A South Carolina school district is suing a Hub-owned insurance brokerage, and others, for $42.5 million, claiming its executives sold the district excessive policies and charged exorbitant fees.
The lawsuit’s defendants include Charlotte-based Knauff Insurance Agency, Knauff senior vice president Stanley Pokorney and his son, commercial sales executive Scott Pokorney, former school district CFO Brantley D. Thomas III, and Hub International, which acquired Knauff in 2012.
The Berkeley County, S.C., School District spent nearly $14.2 million over the last 16 years “to insure itself against non-existent, or nominal, risk,” the lawsuit said.
The lawsuit claimed that Stanley Pokorney – who acted as the district’s consultant and broker since at least 1993 – and Thomas worked together to hatch “insidious schemes” to defraud the district, according to a report by
The Post & Courier. Thomas, who is under indictment has admitted to embezzling nearly $1 million from the district and accepting kickbacks from insurance executives.
Thomas and Pokorney “lined their pockets at the expense of the children of Berkeley County for the last 15 years,” the lawsuit claimed.
“As a board we will pursue every avenue to right the terrible wrongs that have been carried out against the children of Berkeley County School District,” school board chairwoman Sally Wofford told
The Post & Courier. “Our goal is to recover all monies lost by BCSD.”
Thomas oversaw all of the district’s finances until he was fired in February of last year, a day after district officials learned that the FBI and Wells Fargo were investigating its finances, the newspaper reported. The lawsuit alleged that Thomas received payoffs for recommending unnecessary insurance policies and policy reviews. He also allegedly received stays in expensive hotels, dinners and spa treatments for convincing other districts to purchase insurance.
Meanwhile,
The Post & Courier reported that the district already had insurance coverage through South Carolina’s Insurance Reserve Fund – which provides low-cost coverage and uses no brokers or agents.
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