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U.S. Insurance Firm CNA Neglects Survivors of Iraqi Translators, May Face Criminal Charges

Posted by defensebaseactcomp on May 23, 2011

U.S. insurer faces criminal probe over Iraqis’ unpaid death benefits

By T Christian Miller at ProPublica   May 23, 2011  and The LA Times

An administrative law judge has referred a U.S. insurance company for criminal investigation after the firm failed to pay benefits owed to survivors of Iraqi translators killed while working for the American government.

Under a federally funded program, Chicago-based CNA Financial Corp. provides insurance coverage to contractors killed or injured while working overseas for the United States. The slain translators were helping to train Iraqi police recruits.

Instead of paying out benefits, however, CNA withheld information from the federal government and avoided making payments to nine families who lost relatives in a 2006 attack, according to court files and interviews. One widow lost her home, unable to keep up payments after her son and other translators were ambushed by insurgents in the southern city of Basrah, one of her attorneys said.

In a ruling this week, administrative law Judge Daniel Solomon ordered CNA to begin making payments to the families. In an unusual move highlighting the government’s concern over potential fraud, the judge also told the Labor Department, which oversees the program, to investigate whether the insurance carrier should face criminal charges. A Labor spokesman said the agency would “fully investigate” the allegations to determine whether to ask the Justice Department to prosecute the case.

CNA said it was also looking into the case.

“We are investigating the matter and will take all appropriate actions,” said Katrina Parker, a company spokeswoman.

Attorneys for the families said they believe CNA withheld documents to avoid making payments.

“These were people who helped the U.S. in Iraq,” said Agnieszka Fryszman, an attorney for the families. “Their families were kicked to the curb when they were most in need of help.”

CNA’s failure to pay out benefits underscores the continuing problems with the Defense Base Act, essentially the workers compensation system for overseas federal contractors.

The system was little-used until the wars in Iraq and Afghanistan sent hundreds of thousands of private contractors onto the battlefield. All told, the government has paid out nearly $1.5 billion in premiums since 2001.

Reporting in 2009 by ProPublica, the Los Angeles Times and ABC’s 20/20 [1] revealed deep flaws in the program. Workers fought long battles for medical care, including such things as prosthetic devices and treatment for post-traumatic stress disorder. Foreign workers, including Iraqi and Afghan translators, often did not receive payments or treatment. The Labor Department seldom took action to enforce the law. One official called the system a “fiasco.”

Congress subsequently held hearings [2] that showed that American insurers were reaping large profits from the program. Documents showed that CNA reported the highest profits margins, taking in nearly 50 percent more in premiums than it paid out in benefits.

The case decided this week began on Oct. 29, 2006, when insurgents boarded a bus and killed 17 Iraqi-born translators working in Basrah for Sallyport Global Services, a logistics and security contractor. The insurgents later scattered their bodies around the city.

Under the law, CNA was responsible for paying death benefits to the translators’ dependents. CNA paid when translators had children and spouses, according to interviews and court records, but not to other survivors. Several translators had no children, but supported parents or other family members.

In such cases, the Labor Department demands proof that survivors relied on contractors’ earnings. CNA hired investigators who interviewed nine families, confirmed their eligibility, and even set up bank accounts. But CNA withheld portions of the investigators’ findings when it submitted the claims to the Labor Department, court records show.

One CNA file shows that the slain translator had supported his mother, a widow, since his father was killed in the Iraq-Iran war. The town council even issued a statement of support, confirming the translator was his mother’s “sole provider.” Another CNA file shows that another translator killed in the ambush was sole support for his family, which “could be described as very poor.”

But those pages were missing from the information CNA submitted to the Labor Department. As a result, Labor officials accepted CNA’s declaration that there were no dependents to pay in any of the nine cases.

The translators’ attorneys at Cohen Milstein, a well-known Washington firm doing pro bono work on the case, estimated that CNA owed a total of about $500,000 to the nine families. Instead, CNA paid about $45,000 into a special federal fund set up to help support the workers compensation system.

The company subsequently recovered some of that money plus additional fees under an obscure law—the War Hazards Compensation Act—that allows insurance carriers to recoup costs for contractors killed in hostile acts, court documents show.

In one case, CNA paid $5,000 into the special fund and $518 to a translator’s family for burial expenses, but was reimbursed $9,289 by the federal government for investigating and handling the claims.

A Sallyport official said the company believed that CNA had made payments to all of the translators’ families except one, which declined to accept money because of security concerns.

