A state-chartered workers’ compensation insurance fund hammered for feting members on luxury junkets admitted “mistakes were made” and major policy changes will be made, it was announced Wednesday.
Board members at Pinnacol Assurance will no longer be able to go on incentive trips with insurance agents, and financial records will be more detailed and handled with more transparency, new board member John Plotkin said.
The good news, he said, is a special committee that reviewed complaints about the quasi-state agency didn’t find nearly the problems that were anticipated after two years of intense scrutiny by lawmakers and others.
“I didn’t find anything that was disturbing,” Plotkin said, except the “perception that there was something so wrong.”
He pointed out that the committee found the company has “significantly” improved its internal controls since a blistering May 2010 audit, and out of 10,700 expenses reviewed, only 85 were considered “potentially excessive.”
And, Plotkin said, the compensation for chief executive Ken Ross, whose controversial behavior during a lavish trip to Pebble Beach, Calif., last year made headlines, is in line with industry standards.
Pinnacol is a quasi-governmental agency that operates similar to a private business but gets certain tax advantages, and its board is appointed by the governor.
Gov. John Hickenlooper, after taking office in January, asked that newly appointed board members look at complaints lodged against the company. They consulted industry and other experts to help them with the review, which was compiled into a report.
Hickenlooper, who read the report Tuesday night, said he thought the committee had done a “thoughtful and detailed job.”
Pinnacol released the findings at a news conference at its headquarters in Lowry. Board member Blair Richardson, another recent appointee, appeared with Plotkin.
“There were mistakes made,” Richardson said.
One of the policy changes, Richardson said, will be to maintain a separation, a sort of “church and state,” between the board and management, which had been criticized as being too cozy.
The committee also found that Ross spent $1,609 on Amazon Kindles for Christmas gifts for his executive staff.
“That’s an example of something we identified that is going to stop,” Rich ardson said. “If you’re going to buy key employees Christmas gifts, you’re going to reach into your own wallet.”
Lynn Bartels: 303-954-5327 or lbartels@denverpost.com
