FILED JUL 8.0 2009 CHIEF FINANCIAL OFFICER STATE OF FLORIDA _ \Q- 3195 PL IN THE MATTER OF: EMILIO GALLOR FAROY CASE NO.: 103162-09-AG f ADMINISTRATIVE COMPLAINT TO: EMILIO GALLOR FAROY 3129 Jackson Avenue Coconut Grove, Florida 33133-4432 EMILIO GALLOR FAROY : c/o Faroy Bail Bonds, Inc. ee 2299 SW 27th AVE, Suite 240 Miami, Florida 33145 You, EMILIO GALLOR FAROY, 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 _ limited surety (bail bond) agent (2-34) in this state, as a result of which it is alleged: GENERAL ALLEGATIONS i. Pursuant to Chapter 648, Florida Statutes, you, EMILIO GALLOR FAROY, currently are licensed in this state as a limited surety (bail bond) (2-34) agent (License Number A081130). 2. At all times pertinent to the dates and occurrences referred to herein, you, EMILIO GALLOR FAROY, were licensed in this state as a limited surety (bail bond) (2-34) agent. 3. Pursuant to Chapter 648, Florida Statutes, and the Florida Insurance Code, the Florida Department of Financial Services (“Department”) has jurisdiction over your bail bond agent license, appointments and eligibility for licensure. 4. According to information on file with the Florida Department of State, Division of Corporations, Faroy Bail Bonds Inc. (“FBBI”), is a Florida corporation located at 2299 SW 27th Avenue, Suite 240, Miami, Florida, 33145. 5. According to the Department’s records, you, EMILIO GALLOR FAROY, are the primary bail bond agent for FBBI, having designated yourself as such on or about February 15, 2005. 6. During 2007, North River Insurance Company (“North River”) and Continental Heritage Insurance Company (“Continental”) were the only insurers for whom you, EMILIO GALLOR FAROY, were an appointed limited surety (bail bond) agent. . 7. Jose Mastrapa (“Mr. Mastrapa”) is a bail bond agent whose license, at all times relevant to the allegations contained herein, was suspended in the state of Florida, pursuant to a Notice of Temporary Suspension. You, EMILIO GALLOR FAROY, were, or should have been, aware of this fact at all times relevant to the allegations contained herein. 8. Surety Financial of America Corporation (“SFAC”) is a Florida corporation located at 2299 SW 27th Avenue, Suite 200, Miami, Florida, 33145. Mr, Mastrapa’s son, Robert Mastrapa, and Mr. Mastrapa’s sister, Dolores Mastrapa, are officers and/or directors of SFAC. Mr, Mastrapa’s son, Joseph Mastrapa, is a signatory on SFAC’s checking account and signed at least one check directly related to the bail bond transaction that is the subject of the present matter. 9. Although Mr. Mastrapa is not an officer, director, or owner of SFAC, he is directly and regularly involved in its business operations. 10. Mr. Mastrapa’s bail bond agency, AAA Bail Yes, is located at the exact same address as SFAC’s office and in a different suite at the same address as FBBI’s office. Both offices are owned by the same entity, Done Deal Holdings, Inc., whose president is Mr. Mastrapa’s son, Robert Mastrapa. 11. Josh Herman (“Mr. Herman”) is a bail bond agent licensed in the state of California, but at all times relevant to the allegations contained herein, Mr. Herman was unlicensed in the state of Florida. You, EMILIO GALLOR FAROY, were, or should have been, aware of this fact at all times relevant to the allegations contained herein. 12. Josh Herman Bail Bonds is a California bail bond agency owned and/or operated by Mr. Herman, Josh Herman Bail Bonds is not and has never been licensed to transact bail bond business in the state of Florida, You, EMILIO GALLOR FAROY, were, or should have been, aware of this fact at all times relevant to the allegations contained herein. 13. On or about January 30, 2007, Darli Velazquez a/k/a Darli Velazquez-Armas was arrested and jailed in Miami, Florida on Federal drug charges. 14, The charges resulted from an indictment in Case Number 07-20081-CR- Gold/Bandstra in the United States District Court for the Southern District of Florida. 15. In February 2007, Darli Velasquez’s bail was set at a total of one million dollars ($1,000,000.00). 16. Soon after Darli Velasquez’s bail was set, his parents, consumers Raul Velazquez, . Sr. and Nelida Velasquez (collectively “the Velazquezs”) contacted you, EMILIO GALLOR FAROY, to arrange for the issuance of the surety bond for Darli Velazquez’s release from custody. 