In an emailed statement, the company declined further comment due to the litigation. It said it would “continue to monitor the situation and support the families within our remit.”

20 Responses to “U.S. Insurance Firm CNA Neglects Survivors of Iraqi Translators, May Face Criminal Charges”

  1. Marlo said

    About time. Amazing that so many have to suffer so much before they step in. I would love to see them face charges not only on those families but the families in the US. And for those who have suffered and still are suffering at the hands of CNA.

    • Brit guy said

      I would like to see all of these people on trial who deny benefits to those who are entitled to them.
      I believe the act states that a deliberate act to deny benefits that leads to death faces
      possibly 5 years in jail and or a fine not to exceed 10,000 dollars you only have to look at this site and others to see that most of these law breakers should be behind bars think how long some of them would be serving for the amount crimes they have committed. Against the brave people who stand up to defend our freedoms.

      How long has it taken to find out that these people are committing fraud and ripping off the US taxpayer because of their actions to increase profits and bonuses.

  2. anonymousonpurpose said


    CNA is small compared to how many Contractors AIG is insuring. Amazing how the ALJ is only investigating and considering criminal charges for unpaid Iraqi families (don’t get me wrong, they deserve their payments too, even though it is little compensation for lost loved ones.)

    What about all of the good ol’ fashioned home grown injured Contractors who have been criminally treated? Talk about a messed up economy? Well, how’s this for a kicker? I finally earned a college degree, (still owe $29,000 in student loans) in a VERY specialized field and more than likely I will NEVER work in that field again because of AIG’s LIES! I am one of thousands who are being criminally mistreated by these two insurance companies! NINE families is a start, open up ALL of their books and get down to how much blood money bonuses these pathetic excuses for human beings earned by denying rightfully earned benefits!

    If only…maybe one day SOMEONE will bring a RICO or some such criminal conspiracy charges against those who knowingly denied benefits for their own profits.

  3. superman said

    OK now what about the American Contractors?? Hell CNA did the same thing to us? Come on DOJ. Their crimes are blatant. I know my specific case they provided NO medical records. Thankfully I had copies. CNA refused to provide any records. They claim, “We can’t get them” HOW CONVENIENT!!

    They will never provide anything that will prove work related injuries. KBR, Dyncorp, Blackwater.. they provided NOTHING!!! Come on DOJ why are you not going after them? I know why you are not going after Blackwater…. its because they are in bed with the government.. CIA & State Department… These companies are committing crimes they are required to provide medical care and account for records under these contracts.. why is the government unwilling to enforce anything???

    I know why… it will bring embarrassment upon the USA.

    Come on DOJ get off your ass and do your job. We the tax payer expect at least a minimal effort here.

  4. superman said

    Don’t worry CNA and AIG have something coming for them very soon. The heads of these places will be running for cover to avoid being thrown in Jail.

  5. superman said

    the following information is for the Criminals of CNA and AIG…

    Countries with diplomatic relations but no extradition treaty:

    The United States maintains diplomatic relations, but does not have extradition treaties with the following countries: Afghanistan, Algeria, Andorra, Angola, Armenia, Bahrain, Bangladesh, Belarus, Bosnia and Herzegovina, Brunei, Burkina Faso, Burma, Burundi, Cambodia, Cameroon, Cape Verde, the Central African Republic, Chad, China, Comoros, Congo (Kinshasa), Congo (Brazzaville), Croatia, Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gabon, Guinea, Guinea-Bissau, Indonesia, Ivory Coast, Kazakhstan, Kosovo, Kuwait, Laos, Lebanon, Libya, Macedonia, Madagascar, Maldives, Mali, Marshall Islands, Mauritania, Micronesia, Moldova, Mongolia, Montenegro, Mozambique, Namibia, Nepal, Niger, Oman, Qatar, Russia, Rwanda, Samoa, São Tomé & Príncipe, Saudi Arabia, Senegal, Serbia, Slovenia, Somalia, Sudan, Syria, Togo, Tunisia, Uganda, Ukraine, United Arab Emirates, Uzbekistan, Vanuatu, Vatican, Vietnam, and Yemen,

    PS if you run and try and hide in these places you may not be able to be extradited but we can surely provide you with UBL style justice.

  6. I believe the U.S. Department of Labor and Department of Justice are as guilty and heartless as the insurance companies. They are personally responsible for the horrible deaths and destruction of many !! If DOL/DOJ were doing their job this would not have taken a Court order !!

