New Mexico Insurance Superintendent John Franchini has been placed on administrative leave after reportedly violating several Public Regulation Commission human resource policies.
PRC Chief of Staff Johnny Montoya made the determination to place Franchini on leave today, but only after meeting with commissioners during an executive session on Thursday in Santa Fe.
Neither Montoya, nor new Commission Chairman Ben Hall would comment about specific policy violations, but SFR has learned that Franchini allowed insurance division employees to leave work five hours before their Christmas holiday without requiring the employees to submit leave requests and without getting prior approval from Montoya.
"We're just not going to talk about personnel issues," Montoya tells SFR. "I had a talk with John, and that's all I'm going to say."
who is responsible for reviewing and approving rate
hike requests for New Mexico health plans and health insurers, has been reprimanded
before. Last year, Montoya and commissioners learned that the superintendent’s
wife Julie A
Franchini was employed as a vice president of insurance programs at
the Independent Insurance Agents of New Mexico—a group that advocates for
agents who are licensed by the PRC’s insurance bureau. When the
potential conflict of interest surfaced, Montoya sent Franchini a letter
criticizing him for not revealing where his wife worked. Franchini denied it
was a conflict. Former Commissioner Jason Marks tells SFR that Franchini promised him he would recuse himself if any issue involving his wife came up.
Franchini was hired by commissioners to replace interim Superintendent Thomas Rushton. Rushton had been serving as interim superintendent following the sudden resignation of then-Superintendent Morris “Mo” Chavez. Chavez quit after approving double-digit premium increases for Blue Cross Blue Shield of New Mexico’s individual health insurance products.
Last year, former Commissioner Jerome Block, Jr. pleaded guilty to fraud and misusing PRC-issued gas credit cards to support his drug habit. And last fall, Montoya placed Pipeline Safety Bureau Damage Control Supervisor Sefie Anaya on paid leave when Anaya’s PRC-issued cell phone number was listed on a political website.
Since being hired, Franchini's division has had its full NCAI accreditation restored.
In November, voters narrowly approved a constitutional amendment to remove the Insurance Division from the PRC. Lawmakers will consider options on how the new division should be appointed and run during the upcoming legislative session, which begins next Tuesday, Jan. 15.
Franchini is only one of two exempt employees in state government who can only be fired for cause. The other is State Engineer Scott A. Verhines, who also serves as secretary of the Interstate Stream Commission. Other political appointees can be fired without cause.
SFR's calls to Franchini -- made after 5pm -- were not immediately returned.