17. You, EMILIO GALLOR FAROY, were not appointed by an insurer qualified, willing, and/or able to write a one million dollar ($1,000,000.00) bond. 18. Instead of referring the Velazquezs to a bail bond agent who could legitimately write Darli Velazquez’s bond, you misrepresented that you could and would arrange to post the bond, 19. | Mr. Herman is an agent for International Fidelity Insurance Company (“IFIC”), an insurer with the resources to write Darli Velazquez’s one million dollar ($1,000,000.00) bond. 20. The bail bond for Darli Velazquez was issued by IFIC through power number IS1M-1110 (“the Bond”). COUNT I 21. The above General Allegations are hereby realleged and fully incorporated herein by reference. . 22. You, EMILIO GALLOR FAROY, contacted Mr. Mastrapa to arrange for Darli Velazquez’s bond, and to actively engage Mr. Mastrapa in the transaction of Darli Velazquez’s bail bond. 23. The Velazquezs only had contact with you, EMILIO GALLOR FAROY, and Mr. Mastrapa during the execution of all of the documents related to the Bond. 24, The Velazquezs gave the Bond premium and/or fees to you, EMILIO GALLOR FAROY, or to Mr. Mastrapa in your presence and/or with your awareness. 25. A Deed of Trust to IFIC was executed on February 23, 2007, by the Velazquezs in Miami, Florida and filed on February 28, 2007, in Alleghany County, North Carolina, Book 303, Pages 1460-1 (“Deed of Trust”). The Velazquezs’ signatures on this Deed of Trust were notarized by Miguel Mata, who was employed by you, EMILIO GALLOR FAROY, at FBBI. 26. The Deed of Trust, and the property that was the subject thereof, was requested from the Velazquezs by you, EMILIO GALLOR FAROY, and/or Mr. Mastrapa in your presence and/or with your awareness, as collateral on the Bond. 27. You, EMILIO GALLOR FAROY, and Mr. Mastrapa, individually and/or cooperatively, acted as bail bond agents for IFIC during the transaction with the Velazquezs. 28. Neither you, EMILIO GALLOR FAROY, nor Mr. Mastrapa were appointed as a bail bond agent by IFIC, as required under Chapter 648, Florida Statutes. You were, or should have been, aware of this fact at all times relevant to the allegations contained herein, 29. Accheck drawn on SFAC’s checking account and signed by Mr, Mastrapa’s son, Joseph Mastrapa, was used to pay the legal fees of the attorney who filed the January 3, 2008, Motion to Discharge Surety related to the Bond. You were, or should have been, aware of this fact. 30. Mr. Mastrapa, acting as a bail bond agent, utilized documents, including powers of attorney, bond forms, and/or collateral receipts, which you, EMILIO GALLOR FAROY, provided to him for the purpose of soliciting, negotiating, or effecting bail bond(s) in the transaction with the Velazquezs. | 31. You, EMILIO GALLOR FAROY, permitted Mr, Mastrapa to solicit or engage in the bail bond business on your behalf. IT IS THEREFORE CHARGED that you, EMILIO GALLOR FAROY, have violated or are accountable under the following provisions. of the Florida Insurance Code and Rules of the Florida Department of Financial Services, which constitute grounds for the imposition of an administrative fine and/or the suspension or revocation of your licenses and appointments as a bail bond agent: a) An insurer, managing general agent, bail bond agent, or temporary bail bond agent appointed under this chapter may not furnish to any person any blank forms, applications, stationery, business card, or other supplies to be used in soliciting, negotiating, or effecting bail bonds until such person has received from the department a license to act as a bail bond agent and is appointed by the insurer. This section does not prohibit an unlicensed employee, under the direct supervision and control of a licensed and appointed bail bond agent, from possessing or executing in the bail bond agency, any forms, except for powers of attorney, bond forms, and collateral receipts, while acting within the scope of his or her employment. [Section 648.441(1), Florida Statutes] b) A person may not act in the capacity of a bail bond agent or temporary bail bond agent or perform any of the functions, duties, or powers prescribed for bail bond agents or temporary bail bond agents under this chapter unless that person is qualified, licensed, and appointed as provided in this chapter. [Section 648.30(1), Florida Statute] ©) Any licensed bail bond agent, temporary bail bond agent, or managing general agent engaged in the bail bond business, who permits any person not licensed, as required under Chapter 648, Florida