STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

STEPHANIE D. GROOMS, )

)

Petitioner, )

)

vs. ) Case No. 85-2916

)

OFFICE OF THE COMPTROLLER, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, an administrative hearing was held before Diane D. Tremor, Hearing Officer with the Division of Administrative Hearings, on November 13, 1985, in Tampa, Florida. The issue for determination in this proceeding is whether petitioner's application-for a mortgage solicitor's license should be granted or denied.

APPEARANCES

For Petitioner: Dick Greco, Jr.

Molloy, James & Greco, P.A. Suite 910

501 East Kennedy Blvd. Tampa, Florida 33602

For Respondent: Wendy M. Mitchler and

Greg Cummings

Assistant General Counsel Office of the Comptroller The Capitol, Suite 1302 Tallahassee, Florida 32301

INTRODUCTION

Concluding that the petitioner Stephanie D. Grooms lacked honesty, truthfulness and integrity, the Office of the Comptroller denied her application for licensure as a mortgage solicitor. This conclusion was based upon the fact that petitioner untruthfully answered the question on the application

which states, "Have you ever been arrested, or indicted for a crime?"

In support of her position that she did not intend to mislead the respondent and was relying upon her attorney's advice, petitioner testified in her own behalf and presented the testimony of Roger Vernon Rigau, an attorney.

The respondent presented the testimony of Jana K. Synatschk, a financial examiner/analyst with the respondent; Arthur M. James, a financial examiner/analyst supervisor with the respondent; and James M. Ehrlich, respondent's Assistant Director of the Division of Finance. Respondent's Exhibits 1, 2 and 3 were received into evidence.

Subsequent to the hearing, counsel for each party submitted proposed findings of fact and proposed conclusions of law. The parties' proposed factual findings are accepted and/or incorporated in this Recommended Order, except as noted in the Appendix hereto.

FINDINGS OF FACT

Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant facts are found:

1. In 1980 or 1981, records of a criminal charge involving the petitioner Stephanie D. Grooms were ordered sealed. The attorney representing petitioner in that proceeding was Abe Rigau, now deceased.

   
   

2. In late July of 198G, petitioner was charged by a two- count information with the crime of issuing worthless checks. She entered a plea of guilty to the charges and the County Courts in and for Hillsborough County withheld adjudication of guilt and imposed a fine of $35 on August 25, 1982.

   
   

3. In the Fall of 1984, petitioner was a candidate for the Office of County Commission of Hillsborough County. During the campaign, a newspaper reporter contacted the petitioner in reference to a criminal charge involving worthless checks. Concerned about the election and the implications a criminal charge would have upon her political aspirations, petitioner telephoned Roger Rigau, an attorney and the son of deceased Abe Rigau, for advice.

   
   

4. Roger Rigau recalls that petitioner telephoned his

   office between September and November of 1984. It was Mr. Rigau's impression that petitioner contacted him because she was concerned that information concerning her previous charges could be politically embarrassing, that she was under the impression that the record had been previously sealed by his father, Abe Rigau, and that she was confused as to how a reporter could have obtained information regarding the prior criminal record which had been sealed. At all times, it was the understanding of Roger Rigau that petitioner was referring to the case which his father had handled for her. He was not aware of any new charges beyond those which were the subject of the record sealed in 1980 or 1981. Roger Rigau expressed surprise to petitioner that a member of the press would be able to obtain information regarding a sealed record. His office file contained paper work indicating that petitioner's record had been sealed by Abe Rigau. Roger Rigau was concerned that something was incorrect, either as a result of his father's error or a court clerk's office error. He told petitioner that he would check into the matter, did so and learned that the case his father had handled had indeed been sealed in 1980 or 1981. He so advised petitioner and also advised her that when a record is sealed, she need not relate to anyone that she had been arrested for or convicted of a crime.

   
   

5. Sometime after petitioner submitted her application for licensure as a mortgage solicitor in April of 1985, she again contacted Roger Rigau regarding sealed criminal charges. Roger Rigau again advised petitioner that when records are sealed or expunged, one may properly refuse to acknowledge or may deny the fact that one has been charged with or arrested for a crime.

   
   

6. Roger Rigau is knowledgeable about the law concerning the sealing and/or expunction of criminal records. Had he understood that petitioner was, either in 1984 or 1985, ever inquiring about her 1982 charges or record, he would have advised her that it is legally impossible to have more than one criminal record sealed. As noted above, Roger Rigau never had any knowledge concerning the 1982 worthless check charges and his advice to petitioner was, at all times, with reference to her 1980 sealed record.

   
   

7. Petitioner has a different recollection of her ., conversations with Roger Rigau. She remembers contacting Roger Rigau in 1984 around election time after a news reporter called her regarding some criminal charges. She states that she asked him if the 1982 charges and record could be expunged and that he replied that he would check into the matter. Sometime

   thereafter, she called his office and a secretary from his office, not identified or called as a witness in this proceeding, led petitioner to believe that the matter had been taken care of.

