Lh 43 DEPARTMENT OF FINANCIAL SERVICES JUN 24 2003 TOM GALLAGHER CHIEF FINANCIAL OFFICER ooassty LL, IN THE MATTER OF: Dy ITT AC RUTH CROWELL HAUGHTON CASE NO: 65579-03-AG es o ADMINISTRATIVE COMPLAINT _ = np TO: RUTH CROWELL HAUGHTON = 101 Park Street : z Safety Harbor, Florida 34695 = oo my on RUTH CROWELL HAUGHTON = 1022 Main Street, Ste. K Dunedin, Florida 34698 You, RUTH CROWELL HAUGHTON, are hereby notified that pursuant to Chapter 626, Florida Statutes, the Insurance Commissioner of the State of Florida, has caused to be made an investigation of your activities while licensed an insurance agent in this state as a result of which it is alleged that: GENERAL ALLEGATIONS 1. You, RUTH CROWELL HAUGHTON, are currently licensed in this state as a life and variable annuity agent, and life, health and annuity agent. 2. At all times pertinent to the dates and occurrences referred to herein this Administrative Complaint, you, RUTH CROWELL HAUGHTON, were licensed in this state as an insurance agent. COUNT I 3. Paragraphs one and two are realleged and incorporated herein by reference, 4. - Onorabout February 20, 2002, you, RUTH CROWELL HAUGHTON, solicited D.C. of Clearwater, Florida to purchase a one-year term certificate of deposit being sold by Money Wise Financial Services. You, RUTH CROWELL HAUGHTON, received from D.C. $94,932.63 of her personal retirement savings to purchase a Certificate of Deposit. You, RUTH CROWELL HAUGHTON, failed to purchase the one- year term Certificate of Deposit. Rather, you, RUTH CROWELL HAUGHTON, induced D.C, to purchase a Trans America Life Insurance Company annuity, 5. You, RUTH CROWELL HAUGHTON, represented to C.D. that the Trans - America annuity was the equivalent of a Certificate of Deposit and would have a guaranteed 6.25% annual retum for one year after which her funds, principal plus interest, would be returned without penalty. Your representations were false and a material misstatement of fact. The annuity is not a certificate of deposit or its equivalent. The annuity did not pay a 6.25% annual return, it is not financially guaranteed by the Federal Deposit Corporation (FDIC) and C.D. is not entitled to the return of her money after one year. Money can only be withdrawn with the payment by C.D ofa very significant financial penalty. C.D. would not have purchased the annuity, but for these misrepresentations. You, RUTH CROWELL HAUGHTON, were aware of these facts. 6. This transaction were neither necessary nor in the purchaser’s best interest. Asa result, C.D. has lost retirement income. 7. You, RUTH CROWELL HAUGHTON, sold the TranAmerica annuity to C.D. for the sole purpose of receiving a commission, which you did receive. Tf IS THEREFORE CHARGED that you, RUTH CROWELL HAUGHTON, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the State Treasurer and Insurance Commissioner which constitute grounds for the suspension or revocation of your license(s) and eligibility for licensure: (a) Willful misrepresentation of any insurance policy or annuity contract or willful deception with regard to any such policy or contract. [Section 626.61 1(5), Florida Statutes] (b) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance. [Section 626.61 1(7), Florida Statutes] (c) Fraudulent or dishonest practices in the conduct of business under the license or permit. {Section 626.611(9), Florida Statutes] (d) Willful failure to comply with, or willful violation of any proper order or rule of the department or willful violation of any provision of this code. [Section 626.611(13), Florida Statutes] (e) Violation of any provision of this code or of any other law applicable to the business of insurance in the course of dealing under the license or permit. [Section 626.621(2), Florida Statutes] (f) In the conduct of business under the license or permit, engaging in unfair methods of competition or in unfair or deceptive acts or practices, as prohibited under part X of this chapter, or having otherwise shown himself to be a source of injury or loss to the public. {Section 626.621(6), Florida Statutes] (g) Knowingly: a. Filing with any Supervisory or other public official, b. Making, publishing, disseminating, circulating, c. Delivering to any person, d. Placing before the public, e. Causing, directly or indirectly, to be made, published, disseminated, Circulated, delivered to any person, or placed before the public, any false material statement. [Section 626.9541(1)(e)1, Florida Statutes} COUNT II 8. Paragraphs one and two are Tealleged and incorporated herein by reference. 