Jun 28 2005 16:30 06/28/2085 16:38 8584874987 LEGAL SERVICES PAGE 43 - io FLORIDA DEPARTMENT OF FINANCIAL SERVICES . TOM GALLAGHER FILED CHIEF FINANCIAL OFFICER STATE OF FLORIDA RUN 10 ages IN THE MATTER OF: — na CASE NO.: 80121-05-AG MICHAEL HENRY BURTON ADMINISTRATIVE COMPLAINT TO: MICHAEL HENRY BURTON 1868 North University Drive Suite 301 Plantation, FL 33322-4135 MICHAEL HENRY BURTON 6000 SW 13th Street Plantation, FL 33317-4637 You, MICHAEL HENRY BURTON, license ID. #4036444, are hereby notified that the Chief Financial Officer of the State of Florida has caused to be made an investigation of your activities while licensed as an insurance agent in this state, as a result of which it is alleged: GENERAL ALLEGATIONS ]. Pursuant to Chapter 626, Florida Statutes, you, MICHAEL HENRY BURTON, are currently licensed in this state as a General Lines (Prop. & Cas.) (2-20) Agent. 2. At all times pertinent to the dates and occurrences referred to herein, you, MICHAEL HENRY BURTON, were licensed in this state as an insurance agent. 3. Pursuant to chapter 626, Florida Statutes, the Florida Department of Financial Services has jurisdiction over your insurance licenses and appointments. Jun 28 2005 16:30 06/28/2685 16:38 8584874947 LEGAL SERVICES PAGE 84 YY NY 4. At all times material herein you, MICHAEL HENRY BURTON, as a licensed insurance agent, conducted insurance business through Clarion Insurance Agency of America, Inc., a Florida corporation (hereinafter CLARION), for which you were an officer and director, and designated primary agent. COUNT I 5. The above general allegations are hereby realleged and fully incorporated herein by reference. 6. On or about June 12, 2000, your agency, CLARION, entered into an agency agreement with American Contractors Indemnity Company (hereinafter AMERICAN). On or after that date, you, MICHAEL HENRY BURTON, caused bonds to be written under authority of that agreement for which you collected all premiums therefor. 7. During the period from March, 2002 through October, 2003, you, MICHAEL HENRY BURTON, caused a total of eighty-eight (88) bonds to be written in behalf of AMERICAN, collected the premiums therefor, and failed to remit such premiums due AMERICAN, which you were required to do by contract and jaw. 8. As of October 31, 2003, you, MICHAEL HENRY BURTON, doing business as CLARION, failed to remit to AMERICAN net premiums due it totaling $153,723.90, having confiscated and misappropriated those funds to your own use and benefits. 9. On or about November 20, 2003, AMERICAN terminated your agency relationship for cause based upon your misappropriation of its premium funds as aforesaid. TT IS THEREFORE CHARGED that you, MICHAEL HENRY BURTON, have violated of are accountable under the following provisions of the Florida Insurance Code and Rules of the Department of Financial Services which constitute grounds for the suspension, or revocation of your licenses, registrations, and appointments as an insurance agent: (a) All premiums, return pretniums, or other funds belonging to insurers or others Teceived by an agent, customer representative, solicitor, ot adjuster in transactions under his or Jun 28 2005 16:30 06/28/2005 16:38 8584874967 LEGAL SERVICES PAGE @5 LY V/ license or trust funds received by the licensee in a fiduciary capacity. The licensee in the applicable regular course of business shall account for and pay the same to the insurer, insured, or other person entitled thereto. [Section 626.561(1), Florida Statutes]; (b) If the license or appointment is willfully used, or to be used, to circumvent any of the requirements or prohibitions of the Florida Insurance Code. [Section 626.611(4), Florida Statutes]; (c) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance. [Section 626.611(7), Florida Statutes]; (d) Fraudulent or dishonest practices in the conduct of business under the licensure or appointment. [Section 626.611(9), Florida Statutes]; (e) Misappropriation, conversion, or unlawful withholding of moneys belonging to uosurers or insureds, their beneficiaries, or to others and received in conduct of business under the license. [Section 626.611(10), Florida Statutes]; (f) In the conduct of business under the license or appointment engaging in unfair or deceptive acts or practices, as prohibited under part LX of Chapter 626, Florida Statutes, or having otherwise having shown himself or herself to be a source of injury or loss to the public. [Section 626.621(6), Florida Statutes]; (g) Any general lines insurance agent who is an officer, director, or stock holder of an incorporated general lines insurance agency shall remain personally and fully liable and accountable for any wrongful acts, misconduct, or violations of any provision of this code committed by such licensee or by any person under his or her direct supervision and control while acting on behalf of the corporation. [Section 626.734, Florida Statutes]; COUNT I 10. The above general allegations are hereby realleged and fully incorporated herein by reference. 