Cy + | FLORIDA ed FINANCIAL SERVICES TOM GALLAGHER . SEP 30 5 CHIEF FINANCIAL OFFICER Docketed by: ( x y_ STATE OF FLORIDA IN THE MATTER OF: ot CASE NO.: 80071-05-AG ~ CHRISTOPHER P. WINCHELL ADMINISTRATIVE COMPLAINT TO: CHRISTOPHER P. WINCHELL . 710 25" Street Northwest Naples, Florida 34120 CHRISTOPHER P, WINCHELL . Od: AI Alf L 9430 Bonita Beach Road, Suite 201 oo Bonita Springs, Florida 34135 : You, CHRISTOPHER P. WINCHELL, 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 and as a result of which it is alleged: GENERAL ALLEGATIONS 1. Pursuant to Chapter 626, Florida Statutes, you, CHRISTOPHER P. WINCHELL, currently are licensed in this state as a life including variable annuity (2-14), life including variable annuity & health (2-15), life (2-16), life & health (2-18), and health (2-40) agent, and _ . were so licensed at all times relevant to the dates and occurrences referenced herein. Your license identification number is A296485. 2. Pursuant to Chapter 626, Florida Statutes, the Florida Department of Financial Services (hereinafter referred to as the “Department”) has jurisdiction over your licenses and appointments. 3. All references herein to Florida Statutes shall mean and refer to Florida Statutes (2002) unless otherwise indicated. COUNTI 4, The above General Allegations are hereby realle ged and fully incorporated herein by reference. 5. On or about January 20, 2003, you, CHRISTOPHER P. WINCHELL, sold a ’ Mutual Benefits Corporation Viatical Settlement Purchase Agreement to RM and JM of Naples, Florida. ; 6, RM had advised you, CHRISTOPHER P. WINCHELL, that he did not want to put his investment principal at risk. © 7. You, CHRISTOPHER P. WINCHELL, assured RM that this investment was safe, and created a reasonable impression by RM that this product was safe and/or guaranteed. 8. You, CHRISTOPHER P. WINCHELL, made material misrepresentations‘as to the nature of the return or the duration of time to obtain the return with respect to the aforesaid Viatical Settlement Purchase Agreement. . 9. You, CHRISTOPHER P. WINCHELL, knew or should have known that this investment was not consistent with the expressed investment intentions of RM. 10. As aresult of the misrepresentations made to RM and JM by you, CHRISTOPHER P. WINCHELL, their investment principal has been put at risk of significant loss. - N C) | LY eee ' In the sale of the aforesaid Viatical Settlement Purchase Agreement, you, CHRISTOPHER P. WINCHELL, failed to conspicuously display, by means of contrasting color and type size, required disclosures to the viatical settlement purchaser(s). IT IS THEREFORE CHARGED that you, CHRISTOPHER P. WINCHELL, have violated or are accountable under one or more of the following provisions of the Florida Insurance Code, which constitutes grounds for the suspension or revocation of your licenses as an insurance agent in this state: (a) No person shall transact insurance in this state, or relative to a subject of insurance resident, located, or to be performed in this state, without complying with the applicable provisions of this code. [Section 624.11(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 this code. [Section 626.611(4), Florida Statutes]. (c) Willful misrepresentation of any insurance policy or annuity contract or willful ; deception with regard to any such policy or contract, done either in person or by any form of . dissemination of information or advertising. [Section 626.611(5), Florida Statutes} 7 (d) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance. [Section 626.611(7), Florida Statutes]. ) (e) Demonstrated lack of reasonably adequate knowledge and technical competence to engage in the transactions authorized by the license or appointment. [Section 626.611(8), Florida Statutes]. (f) . Fraudulent or dishonest practices in the conduct of business under the license or appointment. [Section 626.611(9), Florida Statutes]. Qo | Cy (g) 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]. (h) . 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 appointment. [Section 626.621(2), Florida Statutes}. qi) Violation of any lawful order or rule of the department. [Section 626.621(3), Florida Statutes]. (ji) | Inthe conduct of business under the license or appointment, engaging in unfair methods of competition or in unfair or deceptive acts or practices, as prohibited under part Ix of this chapter, or having otherwise shown himself or herself to be a source of injury or loss to the public or detrimental to the public interest, [Section 626.621(6), Florida Statutes]. (k) Ifa life agent, violation of the code of ethics. [Section 626.621(9), Florida Statutes]. qd) No person shall engage in this state in any trade practice which is defined in this part as, or determined pursuant to's. 626.951 or s. 626.9561 to be, an unfair method of competition or an unfair or deceptive act or practice involving the business of insurance. [Section 626.9521(1), Florida Statutes]. - (m) Misrepresents the benefits, advantages, conditions, or terms of any insurance policy. [Section 626.9541(1)(a)1., Florida Statutes]. (n) Knowingly making, publishing, disseminating, circulating, or placing before the public, or causing, directly or indirectly, to be made, published, disseminated, circulated, or , placed before the public: -_ ; cy) 1, Ina newspaper, magazine, or other