Newspaper Says Texas Mutual Fraud Contract a Conflict of Interest

Tuesday, September 22, 2015 | 0

The Dallas Morning News called for an end to a contract by which Texas Mutual Insurance pays for the salaries of prosecutors and support staff for a fraud unit at the Travis County District Attorney's Office that prosecutes only crimes committed against the insurance carrier.

"That's a bit too cozy for our tastes, and for the tastes of some lawmakers concerned about potential conflicts of interest and abuses of power," the newspaper said in an editorial that ran Monday.

Texas Mutual has paid $4.7 million to Travis County District Attorneys since the inception of the contract in 2001. The arrangement was brought to light earlier this month in an article by the Texas Tribune and Austin American-Statesman.

State Sen. Kirk Watson, D-Austin, and Travis County Judge Sarah Eckhardt, also a Democrat, have both said the exclusive prosecution contract is concerning. Eckhardt placed the agenda up for discussion during a closed "executive session" that is scheduled during today's meeting of the Travis County Commissioners Court, the legislative body for the county that includes the state capitol of Austin.

The Morning News said there are no written guidelines within the privately funded unit to safeguard against conflicts of interest or prosecutorial abuse and noted that the District Attorney's Office has never prosecuted a fraud case against Texas Mutual, instead directing complaints to the state Insurance Department.