R.I. Governor To Meet with Two Beacon Directors He Wants Out

April 27, 2006

Gov. Don Carcieri this week offered to meet with two men he is trying to remove from the board of directors of Beacon Mutual Insurance Co., which is being audited by the state after allegations of questionable business practices.

The governor’s executive counsel, Andrew M. Hodgkin, faxed letters to a lawyer for George Nee and Henry Boeniger inviting them to a meeting on May 4. Last week, Carcieri said he wanted the men, both gubernatorial appointees, off the board of Beacon.

Beacon, a nonprofit independent corporation created by the state in the 1990s, controls more than 90 percent of the state’s worker’s compensation insurance market.

Earlier this month, a report commissioned by Beacon found that the company gave certain companies preferential rates on worker’s compensation policies, including a firm owned by Beacon’s former board chairman, Sheldon Sollosy. The report said the company also maintained “inappropriate relationships” with a group of insurance agents and their clients.

In response, the board last week fired President and Chief Executive Joseph Solomon and David Clark, vice president of underwriting. But Carcieri said he also wanted a shake up on the board and demanded that Nee, secretary-treasurer of the Rhode Island AFL-CIO, and Boeniger, who works for the Rhode Island chapter of the National Education Association, step down.

When they did not, he removed them. Both men had been on the board since 1994.

Nee and Boeniger contested the removal, saying they had a right to a hearing and were being discriminated against because of their ties to organized labor. They remain on the board for now.

In Wednesday’s letters, Hodgkin disputed those arguments. He said the governor did not have to agree to a hearing on the matter but would meet with the men and their lawyer.

“The governor is willing to hear your client personally,” the letter read.

A board meeting was in progress Wednesday evening, and Nee and Boeniger could not be reached for comment.

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