A Texas Department of Insurance Cover-up

Update to readers: After this piece appeared in the Fort Worth Star-Telegram Dave Lieber Watchdog column, the Texas Insurance Department changed its policy and restored open government. In August, 2012, State Senator Wendy Davis, D-Fort Worth, cited this episode in a letter to press release about a letter she went to Texas Gov. Rick Perry seeking the resignation of Texas Insurance Commissioner Eleanor Kirtzman. Here’s the original report, with slight updates.

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With governments everywhere moving much of the people’s business online for easy accessibility, the Texas Insurance Department took a big step in the opposite direction.

Until September 2011, the department, which promises to protect insurance customers, publicly released the names of insurance companies and agents who violated state rules. The September announcement, for example, noted that Great American Assurance Co. was fined $195,000 for failure to file policy forms or endorsements containing property and casualty benefits and that the Texas Windstorm Insurance Association failed to process claims in a timely manner or pay claims for storm damage that is a covered loss. Information on violators was also available in the department’s newsletter, TDInSight.

No longer.

Less than two months after Gov. Rick Perry appointed Eleanor Kitzman state insurance commissioner, the department abandoned its longtime practice of naming names. The information was still available, but with some heavy strings attached. You had to write and ask for it.

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For example, the most recent announcement, on April 25, says seven insurance agents had their licenses revoked and paid fines and restitution totaling $270,950. Want the names? Continue reading: “Copies of Commissioner’s Orders may be obtained by contacting TDI’s Public Information Office.”

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That’s an extra step that most consumers searching for the latest news on violators probably won’t take. And it protects the names of offenders since they will no longer show up in Internet search results.

I asked the department how many people had requested the list, and the answer was four.

The Watchdog asked the department for an interview with Kitzman. Spokesman John Greeley’s response? “The commissioner is not available for an interview.”

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Go figure. Online you can find out about all kinds of licensed professionals who get in trouble with the state. No problem finding out the names of nurses who get their licenses revoked or suspended. Actions by the Texas State Securities Board are a click away. The Texas Medical Board issues news releases naming disciplined docs.

The State Bar eventually reports the names of lawyers who run afoul of ethics rules. The Board of Architectural Examiners reports on architects who transgress, and the Department of Licensing and Regulation reports on auctioneers, barbers, electricians and 26 other occupations.

Alex Winslow, whose group Texas Watch monitors the Insurance Department, said Kitzman’s “job is to police the insurance industry and look out for the interests of policyholders. And if she’s sweeping these disciplinary actions under the rug, she’s doing the exact opposite. She’s covering the backsides of unscrupulous agents and insurance companies.”

Why is this information important?

“From a consumer’s point of view,” Winslow said, “that information must be public and must be available so that insurance customers know what they’re dealing with, whether it’s an unscrupulous agent or a company with a pattern of unfair claims practices. This is key information that insurance customers need when they’re making a decision about what agent and what insurance company to use, and how they’re going to spend their hard-earned money.”

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Gov. Rick Perry appointed Kitzman

I sent the Insurance Department questions but received only this statement: “TDI strictly enforces the Texas Insurance Code and takes prompt action when entities (companies or agents) violate the law. While not every regulatory action is equally newsworthy, TDI will continue to highlight enforcement actions of greater or broader significance, especially instances of fraud, to serve as a deterrent.”

Kitzman, originally from Texas, made a name for herself as South Carolina’s insurance commissioner. She’s also a close friend of South Carolina Gov. Nikki Haley. Kitzman ran as a Republican for South Carolina lieutenant governor in 2010. She collected more than half her donations from the insurance industry, according to reports. She lost, but when she learned about the Texas opening, she applied and was selected by Perry.

Kitzman has been accused by critics of politicizing her regulatory office. A month after taking charge, she served as a star attraction at a September Republican fundraiser that attracted insurance bigwigs she’s supposed to regulate. The event was for her mentor, Haley. But it also served as Kitzman’s coming-out party, held at the Las Colinas corporate offices of Ethos Group, an insurance and consulting company. The Texas Observer released a copy of the invitation that said, “Also in attendance will be the new Texas Commissioner, Eleanor Kitzman.” Suggested ticket price to meet Haley and the commissioner: $500.

