According to sources interviewed by National Underwriter Life & Health for our Complete ELNY Saga, there was an investigation into the shadowy mechanics of the New York Liquidation Bureau (the Bureau) albeit one with no conclusion. Indeed, the investigation results are now are under seal, according to a source. More than one person confirmed the investigation.
Sources have said that Jody Hall, former head of the Bureau ordered an investigation into the Bureau’s past dealings and estates, hiring insurance insolvency and reinsurance lawyer Paige Waters of Sonnenschein Nath & Rosenthal LLP (informally Sonnenschein and now part of a 2010-formed SNR Denton).
The investigation began first by looking into an old computer system that did not work, that had never worked, with the exception of maybe one computer out of about 25 ancient ones, according to a source, but soon spread to other areas and those working on the Frontier Insurance estate.
Frontier Insurance Company (Fronteir) is a property and casualty insurer domiciled in the State of New York. The company was placed in rehabilitation and the New York Superintendent of Insurance was appointed as Rehabilitator on October 2001. Frontier bounced back and forth between attempts to outsource its rehabilitation via the Lancer Group, which bought the parent company and attempted to take the enterprise in house at the Bureau under various administrations. Due to a court ruling this year on surety bonds, there was no choice but to put the company into rehabilitation people familiar with the case say, because, with the ruling on which class the surety bonds would fall into, the paper liabilities vastly outstripped the assets.
Superintendent Ben Lawsky asked this summer that Frontier be liquidated.
Liquidation request for Frontier— http://www.nylb.org/Documents/Frontier_OTSC_20120808.pdf
Frankie Bliss, who could not be reached by phone after numerous attempts, was in charge of the estate. Bliss is now on the board of directors of the International Association of Insurance Receivers and is well-regarded by old hands in the industry.