BILOXI, Miss. - A lawyer for U.S. Sen. Trent Lott (news, bio, voting record) said Monday that State Farm Insurance Co. is destroying documents that could show the insurer has fraudulently denied thousands of claims by Lott and other policyholders whose homes were destroyed by Hurricane Katrina.
Zach Scruggs, one of Lott's attorneys, says his client has a "good faith belief" that several State Farm employees in Biloxi are destroying engineering reports that gave conflicting conclusions about whether wind or water was responsible for storm damage.
Like thousands of Gulf Coast homeowners, Lott's claim was denied because State Farm concluded that Katrina's flood water demolished his beach-front Pascagoula home. State Farm says its policies do not cover damage from rising water, including wind-driven water.
But lawyers for the Mississippi Republican claim Bloomington, Ill.-based State Farm has routinely pressured its engineers to alter "favorable" reports that initially blamed damage on hurricane's wind, which the company's policies cover.
Lott's allegations come on the heels of a lawsuit filed by Kiln, Miss., couple who claimed they had obtained copies of conflicting reports prepared by State Farm's engineers on what damaged their home. They said one report traced the destruction to Katrina's winds while a later report said flooding was the culprit.
In response, State Farm spokesman Phil Supple had said the second report was the only one the engineering firm sent to State Farm's claims office.
In an interview Monday, Scruggs said corporate "whistleblowers" who are cooperating with Lott's attorneys have provided evidence that State Farm employees are destroying or moving those "initial favorable" engineering reports.
This is totally uncalled for--State Farm Insurance either altering or destroying documents so they can avoid paying claims.
This is part of a larger problem--a problem of deregulation and allowing corporations to get away with murder, while the government agencies are hamstrung in not investigating these claims due to budget cuts, or if the government finds fault with these companies, they impose insignificant fines that the companies will consider as a business expense. There is no accountability, no stiff penalties to make companies think twice before engaging in illegal acts. And it doesn't matter whether it is State Farm Insurance, Haliburton, Enron, Merck, Big Mining companies, Wall Street financial companies, Big Oil--they get away with murder because they can buy the politicians--both Democratic and Republican--with political campaign contributions. Corporate interests can buy Washington politicians in both Congress and the White House to do their bidding.
And the Washington politicians are happy to oblige.
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