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State agency hit with whistleblower lawsuit

Copyright © 2019 Albuquerque Journal

SANTA FE – A former employee of the Office of the Superintendent of Insurance has filed a lawsuit against the agency, claiming she was retaliated against after exposing tax underpayments by insurance companies and was eventually forced to leave her job.

The lawsuit is the second court case filed against the state insurance agency for alleged Whistleblower Protection Act violations, as another ex-employee filed a similar lawsuit last year.

In the case filed this week, Shawna Maestas, a former financial audit bureau chief with the agency, claims she was threatened with arrest and criminal prosecution for reporting suspected fraud and underpayments to Attorney General Hector Balderas’ office.

While still with the agency, Maestas also joined two other OSI employees in filing a lawsuit under the state’s Fraud Against Taxpayers Act in 2016 that accused Presbyterian Healthcare Services – New Mexico’s largest health insurer – of more than $40 million in Medicaid premium tax underpayments.

The AG’s Office eventually took over the case and Presbyterian agreed to pay $18.5 million to the state in 2017 to settle the lawsuit.

However, Maestas alleged in her lawsuit that she was excluded from work meetings, told to stop performing audits and assigned unnecessary paperwork after filing the whistleblower lawsuit.

She eventually resigned from her job in April 2018 due to “intolerable” working conditions.

Her attorney, Kate Ferlic, said Friday that Maestas and the other whistleblowers should be applauded for their defense of New Mexico taxpayers. The lawsuit, filed in state District Court in Santa Fe, asks a judge to award Maestas two times her accumulated back pay, attorney fees and various types of damages.

“It is terribly unfortunate that the superintendent of insurance chose to target some of the most important whistleblowers in the history of the state of New Mexico,” Ferlic said. “Instead of helping to root out fraud, waste and abuse, the superintendent of insurance retaliated against the very women who brought the fraud suit in the first place.”

A spokeswoman for state Superintendent of Insurance John Franchini did not immediately respond Friday to questions about the lawsuit and the alleged retaliation.

In the past, officials with the Office of the Superintendent of Insurance have defended the agency’s handling of the case, but have said they could not directly respond to the whistleblowers’ claims.

New Mexico’s Whistleblower Protection Act, enacted in 2010, prohibits public employers from retaliating against workers who report illegal or improper acts, or who testify about such actions.

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