Ly Ap & b “4 , FILED, "4, ATER SIN : Wee 6 é 49 EX SINK eel’: CHIEF FINANCIAL OFFICER FEB 21 2008 Milyliyp STATE OF FLORIDA D&- 1633 PC Bocketed py: CU IN THE MATTER OF: nes KEVIN EARL COCHRAN CASE NO.: 92296-08-AG / ADMINISTRATIVE COMPLAINT TO: KEVIN EARL COCHRAN 301 Lemon St. West Bowling Green, FL 33834 You, KEVIN EARL COCHRAN, license identification D012391, 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 1. Pursuant to Chapter 626, Florida Statutes, you, KEVIN EARL COCHRAN, are currently licensed in this state as a Life Including Variable Annuity Agent (2-14), Life Including Variable Annuity & Health Agent (2-15), Life Agent (2-16), Life & Health Agent (2-18), anda Health Agent (2-40). 2. At all times pertinent to the dates and occurrences referred to herein, you, KEVIN EARL COCHRAN, were so licensed. 3. Pursuant to Chapter 626, Florida Statutes, the Florida Department of Financial Services (hereinafter “Department”) has jurisdiction over your insurance licenses and appointments. 4, Atall times relevant to the dates and occurrences referred to herein, you, KEVIN EARL COCHRAN, worked out of Avon Insurance Brokers, Inc. (“the agency”), 1732 US Highway 27 N., Suite C, Avon Park, Florida 33825-8364, a Florida corporation owned by your former father-in-law, Stanley A. Spurlock. 5. Atall times relevant to the dates and occurrences herein, all funds received by you, KEVIN EARL COCHRAN, from consumers or on behalf of consumers representing premiums for insurance policies, were trust funds pursuant to Section 626.561 (1), Florida Statutes, and were received in a fiduciary capacity and were to be accounted for and paid over to the insurer, insured or others persons entitled thereto in the regular course of business. 6. You, KEVIN EARL COCHRAN, number among your former insurance clients Lee Marvin Johns, his wife Carol M. Johns, and their son, Samuel Johns from whom you had obtained private financial information which you used to facilitate most of the fraudulent insurance transactions described below. 7. As described in more detail in each of the allegations set forth in the first five of the six counts listed below, you, KEVIN EARL COCHRAN, submitted to insurance companies, without the permission of any member of the Johns family, automatic checking account forms purporting to contain the signature of Lee Johns so as to transfer funds representing premium payments from the Johns’ account with Wauchula State Bank to Peoples Benefit Life Insurance Company (“Peoples”) and Life Investors Insurance Company of America (“LIICA”). 8. The funds so transferred to Peoples as premium payments totaled approximately $1,608.13. 9. The funds so transferred to LIICA as premium payments totaled approximately $5,517.18. 10. Lee Johns thus made, without his knowledge or consent, initial premium payments on 36 life insurance policies for various individuals in addition to being wrongfully listed as contingent beneficiary and a relative of the insured on most of these policies for which you, KEVIN EARL COCHRAN, illegally received commissions totaling some $41,487.73. 1]. You, KEVIN EARL COCHRAN, employed essentially the same schemes described above and more specifically below, by using the bank account of Guadalupe M. Hernandez, without her knowledge or consent, to purchase an additional 33 life insurance policies on various other individuals, also earning you substantial commissions. 12. Although the counts listed below represent but a sampling of the wrongdoing described above, the Department intends to tender evidence as to all such illegal life insurance sales at the final hearing in this matter so as to aggravate any penalty imposed, as provided in Rule 69B-231.160, Florida Administrative Code, to justify REVOCATION of all insurance licenses held by you, KEVIN EARL COCHRAN. COUNT I 13. The above general allegations are hereby realleged and fully incorporated herein by reference. 14. On or about March 25, 2004, you, KEVIN EARL COCHRAN, submitted two life insurance applications, one on the life of Trudy Lynn Ast and the other on the life of her husband Thomas D. Ast, showing Lee M. Johns as contingent beneficiary on the policies. Both applications showed a face value of $100,000. 15. Mr. and Mrs. Ast are not related to, and do not know of, Lee M. Johns. 16. Mr. and Mrs. Ast had no foreknowledge of the above insurance transactions and never gave their consent to you, KEVIN EARL COCHRAN, to take out such insurance on their lives. 17. | You, KEVIN EARL COCHRAN, submitted these Peoples insurance applications by using: a false address for, and the false signatures of, Mr. and Mrs. Ast; a false telephone number for them; their driver’s licenses’ numbers and social security numbers without their permission; false medical information for Mr. and Mrs. Ast; and by otherwise submitting false information to Peoples. 