Oklahoma Commissioner: Weapons Necessary for Safety of Anti-Fraud Unit

December 4, 2012

Defending his agency’s expenditures on weapons and police vehicles for use by its anti-fraud unit, Oklahoma’s top insurance regulator said the purchases help ensure the safety of investigators and are not paid for with taxpayer money.

The Oklahoma Insurance Department spent more than $180,000 on high-tech shotguns, bulletproof vests and seven police-package vehicles, according to an Associated Press report. In that report, several state lawmakers questioned why the agency’s nine-member anti-fraud unit which primarily investigates white-collar crimes needs equipment typically used by police officers and SWAT teams.

Oklahoma Insurance Commissioner John D. Doak responded to that criticism with the following statement:

“I’m happy to address any concerns people may have. I am very proud about what our Anti-Fraud Unit is doing, especially since it doesn’t come at taxpayer expense. The Unit includes former OSBI agents, Tulsa homicide detectives, and other long-time law enforcement veterans. They are some of the most experienced criminal investigators in the state of Oklahoma.

“They investigate serious crimes including embezzlement, exploitation of the elderly and fraud. We’ve had cases where victims lost their life savings. We helped track that individual all the way to Florida where he was arrested.

“Our investigators also respond to natural disaster scenes, looking for unscrupulous contractors and making sure vulnerable consumers aren’t victimized for a second time.

“Protecting Oklahomans is my top priority. I will do whatever I can to keep them and my investigators safe. The best part about the Anti-Fraud Unit is that it’s funded by fines, penalties and multi-state settlements, not taxpayer dollars.”

The Oklahoma Insurance Department noted that in last two years the OID has returned $10 million to the state that the OID was legally authorized to spend. In fiscal year 2011, the OID deposited $121,055,455 into the General Revenue Fund; $59,884,843 into the Firefighter’s Pension Fund; and $24,648,957 into the Police Pension Fund.

Ramping up security for Oklahoma’s anti-fraud unit has partly been in response to a case in Louisiana last year in which two fraud investigators were shot and killed during what should have been a routine trip to collect records from a suspended insurance agent who later shot himself.

Louisiana Insurance Commissioner James Donelon, in a statement released by the OID, said he plans to ask lawmakers in his state to provide similar protection for some Louisiana Department of Insurance investigators.

“I certainly support any actions that other states’ insurance departments take, including those taken by Commissioner Doak in Oklahoma, to increase the level of personal safety for their fraud investigators,” Donelon stated. “Louisiana was sadly alerted to the fatal dangers facing insurance fraud investigators when we lost two of our exemplary investigators last year while on a simple investigation. Since then we have revised our internal procedures and added an additional level of threat recognition awareness training for our fraud investigators and I plan to ask the Louisiana Legislature in the upcoming session to arm some of our investigators. I hope that no other lives will be lost in this vital activity of states’ insurance departments, due to a lack of personal safety for the investigators.”

Kim Sledge and Rhett Jeansonne were killed during what had been on what appeared to be a routine assignment to collect records from suspended insurance agent John Melvin Lavergne at his office in Ville Platte, La., in June 2011. State police said Lavergne shot the investigators, holed up in his business and shot himself to death while the building was surrounded by officers and SWAT team.

Donelon said shortly after the incident that the department was considering arming some of its fraud investigators.

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