Calif. State Fund Investigation Closed

March 10, 2011

The Joint Task Force comprised of the California Highway Patrol (CHP), the California Department of Insurance (CDI) and San Francisco District Attorney’s Office has reportedly completed its four-year investigation of former California State Compensation Insurance Fund employees and directors.

In March 2007, as a result of its own internal investigation, State Fund’s Board terminated the appointments of two executives — former president Jim C. Tudor and former vice president of group programs Renee Koren — based on what it termed an “unacceptable” operation of the insurer’s administrative fee program. State Fund turned over the results of the internal investigation to the CHP in June 2007.

Since that time, the workers’ compensation insurer has been cooperating with the Task Force in an independent State Fund investigation.

“While State Fund provided substantial cooperation to the Task Force, the findings of the investigation are a law enforcement matter and will continue to be handled as such,” State Fund said in a statement. “Any questions about the Task Force’s work or the charges that have been filed should be directed to the Task Force. The District Attorney’s office is notpursuing any criminal charges.

Meanwhile, State Fund emphasized that since 2007, it has embarked on a significant transformation of its operations. Among the changes are:

  • A new, reconfigured leadership team comprised of industry experts and an expanded, more diverse and dynamic board of directors.
  • State Fund now operates under the Bagley-Keene open meetings act and the California Public Records Act as required by SB1145 and AB 1874, which State Fund sponsored in 2008. This has increased the organization’s transparency and strengthened its corporate governance.
  • Enhanced customer service.
  • State Fund’s financial position remains strong, and is a vital and necessary resource for California’s economy providing security for California’s businesses and employees.

“While proud of the progress we have made since 2007, State Fund remains committed to a process of continuous improvement. That is why, although State Fund is a very different organization than it was four years ago when we began the arduous but fruitful process to transform our operations, we are not stopping here,” the insurer said.

State Fund said it is focused on repositioning its operations to become “a more efficient and agile insurer” that is equipped to effectively manage the cost of workers’ compensation insurance for all Californians. “Over the next several years we will focus on operating efficiently, pricing fairly and delivering excellent services,” it said.

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