STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF STATE, DIVISION ) OF LICENSING, )

)

Petitioner, )

)

vs. ) Case No. 99-2630

)

A PEOPLE FINDER, INC., and ) RHONDA L. PEROUTKA, President, )

)

Respondents. )

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was conducted in this case on September 30, 1999, by means of teleconference video connection in Tallahassee and Miami, Florida, before Administrative Law Judge Michael M. Parrish, of the Division of Administrative Hearings.

APPEARANCES

For Petitioner: Douglas D. Sunshine, Esquire

Department of State Division of Licensing

The Capitol, Mail Station No. 4 Tallahassee, Florida 32399-0250

For Respondent: Frances Schreiber, Esquire

Jerry B. Schreiber, Esquire

One Northeast Second Avenue, Suite 201 Miami, Florida 33132

STATEMENT OF THE ISSUES

This is a license discipline proceeding in which the Petitioner seeks to take disciplinary action against the Respondents on the basis of allegations of misconduct set forth

in an Administrative Complaint. The essence of the alleged misconduct is that the Respondents have conducted or advertised the business of a recovery agent without a valid Class "R" Recovery Agency license.

PRELIMINARY STATEMENT

At the final hearing in this case, the Petitioner presented the testimony of one witness, and offered two exhibits, both of which were received in evidence. The Respondents presented the testimony of one witness, and offered three exhibits, all of which were received in evidence.

At the conclusion of the hearing, the parties were allowed ten days from the filing of the transcript to file their respective proposed recommended orders. The transcript of the final hearing was filed on October 14, 1999. Thereafter, the Respondents moved for an extension of time and, by order dated October 27, 1999, all parties were allowed until November 2, 1999, to file their respective proposed recommended orders. On November 3, 1999, all parties filed proposed recommended orders containing proposed findings of fact and conclusions of law. 1/

FINDINGS OF FACT

1. Rhonda L. Peroutka has a Class "CC" Private Investigator Intern license, Number CC99-00699, issued by the Petitioner agency.

2. Rhonda L. Peroutka, in her capacity as President of A People Finder, Inc., holds a Class "A" Private Investigative

   Agency license, Number A97-00289, and a Class "ZA" Organizational Officer Position license, Number ZA97-00405, both issued by the Petitioner agency.

3. Beginning on January 8, 1999, and continuing to the date of the final hearing in this case, the Respondents have been engaged in business activities in the State of Florida that involve the performance of repossessions for consideration.

4. During the period of time mentioned above, the Respondents regularly and frequently entered into contracts with the Superior Bank in New Jersey to repossess motor vehicles in the State of Florida on which the Superior Bank had a lien. Pursuant to those contracts, the Respondents acted in the capacity of an independent contractor of the bank for the purpose of repossessing specific motor vehicles identified by the bank.

5. The contracts between Superior Bank and the Respondents specifically authorized and directed the Respondent, A People Finder, Inc., to repossess a specifically described motor vehicle. Such contracts did not authorize the Respondents to forward or to subcontract the repossession authorization. Nevertheless, the regular practice of the Respondents is to subcontract the repossession work to licensed recovery agencies throughout the State of Florida. The subcontracting licensed recovery agencies perform the actual repossessions of the motor vehicles the Superior Bank seeks to have repossessed. Following a successful recovery of a motor vehicle, the subcontracting

   licensed recovery agencies bill the Respondents for their services. Thereupon, the Respondents advise Superior Bank of the successful recovery, and the Respondents submit a bill to Superior Bank for repossessing the motor vehicle. The Respondents do not advise Superior Bank that the actual repossession was performed by a subcontractor.

6. The bills submitted by the Respondents to Superior Bank typically list as separate items a repossession fee, an administrative fee, and any miscellaneous costs associated with the repossession, such as the cost of making keys. Superior Bank pays the entire amount of the bill to the Respondents. When Superior Bank pays for a repossession, the entire amount of the payment is deposited into an escrow account controlled by the Respondents. Thereafter, the Respondents pay from the escrow account the amount due to the subcontracting licensed recovery agency, and they pay to A People Finder, Inc., the administrative fee that was charged to Superior Bank.

7. The Respondents agree with the licensed recovery agencies with whom they contract to hold them "harmless from and against any and all claims, damages, losses, and actions including reasonable attorney's fees, resulting from and arising out of your efforts to collect and/or repossess. . . ." However, the Respondents do not carry insurance for the actions of a recovery agency during the course of a repossession. Neither of the Respondents has a recovery agency license.