9. On or about June 8, 2001, you, RUTH CROWELL HAUGHTON, solicited L.L. of Clearwater, Florida to purchase a short- term certificate of deposit being sold by Money Wise Financial Services. You, RUTH CROWELL HAUGHTON, received from L.L. $50,000 of her Personal retirement savings to purchase a Certificate of Deposit. You, RUTH CROWELL HAUGHTON, failed to purchase the short term Certificate of Deposit. Rather, you, RUTH CROWELL HAUGHTON, induced L.L, to purchase a Trans America Life Insurance Company annuity. 10. You, RUTH CROWELL HAUGHTON, represented to L.L.that the Trans America annuity was the equivalent of a Certificate of Deposit and would have a guaranteed 6.00% annual return without early withdrawal penalties. Your representations were false and a material misstatement of fact. The annuity is not a certificate of deposit or its equivalent. The annuity did not pay a 6.00% annual retum, it is not financially guaranteed by the Federal Deposit Corporation (FDIC) and L.L. is Not entitled to the return of her money after one year. Money can only be withdrawn with the payment by L.L. of a very significant financial penalty. L.L. would not have purchased the annuity, but for these misrepresentations. You, RUTH CROWELL HAUGHTON, were aware of these facts. 11. This transaction were neither necessary nor in the purchaser’s best interest. Asa result, L.L. has lost retirement income. 12. You, RUTH CROWELL HAUGHTON, sold the Trans America annuity to L.L. for the sole purpose of receiving a commission, which you did receive. IT IS THEREFORE CHARGED that you, RUTH CROWELL HAUGHTON, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the State Treasurer and Insurance Commissioner which constitute grounds for the suspension or revocation of your license(s) and eligibility for licensure: Sections 626.611(5); 626.611(7); 626.611(9); 626.611(13); 626.621(2); 626.621(3); 626.621(6); and 626.9541(1)(e)t, Florida Statutes as more particularly alleged in Count I above. ‘OUNT II 13. Paragraphs one and two are realleged and incorporated herein by reference. 14. Onor about March 1, 2001, you, RUTH CROWELL HAUGHTON, solicited R.M.J. of Clearwater, Florida to purchase a short- term certificate of deposit being sold by Money Wise Financial Services. You, RUTH CROWELL HAUGHTON, received from R.M.J. $25,000 of her personal retirement savings to purchase a Certificate of Deposit. You, RUTH CROWELL HAUGHTON, failed to purchase the short term Certificate of Deposit. Rather, you, RUTH CROWELL HAUGHTON, induced R.M.J. to purchase a Trans America Life Insurance Company annuity. 15. You, RUTH CROWELL HAUGHTON, represented to R.M.J. that the Trans America annuity was the equivalent of a Certificate of Deposit and would have a guaranteed 10% annual return without early withdrawal penalties. Your representations were false and a material misstatement of fact. The annuity is not a certificate of deposit or its equivalent, The annuity does not pay a 10% annual Tetum, it is not financially guaranteed by the Federal Deposit Corporation (FDIC) and R.M.J. is not entitled to the return of her money after one year, Money can only be withdrawn with the payment by L.L. ofa very significant financial penalty. L.L. would not have purchased the annuity, but for these misrepresentations. You, RUTH CROWELL HAUGHTON, were aware of these facts, 16. This transaction were neither necessary nor in the purchaser’s best interest. Asa Tesult, R.M.J. has lost retirement Income. 17, You, RUTH CROWELL HAUGHTON, sold the Trans America annuity to R.M.J. for the sole purpose of receiving a commission, which you did receive. IT IS THEREFORE CHARGED that you, RUTH CROWELL HAUGHTON, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the State Treasurer and Insurance Commissioner which constitute grounds for the Suspension or revocation of your license(s) and eligibility for licensure: Sections 626.611(5); 626.611(7); 626.61 1(9); 626.611(13); 626.621(2); 626.621(3); 626.621(6); and 626.9541(1)(e)1, Florida Statutes as more particularly alleged in Count I above. COUNT IV 18, Paragraphs one and two are Tealleged and incorporated herein by reference. 