18. _In addition you, KEVIN EARL COCHRAN, submitted two additional phony insurance applications on behalf of Mr. and Mrs. Ast, each in the amount of $100,000, to LIICA. Mr. and Mrs. Ast knew nothing about these applications at the time they were submitted. The signatures shown are not those of Mr. and Mrs. Ast. Before these transaction came to the Asts’ attention, they had never heard of “Lee Johns” the name shown on Mr. Ast’s LIICA policy, and only then discovered other false information appearing on these policies. 19. All four Ast policy applications having a total face value of $400,000 were accompanied by a phony “pre-authorization payment plan initial withdrawal agreement” containing the forged signature of Lee M. Johns and were willfully submitted by you, KEVIN EARL COCHRAN. 20. You, KEVIN EARL COCHRAN, knew that all of the LIICA and Peoples policies would eventually lapse for lack of premium payments and they did so lapse. 21. All of the LIICA and Peoples applications were submitted by you, KEVIN EARL COCHRAN, solely for the purpose of obtaining commissions to which you were not entitled. 22. When LIICA and Peoples demanded repayment of these commissions, you, KEVIN EARL COCHRAN, refused to return them. IT IS THEREFORE CHARGED that you, KEVIN EARL COCHRAN, 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 and appointments: (a) The Business of Life Insurance is declared to be a public trust, in which all agents of all companies have a common obligation to work together in serving the best interests of the insuring public, by understanding and observing the laws governing Life Insurance by presenting accurately and completely every fact essential to a client’s decision, and by being fair in all . relations with colleagues and competitors, always placing the policyholder’s interests first. [Chapter 69B-215.210, Florida Administrative Code]; (b) All premiums, return premiums, or other funds belonging to insurers or others received by an agent, customer representative, or adjuster in transactions under his or her license are trust funds received by the licensee in a fiduciary capacity. An agent shall keep the funds belonging to each insurer for which he or she is not appointed, other than a surplus lines insurer, in a separate account so as to allow the department to properly audit such funds. The licensee in the applicable regular course of business shall account for and pay the same to the insurer, insured, other person entitled there to. [Section 626.561(1), Florida Statutes]; (c) The following are defined as unfair methods of competition and unfair or deceptive acts or practices: ... (e) False statements and entries. — 1. Knowingly: ... 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]; (d) Fraudulent or dishonest practices in the conduct of business under the license or appointment. [Section 626.611 (9), Florida Statutes]; (e) Misappropriation, conversion, or unlawful withholding of moneys belonging to insurers or insureds or beneficiaries or to others and received in conduct of business under the license or appointment. [Section 626.611(10), Florida Statutes]; (f Failure or refusal, upon demand, to pay ‘over to any insurer he or she represents or has represented any money coming into his or her hands belonging to the insurer. [Section 626.621(4), Florida Statutes]. -COUNT II 23. The above general allegations are hereby realleged and fully incorporated herein by reference. 24, On or about July 28, 2003, you, KEVIN EARL COCHRAN, submitted a LIICA life insurance application on behalf of the insured, Kip Wade Goolsby, showing Lee M. Johns as contingent beneficiary on the policy. The policy had a face value of $100,000. 25. Mr. Goolsby is not related to, and does not know of, Lee M. Johns. 26. Mr. Goolsby had no foreknowledge of the above insurance transaction and never gave his consent to you, KEVIN EARL COCHRAN, to take out such insurance on his life. 27. You, KEVIN EARL COCHRAN, submitted the insurance application by using: a false address for, and false signatures of, Mr. Goolsby; a false telephone number for him; his driver’s license number and social security number without his permission; false medical information for Mr. Goolsby and by otherwise submitting false information to LIICA. 28. You, KEVIN EARL COCHRAN, knew that the LIICA policy would eventually lapse for lack of premium payments and it did so lapse. 29. The LIICA life insurance application was submitted by you, KEVIN EARL COCHRAN, solely for the purpose of obtaining commissions to which you were not entitled. IT IS THEREFORE CHARGED that you, KEVIN EARL COCHRAN, have violated or are accountable under the above-listed Count I (a) - (f) 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 and appointments. COUNT Ill 30. The above general allegations are hereby realleged and fully incorporated herein by reference. 31. On or about October 17, 2003, you, KEVIN EARL COCHRAN, submitted a LIICA life insurance application on behalf of James F. Hancock without Mr. Hancock’s knowledge or permission. The policy application had a face value of $75,000. 