    If they do anything it will almost certainly be too little. The lateness of any DOL/DOJ action is criminal too. At least there’s one administrative law Judge (Daniel Solomon) who understands.

  7. superman said

    maybe this Judge Solomon is the only one not “on the take”. I can not come up with another explanation for why they allow these insurance companies to continue to break the law..

  8. […] Partridge, Contractor, Killed in IraqFormer Navy SEAL, Contractor, Killed Thurs in CIA bombingU.S. Insurance Firm CNA Neglects Survivors of Iraqi Translators, May Face Criminal Charges DBA Defense TricksStaff Sgt David Senft, Symptoms Ignored, dies from "injuries sustained in a […]

  9. […] Sallyport has received a four-year subcontract on the recently awarded USAID Tarabot project. Beginning June 16, 2011, the program will assist with training the Iraqi Civil Service and improving the capabilities of the Iraqi government. Under this project, Sallyport will provide Turn-Key support solutions to Management Systems International, which is serving as the Prime Contractor. […]

  10. injuried warrior said

    I’m a concern injured person that got hurt in afghanistan, I had to come back stateside for surgery, CNA has paid me worksman comp, my doctor has given me a permately disability in my shoulder/ left arm, I was able to get a part-time job and now two years later CNA wants me to return back to afghanistan under light duty for a private contractor at age 55, my question is where is there light duty in a war zone? Should a man or woman be fighting/working in a war zone, it would seem that you are an accident waiting to happen, you cant 100% protect yourself and no one else. I been told by my attorney that I must apply for jobs that CNA has sent me to return back to afghanistan, I’m ex-military and a retired police officer, I have served my country in my early years and again at 52, now I’m injuryed and older, I think its time to stop and I would hope the federal gov. can put a stop to such request by ins. co. like CNA and demand that CNA pay there insured people.

  11. James said

    It is a horribale thing the Insurance company and from what I understand also the DOL for not checking on more cases and making more access to file a complaint and get action sooner than 18 or more months. I myself am a victom of a Insurance Co. and possibly the DOL where a Dr. of the DOL said I needed surgery and the Insurance Co. had someone watching me. just because I was washing my truck very carefully as to not further injure myself, the Insurance Co. stopped my comp checks. The same Dr. told me I should do all I feel I am able to do, to keep mussle tone up. I do believe this Dr. was paid off to take the video and state, I was healed and could return to full and heavy work. I tried to get in to talk with the Dr. and was refused a visit. I was on and still am on a high strength of Oxycotin and this did enable me to do a few things from time to time.I feel I was Black mailed into settling my claim. I was the soul provider for my family and the company where I was hurt, The Insurance co. and the DOL really let me and my family down. Is there any justice? we will see as this investagation unfolds.

  12. Legal Articles…

    […]U.S. Insurance Firm CNA Neglects Survivors of Iraqi Translators, May Face Criminal Charges « Defense Base Act Compensation Blog[…]…

  13. Richard E Philemon Jr said

    The Lador Dept has NO BACK BONE for this. they will not do anything to investacted this. They, in my eyes and experince are worthless. I dealed with them for 2 yrs FIGHTING the big insurance company AIG. All they ever did was to “Inform me” of what I already knew was going on in the courts system. Like I said they have “No Back Bone” to INFORCE anything, worthless, worthless and still worthless……….
    ProPublica did a story on me and another Ex-KBR employess, T Christian Miller, was the reported.

  14. […] U.S. Insurance Firm CNA Neglects Survivors of Iraqi Translators, May Face Criminal Charges […]

  15. Donna said

    It’s about time. CNA has screwed over hundreds of men and women who served proudly! If we thought it was hard for Americans to get benefits, then God help the Iraqis and South Africans!!! Hope they burn, to bad Donna Spraggs doesn’t work for them anymore! She made my life miserable. I am lucky to be alive.

  16. […] See also US Insurance Firm CNA Neglects Survivors of Iraqi Translators May Face Criminal Charges Share this:ShareTwitterStumbleUponRedditFacebookDiggPrintEmailLike this:LikeBe the first to like this post. […]

  17. […] Documents showed that CNA reported the highest profits margins, taking in nearly 50 percent more in … Share this:StumbleUponDiggTwitterRedditFacebookMoreEmailPrintLike this:LikeBe the first to like this. […]

  18. […] is currently under investigation for just this kind of unlawful and Overly Zealous Defense in denying Defense Base Act […]

  19. […] See also Documents showed that CNA reported the highest profits margins, taking in nearly 50 percent more in … […]

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