the government relations department of Adams and Reese law firm.
Unlike Dale, Harrell is an attorney. He was unavailable for comment Wednesday. Chaney said Harrell will focus on insurance cases in his new job. Baker, Donelson represents insurance companies and policyholders…Harrell oversaw a market conduct study of State Farm after Dale’s departure. (emphasis added)
Anita Lee, of the Sun Herald, recently reported that the deputy insurance commissioner who “oversaw” the Mississippi Insurance Department’s Market Conduct Study of State Farm following Hurricane Katrina has left the Mississippi Department of Insurance. Guess who hired him? The lawyers who represent State Farm in Hurricane Katrina matters.
Given this, you do not need to be a psychic to guess how well State Farm did in the Study. I noted the serious problems with the Mississippi Insurance Department study in a previous blog. In an article published in the Sun Herald, a noted consumer advocate wrote that State Farm could have written the report itself. Only legislation which prevents those regulated from hiring, directly or indirectly, those who recently regulated them can prevent this kind of conflict of interest.
This revolving door has a particularly interesting “spin”.
After Hurricane Katrina ravaged the Gulf Coast in 2005, thousands of homeowners received only small payouts for wind damage from their insurance companies, most of which didn’t cover flooding. In cases brought by the Katrina Litigation Group (formerly Scruggs Katrina Group), hurricane victims sought to have a greater portion of their damages covered by their insurers.
Welch, a shareholder in the Jackson office of Baker, Donelson, Bearman, Caldwell & Berkowitz, represents one of those insurers. He was the lead trial counsel for a major insurance company in cases filed by the attorney general of Mississippi, the Katrina Litigation Group and related putative class actions. He was hired shortly after the attorney general of Mississippi filed a case against several insurance companies seeking to have a part of their policy declared void.
The depositions of Lee Harrell in his capacity as Deputy Commissioner make for interesting reading in this new light – as does the MID market conduct survey.
Time will tell if and how Mississippi’s Ethic’s laws, including these provisions at 23-4-105 of the State Code, fit in this picture:
(e) Perform any service for any compensation for any person or business after termination of his office or employment in relation to any case, decision, proceeding or application with respect to which he was directly concerned or in which he personally participated during the period of his service or employment.
(5) No person may intentionally use or disclose information gained in the course of or by reason of his official position or employment as a public servant in any way that could result in pecuniary benefit for himself, any relative, or any other person, if the information has not been communicated to the public or is not public information.
(6) Any contract made in violation of this section may be declared void by the governing body of the contracting or selling authority of the governmental subdivision or a court of competent jurisdiction and the contractor or subcontractor shall retain or receive only the reasonable value, with no increment for profit or commission, of the property or the services furnished prior to the date of receiving notice that the contract has been voided.
At least the slabbed no longer have their taxes paying his salary.