19. On or about March 7, 2001, you, RUTH CROWELL HAUGHTON, solicited L.A. of Clearwater, Florida to purchase a short- term certificate of deposit being sold by Money Wise Financial Services. You, RUTH CROWELL HAUGHTON, received from L.A. $132,000 of his personal retirement Savings to purchase a Certificate of Deposit. You, RUTH CROWELL HAUGHTON, failed to purchase the short term Certificate of Deposit. Rather, you, RUTH CROWELL HAUGHTON, induced L.A. to purchase a Trans America Life Insurance Company annuity. 20. You, RUTH CROWELL HAUGHTON, represented to L.A.that the Trans America annuity was the equivalent of a Certificate of Deposit and would have a guaranteed annual return without early withdrawal penalties. Your representations were false and a material misstatement of fact. The annuity is not a certificate of deposit or its equivalent. The annuity did not pay an annual retum as represented, it is not financially guaranteed by the Federal Deposit Corporation (FDIC) and L.A. is not entitled to the retum of his money after one year. Money can only be withdrawn with the payment by L.A. of a very significant financial penalty. L.L. would not have purchased the annuity, but for these misrepresentations. You, RUTH CROWELL HAUGHTON, were aware of these facts. 21. This transaction were neither necessary nor in the purchaser’s best interest. Asa result, L.A. has lost retirement income. 22. You, RUTH CROWELL HAUGHTON, sold the Trans America annuity to L.A. for the sole purpose of receiving a commission, which you did receive. IT IS THEREFORE CHARGED that you, RUTH CROWELL HAUGHTON, have violated or are accountable under the following provisions of the Florida Insurance Code-and Rules of the State Treasurer and Insurance Commissioner which constitute grounds for the suspension or revocation of your license(s) and eligibility for licensure: Sections 626.61 1(5); 626.611(7); 626.611(9); 626.611(13); 626.621(2); 626.621(3); 626.621(6); and 626.9541(1)(e)1, Florida Statutes as more particularly alleged in Count I above. ---——_. Te arn ee errr oes =e a et se ens COUNT Vv 23. Paragraphs one and two are realleged and incorporated herein by reference. 24. Onor about May and September, 2000, you, RUTH CROWELL HAUGHTON, solicited C.P, and L.P. of Clearwater, Florida to purchase a short- term certificate of deposit being sold by Money Wise Financial Services. You, RUTH CROWELL HAUGHTON, received from C.P. and L.P. $50,000 of their personal retirement savings to purchase a Certificate of Deposit. You, RUTH CROWELL HAUGHTON, failed to purchase the short term Certificate of Deposit. Rather, you, RUTH CROWELL HAUGHTON, induced LLL. to purchase a Trans America Life Insurance Company annuity, 25. You, RUTH CROWELL HAUGHTON, Tepresented to C.P. and L.P. that the Trans America annuity was the equivalent of a Certificate of Deposit and would have a guaranteed 6.00% annual retum for five years without early withdrawal penalties. Your deposit or its equivalent. The annuity did not pay a 6.00% annual return, it is not financially guaranteed by the Federal Deposit Corporation (FDIC) and C.P. and L.P. are not entitled to the Teturn of their money after five years, Money can only be withdrawn with the Payment by L.L. of a very significant financial penalty. C.P. and LP. would not have purchased the annuity, but for these misrepresentations. You, RUTH CROWELL HAUGHTON, were aware of these facts, 26. This transaction were neither necessary nor in the purchaser’s best interest. Asa result, C.P. and L.P, have lost retirement income. 27. You, RUTH CROWELL HAUGHTON, sold the Trans America annuity to L.L. for the sole Purpose of receiving a commission, which you did receive. IT IS THEREFORE CHARGED that you, RUTH CROWELL HAUGHTON, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the State Treasurer and Insurance Commissioner which constitute grounds for the suspension or revocation of your license(s) and eligibility for licensure: Sections 626.611(5); 626.611(7); 626.611(9); 626.611(13); 626.621(2); 626.621 (3); 626.621(6); and 626.9541(1)(e)1, Florida Statutes as more particularly alleged in Count I above. COUNT VI 28. Paragraphs one and two are realleged and incorporated herein by reference. 