Her ties to the industry may call into question the reasons the department decided to protect the names of the disciplined.

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Followup: After this piece appeared in the Fort Worth Star-Telegram Dave Lieber Watchdog column, the Insurance Department changed its policy. The names of those cited for improper actions were returned to the state website.

In August, 2012, State Senator Wendy Davis, D-Fort Worth, cited this episode in a letter press release about a letter she sent to Texas Gov. Rick Perry seeking Kirtzman’s removal from office.

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Do you want to learn more about how to expose government wrongdoing? How to protect yourself from bad folks in the insurance industry? How to fight for openness in government and business? These tips and many others are in the award-winning book by Dave Lieber, author of this story. His book Dave Lieber’s Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong, shows you how to fight back — and win! The book is available at WatchdogNation.com as a hardcover, CD audio book, e-book and hey, what else do you need? The author is The Watchdog columnist for the Fort Worth Star-Telegram. Visit our store. Now revised and expanded in a 2012 edition, the book won two national book awards for social change.

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A Texas appraisal district breaks open meetings law

For a year, the board of directors of the Tarrant Appraisal District has unknowingly violated the Texas open-meetings law that requires government bodies to post their agendas publicly 72 hours before a meeting.

The idea, one of the most basic in participatory democracy, is to alert the public to topics that might be of interest so people can attend.

In a random check with the Tarrant County clerk’s office to see who follows the 72-hour rule, The Watchdog found that the district had routinely missed the deadline.


Under state law, if the agenda is not properly posted 72 hours before a meeting, any votes taken during the meeting could be considered illegal. A concerned party could challenge the action in a lawsuit and nullify a vote.

“I am shocked,” district Executive Director and Chief Appraiser Jeffery Law said. “To hear you say we are the No. 1 violator — that absolutely blows me away.”

As readers of the Fort Worth Star-Telegram Dave Lieber Watchdog column first learned, Law said his office staff mails the agenda a week before each meeting to the clerk’s office. Apparently, the mail is slow in arriving. Month after month.

The law requires postings to be on a bulletin board in a place convenient to the public three days before a meeting. Weekends count as regular days. When an agenda arrives at the clerk’s office, it is immediately stamped with the date and time. Then it is posted on a bulletin board and on the county website.

The Watchdog compared called meeting times for the district with the time stamp from the clerk’s office. The deadlines for the June 17 and June 30 meetings were missed by one day and two days, respectively.

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Other missed deadlines for district meetings in the past year: April 22 (one hour), Feb. 15 (two days), Feb. 4 (four hours), Jan. 21 (one day), Dec. 3 (one day), Oct. 15 (90 minutes), Sept. 17 (one day) and July 9, 2010 (one day).

Theoretically, a taxpayer in dispute with the district could file a lawsuit challenging any actions taken at those meetings.

The clerk’s office can’t compel governments to follow the law. The Texas attorney general’s office says enforcement is left to local district attorneys. The Tarrant County district attorney’s office says unintentionally missed deadlines are not considered criminal offenses. Actions taken at these meetings are best challenged by interested parties in lawsuits.

Boards that do a good job of meeting the requirements include the Tarrant County Commissioners Court, Trinity River Authority, Tarrant Regional Water District and Tarrant County Hospital District, which has been known to cancel meetings if an agenda is posted a few minutes late.

Houston lawyer Joe Larsen, a board member at the Freedom of Information Foundation of Texas, said, “When you abridge the amount of notice you give, you are basically abridging the right of participation.”

“Until the people of Texas, the citizens of Tarrant County and any other county begin to take notice and make this an issue, the district attorneys are going to continue to ignore it because they get pressure from their co-officeholders not to enforce it and they don’t get much pressure from the public to enforce it. So to them, it’s an easy call.”

Law said: “I want to thank you for bringing this matter to our attention. It was never our intention to act in any kind of manner that would mislead the public or hide our meetings from public view.”

From now on, the district will post notices on its own website — www.TAD.org — in addition to the clerk’s office.

