Texas Fraud Committee Gearing Up for Legislative Action

Acknowledging that nothing significant would happen until after the Texas Legislature closes out its special session on school finance reform, members of the Texas Committee on Insurance Fraud pushed forward recently on efforts to define issues they would like the legislature to address when it convenes for the regular session in early 2005.

Opening an April 20, 2004 meeting at Texas Department of Insurance, committee Chairman Craig Sparks said one major initiative of the group is to assist TDI in encouraging district attorneys across the state to prosecute insurance fraud more vigorously. He applauded Insurance Commis-sioner José Montemayor for funding and placing a special insurance fraud prosecutor in the Dallas County District Attorney’s office. He also commended District Attorney Bill Hill of Dallas County for being the first in the state to accept a TDI sponsored special prosecutor.

It was noted that Dallas County and Harris County account for about 50 percent of the fraud cases in Texas. The committee is working with Monte-mayor to try and convince the Harris County District Attorney’s office to accept a fully funded special prosecutor, as well.

Members of the committee—whose numbers include insurance trade associations, insurance companies, regulators, law enforcement professionals and others—reported on the items various subcommittees wish to see included in draft legislation.

Common legislative goals include strengthening and enhancing the insurance code and statute, and the penal code, to broaden the definition of insurance fraud, increase the penalties for committing insurance fraud and give investigators more tools to combat fraud schemes.

Shannon Phillips, an attorney with Thompson, Coe, Cousins & Irons LLP, is assisting the committee in developing its legislative proposal. She said it is best to pre-file proposed legislation 30 to 60 days before the session begins so it will get priority treatment.

“Ask big,” Phillips said. “Ask for everything you want because we need some bargaining room.” Phillips also told the group to be specific about what they want, but warned not all ideas are suitable for legislation. She set a Labor Day deadline for the subcommittees to submit their proposals.

The committee plans to meet again at the end of July to fine tune its legislative agenda.