   
   

8. In March of 1985, petitioner went to work for Cameron- Brown, Co. In April of 1985, she filled out an application to the Comptroller's Office for registration as a mortgage solicitor. The application form requires answers to 18 questions and the signature of the applicant in affirmation under penalty of perjury that the answers provided are true and correct. Question 5 of the application states: "Have you ever been arrested, or indicted for a crime?" Petitioner answered this question "NO."

   
   

9. Petitioner recalls that, prior to submitting her application, she telephoned Roger Rigau or a secretary in his office, inquired as to how she should answer question 5 on the application and was advised that since her record had been sealed, she could fail to acknowledge or deny any charges which had been sealed. Petitioner recalls making the following statement to Roger Rigau:

   
   

   "My worthless check charges that your dad had expunged and that you had taken care of for me, can I legally put down there "no," or how can I answer that?"

   
   

   Roger Rigau does not specifically recall talking to petitioner prior to the time she submitted her application, but does recall talking to her either during the time of the respondent's investigation or after petitioner received notice of the respondent's intent to deny her application. In any event, he gave her the same advice he had given her in 1984 -- that she need not acknowledge and may deny a sealed criminal charge.

   Again, he was not aware that petitioner was involved in any criminal charges beyond that 0th which his father was involved in 1980 or 1981.

   
   

10. After the submittal of the petitioner's application, respondent's financial examiner/analyst, Jana Synatschk. conducted a routine investigation, which included a review of Court files. It was discovered that petitioner was the subject of two criminal actions - one in 1980 and one in 1982. The 1980 file was sealed, but the 1982 file was open for review. Ms. Synatschk telephoned petitioner on May 30, 1985, told her she had found two cases against a Stephanie Grooms for worthless

    check writing and asked petitioner if she was aware of this. Petitioner responded that she had no knowledge of such charges, and Ms. Synatschk required petitioner to submit an affidavit to that effect. After reviewing the notarized affidavit stating "I, Stephanie Grooms, have no knowledge of a record on a check charge mentioned by Jana Synatschk," Ms. Synatschk determined that the social security numbers, driver's license numbers and birth dates of the person involved in the 1982 worthless check charges and the petitioner/applicant were identical. She thereupon turned the case over to her supervisor, Arthur M. James.

    
    

11. Petitioner recalls speaking with Roger Rigau prior to submitting the affidavit to the respondent and again receiving the advice that she could properly deny a sealed criminal charge. Mr. Rigau does not recall speaking to the petitioner about the affidavit she was required to submit during the application process. He does recall that petitioner requested him to sign an affidavit after she received notice that her application had been denied.

    
    

12. Supervisor Art James telephoned petitioner on June 20, 1985, and asked her specific questions relating to the 1982 criminal charges. After denying that she had written the bad checks, Mr. James told her that the signatures on the checks appeared to be similar to her signatures on the affidavit and on her application. He invited her to come to his office to discuss the matter. She responded that her attorney would get in touch with him. Mr. James waited three or four days and, when he did not hear from petitioner's attorney, the petitioner's file was forwarded to Tallahassee.

    
    

13. On July 22 1985, the respondent denied petitioner's application for a mortgage solicitor's license based upon her lack of integrity, truthfulness and honesty as evidenced by her false statement in response to Question 5 on the application.

    
    

14. On or about the time of the respondent's denial order, but prior to petitioner's knowledge of the denial, petitioner telephoned the respondent's Tallahassee office to inquire about the status of her application. Joseph Ehrlich, the Assistant Director for the respondent's Division of Finance, informed petitioner that her application was being investigated and asked her about her arrest record. Petitioner denied any such record.

    
    

15. It was not until after the respondent's order of denial dated July 22, 1985, that she explained to respondent's

    personnel that she denied the 1982 worthless check charges because she thought that case had been sealed or expunged and that she accordingly had a legal right to deny all charges in connection with that case.

    
    

    CONCLUSIONS OF LAW

    
    

16. An applicant for a mortgage solicitor's license must complete and submit a form prescribed by the Department of Banking and Finance. Said Department may require such information, with due regard to the paramount interests of the public, as to the applicant's experience, background, competency, honesty, truthfulness and integrity, and may deny or refuse a license if it is determined that the applicant lacks such qualities necessary to properly act as a mortgage solicitor in Florida. Sections 494.04(4) and 494.05(4), Florida Statutes.

