Insight, analysis & opinion from Joe Paduda

Oct
30

Who’s the crook?

Few things I’ve encountered in my twenty-five-plus years in the insurance business are as outrageous as the prosecution of Sandy Blunt, the former head of the North Dakota work comp fund.
I’ve posted on this case several times; what originally caught my attention was the announcement that Bryan Klipfel, a former State Trooper had been named the head of the ND work comp fund.
According to a local paper in ND, when asked about his qualifications, Klipfel said “I’m going to work with Bruce (Furness) for a couple of weeks, and I’ll just have to learn some of that information as time goes on…My strong points are that I have leadership ability, and I understand human resources, how to deal with people. And I think that’s the big part (of the job) right now.”
That got me thinking – “He’s going to learn on the job? While getting mentoring for a ‘couple of weeks”? In a business that is incredibly complex? At a time when investments and reserving practices are critically important? And his qualifications are his understanding of human resources and leadership ability?” – with the result that I dug deep into the story, only to find out what can only be characterized as a witch hunt, conducted for unknown reasons by a prosecutor’s office that went way beyond what could be construed appropriate behavior.
The deeper I dug, the stinkier it got. Blunt was convicted of felony charges, which could only be brought because the prosecutor ‘rolled up’ several smaller charges related to gifts for workers (trinkets, food for parties, etc) and his authorization of sick leave. In fact there aren’t any charges that Blunt took money himself.
At the time, I thought ‘Ok, so Blunt made a few bad decisions and/or didn’t follow all the rules by the book. But a felony conviction for a sick leave authorization and some inexpensive ‘gifts’?’ Seemed wildly excessive – at any other big organization – public or private – this wouldn’t merit anything more than a reproachful email from the corporate compliance officer/legal counsel.
Turns out it was way more than ‘wildly excessive’; the Blunt conviction was the result of egregious prosecutorial misconduct.
The prosecutor didn’t give Blunt’s attorney exculpatory evidence – evidence that would have proven that the sick leave charge was insignificant – it wasn’t even a concern to state auditors who had gone thru the state fund’s books with a fine-toothed comb. More importantly, the prosecutor didn’t give the memo from the state auditor pertaining to this issue to Blunt’s attorney.
Anyone who’s watched even a little TV knows that prosecutors MUST give all evidence to the defense. Anyone except Cynthia Freland, the assistant state’s attorney who tried the case.

I have no idea what in the hell is going on up in North Dakota, but I do know this. Sandy Blunt is a decent, honest, very capable guy who has been absolutely screwed, apparently in no small part by a prosecutor who broke the law.

Blunt is currently appealing the case before the state supreme court, primarily on the basis of the prosecutor’s ‘roll-up’ of charges. His contention appears to be because one of the charges was thrown out, the jury should have been allowed to consider each of the other charges independently, which not coincidentally may well have resulted in acquittal as the remaining alleged offenses may not have met the standard for a felony conviction.
If there’s any justice in this country, Blunt will be acquitted and Freland fired and investigated for possible commission of a crime. Regardless, Blunt’s reputation will be forever tarnished with his professional life ruined due to some bizarre personal vendetta on the part of an at-least incompetent and possibly criminal state prosecutor.
Disclosure – I’ve come to know Sandy pretty well. I called him to hear his side of the story earlier this year. He is a very smart, humble, positive gentleman who is a consummate professional. Sandy and I have worked together on a couple projects, and I have been very impressed. Sandy’s performance at the ND Fund speaks for itself – and I can – and will – put my personal reputation on the line for him.
It’s a no-brainer.


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Joe Paduda is the principal of Health Strategy Associates

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