R.I. Gov. Carcieri Pulls Nomination Of Beacon Mutual Whistleblower

June 21, 2007

The fallout from the management scandal at Rhode Island workers’ compensation insurer Beacon Mutual Insurance Co. continued this week, even as the insurer unveiled its board of directors.

Rhode Island Governor Donald L. Carcieri yesterday withdrew the renomination of Adelita Orefice as director of the Department of Labor & Training that had been scheduled for a Senate committee vote yesterday.

Carcieri said he withdrew Orefice’s nomination after receiving word that a prominent union leader with ties to former Beacon Mutual management had convinced Senate leadership to vote against her.

Carcieri accused the Senate of planning to reject Orefice’s nomination in retaliation for her decision in 2006 to disclose the result of a damning internal audit at Beacon Mutual Insurance Co. That revelation led to a number of investigations and the expulsion of several union leaders, including George Nee, from the insurer’s board of directors. Beacon Board members, including Nee, were paid $20,000 per year.

The state labor chief has a seat on the Beacon Mutual board.

The governor vowed that he would not allow union leaders and their Senate allies to exact “political retaliation” against Orefice as payback for blowing the whistle on the illegal activities at Beacon Mutual.

“It is clear that the Senate planned to reject Director Orefice’s nomination as political retaliation for standing up to organized labor and defending Rhode Island taxpayers,” Carcieri said. “Members of my staff have been told that her nomination was doomed to failure.”

Carcieri defended Orefice, who he said has served with “great distinction” since he first appointed her to the post in March 2004.

“It is shameful that the Senate Labor Committee has decided to put politics before the best interests of the Department of Labor and Training. This is just another indication that the union leadership is actually in charge of the Rhode Island State House,” he charged.

He pointed a finger at former Beacon Mutual leaders, including former company director Nee.

“Unfortunately, the people responsible for the corruption at Beacon Mutual are using this confirmation vote to exact revenge,” Carcieri said. “In the last few days, we understand that George Nee — who lost his seat on the Beacon board in the wake of the scandal — has been actively lobbying against Adelita’s re-confirmation. He has even gone so far as to personally warn people not to testify on her behalf.”

“Elected representatives should not be taking orders from labor bosses. Senators should not be attacking a good public servant in order to pay off their union allies,” he said.

The governor said Orefice will continue to serve as a holdover until she is reconfirmed or another nominee takes her place.

“I am hopeful that, over the course of the next six months, cooler heads prevail and the Senate will decide to give her a fair hearing next session,” Carcieri added.

Meanwhile, the Beacon Mutual Insurance Co. board of directors unveiled a slightly revamped board that includes H. Robert Bacon, a new member, and John F. Treanor, who was named by Carcieri.

Bacon is vice president of operations for the Gregg’s Restaurant group.

Treanor is the president and chief operating officer of The Washington Trust Co. and also serves on the board of Meeting Street School and as vice chairman of Hospice Care of Rhode Island. Treanor replaces Col. Brendan Doherty, who left in April after being named superintendant of the state police.

Policyholder appointees Richard J. DeRienzo, board chairman and a managing principal of Providence-based accounting firm Lefkowitz, Garfinkel, Champi & DeRienzo PC, and Carol Saccucci, vice president of Saccucci Honda Lincoln Mercury in Middletown, were re-elected to four-year terms.

Beacon’s other board members are James V. Rosati, president and CEO; Sister M. Therese Antone, president of Salve Regina University; Raymond Coia, a coordinator with New England Laborers’ Tri-Funds; Adelita S. Orefice, the director of the R.I. Department of Labor and Training; and Michael Ruggeri, president of the Rhode Island Building & Construction Trades Council.

Beacon Mutual is the largest writer of workers’ compensation in the state.

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