State Compensation Insurance Fund's board of directors, at the
onset of what promises to become a bigger scandal, has fired the
insurer's president, Jim C. Tudor, and his long-time ally Renee
Koren. She was vice president of group insurance programs. The
firings come on the heels of an internal investigation ordered by
the governor's office. An interim president has been appointed from
Highly placed officials within the government indicate more
bombs are expected to fall as the outcome of the investigation
becomes clearer. State Fund management and operations, including
its group programs, came under scrutiny last year after the
Executive uncovered the veil of secrecy and Tammany
Hall-style political intrigue and possible payoffs that have
surrounded the group safety program scheme for years.
California Insurance Commissioner Steve Poizner told the
Executive "The State Fund is a high priority for me." He
said that it has been a struggle for the Department to work with
State Fund for many years because of former SCIF management's
recalcitrant attitudes. "The Legislature clarified our role last
year. I am happy to be working with the governor's office and the
State Fund's board to fully implement the kind of changes that are
necessary to protect so many of California's injured workers and
State Fund employees were notified of the dismissals at 5:05 pm
yesterday in an unprecedented internal email from Jeanne Cain,
chairwoman of State Fund's board. She admonished employees to steer
clear of any contact the ousted duo.
"Effective immediately, Jim Tudor and Renee Koren
have resigned from State Fund and are no longer involved in any
aspect of State Fund operations," the memo reads. "Therefore all
communication with them regarding State Fund matters must cease. No
employee is permitted to communicate in any way with Mr. Tudor or
Ms. Koren regarding any subject involving State
Never before has any board member communicated directly with the
employees of State Fund. The move was welcomed by many employees as
bold and efficient. The tenor of the email has many employees
postulating that the investigation has turned criminal. No
indictments or arrests have been made.
The board of directors will announce the interim president later
today. It will be Lawrence 'Larry' Mulryan, former director of the
California Insurance Guarantee Association.
Mulryan is well known, highly respected, and has integrity
beyond reproach. He will be credible to both the Insurance
Department and Legislature and brings with him the kind of
respectability that will be needed as the continuing scandal
One highly placed State Fund official told the
Executive the regular board meeting was cancelled and then
held without Jim [Tudor]. "We knew then that something was up," he
Tudor had stacked the executive committee, as the group of vice
presidents is called, with his own appointments and lobbied former
presidents Dianne C. Oki and Kenneth C. Bollier for many
of its present members. Many of them are likely loyal to
In fact, State Fund vice president and general counsel Charles
Savage was who all management audit reports went to. Savage was
hand-picked by Tudor and reported to Tudor including on these
management audit issues.
"Tudor was a master manipulator," the executive says. "No one
was surprised that he made it come out so he got the presidency."
Koren was under Tudor's wing for years and is infamous among staff
for her take-no-prisoners management style. The executive
says that many of the vice presidents spoke badly about Koren
"when she wasn't around."
Interviews with the investigation team bear this out, he
Neither Tudor nor Koren could be reached for comment.
Others Expected To
Highly placed sources within the government tell the
Executive that others on the executive committee are
expected to leave in the near future, but as retirees.
The sources say that the message is clear that cooperative
retirements are likely better than the alternative.
The dismissals came after a two-month probe by the board, which
had tapped two outside law firms to investigate, State Fund sources
tell the Executive.
This was possible only after two board members, Frank Del Re and
Kent Dagg, both of who operate State Fund safety groups, were
forced to resign by the governor's office due to conflict of
interest allegations. Those allegations were brought to light last
year by the Workers' Comp Executive which reported that the
board would be voting to increase commissions on group business,
which would directly have benefited Del Re and Dagg. State Fund
pays fees based on premium volume to group administrators.
Tudor has for years had a close relationship with Del Re, whose
Western Insurance Administrators administers workers' compensation
groups for seven trade associations. Del re is a former State Fund
"Our president has been fired in disgrace and the lady who hired
me was fired in disgrace too," one State Fund staffer, who
requested anonymity, says. "Finally after all of these years State
Fund employees are vindicated."
So is the integrity of the State Fund.