FEMA in settlement talks over Sandy flood claims
THE Federal Emergency Management Agency is working to settle lawsuits by hundreds of Hurricane Sandy victims who challenged denials or alleged underpayments of flood insurance claims.
Brad Kieserman, deputy associate administrator for insurance at FEMA, disclosed the settlement talks during a break in a court hearing Wednesday over whether an insurer, Wright National Flood Insurance Co., concealed from a homeowner the existence of conflicting reports over damages.
Private insurers working in partnership with FEMA’s National Flood Insurance Program have come under scrutiny over allegations they denied or rejected damage claims based on falsified reports. About 1,500 cases over flood claims from the devastating 2012 hurricane are pending in New York and New Jersey courts. FEMA may also review settlements with homeowners with disputed payments who didn’t sue, Kieserman said.
“We are going to consider all of them,” he said.
Separately, state law enforcement agents on Wednesday executed a search warrant at the Uniondale, New York, office of HiRise Engineering PC, according to Liz DeBold, a spokeswoman for New York Attorney General Eric Schneiderman. The firm did work for Hartford Financial Services Group Inc., which also participated in the FEMA program. A call to HiRise wasn’t immediately returned.
Wednesday’s hearing in federal court in Brooklyn, New York, centered on allegations by Deborah Ramey, who said a rental property she owned in Long Beach was severely damaged by the flood yet falsely described as having had long-term damage by an engineer working on behalf of the Wright Flood.
The engineering firm, U.S. Forensic LLC, produced conflicting reports about damage to Ramey’s home, according to evidence at an earlier proceeding. After an initial engineering report found her home was heavily damaged by the storm, a later report concluded much of the loss was due to the age of the roughly 80-year-old property.
In November, U.S. Magistrate Judge Gary Brown said he feared there may be conflicting reports in many other flood insurance cases, and hundreds of homeowners are now searching for evidence that similar tactics were used to deny their Sandy-related claims.
In court, Brown is weighing whether to penalize Wright Flood and a law firm that represented it and other insurers. Representatives from the Metairie, Louisiana-based firm, Nielsen Carter & Treas LLC, didn’t attend the hearing, and a phone call wasn’t immediately returned.
During the proceeding, Jeff Moore, who was Wright Flood’s vice president of claims when Ramey was disputing her claim, refused to answer questions posed by her lawyers, citing his Fifth Amendment right under the U.S. Constitution not to incriminate himself.
Dolores Glass, a spokeswoman for St. Petersburg, Florida-based Wright Flood, declined to comment on Wednesday’s hearing. A call to U.S. Forensic after regular business hours wasn’t immediately returned.
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