TALLAHASSEE -- The corporate watchdogs who were recently fired from Citizens Property Insurance Corp. had uncovered evidence of favoritism, improper compensation and poorly handled investigations at the highest levels of the state-run company.
A report reviewed Friday by Citizens’ Audit Committee shows that one of the final investigations conducted by Citizens’ Office of Corporate Integrity targeted top senior officials at the company. The four corporate watchdogs were investigating how Citizens had handled previous allegations of sexual harassment, drunken disrobing, irregular severance payments, falsified documents and other improprieties by employees.
All four investigators were given termination notices last month.
The report released Friday “focused on the mishandling of investigations, the mishandling of discipline and the mishandling of Citizens’ funds,” said Chief Internal Auditor Joe Martins, who recently decided that the Office of Corporate Integrity was no longer needed at Citizens.
The investigation by the now-terminated employees found that, among other things, Citizens:
• Gave large severance packages to some top employees accused of misconduct, including more than $80,000 to an underwriting executive who resigned after being accused of “inappropriate behavior” with another employee.
• Gave only a warning to its deputy director of human resources after she got drunk at the Coyote Ugly bar in Tampa, removed her bra and danced on top of a table during a company retreat.
• Failed to complete certain investigations or did not file them into the official complaint system, potentially shielding them from public view. Certain employees were shown favoritism after they were discovered breaking company policy.
Citizens declined to respond to several follow-up questions about the various allegations, stating that more public records would be released on Monday.
The state-run insurer disbanded its Office of Corporate Integrity abruptly in October, terminating all four members and presenting them with confidentiality agreements. The move sparked rebuke from government watchdogs, state lawmakers and Gov. Rick Scott, who had recently called for an investigation into lavish corporate spending at the company.
The reports of corporate excess and impropriety come at a time when Citizens is raising insurance rates on homeowners and slashing coverage to reduce risk on its 1.4 million policies.
Citizens said the move to terminate the four investigators — T.W. Smart, Selisa Daniel, Melanie Yopp and Meghan Walker — was actually a restructuring effort aimed at beefing up its fraud detection system and “avoiding unnecessary redundancies.” The company is currently looking to hire new fraud detectors. Citizens categorically denied that it had eliminated the OCI as a way of silencing the investigators.
The report reviewed Friday is the first evidence of what the Citizens investigators were doing shortly before they were told their services were no longer needed.
In March, an anonymous tipster complained that Citizens had mishandled internal investigations, spent funds on improper severance agreements and shown favoritism to certain employees engaged in misconduct. The accusations implicated some of the highest-ranking executives at the multibillion-dollar insurer.