29. Onor about March 1, 2001, you, RUTH CROWELL HAUGHTON, solicited R.M.J. of Clearwater, Florida to purchase a short- term certificate of deposit being sold by Money Wise Financial Services. You, RUTH CROWELL HAUGHTON, received from R.M.J. $25,000 of her personal retirement savings to purchase a Certificate of Deposit. You, RUTH CROWELL HAUGHTON, failed to purchase the short term Certificate of Deposit. Rather, you, RUTH CROWELL HAUGHTON, induced R.M.J. to purchase a Trans America Life Insurance Company annuity. 30. You, RUTH CROWELL HAUGHTON, represented to R.M.J. that the Trans America annuity was the equivalent of a Certificate of Deposit and would have a guaranteed 10% annual return without early withdrawal penalties. Your representations were false and a material misstatement of fact. The annuity is not a certificate of deposit or its equivalent. The annuity does not pay a 10% annual return, it is not financially guaranteed by the Federal Deposit Corporation (FDIC) and R.M.J. is not entitled to the retum of her money after one year. Money can only be withdrawn with the payment by LLL. of very significant financial penalty. L.L. + ees, nce ee would not have purchased the annuity, but for these misrepresentations. You, RUTH CROWELL HAUGHTON, were aware of these facts. 31. This transaction were nei ther necessary nor in the purchaser’s best interest. Aga result, R.M.J. has lost retirement income. 32. You, RUTH CROWELL HAUGHTON, sold the Trans America annuity to NOTICE OF RIGHTS MAILE OF RIGHTS filed with the Department within twenty-one (21) days of your receipt of this notice. Completion Department no later than 5:00 p.m. on the twenty-first day after your Teceipt of this notice. Mailing the tesponse on the twenty-first day will not Preserve your right to a hearing. YOUR FAILURE TO RESPOND IN WRITING WITHIN TWENTY-ONE (21) DAYS OF YOUR RECEIPT OF THIS NOTICE WILL CONSTITUTE A WAIVER OF YOUR RIGHT TO REQUEST A PROCEEDING ON THE MATTERS ALLEGED HEREIN AND AN ORDER OF REVOCATION WILL BE ENTERED AGAINST YOU. If you request a Proceeding, you must provide information that complies with the requirements of Rule 28-107.004, Florida Administrative Code. As noted above, completion of the attached Election of Proceeding form conforms to these requirements. Specifically, your response must contain: (a) The name and address of the party making the request, for purpose of service; (b) A statement that the party is requesting a hearing involving disputed issues of material fact, or a hearing not involving disputed issues of material fact; and (c) A reference to the notice, order to show cause, administrative complaint, or other communication that the party has received form the agency. If a hearing of any type is requested, you have the right to be represented by counsel or other qualified representative at your expense, to present evidence and argument, to call and cross-examine witnesses, and to compel the attendance of witnesses and the production of documents by subpoena. If a proceeding is requested and there is no dispute of material fact, the provisions of section 120.57(2), Florida Statutes, apply. In this regard, you may submit oral or written evidence in opposition to the action taken by the Department or a written statement challenging the grounds upon which the Department has relied. While a hearing is normally not required in the absence of a dispute of fact, if you feel that a hearing is necessary, one will be conducted in Tallahassee, Florida, or by telephonic conference call upon your request. However, if you dispute material facts which are the basis for the Department's action, you must request an adversarial Proceeding pursuant to sections 120,569 and 120.57(1), Florida 11 the Department of Insurance, DATED this 24th dayof___ June , 2003. £oth oS 'N CHANDLER Deputy Chief Financial Officer CERTIFICATE OF SERVICE MSRUILATE OF SERVICE ames A. Bossart, Esquire Fla. Bar No.:374598 ; Florida Department of F inancial Services Division of Legal Services 612 Larson Building 200 East Gaines Street Tallahassee, Florida 32399-0333 (850) 413-4125

Docket for Case No: 03-004403PL