The Conversion UC Cannot Explain

I. Background — The Disability Classification That Preceded the 2015 Conversion

The factual record established in Chapter 03 documents that between September 2009 and June 2010, UC’s own Retirement Administration Service Center — through its employee Thomas Herz — confirmed in writing across multiple communications that Charles A. Harold Jr. was classified as a “retiree on disability” receiving UCRP Disability Income, that his Anthem UC CARE medical insurance coverage was employer-paid under that classification, and that his status was a matter of UC’s own administrative record. Harold asked Herz twice, in writing, to verify his workers’ compensation settlement before any action was taken. Herz did not do so.

The workers’ compensation settlement at issue is Claim No. 199650445, settled in March 2003, with attorney Dennis Hargrove of Mastagni Holstedt. The terms included a lump sum payment, paid health insurance for Harold and his family, and a concealed weapons permit. The permanent and stationary determination by Octagon Risk Services adjuster Grace McAdams, dated August 8, 2001, established Harold’s permanent disability and was never revoked. The settlement was approved in the Workers’ Compensation Appeals Board proceedings.

By 2015, Harold’s workers’ compensation attorney Dennis Hargrove had retired. Harold had no legal representation. UC’s own systems had no records of the settlement. The adjuster who initiated the conversion process had no records of the settlement. The At Your Service counselor had no records of the settlement. Harold was left to rely solely on what UC’s own employees told him — employees who were uniformly unaware of the legal agreement that governed his rights.

I-A. The 2014 Adjusting Company Coercion

Sometime after 2014, Harold began receiving letters from a third-party workers’ compensation adjusting company representing UC (believed to be Gates McDonald or Gallagher Bassett, a successor to Octagon Risk Services). A representative of that adjusting company stated that Harold was required to appear for a medical examination for fitness for duty to determine if he still qualified for “Disability Income.”

Harold explained that his settlement had no such requirement, that his disability status was governed by the August 8, 2001 Octagon permanent-and-stationary determination and the 2003 WCAB-approved settlement in Claim No. 199650445, and that his settlement attorney Dennis Hargrove (Mastagni Holstedt) had retired. The adjusting company representative stated she “knew nothing about a lawsuit or worker’s comp settlement agreement.” She stated Harold was required to appear for a medical examination or UC would stop his monthly disability payments. When Harold continued to refuse, the representative stated Harold must convert from Duty Disability Income to Retirement Income or he would lose his income entirely — over a barrel, with no alternative that preserved his benefits.

UC’s own claims administrator had determined, fourteen years earlier, that Harold’s disability was permanent and stationary. A different UC-contracted adjusting company, operating without access to the settlement records, now demanded re-examination of a condition already determined to be permanent — and made the demand under threat of total benefits loss. Harold converted to Retirement Income in June 2015 only to avoid total loss of benefits.

After the Medicare representative told Harold that they listed his insurance canceled several years prior, and that he seemed to have been on Medicare years earlier, Harold, to explain how badly his UC file was corrupted, recounted this coercion contemporaneously on Medicare’s own recorded line on December 31, 2025, to a disinterested federal employee:

This statement, made on Medicare’s own recorded line to a disinterested federal employee with no motive to fabricate, is a contemporaneous third-party record of the coercion that produced the 2015 conversion.

II. The Retirement Estimator — April 2, 2015

On April 2, 2015, Harold used the UC At Your Service online portal at atyourserviceonline.ucop.edu to generate a Retirement Estimator for a projected retirement date of June 1, 2015. The document was prepared at 11:01 AM PDT. The following facts are drawn directly from that document:

The covered compensation rate for February 2015 is shown as $0.00. This reflects that Harold was not receiving an active salary at that time — he was receiving UCRP Disability Income, not employment compensation. Harold’s membership classification is listed as “Safety without Social Security” — the standard UCRP membership classification for all UC police officers and firefighters. This classification applies to every UC Safety member regardless of disability status; it does not indicate the member’s disability status one way or another. Harold’s 21.667 years of total service credit reflects the accrual of service credit during the period of disability income receipt, consistent with UCRP § 8.18(e).

III. The RASC Letter — March 2, 2015

On March 2, 2015, the UC Office of the President, Retirement Administration Service Center, sent Harold a letter explaining his options for converting his Disability Income to Retirement Income. The letter stated in relevant part:

The letter also stated that Harold’s Highest Average Plan Compensation (HAPC) was $3,601.557 — an amount above the original $3,075.98 monthly disability payment established by the Octagon Risk Services determination of August 8, 2001. Harold was already enrolled in UC-sponsored insurance under Disability Income, and that enrollment was paid for by UC. The language of the letter — “you may continue your UC sponsored medical” — reasonably implied continuation of the existing arrangement.

