Florida Chief Financial Officer Jeff Atwater’s Money Services Business Workers’ Compensation Fraud Work Group Reviews Draft Report at October 6 Meeting

Florida Chief Financial Officer (“CFO”) Jeff Atwater’s Money Service Business Workers’ Comp Fraud Work Group (“Work Group”) met on October 6, 2011, to discuss its draft report on the relationship between perpetrators of workers’ compensation fraud and the money services business.  The meeting was facilitated by CFO Atwater’s Legislative Director Ashley Mayer and Florida Insurance Consumer Advocate Robin Westcott.

Ms. Mayer opened the meeting by saying that the recommendations within the report focused on facilitating the flow of information from regulators to the Florida Division of Insurance Fraud. 

There was much discussion of the recommendation relating to the Proof of Coverage Web site (“Web site”) maintained by the Florida Division of Workers’ Compensation.  The recommendation in the draft report suggested that payroll information should be included on the Web site, and that contractors should be required to check it.  Work Group members discussed the ability of contractors to check the Web site and whether its information was up to date.  Much of the discussion centered on the fact that the policy information available on the Web site is not updated and is only reported at the inception of a policy.  During testimony, construction industry representatives showed resistance to being required to check the Web site, but pointed out that most contractors are now accustomed to checking it, even though it is not required.

The Work Group also discussed whether the Florida Office of Financial Regulation (“OFR”) has the necessary tools to oversee the money services business industry and agreed that the OFR should not be tied to the five-year examination schedule currently prescribed by Florida law.  Rather, the OFR should be given the flexibility to perform risk-based examinations and unannounced visits. 

OFR Representatives expressed a desire to exempt the small “mom and pop” check cashing companies from the licensing requirements.  Unlike their larger counterparts, these smaller businesses usually cash correspondingly smaller checks.  The idea of exemption was met with resistance from the rest of the industry. 

Ms. Mayer reported the CFO has lined up potential legislative sponsors to shepherd any of the Work Group’s resulting legislation through the process. 

The Work Group’s report will be finalized within the next few weeks and presented at a Florida Cabinet meeting.

To access a copy of the agenda and draft Work Group report, click here.

Should you have any comments or questions, please contact Colodny Fass.

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