 “I am taking corrective action immediately beginning today to make sure that all of our meetings are held in strict compliance of the law,” Law said. “This is going to be fixed.”

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Fort Worth City Hall lawyer loses job over open records failure

Fort Worth has a reputation for being difficult to deal with when it comes to public records requests. A Star-Telegram examination last year showed that the city delays requests by going to the state attorney general far more than other Texas cities of its size.

I decided to test the system with a request. The results are worse than I expected. The city’s grade is an easy F, with no room for appeal.

Here’s what happened: On Nov. 11, I asked to see the e-mails and personnel record of a city police sergeant. On Nov. 29, the city asked the Texas attorney general whether it had to release the records, with a city attorney saying he believed that the records could be kept secret.

The attorney general’s office ruled Feb. 7 that the records should be released because the city failed to meet a legal deadline. The AG’s letter to the city states: “You have not submitted to this office comments explaining why the stated exceptions apply, nor have you submitted a copy or representative sample of the information requested. “Therefore, we have no choice but to order the city to release the information.”

Then I waited some more. Nothing.

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So on Feb. 28, I filed a complaint with the attorney general. A month later, the office notified Fort Worth of the complaint. Then on Saturday, April 2, at 7:16 p.m., the city attorney responsible for my request, C. Patrick Phillips, finally responded. He provided about 80 of the sergeant’s e-mails and other records, fulfilling my request.

“As for the delay in release of these records, I offer you my personal apology,” Phillips wrote in an e-mail. “Please trust that such delays are contrary to the intentions of the City Attorney’s Office, the Police Department, and the City of Fort Worth.”

Four days later, on April 6, Phillips’ employment with the city ended. One of his supervisors won’t say why.

“I can’t talk about the details of a personnel case, but he’s no longer with the city,” Deputy City Attorney Peter Vaky said. Vaky has been placed in charge of open-records management. He says he and new City Attorney Sarah Fullenwider are “taking steps to make sure that will never happen again.”

He declined to talk about what happened in my case, but he said there is no current backlog of requests in the open-records office.

Reached Friday, Phillips said he couldn’t comment. “Dealing with anything having to do remotely with a former client is not anything I can talk about,” he said. Phillips, 33, had worked in the city attorney’s office for four years.

Critics have said that the city relies on attorney general opinions on some requests to delay releasing the information. The city denies that.

In my test case, I requested information that had caused the city trouble once before. A Fort Worth police officer had sought the e-mails of the same police sergeant and couldn’t get them.

A year ago, when I interviewed Phillips about the matter, he told me that the officer had received all the available information. He explained that the e-mails probably no longer existed. “We just don’t have it,” Phillips told me last year.

Fetching the e-mails from a backup server would be difficult and unnecessary, the attorney general’s office had ruled. But the 80 e-mails that I received included ones that Phillips said the city didn’t have.

I checked last week with the officer who requested those records more than two years ago, and he still hasn’t received them.

Vaky declined to comment, saying he wasn’t familiar with what Phillips had done or said or why the e-mails had suddenly become available.

Last year, Phillips told me, “We know the process is ugly. … We would like it to get better.”

My test case shows that didn’t happen. But the city says it is now on top of it. We’ll see.

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Thanks to TexasWatchdog.org for picking up this story here.

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Texas Opens Meetings Law challenge could go to U.S. Supreme Court

Here’s the latest information on public officialdom’s assault on the Texas Open Meetings law.

A federal judge in West Texas ruled in April 2010 that the Texas Open Meetings Act can stand as it is. Public officials who break the law by holding secret discussions can be fined and go to jail. That hasn’t happened once since the law was passed more than 40 years ago. But that hasn’t stopped some officials from challenging the law.

The fight is not over. A lawyer challenging the law on the grounds that it violates public officials’ free-speech rights says his side will appeal. The case could end up in the U.S. Supreme Court, he says.

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Read the complete transcript of the Texas Opens Meeting Act trial here.

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The issue comes down to this: If a quorum of public officials talks to one another or to others about government business outside of an announced public meeting, are the officials violating the law?