publication, No . In the form of a notice, circular, pamphlet, letter, or poster, 3. Over any radio or television station, or 4, In any other way, an advertisement, announcement, or statement containing any assertion, representation, or statement with respect to the business of insurance, which is untrue, deceptive, or misleading. [Section 626.9541(1)(b), Florida Statutes]. . (0) No person shall misrepresent the nature of the return or the duration of time to obtain the return of any investment related to one or more viatical settlements sold by a viatical settlement provider or related provider trust. [Section 626.99235(1), Florida Statutes]. (p) The viatical settlement provider and the-viatical settlement sales agent, themselves or through another person, shall provide in writing the following disclosures to any viatical settlement purchaser or purchaser prospect: , . ' (a) That the retum represented as being available under the viatical settlement purchase agreement is directly tied to the projected life span of one or more insureds. (b) If a return is represented, the disclosure shall indicate the projected life span of the insured or insureds whose life or lives are tied to the return. (c) If required by the terms of the viatical settlement purchase agreement, that the -viatical settlement purchaser shall be responsible for the payment of insurance premiums . on the life of the insured, late or surrender fees, or other costs related to the life insurance policy on the life of the insured or insureds which may reduce the return. . (d) The amount of any trust fees, commissions, deductions, or other expenses, if any, to be charged to the viatical settlement purchaser. (e) The name and address of the person responsible for tracking the insured.” 9 , Oo That group policies may contain limitations or caps in the conversion rights, that additional premiums may have to be paid if the policy is converted, and that the party responsible for the payment of such additional premiums shall be identified. (g) That the life expectancy and rate of return are only estimates and cannot be guaranteed. - (h) That the purchase of a viatical settlement contract should not be considered a liquid purchase, since it is impossible to predict the exact timing of its maturity and the funds may not be available until the death of the insured. (i) The name and address of the person with the responsibility for paying the premium until the death of the insured. The written disclosure required under this subsection shall be conspicuously displayed in any viatical settlement purchase agreement, and in any solicitation material furnished to the viatical settlement purchaser by such viatical settlement provider, related provider trust, or person, and shall be in contrasting color and in not less than 10-point type or no smaller than the largest type on the page if larger than 10-point type. The department is authorized to adopt by rule the disclosure form to be used. The disclosures need not be furnished in an invitation to inquire, the objective of which is to create a desire to inquire further about entering into a viatical settlement purchase agreement. The invitation to inquire may not quote rates of return, may not include material attendant to the execution of any specific viatical settlement purchase agreement, and may not relate to any specific viator. [Section 626.99235(2), Florida Statutes]. (q) A violation of this act is an unfair trade practice under ss. 626.9521 and 626.9541 and is subject to the penalties provided in the insurance code. Part X of this chapter applies to a licensee under this act or a transaction subject to this act as if a viatical settlement contract and a viatical settlement purchase agreement were an insurance policy. [Section 626.9927(1)]. @ A person may not represent that the investment ina viatical settlement purchase agreement is "guaranteed," that the principal is "safe," or that the investment is free of risk. [Section 626.99277(6), Florida Statutes]. (s) No person shall make, publish, disseminate, circulate, or place before the public, or cause, directly or indirectly, to be made, published, disseminated, circulated, or placed before the public, in a newspaper, magazine, or other publication, or in the form of a notice, circular, pamphlet, letter or poster, or over any radio or television station, or in any other way, any advertisement, announcement or statement containing any assertion, representation or statement with respect to the business of insurance or. with respect to any person in the conduct of his insurance business, which is untrue, deceptive or misleading, [Rule 69B-215.230(2), Florida Administrative Code]. COUNT IL 12. . The above General Allegations are hereby realleged and fully incorporated herein by reference. 13. On or about May 23, 2003, you, CHRISTOPHER P. WINCHELL, sold a Mutual Benefits Corporation Viatical Settlement Purchase Agreement to’CS and JS of Naples, Florida. 14. CS had advised you, CHRISTOPHER P. WINCHELL, that he did not want to put his investment principal at risk. 15. You, CHRISTOPHER P. WINCHELL, assured CS that this investment was safe, and created a reasonable impression by CS that this product was safe and/or guaranteed. oe | Z.) 16. You, CHRISTOPHER P. WINCHELL, made material misrepresentations as to the nature of the return or the duration of time to obtain the return with respect to the aforesaid Viatical Settlement Purchase Agreement. 