32. Mr. Hancock does not know “Lee M. Johns” whose void check number 12928 was submitted by you, KEVIN EARL COCHRAN, together with the application and a phony authorization to make withdrawals from the Johns’ account toward premium payments on the policy. 33. Mr. Hancock had no foreknowledge of the above insurance transaction and never gave his consent to you, KEVIN EARL COCHRAN, to take out such insurance on his life. 34, You, KEVIN EARL COCHRAN, submitted this insurance application by using: a false address for, and false signatures of, Mr. Hancock; a false telephone number for him; his driver’s license number and social security number without his permission; false medical information for Mr. Hancock and otherwise submitting false information to LIICA. 35. In addition you, KEVIN EARL COCHRAN, on or about March 15, 2004, submitted an additional phony insurance application on behalf of Mr. Hancock in the amount of $25,000, to Peoples. Mr. Hancock knew nothing about that application at the time it was submitted. The signatures shown are not those of Mr. Hancock. He never heard of “Lee Johns” the name shown on Mr. Hancock’s Peoples policy application, in addition to other false address, telephone number, and health information appearing on that policy application. Mr. Hancock never authorized the use of his social security and driver’s license numbers for such insurance purposes, although they too appear on the Peoples application. 36. At least one of the two Hancock policy applications having a total face value of $100,000 was accompanied by a phony “pre-authorization payment plan initial withdrawal agreement” purportedly signed by “Lee M. Johns” and willfully submitted by you, KEVIN EARL COCHRAN. 37. You, KEVIN EARL COCHRAN, knew that all of the LIICA and Peoples policies would eventually lapse for lack of premium payments and they did so lapse. 38. All of the LIICA and Peoples applications were submitted by you, KEVIN EARL COCHRAN, solely for the purpose of obtaining commissions to which you were not entitled. IT IS THEREFORE CHARGED that you, KEVIN EARL COCHRAN, have violated or are accountable under the above-listed Count I (a) - (f) 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 and appointments. COUNT IV 39. The above general allegations are hereby realleged and fully incorporated herein by reference. 40. On or about September 30, 2003, you, KEVIN EARL COCHRAN, submitted two LIICA life insurance applications, one on Danny Broder and the other on his wife Brenda C. Broder showing “Carol Johns” as Mr. Broder’s mother-in-law and as Mrs. Broder’s mother. 41. Carol Johns is listed as contingent beneficiary on both policies. Each policy shows a face value of $100,000. 42. Mr. and Mrs. Broder are not related to, and do not know of, Carol Johns. 43. Mr. and Mrs. Broder had no foreknowledge of the above insurance transactions and never gave their consent to you, KEVIN EARL COCHRAN, to take out such insurance on their lives. 44. You, KEVIN EARL COCHRAN, submitted these insurance applications by , using: a false address for, and false signatures of, Mr. and Mrs. Broder; a false telephone number for them; their driver’s licenses’ numbers and social security numbers without their permission; false medical information for Mr. and Mrs. Broder and otherwise submitted false information to LIICA. 45. The two policy applications, having a total face value of $200,000, were submitted by you, KEVIN EARL COCHRAN. 46. | You, KEVIN EARL COCHRAN, knew that the LIICA policies would eventually lapse for lack of premium payments and they did so lapse. 47. The LIICA applications were submitted by you, KEVIN EARL COCHRAN, solely for the purpose of obtaining commissions to which you were not entitled. IT IS THEREFORE CHARGED that you, KEVIN EARL COCHRAN, have violated or are accountable under the above-listed Count I (a) - (f) 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 and appointments. COUNT V 48. The above general allegations are hereby realleged and fully incorporated herein by reference. 49. On or about September 30, 2003, you, KEVIN EARL COCHRAN, submitted two LIICA life insurance applications, one on Crystal Marie Clanton and the other on her sister Charlotte A. Clanton showing their mother Brenda C. Broder as the primary beneficiary on each application, and “Carol Johns” as their grandmother. 50. Carol Johns is listed as contingent beneficiary on both policies. Each of the polices has a face value of $100,000. Sl. The Clanton sisters are not related to, and do not know of, Carol Johns. 52. Crystal and Charlotte Clanton had no foreknowledge of the above insurance transactions and never gave their consent to you, KEVIN EARL COCHRAN, to take out such insurance on their lives, 53. You, KEVIN EARL COCHRAN, submitted these insurance applications by using: a false address for, and false signatures of, Crystal and Charlotte Clanton; false telephone numbers for them; false driver’s license numbers or false social security numbers or correct numbers without their permission; false medical information for both Clanton sisters and otherwise submitting false information to LIICA. 