Transparency sought in Sandy settlements

WASHINGTON - Worried that Hurricane Sandy victims could be shortchanged by what a judge recently called "reprehensible gamesmanship," New Jersey Sens. Robert Menendez and Cory Booker pressed a key federal official Wednesday to force the release of documents that they say could expose deceptive practices by some insurers.

Menendez and Booker, both Democrats, met with the Federal Emergency Management Agency administrator, Craig Fugate, after a New York court case ended with a magistrate judge ordering documents to be released to New Yorkers who may have been misled by insurers.

Menendez and Booker want similar releases to New Jerseyans.

"This is about transparency. It's about accountability," Booker said, and "a lot of exposing what many of us suspected all along - that there's foul play going on."

Booker and Menendez were joined by New York Sens. Chuck Schumer and Kirsten Gillibrand, also Democrats.

In the New York case, Magistrate Judge Gary Brown found that after one insurance firm's engineer initially found that a home had been damaged by Sandy - presumably entitling the homeowner to insurance benefits - another engineer who had not visited the home and only viewed photos of the site secretly rewrote the findings to say that Sandy had not caused the damage.

The homeowners were never made aware of the original report.

Hundreds of flood insurance claims may have been similarly affected, the judge wrote in a scathing opinion last month. The judge ordered that the insurers, which work for FEMA, give plaintiffs every version of their findings.

"I've been around politics for a long time. You can smell something really bad," Schumer said, "and there's something really bad here."

Because the insurers work for FEMA, the New Jersey senators said the agency should press for similar steps in the Garden State. In a joint letter, they wrote that people who have paid for flood insurance are being victimized by an "intentional effort to lowball disaster victims."

Menendez said FEMA promised to look into the legality of releasing the requested documents.

Menendez and Booker also pressed FEMA to review insurance appeals by homeowners who missed their appeals deadline, saying FEMA itself often missed its deadline for responses. And they urged the agency to change incentives that penalize insurers more severely for overpaying than for underpaying claims.

"We made it very clear to the administrator that we're going to continue on this until we have success," Menendez said.

A FEMA spokesman said the agency takes allegations of fraud "very seriously" and refers them to internal investigators.

"Each policyholder deserves to be paid for every dollar of their covered flood losses, and taxpayers deserve to know that we remain good stewards of taxpayer dollars," the spokesman wrote in a statement.