Some elected officials say the answer is not clear. Different lawyers give them different answers. That causes confusion, they say.

“No one can answer that question as to what we can and cannot do,” says Arlington Councilman Mel LeBlanc, who testified against portions of the law at the trial.

The law “limits our ability to discuss matters legally with our constituents as well as other council members for fear of being prosecuted and imprisoned,” says Hurst Councilman Henry Wilson, who also testified at the trial.

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Keith Elkins, executive director of the Freedom of Information Foundation of Texas, says the court challenge is based on untruths. Public officials violate the law only if enough members to make up a quorum gather and talk about public business out of the public’s eye.

“If you have four or six council members sitting at a diner having breakfast and talking about sports or Justin Bieber, that’s not a violation of the Open Meetings Act,” Elkins said. “If they’re talking about city business, it is.”

And nothing in the law prevents a public official from talking with a constituent or answering a constituent’s question, he said.

He adds, “Public officials are held to a higher standard. If they are uncomfortable, perhaps they shouldn’t run for office.”

Rod Ponton, the city attorney for Alpine and one of the lawyers challenging the law, told me, “We think the district judge was flat wrong. … Every public official in Texas that deals with [the Texas Open Meetings Act] on a daily basis knows that his First Amendment rights are being infringed upon.”

He continued, “They talk about how they can’t talk with each other except at a meeting. They can’t communicate with each other the way the members of the Legislature do. That’s a chilling of political speech. You can talk about the weather. You can talk about sports. But you can’t talk about public matters. … There’s no reason they shouldn’t be able to have informal discussions among themselves all the time.”

If they did that, though, the public may not know how government decisions are made, critics say.

Under Texas law, notice of a public meeting must be posted 72 hours before it begins. The posting includes the agenda. Only what is posted can be discussed at the meeting.

The law allows for closed meetings when officials discuss certain matters such as real estate purchases, lawsuits or some personnel issues.

Here’s an example given by Hurst Councilman Wilson at the November trial that he says shows how his free-speech rights are being violated:

The city was looking at changing its gas-drilling ordinance to toughen water and air quality standards. Because the council couldn’t discuss the issue privately, Wilson testified, the questions instead were asked of Chesapeake Energy officials in a public forum.

“We generated a very severe adversarial relationship with the drilling company that we were really looking at doing business with because the city had sold a lot of their mineral rights or given permission to the companies,” Wilson testified.

He added, “It presented a problem in our relationship with Chesapeake. … We ended up having to air all our concerns and be on the opposite side of the issues in the public with them.”

In his ruling, released last week, U.S. Judge Robert Junell writes, “Open meetings enable public discussion and discourage government secrecy and fraud.”

Public officials “are merely asked to limit their group discussions about these ideas to forums in which the public may participate.”

He continued, “Governmental bodies have no First Amendment right to conduct public business behind closed doors. TOMA ensures that governmental bodies perform their duty, which is informing Texas citizens about public affairs.”

The same judge ruled similarly in 2006. Two years ago, his ruling was reversed by the 5th U.S. Circuit Court of Appeals. The case will now be appealed with that same Louisiana-based court.

If Junell is reversed again, the U.S. Supreme Court could eventually hear the case. At that point, the Texas case could have implications for open government across the land.

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Are you tired of fighting the bank, the credit card company, the electric company and the phone company? They can be worse than scammers the way they treat customers. A popular book, Dave Lieber’s Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong, shows you how to fight back — and win! The book is available at WatchdogNation.com as a hardcover, CD audio book, e-book and hey, what else do you need? The author is The Watchdog columnist for the Fort Worth Star-Telegram. Visit our store. Now revised and expanded, the book won two national book awards for social change. Twitter @DaveLieber

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Police officer can’t get records he wants despite Texas open records law

For the Fourth of July, 2010, I decided to play watchdog by sharing the story of the man with the noble idea that he can ask for and receive public information from a city government? It’s a true symbol of our freedom, our liberty, our right to know how we are governed, right?

Only when it isn’t.

