Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, September 22, 1993 TAG: 9309220138
SECTION: BUSINESS PAGE: B6 EDITION: METRO
SOURCE: The New York Times
DATELINE: NEW YORK LENGTH: Short
The announcement amounted to an official admission by the company that allegations it had been keeping double records and misstating its losses were true.
The company said it would probably refile the records for the past four years, during which the inaccurate figures were used to influence legislation overhauling the state's insurance industry.
The findings were the result of an internal inquiry ordered in June by Empire's new management and directed by former U.S. Attorney Otto G. Obermaier in Manhattan.
His report, made public Tuesday, concluded that the company ultimately had overstated losses on its high-risk policies in each of the last four years by a total of $63 million.
During those years, Empire lobbied heavily - and successfully - for a change in state law that forced its competitors to accept some of the high-risk customers that only Empire had previously been required to take. The figures also were used last year by Empire's chairman, Albert A. Cardone, who was later ousted, to argue for a large rate increase.
by CNB