17. You, CHRISTOPHER P. WINCHELL, knew or should have known that this investment was not consistent with the expressed investment intentions of CS. 18. As a result of the misrepresentations made to CS and JS by you, CHRISTOPHER P, WINCHELL, their investment principal has been put at risk of significant loss. 19. In the sale of the aforesaid Viatical Settlement Purchase Agreement, you, | CHRISTOPHER P. WINCHELL, failed to conspicuously display, by means of contrasting color and type size, required disclosures to the viatical settlement purchaser(s). IT IS THEREFORE CHARGED that you, CHRISTOPHER P. WINCHELL, have violated or are accountable under one or more of the following provisions of the Florida Insurance Code, which constitutes grounds for the suspension or revocation of your licenses as an insurance agent in this state: (a) Sections 624.11(1), 626.611(4), 626.611(5), 626.611(7), 626.61:1(8), 626.611(9), 626.611(13), 626.621(2), 626.621(3), 626.621(6), 626.621(9), 626.9521(1), 626.9541(1)(a)1., . 626.9541(1)(b), 626.99235(1), 626.99235(2), 626.9927(1), 626.99277(6), Florida Statutes, and Rule 69B-215.230(2), Florida Administrative Code, as set forth more fully in Count I above and incorporated herein by reference. | COUNT Tit 20. The above General Allegations are hereby realleged and fully incorporated herein by reference. 2) | O. 21. On or about November 11, 2002, you, CHRISTOPHER P. WINCHELL, sold a Mutual Benefits Corporation Viatical Settlement Purchase Agreement to JW and LW of Naples, Florida. 22. JW had advised you, CHRISTOPHER P. WINCHELL, that he did not want to put his investment principal at risk. | 23, You, CHRISTOPHER P. WINCHELL, assured JW that this investment was safe, _and created a reasonable impression by JW that this product was safe and/or guaranteed. — 24, You, CHRISTOPHER P. WINCHELL, made material misrepresentations as to. the nature of the return or the duration of time to obtain the return with respect to the aforesaid Viatical Settlement Purchase Agreement. 25, You, CHRISTOPHER P, WINCHELL, knew or should have known that this investment was not consistent with the expressed investment intentions of JW. 26. As a result of the misrepresentations made to JW and LW by you, | CHRISTOPHER. P. WINCHELL, their investment principal he has been put at tisk of significant loss. 27. Inthe sale of the aforesaid Viatical Settlement Purchase Agreement, you, CHRISTOPHER P. WINCHELL, failed to conspicnously display, by means of contrasting color and type size, required disclosures to the viatical settlement purchaser(s). ITIS THEREFORE CHARGED that you, CHRISTOPHER P. WINCHELL, have violated or are accountable under one or more of the following provisions of the Florida Insurance Code, which constitutes grounds for the suspension or revocation of your licenses as an insurance agent in this state: o O . (a) Sections 624.11(1), 626.611 (4), 626.611(5), 626.611(7), 626.611(8), 626.611(9), 626.61 1(13), 626.6210), 626.621(3), 626.621(6), 626.621(9), 626.9521(1), 626.9541(1)(a)1., 626.9541(1)(b), 626.99235(1), 626.99235(2), 626.9927(1), 626.99277(6), Florida Statutes, and Rule 69B-215.230(2), Florida Administrative Code, as set forth more fully in Count I above and incorporated herein by reference. WHEREFORE, you, CHRISTOPHER P. WINCHELL, 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 624.15, 626.611, 626.621, 626.681, 626.691, and 626.9521, Florida Statutes, and under the other referenced sections of the Florida Statutes as set out in this Administrative Complaint and under the provisions of Rule 69B-231, Florida Administrative Code. You are further notified that any order entered in this case revoking or suspending any license or eligibility for licensure held by you shall also apply | to all other licenses and eligibility | held by you under the Florida Insurance Code. 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 10 oy. ae) 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; | (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 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. _Ifa 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. 11 ) 0) 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 maj ority 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. All 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. Mediation of this matter pursuant to Section 120.573, Florida Statutes, is not available. No Department attorney will discuss this matter with you until the response has been received by the Department of Financial Services. : DATED and SIGNED this Hee, 3 2005. CHANDLER Deputy Chief Financial Officer CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing ADMINISTRATIVE COMPLAINT and the following ELECTION OF PROCEEDING have been furnished to CHRISTOPHER P. WINCHELL, at 710 25" Street Northwest, Naples, Florida 34120, and at 9430, Bonita Beach Road, Suite 201, Bonita Springs, Florida 34135, by Certified Mail this 30~" day of SEPTEMBER, , 2005. Florida Department of Financial Services Division of Legal Services 200 East Gaines St. 612 Larson Building Tallahassee, Florida 32399-0333 (850) 413-4180 Florida Bar Number 131369 Attorney for Petitioner 13

Docket for Case No: 05-003936PL