Meet Dan St. Clair, who is one little piece in the puzzle that is the part of Fort Worth government that doesn’t seem to be working for a lot of people. He asked for public information 16 months ago. He never got it. The city admits it mishandled his request. It wasn’t until this week, with prodding from The Watchdog, that the city even told him that what he wanted is no longer available. (The reason it’s not available is something we’ll discover — and you may not like it.)

Recently, my colleague, Star-Telegram reporter Gene Trainor, reported that Fort Worth is one of the toughest cities from which to retrieve public records. It filed more requests for attorney general rulings than other cities its size. Critics call that a delaying tactic. “I can go to Euless and request the same information; they turn it over. Fort Worth — no,” a defense attorney told Trainor.

St. Clair is quick to agree. The 38-year-old retired Air Force captain has gung-ho ideas about what it means when you say government of the people, by the people, for the people. For the last three years, he has worked as a Fort Worth police officer. And in a move that seems to be from a TV detective show, he began investigating the behavior of a police sergeant who he fears may have railroaded a colleague off the force unfairly.

It takes guts to request records from your own employer. Here, in words worthy of the Fourth of July, is St. Clair’s reason:

“I don’t see it as a fight with the entire department. I see it as a fight with what I’ve seen is a very corrupt element of the department. If I’m trying to uphold the law and the lawyers for us are blatantly breaking the law, to me, there’s no place for that.

“When I was in the military, I didn’t let things like that slide. If someone was doing something wrong, I did what I could to take care of it. I want to take ownership of the job I have, which I believe is a public service. If I see something like this, I have to do something.”

In February 2009, St. Clair asked for e-mails and other computer terminal messages sent by a police sergeant while she was on duty. He believes that the sergeant sent messages stating her intention to remove the other officer from the force.

After St. Clair filed his request, the city missed deadlines for informing him about the status of the records. After agreeing to pay $71 for the records, he didn’t hear from the city for seven months.

The city told him that parts of the records had to be edited to delete confidential information. Eventually, he received three sets of squad car messages, the kind police send from computers in their cars, but they were almost all police-related checks of license plates and other data. There were few personal e-mails.

St. Clair knows that there were many more because he received some of them originally, he says.

Now the matter is before the Texas attorney general. The city acknowledges the screw-up. Assistant City Attorney Patrick Phillips wrote to the attorney general last week that “the city acknowledges that it has failed to comply with the time periods prescribed … in seeking a ruling from your office and recognizes that this failure results in the presumption that the information is public.”

But.

But the city has another argument to make. Phillips told me the city doesn’t have the information anymore. Why? E-mails and squad car messages are kept on the city’s computer servers for “not that long.”

Once e-mails are deleted from the system and removed from the servers, “we are not required to go to backup systems and backup tapes. … The attorney general’s office considers anything on a backup tape, that it’s no longer public information. … That’s a distinction made at the attorney general’s office, and we’re bound to follow.”

He may be right. In two open-records rulings for other government bodies, released in April, the attorney general’s office says that because e-mails are sometimes deleted from computers, “the data may be overwritten and permanently removed.”

To use backup tapes to retrieve old information, the attorney general’s office says, “the city would be required to restore data from the city’s back-up tapes onto a separate server. … Therefore, we find that any of the requested information that existed only in back-up tapes at the time of the request was no longer being ‘maintained’ by the city at the time of the request, and is not public information subject to disclosure.”

Read the two April 2010 opinions here and here.

Ouch. The Watchdog doesn’t like that. Did the city miss deadlines so that the information would be gone? The Library of Congress can accept an archive of every public tweet on Twitter since 2006, so electronic storage of records by governments should not be a problem.

St. Clair wants copies of messages that he believes he is entitled to have. He will apparently never see them, but until now, nobody bothered to tell him why.

“It’s not our ideal,” Phillips said. “We know the process is ugly. … We would like it to be better.”

Happy Fourth.

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Dave Lieber, The Watchdog columnist for The Fort Worth Star-Telegram, is the founder of Watchdog Nation. The new 2010 edition of his book, Dave Lieber’s Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong, is out. Revised and expanded, the book won two national book awards in 2009 for social change. Twitter @DaveLieber

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