Florida's chief financial officer, Tom Gallagher, has opened a criminal fraud investigation into whether executives at Citizens Property Insurance Corp., the state's insurer of last resort, took bribes to award business to adjusters.

The insurer's CFO, R. Paul Hulsebusch, resigned in September following allegations of kickbacks and other unethical conduct. A lawsuit filed by Texas adjusting firm, Universal Risk, alleges that Hulsebusch accepted at least $28,000 in bribes from another adjusting firm, which later was hired to handle claims for Citizens. Universal is seeking $3.6 million in lost adjusting fees, as well as unspecified punitive damages.

The Florida insurer also is under investigation following numerous complaints by policyholders who said that Citizens failed to handle their claims in an expeditious and fair manner following the 2004 hurricanes. In early November, the Office of Insurance Regulation completed a market conduct exam looking at Citizens' handling of claim payments, and a data validation review was performed to verify the accuracy of the company's hurricane. Examiners identified several weaknesses and directed Citizens to address those areas.

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