Senate Bill No. 271
(By Senator Minard)
____________
[Introduced February 24, 2005; referred to the Committee
on Banking and Insurance; and then to the Committee on the
Judiciary.]
____________
A BILL to amend the Code of West Virginia, 1931, as amended, by
adding thereto two new sections, designated §33-41-4a and §33-
41-8a; and to amend and reenact §33-41-8 of said code, all
relating to insurance fraud; permitting the fraud unit to
investigate the forgery of insurance documents; permitting the
Insurance Commissioner to accept gifts and other property;
exempting fraud unit employees from liability under certain
circumstances; designating the fraud unit a criminal justice
agency for purposes of access to information; and requiring
background checks of applicants for employment with the fraud
unit.
Be it enacted by the Legislature of West Virginia:
That of the Code of West Virginia, 1931, as amended, be
amended by adding thereto two new sections, designated §33-41-4a and §33-41-8a; and that §33-41-8 of said code, be amended and
reenacted, all to read as follows:
ARTICLE 41. PRIVILEGES AND IMMUNITY.
§33-41-4a. Acceptance of grants, gifts and other property by
Commissioner.
(a) The Commissioner may accept gifts, grants, the proceeds of
court ordered forfeiture proceedings and bequests of funds or
property from individuals, foundations, corporations, the federal
government, governmental agencies and other organizations or
institutions.
(b) Moneys from gifts, grants, proceeds of forfeiture
proceedings and bequests received by the Commissioner shall be
deposited into the special revenue account established in
subsection (b), section thirteen, article three of this chapter,
and the Commissioner has the authority to make expenditures from
such fund in order to effectuate the purposes of this article.
(c) The director of the unit, acting on behalf of the
Commissioner, may enter into and execute any agreements and do and
perform any acts that may be necessary, useful, desirable or
convenient to effectuate the purposes of this section.
§33-41-8. Creation of insurance fraud unit; purpose; duties;
personnel qualifications.
(a) There is established the West Virginia insurance fraud
unit within the office of the Insurance Commissioner of West Virginia. The Commissioner may employ full-time supervisory, legal
and investigative personnel for the unit, who shall be qualified by
training and experience in the areas of detection, investigation or
prosecution of fraud within and against the insurance industry to
perform the duties of their positions. The director of the fraud
unit
shall be is a full-time position and shall be appointed by the
Commissioner and serve at his or her will and pleasure. The
Commissioner shall provide office space, equipment, supplies,
clerical and other staff that is necessary for the unit to carry
out its duties and responsibilities under this article.
(b) The fraud unit may in its discretion:
(1) Initiate inquiries and conduct investigations when the
unit has cause to believe violations of
any of the
following
provisions of this
code chapter, the provisions of chapter twenty-
three, the provisions of article three chapter sixty one of this
code relating to the business of insurance have been or are being
committed:
Chapter thirty-three; chapter twenty-three; article
three of chapter sixty-one; and section five, article four of
chapter sixty-one.
(2) Review reports or complaints of alleged fraud related to
the business of insurance activities from federal, state and local
law-enforcement and regulatory agencies, persons engaged in the
business of insurance and the general public to determine whether
the reports require further investigation; and
(3) Conduct independent examinations of alleged fraudulent
activity related to the business of insurance and undertake
independent studies to determine the extent of fraudulent insurance
acts.
(c) The insurance fraud unit may:
(1) Employ and train personnel to achieve the purposes of this
article and to employ legal counsel, investigators, auditors and
clerical support personnel and other personnel as the Commissioner
determines necessary from time to time to accomplish the purposes
of this article;
(2) Inspect, copy or collect records and evidence;
(3) Serve subpoenas issued by grand juries and trial courts in
criminal matters;
(4) Share records and evidence with federal, state or local
law-enforcement or regulatory agencies, and enter into interagency
agreements.
For purposes of carrying out investigations under this
article, the unit shall be deemed a criminal justice agency under
all federal and state laws and regulations and as such shall have
access to any information that is available to other criminal
justice agencies concerning violations of the insurance laws of
West Virginia or related criminal laws;
(5) Make criminal referrals to the county prosecutors;
(6) Conduct investigations outside this state. If the
information the insurance fraud unit seeks to obtain is located outside this state, the person from whom the information is sought
may make the information available to the insurance fraud unit to
examine at the place where the information is located. The
insurance fraud unit may designate representatives, including
officials of the state in which the matter is located, to inspect
the information on behalf of the insurance fraud unit, and the
insurance fraud unit may respond to similar requests from officials
of other states;
(7) The fraud unit may initiate investigations and participate
in the development of, and if necessary, the prosecution of any
health care provider, including a provider of rehabilitation
services, suspected of fraudulent activity related to the business
of insurance;
(8) Specific personnel, designated by the Commissioner, shall
be permitted to operate vehicles owned or leased for the state
displaying Class A registration plates;
(9) Notwithstanding any provision of this code to the
contrary, specific personnel designated by the Commissioner may
carry firearms in the course of their official duties after meeting
specialized qualifications established by the Governor's committee
on crime, delinquency and correction, which shall include the
successful completion of handgun training provided to law-
enforcement officers by the West Virginia State Police:
Provided,
That nothing in this subsection shall be construed to include any person designated by the Commissioner as a law-enforcement officer
as that term is defined by the provisions of section one, article
twenty-nine, chapter thirty of this code; and
(10) The insurance fraud unit shall not be subject to the
provisions of article nine-a, chapter six of this code and the
investigations conducted by the insurance fraud unit and the
materials placed in the files of the unit as a result of any such
investigation are exempt from public disclosure under the
provisions of chapter twenty-nine-b of this code.
(d) Any employee of the unit who has the authority to
investigate cases of alleged insurance fraud is exempt from civil
liability arising from such an investigation as long as such
investigation has been made in good faith and on the basis of facts
reasonably known or reasonably believed.
§33-41-8a. Fingerprinting and background check for applicants for
employment with fraud unit.
(a) The Commissioner shall require any applicant for
employment with the fraud unit to be fingerprinted. The
Commissioner is authorized to conduct a criminal records check
through the criminal identification bureau of the West Virginia
State Police and a national criminal history check through the
Federal Bureau of Investigation. The results of any criminal
records or criminal history check shall be sent to the
Commissioner. The West Virginia State Police may exchange this fingerprint data with the Federal Bureau of Investigation.
(b) The Director shall not disclose information obtained
pursuant to subsection (a) of this section except for purposes
directly related to the employment of the applicant.
NOTE: The purpose of this bill is to clarify that the
insurance fraud unit can participate in law-enforcement information
exchange, complete criminal background checks on potential
employees of the fraud unit and assist other law-enforcement
agencies. It also allows the fraud unit to investigate forgery of
insurance documents.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
§§33-41-4a and 33-41-8a are new; therefore, underscoring and
strike-throughs have been omitted.