COMMITTEE SUBSTITUTE
FOR
Senate Bill No. 643
(By Senator Minard)
____________
[Originating in the Committee on Banking and Insurance;
reported February 21, 2007.]
____________
A BILL to amend the Code of West Virginia, 1931, as amended, by
adding thereto a new section, designated §33-2-3a; and to
amend and reenact §33-2-7 and §33-2-19 of said code, all
relating to investigations of violations of insurance laws;
clarifying that the Insurance Commissioner may investigate
noncriminal violations; authorizing use of Class A
registration plates; clarifying that immunity granted in
certain cases applies to criminal prosecutions only; and
clarifying the authority and duties of the Insurance
Commissioner with regard to information obtained during
investigations.
Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended
by adding thereto a new section, designated §33-2-3a; and that §33-
2-7 and §33-2-19 of said code be amended and reenacted, all to read as follows:
ARTICLE 2. INSURANCE COMMISSIONER.
§33-2-3a. Administrative investigations.
(a) In addition to the authority granted to the fraud unit
created in article forty-one of this chapter and to the workers'
compensation fraud and abuse unit previously transferred to the
commissioner pursuant to section one-b, article one, chapter
twenty-three of this code, the commissioner has the authority to
conduct investigations whenever he or she has cause to believe that
a violation of any provision of this chapter or of chapter
twenty-three of this code has been or is being committed.
(b) Employees designated by the commissioner are permitted to
operate vehicles owned or leased by the state displaying Class A
registration plates when engaged in carrying out the investigative
duties assigned to the commissioner by this chapter.
§33-2-7. Immunity of witness.
If any person shall ask to be excused from attending and
testifying or from producing any books, papers, records,
correspondence or other documents at any hearing conducted pursuant
to this chapter
or chapter twenty-three of this code or in any
cause or proceeding instituted by the commissioner pursuant to this
chapter
or chapter twenty-three of this code on the ground that the
testimony or evidence required of him may tend to incriminate him
or subject him to a
criminal penalty
or forfeiture and shall
notwithstanding be directed by the commissioner to give such testimony or produce such evidence, he must nonetheless comply with
such direction, but he shall not thereafter be prosecuted or
subjected to any
criminal penalty
or forfeiture for or on account
of any matter or thing concerning which he may testify or produce
evidence, pursuant thereto, and no testimony so given or evidence
produced shall be received against him upon any criminal action,
investigation or proceeding:
Provided, That no such individual so
testifying shall be exempt from prosecution or punishment for any
perjury or false swearing, committed by him while so testifying and
the testimony or evidence so given or produced
shall be is
admissible against him upon any criminal action, investigation or
proceeding concerning such perjury or false swearing, nor
shall is
he
be exempt from the refusal, revocation or suspension of any
license, permission or authority conferred, or to be conferred,
pursuant to this chapter. Any such individual may execute,
acknowledge and file in the office of the commissioner a statement
expressly waiving such immunity or privilege in respect to any
transaction, matter or thing specified in such statement and
thereupon the testimony of such person or such evidence in relation
to such transaction, matter or thing may be received or produced
before any judge or justice, court, tribunal, grand jury or
otherwise, and if so received or produced such individual
shall is
not
be entitled to any immunity or privilege on account of any
testimony he may so give or evidence so produced.
§33-2-19. Confidentiality of information.
(a) Documents, materials or other information in the
possession or control of the commissioner that are obtained in an
investigation of any suspected violation of any provision of this
chapter or chapter twenty-three of this code are confidential by
law and privileged, are not subject to the provisions of chapter
twenty-nine-b of this code and are not open to public inspection.
The commissioner may use the documents, materials or other
information in the furtherance of any regulatory or legal action
brought as a part of the commissioner's official duties. The
commissioner may use the documents, materials or other information
if they are required for evidence in criminal proceedings or for
other action by the state or federal government and in such context
may be discoverable only as ordered by a court of competent
jurisdiction exercising its discretion.
(b) Neither the commissioner nor any person who receives
documents, materials or other information while acting under the
authority of the commissioner may be permitted or required to
testify in any private civil action concerning any confidential
documents, materials or information subject to subsection (a) of
this section except as ordered by a court of competent
jurisdiction.
(c) In order to assist in the performance of the
commissioner's duties, the commissioner may:
(1) Share documents, materials, communications or information,
including otherwise confidential and privileged documents,
materials or information, with other state, federal and international regulatory agencies, with the National Association of
Insurance Commissioners and its affiliates and subsidiaries, and
with regulatory and law-enforcement officials of other foreign or
domestic jurisdictions: Provided, That the recipient agrees to
maintain the confidentiality and privileged status of the document,
material, communication or other information;
(2) Receive documents, materials, communications or
information, including otherwise confidential and privileged
documents, materials or information, from the National Association
of Insurance Commissioners and its affiliates and subsidiaries and
from regulatory and law-enforcement officials of other foreign or
domestic jurisdictions and shall maintain as confidential or
privileged any document, material or information received with
notice or the understanding that it is confidential or privileged
under the laws of the jurisdiction that is the source of the
document, material or information; and
(3) Enter into agreements governing sharing and use of
information consistent with this subsection.
NOTE: The purpose of this bill is to clarify that the
Insurance Commissioner has the authority to undertake
investigations of noncriminal violations of the insurance code and
that such investigators have the same authority and duties as fraud
investigators regarding the confidentiality of information received
in the course of such investigations.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
§33-2-3a is new; therefore, underscoring and strike-throughs have been omitted.
§33-2-19 has been rewritten; therefore, underscoring and
strike-throughs have been omitted.)