   CONCLUSIONS OF LAW

   
   

8. The Division of Administrative Hearings has jurisdiction over the parties to and the subject matter of this case pursuant to Section 120.57(1), Florida Statutes.

9. In license revocation and suspension actions, the Division of Licensing has the burden to prove by clear and convincing evidence the violations alleged in a license disciplinary action. Department of Banking and Finance v. Osbourne Stern, 670 So. 2d 932 (Fla. 1996); Pic n' Save Central Florida, Inc. v. Department of Business Regulation, Division of Alcoholic Beverages & Tobacco, 601 So. 2d 245 at 249 (Fla. 1st DCA 1992); and Ferris v. Turlington, 510 So. 2d 292 at 294 (Fla. 1987).

10. Section 493.6118(1)(g), Florida Statutes, provides, in pertinent part:

    1. The following constitute grounds for which disciplinary action specified in subsection (2) may be taken by the department against any licensee, agency, or applicant regulated by this chapter, or any unlicensed person engaged in activities regulated under this chapter.

       
       

       * * *

       
       

       (g) Conducting activities regulated under this chapter without a license. . . .

       
       

11. Section 493.6401(1), Florida Statutes, requires every "recovery agency" to have a license. Section 493.6101(20), Florida Statutes, defines "recovery agency" as "any person who,

    for consideration, advertises as providing or is engaged in the business of performing repossessions." (Emphasis added.)

12. Section 493.6118(2), Florida Statutes, provides:

    
    

    1. When the department finds any violation of subsection (1), it may do one or more of the following:

       1. Deny an application for the issuance or renewal of a license.

       2. Issue a reprimand.

       3. Impose an administrative fine not to exceed $1,000 for every count or separate offense.

       4. Place the licensee on probation for a period of time and subject to such conditions as the department may specify.

       5. Suspend or revoke license.

13. The Petitioner has met its burden of proof in this case. The actions of the Respondents described in the Findings of Fact constitute the business of performing repossessions for consideration. 2/ The Respondents are not licensed to engage in such business. Engaging in such business without a license is a violation of Section 493.6118(1)(g), Florida Statutes, and Rule 1C-3.122(1), Florida Administrative Code, as charged in the Administrative Complaint.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be issued in this case concluding that the Respondents are guilty of the violations charged and imposing the following penalties: (a) a one-year suspension of all licenses held by the Respondents; (b) an administrative fine in the amount of $1,000.00 against

Respondent, A People Finder, Inc.; and (c) an administrative fine in the amount of $1,000.00 against Respondent, Rhonda L. Peroutka.

DONE AND ENTERED this 16th day of December, 1999, in Tallahassee, Leon County, Florida.

MICHAEL M. PARRISH

Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(850) 488-9675 SUNCOM 278-9675

Fax Filing (850) 921-6847 www.doah.state.fl.us

Filed with the Clerk of the Division of Administrative Hearings this 16th day of December, 1999.

ENDNOTES

1/ The Proposed Recommended Order submitted by the Petitioner more nearly conforms to the findings and conclusions reached by the Administrative Law Judge. Many of the findings and conclusions proposed by the Petitioner have been incorporated into this Recommended Order.

2/ The Respondents argue that they are merely "account forwarders," and that, therefore, they are not performing repossessions and they do not come within the statutory definition of "recovery agency." The Respondents are doing much more than forwarding accounts. The Respondents enter into contracts with lienholders to repossess motor vehicles, enter into contracts with recovery agencies to accomplish the repossessions, and receive payment from the lienholders when repossessions are successfully executed.

COPIES FURNISHED:

Douglas D. Sunshine, Esquire Department of State

Division of Licensing

The Capitol, Mail Station No. 4 Tallahassee, Florida 32399-0250

Frances Schreiber, Esquire Jerry B. Schreiber, Esquire Suite 201

One Northeast Second Avenue Miami, Florida 33132

Honorable Katherine Harris Secretary of State

The Capitol, Plaza Level 02 Tallahassee, Florida 32399-0250

Deborah K. Kearney, General Counsel Department of State

The Capitol, Lower Level 10 Tallahassee, Florida 32399-0250

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within 15 days from the date of this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the Final Order in this case.

Docket for Case No: 99-002630

Orders for Case No: 99-002630