IV. The Verbal Assurance — “UC Will Continue to Pay Your Insurance”

Harold’s contemporaneous written Statement of Facts, subsequently incorporated into the November 9, 2021 letter of Attorney Edgar Saenz to UC Senior Vice President Alexander Bustamante, documents the following regarding the At Your Service interaction:

The At Your Service counselor identified in the April 2, 2015 Retirement Estimator is Angelica Simental, UC Office of the President, phone (800) 888-8267. Harold’s Statement of Facts further documents that “At Your Service had no records reflecting my tort lawsuit, worker’s comp case or settlement agreement” at the time of this interaction.

Harold also documents: “Nowhere in this document [the Retirement Estimator] did it say I would NOT continue to receive medical insurance or that my lifetime monthly payment would be reduced to pay for medical insurance. Relying on statements from UC employees, the March 2, 2015 UC letter and the April 2, 2015 Retirement Estimator, I filed the required paperwork for ‘Retirement Income’ feeling I had no choice.”

V. What Actually Happened — The Arithmetic

Following the June 2015 conversion, Harold’s financial situation changed as follows. The figures below are drawn from UC’s own IRS Form 1099-R filings and Harold’s documented bank records:

VI. The WCAB Requirement — What the Law Requires

Harold’s disability classification was established through a WCAB-approved workers’ compensation settlement — Claim No. 199650445, settled March 2003, with the Octagon Risk Services permanent and stationary determination of August 8, 2001 as the underlying medical determination. That determination was never revoked by the WCAB.

California Labor Code § 5803 provides, in full:

California Labor Code § 5804 provides, in full:

Under § 5803, only the Workers’ Compensation Appeals Board has authority to determine whether a disability has “diminished or terminated.” Three requirements must be satisfied before any modification: (1) notice to the parties in interest, (2) an opportunity to be heard, and (3) good cause. The power to make this determination belongs exclusively to the WCAB — not to the employer, not to the insurer, and not to any administrative benefits office.

Under § 5804, even the WCAB loses modification jurisdiction five years after the date of injury — unless a petition was filed within that five-year window. Harold’s injury occurred in January 1996. Five years from that date is January 2001. The permanent and stationary determination was issued August 8, 2001. No WCAB petition to modify or terminate the disability award has been located in the record. The conversion occurred in June 2015 — fourteen years after the Octagon determination and nineteen years after the date of injury.

VII. UC’s Own Published Policy Is Silent on WCAB Rights

The UC “From Disability to Retirement” fact sheet, published by UC Human Resources under authority of the Regents and available on UCnet, is the document provided to disability recipients to guide the conversion decision. A complete review of that document confirms the following:

The words “Workers’ Compensation Appeals Board,” “WCAB,” “Labor Code,” “workers’ compensation,” “settlement,” or “modification order” do not appear anywhere in the document. The document describes three conditions under which disability income ends: (1) the member is no longer disabled based on UCRP definitions; (2) the member elects to retire; or (3) the member reaches the disability income cutoff date. No mention is made of any requirement to obtain WCAB approval before conversion for members whose disability was established through a workers’ compensation settlement.

A UC disability recipient whose benefits were established through a WCAB-approved workers’ compensation settlement has a statutory right under Labor Code §§ 5803 and 5804 to have any modification of those benefits reviewed and approved by the WCAB. That right is not disclosed anywhere in UC’s published policy governing the disability-to-retirement transition.

VIII. The Federal Connection — Elevance Health, Disabled Beneficiaries, and the DOJ

The active federal litigation described in Chapter 01 of this audit demand — United States ex rel. Shea v. eHealth, Inc., et al., Case No. 21-cv-11777 (D. Mass.) — provides documentary context for the pattern documented in this chapter.

The DOJ’s complaint in that case, filed May 1, 2025, alleges that from 2016 through at least 2021, Elevance Health, Inc. (the parent company of Anthem Blue Cross, Harold’s insurer) paid hundreds of millions of dollars in illegal kickbacks to insurance brokers to steer Medicare beneficiaries into Medicare Advantage plans. The complaint further alleges that Elevance Health pressured brokers to reduce enrollment of disabled Medicare beneficiaries, who were perceived as costlier to insure.

Harold’s 2015 conversion removed his disability classification one year before the DOJ’s documented kickback scheme began. After the conversion, Harold was classified as a regular retiree — no longer a disabled beneficiary. A disabled beneficiary is the exact category the federal complaint identifies as being systematically excluded by Elevance Health and its broker partners because disabled beneficiaries were considered less profitable.