11. On or about February 3, 2004, the Bureau of Investigation of the Department of Financial Services, attempted to obtain and review your records with respect to premium Jun 28 2005 16:31 46/28/2885 16:38 9564874987 LEGAL SERVICES PAGE 46 aed Sued payments due from you and your agency, CLARION, to AMERICAN. You failed and refused to produce or provide records as requested and required by law. It IS THEREFORE CHARGED that you, MICHAEL HENRY BURTON, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the Department of Financial Services which constitute grounds for the suspension, or revocation of your licenses, registrations, and appointments as an insurance agent: (a) If the license or appointment is willfully used, or to be used, to circumvent any of the requirements or prohibitions of the Florida Insurance Code. (Section 626.611(4), Florida Statutes]; (b) Every person being examined or investigated, and its officers, attorneys, employees, agents and representatives, shall make freely available to the Department or office or its examiners or investigators the accounts, records, documents, files, information, assets, and matters in their possession or control relating to the subject of the examination or investigation. {Section 624.318(2), Florida Statutes; (c) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance. [Section 626.611(7), Florida Statutes]; (d) Knowingly aiding, assisting, procuring, advising, or abetting any person in the violation of or the violated provision of the Insurance Code or any order or rule of the Department. [Section 626.621(12), Florida Statutes); (e) Willful failure to comply with, or willful violation of, an order or rule of the Department of Financial Services or willful violation of any provision of the Florida Insurance Code. [Section 626.611(13), Florida Statutes]. WHEREFORE, you, MICHAEL HENRY BURTON, are hereby notified that the Chief Financial Officer intends to enter an Order suspending or revoking your licenses and appointments as an insurance agent or to impose such penalties as may be provided under the provisions of Sections 626.611, 626.621, 626.681, 626.691, and 626.9521, Florida Statutes, and Jun 28 2005 16:31 06/28/2685 16:38 9584874987 LEGAL SERVICES PAGE 87 under the other referenced Sections of the Florida Statutes as set out in this Administrative Complaint. NOTICE OF RIGHTS You have the right to request a proceeding to contest this action by the Department pursuant to Sections 120.569 and 120.57, Florida Statutes, and Rule 28-107, Florida Administrative Code. The proceeding request must be in writing, signed by you, and must be filed with the Department within twenty-one (21) days of your receipt of this notice. Completion of the attached Election of Proceeding form and/or a petition for administrative hearing will suffice as a written request. The request must be filed with the General Counsel as acting Agency Clerk, at the Florida Department of Financial Services, 612 Larson Building, 200 East Gaines Street, Tallahassee, Florida 32399-0333. Your written response must be received by the Department no later than 5:00 p.m. on the twenty-first day after your receipt of this notice. Mailing the response 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; (6) 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. Jun 28 2005 16:31 86/28/2085 16:38 9584874987 LEGAL SERVICES PAGE 48 (c) A reference to the notice, order to show cause, administrative complaint, or other communication that the party has received from the agency. Ifa 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 Statutes. These proceedings are held before a State administrative law judge of the Division of Administrative Hearings, Unless the majority of witnesses are located elsewhere, the Department will request that the hearing be conducted in Tallahassee, Florida. Failure to follow the procedure outlined with regard to your response to this notice may result in the request being denied. AJ prior oral communication or correspondence in this matter shall be considered freeform agency action, and no such oral communication or correspondence shall operate as a valid request for an administrative proceeding. Any request for an administrative proceeding received prior to the date of this notice shall be deemed abandoned unless timely renewed in compliance with the guidelines as set out above. Jun 28 2005 16:32 @6/28/2085 16:36 8584874987 LEGAL SERVICES PAGE a9 Ne Ns Mediation of this matter pursuant to Section 120.573, Florida Statutes, is not available. No Department attomey will discuss this matter with you until the response has been received by the Department of Financial Services. DATED and SIGNED this oth. day of June 2005. IN CHANDLER. Deputy Chief Financial Officer CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing ADMINISTRATIVE COMPLAINT and ELECTION OF PROCEEDING has been furnished to: MICHAEL HENRY BURTON, 1868 North University Drive, Suite 301, Plantation, FL 33322-4135; MICHAEL HENRY BURTON, 6000 SW 13th Street, Plantation, FL 33317-4637 by Certified Mail this (0th day of Syren , 2005. LGA Dean Andrews Division of Legal Services 200 East Gaines St. 612 Larson Building Tallahassee, Florida 32399-033 (850) 413-4242 Florida Bar Number 0001959

Docket for Case No: 05-002321PL