    
    

17. Here, the evidence demonstrates that in 1980 or 1981, a criminal record involving the petitioner was sealed. Accordingly, petitioner had the legal right to deny or refuse to acknowledge the existence if either the arrest or the charge relating to that record. Section 943.058, Florida Statutes. At all times relevant to the application process, petitioner and attorney Roger Rigau were aware of the sealed criminal action and the legal rights of the petitioner regarding that action. Were that the singular criminal action in which petitioner had been involved, her answer to question 5 on the application would have been legally proper.

    
    

18. However, in July of 1982, petitioner was charged by a two-count information with worthless checks. The record involving this criminal charge was never sealed or expunged, nor could it have been pursuant to Section 943.058, Florida Statutes. Accordingly, the answer of "no" to question 5 on the application constituted a false statement adversely reflecting upon petitioner's honesty, truthfulness and integrity.

    Likewise, the affidavit submitted to Ms. Synatschk, as well as the oral statements made to Ms. Synatschk, Mr. Allen and Mr.

    Ehrlich, denying the 1982 worthless check charges constituted false, statements for which the Department could conclude that petitioner fails to possess the qualities of honesty, truthfulness and integrity required of mortgage solicitors in Florida.

    
    

19. Petitioner contends that her false statements, in all

    instances, were the direct result of her continuing reliance upon the advice of attorney Roger Rigau that her records had been sealed and/or expunged and that she was entitled to deny all charges. While reliance on the advice of counsel may be a proper defense in some instances, especially where the issue involves an intent to mislead or give false information, it must first be demonstrated that the reliance was in good faith and with due care.

    
    

20. The burden in this proceeding is upon the petitioner, as an applicant, to fully demonstrate that she meets all the statutory criteria for licensure. Among the statutory criteria for licensure as a mortgage solicitor in Florida are the attributes of honesty, truthfulness and integrity. Petitioner made false statements, both orally and in writing, on five occasions during the application process. Her defense of reliance on the advice of counsel is not supported by the record of this proceeding.

    
    

21. There was insufficient evidence presented by the petitioner that she fully advised Roger Rigau that she had a 1982 criminal record in addition to the record sealed by his father in 1980 or 1981. He obviously made clear to her his concern with the 1980 or 1981 sealed record. It is reasonable to assume that had he been aware of a further criminal charge, he would have advised her that a second sealing or expunction would be legally impossible. His lack of awareness of the 1982 charges must be attributable to petitioner based upon incomplete facts supplied to him by her.

    
    

22. Even assuming that petitioner was legitimately confused at the time she completed and submitted her application for licensure, she was repeatedly confronted with the 1982 check charges by three different employees of the Department during the 90-day period following the submittal of her application.

    At some point in time, at least as early as May 30, 1985, she was informed that the Department had access to and full knowledge of the record of the 1982 charges. Thus, no matter what her understanding was of her attorney's prior advice, petitioner was placed on notice that her 1982 record had not been sealed or expunged. At least by that point in time, it was no longer reasonable or excusable for petitioner to continue to believe or assume that her 1982 charges could be denied. With the exercise of reasonable care and diligence, petitioner should have, at least by that point in time, ceased giving false statements to those charged with the responsibility of administering and enforcing the Mortgage Brokerage Act under

    which she was seeking licensure. It was not until after the denial order was issued on July 22, 1985, that petitioner elected to make an effort to explain her prior false statements to the respondent.

    
    

23. Based upon the false statements made by the petitioner on her application, in the subsequent affidavit and in three separate contacts with respondent's representatives, which statements petitioner knew or through the exercise of reasonable care should have known were false, it is concluded that petitioner failed to demonstrate the qualities of honesty, truthfulness and integrity necessary for licensure as a mortgage solicitor in Florida.

RECOMMENDATION

Based upon the findings of fact and conclusions of law recited herein, it is RECOMMENDED that the application of Stephanie D. Grooms for licensure as a mortgage solicitor be DENIED.

Respectfully submitted and entered this 8th day of January, 1986, in Tallahassee, Florida.

DIANE D. TREMOR, Hearing Officer Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32399

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 8th day of January, 1986.

COPIES FURNISHED:

Honorable Gerald Lewis Comptroller, State of Florida Department of Banking and Finance The Capitol

Tallahassee, Florida 32301 Dick Greco, Jr., Esquire

Molloy, James & Greco, P.A. Suite 910

501 East Kennedy Blvd. Tampa, Florida 33602

Wendy M. Mitchler, Esquire Greg Cummings, Esquire Assistant General Counsel Office of the Comptroller The Capitol, Suite 1302 Tallahassee, Florida 32301

APPENDIX

The proposed findings of fact submitted by the petitioner and the respondent have been accepted and/or incorporated in this Recommended Order, except as noted, below.

Petitioner

Respondent

13. Rejected, not relevant or dispositive of any issue in this proceeding.

15. Last sentence rejected, not relevant or dispositive of any

issue in this proceeding.

Docket for Case No: 85-002916

Orders for Case No: 85-002916