In 2026, UC then attempted to transfer Harold from his Anthem Medigap (UC High Option Supplement to Medicare) coverage to Via Benefits — the Willis Towers Watson platform. The DOJ’s complaint in United States v. Aon plc, Case No. 1:21-cv-01633 (D.D.C.), identified Willis Towers Watson as co-dominant in the retiree exchange market through which Medicare Advantage plans are sold to transferred retirees.

IX. The Question UC Must Answer

The record established in this chapter documents the following undisputed facts:

In 2015, Harold’s disability classification established under a WCAB-approved workers’ compensation settlement (Claim No. 199650445, August 8, 2001) was converted to regular service retirement. Harold had no attorney. His workers’ compensation attorney had retired. UC’s systems had no records of his settlement. The At Your Service counselor confirmed verbally that insurance would continue. The written RASC letter stated Harold could “continue” his UC-sponsored medical coverage. The Retirement Estimator showed $2,341.04 per month with no insurance deduction. Harold relied on those representations and filed the conversion paperwork “feeling he had no choice.”

After conversion, Harold’s monthly income dropped from approximately $3,000 per month tax-free to approximately $1,300 per month fully taxable, with $727.48 per month in insurance premiums deducted — a cost that appeared nowhere in either the written RASC letter or the Retirement Estimator.

No WCAB modification order authorizing the conversion has been produced. The Octagon Risk Services determination was never revoked. UC’s own published policy governing this transition does not disclose the WCAB’s exclusive jurisdiction over workers’ compensation disability awards.

IX.A  The Pattern: Institutional Evasion By Design

The foregoing question is not rhetorical, and the inability of the University of California to answer it is not accidental. Across twenty-four years of requests, letters, emails, claims, and filings, UC has constructed a pattern of non-response that operates on three reinforcing layers. These layers are not alternative theories — they coexist and compound. Parsed out, each is independently actionable; together they establish institutional evasion by design.

The administrative layer — silo-shifting as a method of non-answer. UC’s internal structure has been used, whether by design or by acquiescence, to prevent any single office from being accountable for Harold’s classification. When Harold or his counsel pressed UCLA Police Department, UCLA PD redirected to the Retirement Administration Service Center (RASC). When pressed at RASC, RASC redirected to UC Office of the President (UCOP) Health & Welfare Administration. When pressed at UCOP, responses were routed through the Office of General Counsel (OGC) or returned to UCLA PD. Attorney Edgar Saenz’s November 9, 2021 letter to Senior Vice President and General Counsel Alexander Bustamante — which set forth the coerced conversion, the verbal assurance of insurance continuity, and the legal basis for reversal — has remained unanswered for more than four years. Under Farmer v. Brennan, 511 U.S. 825 (1994), and Global-Tech Appliances, Inc. v. SEB S.A., 563 U.S. 754 (2011), deliberate indifference and willful blindness are established where an institution maintains structural arrangements that predictably prevent it from learning, or answering for, facts it is obligated to know. Four years of non-response to counsel of record, on a matter involving a WCAB-approved settlement and a federally reported tax classification, is not an administrative oversight. It is the administrative layer functioning exactly as it was arranged to function.

The cognitive layer — conscious avoidance by individual decision-makers. Where the administrative layer fails to shield UC, individual UC actors have repeatedly refused to acquire the knowledge their positions required them to have. In 2010, RASC employee Thomas Herz declined on two separate occasions to check with UC Legal regarding the workers’ compensation settlement controlling Harold’s classification, despite Harold specifically asking him to do so. In 2014, the adjuster then handling Harold’s claim stated she “knew nothing about the settlement” — the same settlement that was the sole legal basis for the benefits she was adjusting. On or about January 30, 2026, UC Claims Specialist Darlene Williams-Cook communicated a determination on Harold’s matter before the file had been formally assigned to her, a sequence that forecloses the possibility of independent review of the record. On February 10, 2026, within approximately one hour and ten minutes of Harold’s written demand for reconciliation of his status, UCLA PD Captain Jeff Chobanian (Badge #307) terminated the communication channel rather than answer. Conscious avoidance — the deliberate decision not to learn what one is obligated to know — is legally indistinguishable from actual knowledge. Global-Tech, 563 U.S. at 769.