54. The two policy applications having a total face value of $200,000 were submitted by you, KEVIN EARL COCHRAN, solely for the purpose of obtaining commissions to which you were not entitled. 55. You, KEVIN EARL COCHRAN, knew that all of the LIICA and Peoples policies would eventually lapse for lack of premium payments and they did so lapse. IT IS THEREFORE CHARGED that you, KEVIN EARL COCHRAN, have violated or are accountable under the above-listed Count I (a) - (f) 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 and appointments. COUNT VI 56. The above general allegations are hereby realleged and fully incorporated herein by reference. 57. On or about January 6, 2005, you, KEVIN EARL COCHRAN, submitted two Shenandoah Life Insurance Company (“Shenandoah”) applications, one insuring Francisco Martinez’s life and the other insuring his spouse Beatrice O. Martinez’s life. Each policy had a face value of $25,000 and each carried an Accidental Death Benefit Rider having an additional face value of $25,000. 58. On or about June 24, 2005, you, KEVIN EARL COCHRAN, submitted two Shenandoah life insurance applications, one insuring Francisco Martinez’s life and the other insuring his spouse Beatrice O. Martinez’s life. Each policy had a face value of $25,000 and each carried an Accidental Death Benefit Rider having an additional face value of $25,000. 59. On or about June 28, 2005, you, KEVIN EARL COCHRAN, submitted two life insurance applications, one insuring Francisco Martinez’s life and the other insuring his spouse Beatrice O. Martinez’s life. Each policy had a face value of $25,000 and each carried an Accidental Death Benefit Rider having an additional face value of $25,000. 60. You, KEVIN EARL COCHRAN, told Beatrice Martinez that if she did not purchase these policies, you would lose your job. 61. You, KEVIN EARL COCHRAN, told Beatrice Martinez that if she paid the premiums on them, you would pay her back. 62. You, KEVIN EARL COCHRAN, wrote two checks to Beatrice Martinez as payback for her premium payments and both checks were returned for insufficient funds. 63. | You, KEVIN EARL COCHRAN, knew that all of the Shenandoah policies would eventually lapse for lack of premium payments and they did so lapse. 64. All of the Shenandoah policy applications were submitted by you, KEVIN EARL COCHRAN, solely for the purpose of obtaining commissions to which you were not entitled. IT IS THEREFORE CHARGED that you, KEVIN EARL COCHRAN, have violated or are accountable under the above-listed Count I (a) - (f) 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 and appointments. 10 : WHEREFORE, you, KEVIN EARL COCHRAN, 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 under the other referenced Sections of the Florida Statutes as set out in this Administrative Complaint. 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 of Financial Services ("Department") pursuant to Sections 120.569 and 120.57, Florida Statutes, and Rule 28-106, 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 acting as 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 SUSPENSION OR REVOCATION WILL BE ENTERED AGAINST YOU. 11 If you request a proceeding, you must provide information that complies with the requirements of Rule 28-106.2015, 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, address, and telephone number, and facsimile number (if any) of the respondent (for the purpose of requesting a hearing in this matter, you are the respondent"). (b) The name, address, telephone number, facsimile number of the attorney or qualified representative of the respondent (if any) upon whom service of pleadings and other papers shall be made. (c) A statement requesting an administrative hearing identifying those material facts that are in dispute. If there are none, the petition must so indicate. (d) _ A statement of when the respondent received notice of the administrative complaint. (e) A statement including the file number to the administrative complaint. 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. 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. 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. 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. 4 DATED and SIGNED this 2)? day of February , 2008. KAREN 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: KEVIN EARL 3s COCHRAN, 301 Lemon Street West, Bowling Green, FL 33834 by Certified Mail this 2 [ day of February , 2008. ( ; 02 y, David J. Busch Division of Legal Services 200 East Gaines St. — 612 Larson Building _ Tallahassee, Florida 32399-0333 (850) 413-4146 Florida Bar Number 140945 14

Docket for Case No: 08-001633PL