The former head of the Maryland Insurance Administration is pushing back on an ex-employee’s claim he was fired to cover up dealings related to the commissioner’s old brokerage firm.
BALTIMORE (CN) — Maryland’s former insurance commissioner, sued by a former employee for wrongful termination, says he never had the conflict of interest described in the lawsuit.
Al Redmer Jr. – a former state legislator, Republican candidate for Baltimore County Commissioner and current executive director of the Maryland Automobile Insurance Fund, the state’s car insurer of last resort – says he quit being a partner at Landmark Insurance and Financial Services in 2010, five years before he became the state’s insurance commissioner.
“The rules are, when you hold an insurance license you have to physically surrender the license when you are insurance commissioner,” he said in a phone interview Friday, adding that he took no income or any other thing of value from the company while he was in office through 2020, when he was appointed to his present job.
Michael G. Stefanowitz, represented by attorneys with the Law Offices of Linda Brown in Laurel, Maryland, claims in a lawsuit filed Wednesday in Baltimore County Circuit Court that Redmer fired Stefanowitz, a former city police detective and 10-year investigator for the Maryland Insurance Administration, in 2018 after he recommended permanent revocation of a financial adviser’s insurance license.
The adviser, Lawrence J. Mieras, had accepted a $500,000 bequest from an elderly client, and did not inform his employer even after he advised the client on how to keep her will out of probate court, which went against the company’s code of ethics.
The story raised eyebrows at the Wall Street Journal, whose columnist Gretchen Morgenstern wrote about it.
But arbitrators at FINRA – the Financial Industry Regulatory Authority, a private corporation that mediates disputes in the industry – found little to sanction. The state insurance commission merely suspended Mieras’s license for 12 months, overruling Stefanowitz, who was then fired, relieved of his key card, escorted from the building and told, in a letter signed by Redmer, that the agency was “going in a different direction.”
The agency did not go in a different direction, according to the lawsuit, instead suspending and revoking about the same number of insurance licenses in the following two years as they had in previous two.
The suit claims that American Portfolios Financial Services, the company Mieras worked for, had a business relationship with Landmark.
“Redmer was and currently is the 100 per cent shareholder owner for the Landmark Insurance and Financial Services, Inc., a brokerage firm located in Princess Anne, Maryland. There exists a brokerage contract between American Portfolios and Landmark,” the complaint states. “The…investigation connected to American Portfolios presents clear conflict of interest for Redmer. Plaintiff asserts that the cover up of this conflict of interest was the motivation for plaintiff’s termination of employment with the MIA.”
After denying the alleged conflict, Redmer said he had not yet seen the complaint and declined to comment on the specifics of the suit or the underlying insurance investigation.
“I’ll tell you the general framework of what happened,” he said. “The insurance administration doesn’t make up the rules, it enforces what we get from General Assembly. Every complaint is investigated thoroughly, and then subject matter experts make the determination if there were violations. The bar is, did they violate law, did they violate a regulation or did they violate the terms of any insurance contract? If they did then the administration acts, and if they didn’t then they don’t act.”
Redmer said he did not make personnel decisions below the employees he directly supervised. The lawsuit names two other defendants, Erica Bailey and Tracey Dailey, both former insurance administration officials, in their individual capacities.
On Thursday, Redmer’s new agency announced an expanded anti-fraud initiative.
“There is a lot of organized fraud out there and it costs us all a lot of money,” Redmer said in a statement. “We at Maryland Auto are committed to identifying and catching fraud. And when we do catch it, we work with the Maryland Insurance Administration and the authorities to prosecute suspected parties.”