The intentional layer — affirmative acts, not omissions. The final layer is not silence or avoidance but action. In June 2015, UC converted Harold from Duty Disability Income to regular retirement without a Workers’ Compensation Appeals Board modification order, in the absence of any legal authority to do so, and in direct contradiction of UC’s own prior written confirmation of his disability status. In the same tax year, UC issued two conflicting IRS Form 1099-R filings for Harold — one coded Code 2 (Early Retirement) and one coded Code 3 (Disability) — documenting, in federal filings made under penalty of perjury, that UC’s own institutional record could not sustain a single classification. In January 2026, UC unilaterally halted the premium deduction that had been occurring monthly for over a decade, without notice or explanation. On April 1, 2026, UC terminated Harold’s Anthem UC CARE medical coverage twenty-nine days earlier than the date UC itself had set and communicated. On April 7, 2026, UC’s benefits portal was updated to reflect a termination date inconsistent with UC’s own prior written communications. The cumulative financial consequence of these affirmative acts is documented at approximately $87,182 in federal and state tax overpayments and approximately $133,000 to $150,000 in improper premium deductions taken from a DDI recipient whose medical coverage is employer-paid under the workers’ compensation settlement. These are not failures to act. These are acts. Under California Government Code § 8547.2(c) and 42 U.S.C. § 1983, affirmative acts by state actors that deprive a claimant of a protected property or statutory interest, taken without lawful authority and in contradiction of the institution’s own record, are actionable on their face.

The Regents-only stamp — the institution’s own admission of position-splitting. On March 30, 2026, Harold served on the UC Office of General Counsel a Formal Demand for Production of Records covering the conduct documented in this chapter and naming, by office and badge number, the individuals responsible for it. UC’s General Counsel returned the served copy bearing a stamp reading “Accepted on behalf of the Regents only.” That stamp is not a clerical notation. It is a written admission, by the institution’s chief legal officer, that the Regents’ legal position and the individual UC employees’ legal position are separable — and that, on the face of Harold’s demand, OGC has elected not to accept service on behalf of any named individual. Under Hafer v. Melo, 502 U.S. 21 (1991), state actors sued in their individual capacity under 42 U.S.C. § 1983 cannot rely on the entity’s sovereign-immunity defenses; they must defend personally. UC’s own General Counsel has now placed on the record, in writing, that the institution is not standing behind the individuals identified in this chapter. Eighteen days later, on April 17, 2026, the UCLA Compliance Office issued a one-paragraph email declaring the parallel Compliance matter “closed” without substantiation — while UCLA Police Department remained 57 days silent on a California Labor Code § 132(a) crime report filed February 19, 2026 naming Captain Jeff Chobanian (Badge #307), and while three California POST complaints filed February 25, 2026 (PUBLIC-26-000212, -000213, -000214) remained pending against named UCLA PD personnel. The pattern is now self-evident on the institution’s own letterhead: the entity declines to defend the individuals; the Compliance Office declares the matter closed without substantiation; the Police Department maintains silence on a statutory crime report; and the named individuals have neither answered nor been answered for. That is not three independent administrative outcomes. That is one coordinated outcome — the institutional evasion described above, executed in the open and in writing.

The indictment made concrete — named actors, named acts. This pattern did not occur in the abstract. It was executed, ratified, or perpetuated by identifiable individuals holding identifiable offices at identifiable times. Chief Clarance Chapman issued Harold’s Carry Concealed Weapon endorsement on September 6, 2002, on the institutional record that Harold was a disabled UCLA PD officer. Chief James D. Herren reissued that CCW endorsement on August 29, 2013, on the same institutional record. Acting Chief Karl Ross, in subsequent years, is on record as having “destroyed” the relationship UC had with Harold as an officer-in-disability-status. Current Chief Craig Valenzuela has been unresponsive to Harold’s recent communications regarding the same matter. Captain Jeff Chobanian (Badge #307) terminated communication within the hour after Harold’s February 10, 2026 demand for reconciliation. Senior Vice President and General Counsel Alexander Bustamante received the Saenz letter of November 9, 2021, and has not responded in the four years since. Chancellor Charles E. Young’s 1992 dismissal of Harold’s internal complaints, historical though it is, is the first documented instance of the silo-shifting pattern that has continued uninterrupted through the administrations that followed. RASC employee Thomas Herz declined, in 2010, to consult UC Legal when Harold asked him to do so. Claims Specialist Darlene Williams-Cook, in 2026, issued a determination on a file before it had been formally assigned to her. The administrative layer was operated by these individuals. The cognitive layer was inhabited by these individuals. The intentional layer was executed by these individuals. The question presented at the top of this section — whether Harold is a Duty Disability Income recipient or a Retiree — is a question these individuals, between them, have had twenty-four years, multiple written requests, and every relevant record in their own files to answer. They have not answered it because answering it, in either direction, exposes the other layer.

X. Chapter Exhibits