Statutes, to solicit or engage in the bail bond business in his behalf shall be deemed in violation of Section 648.30, Florida Statutes, [Rule 69B- 221.001, Florida Administrative Code] d) Lacks one or more of the qualifications specified in this chapter for a license or appointment. [Section 648.45(2)(a), Florida Statutes] e) Has willfully used, or intended the use, of the license or appointment to circumvent any of the requirements or prohibitions of this chapter or the insurance code. [Section 648.45(2)(d), Florida Statutes] f) Has demonstrated lack of fitness or trustworthiness to engage in the bail bond business. [Section 648.45(2)(e), Florida Statutes] g) Has engaged in fraudulent or dishonest practices in the conduct of business under the license or appointment. [Section 648,45(2)(g), Florida Statutes] h) Has willfully failed to comply with or willfully violated any proper order or rule of the department or willfully violated any provision of this chapter or the insurance code, [Section 648.45(2)()), Florida Statutes]: COUNT I 32. The above General Allegations are hereby realleged and fully incorporated herein by reference. 33. You, EMILIO GALLOR FAROY, and/or Mr. Mastrapa in your presence and/or with your awareness, contacted Mr. Herman to write or assist in writing Darli Velazquez’s bond. 34. 9 Mr, Herman, through Josh Herman Bail Bonds, requested that the Deed of Trust given as collateral for the Bond be recorded in Alleg hany County, North Carolina. ' 35. In return for Mr. Herman’s activities or involvement in writing the Bond, SFAC: paid Josh Herman Bail Bonds one hundred thousand dollars ($100,000.00) by wire transfer on March 16, 2007. This was done at your direction, with your knowledge and/or on your behalf. 36. | Mr. Herman, and/or Josh Herman Bail Bonds, acting as a bail bond agent, utilized documents, including powers of attorney, bond forms, and/or collateral receipts, which you, EMILIO GALLOR FAROY, provided for the purpose of soliciting, negotiating, or effecting bail bond(s) in the transaction with the Velazquezs. 37, You, EMILIO GALLOR FAROY, permitted Mr. Herman, and/or Josh Herman Bail Bonds, to solicit or engage in the bail bond business on your behalf. IT IS THEREFORE CHARGED that you, EMILIO GALLOR FAROY, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the Florida Department of Financial Services, which constitute grounds for the imposition of an administrative fine and/or the suspension or revocation of your licenses and appointments as a bail bond agent: | a) An insurer, managing general agent, bail bond agent, or temporary bail bond agent appointed under this chapter may not furnish to any person any blank forms, applications, stationery, business card, or other supplies to be used in soliciting, negotiating, or effecting bail bonds until such person has received from the department a license to act as a bail bond agent and is appointed by the insurer. This section does not prohibit an unlicensed employee, under the direct supervision and control of a licensed and appointed bail bond agent, from possessing or executing in the bail bond agency, any forms, except for powers of attorney, bond forms, and collateral receipts, while acting within the scope of his or her employment. [Section 648.441(1), Florida Statutes] b) A person may not act in the capacity of a bail bond agent or temporary bail bond agent or perform any of the functions, duties, or powers prescribed for bail bond agents or temporary bail bond agents under this chapter unless that person is qualified, licensed, and appointed as provided in this chapter. [Section 648.30(1), Florida Statute] ¢) Any licensed bail bond agent, temporary bail bond agent, or managing general agent engaged in the bail bond business, who permits any person not licensed, as required under Chapter 648, Florida Statutes, to solicit or engage in the bail bond business in his behalf shall be deemed in violation of Section 648.30, Florida Statutes. [Rule 69B- 221.001, Florida Administrative Code] d) Lacks one or more of the qualifications specified in this chapter for a license or appointment. [Section 648.45(2)(a), Florida Statutes] e) Has willfully used, or intended the use, of the license or appointment to circumvent any of the requirements or prohibitions of this chapter or the insurance code. [Section 648.45(2)(d), Florida Statutes] f) Has demonstrated lack of fitness or trustworthiness to engage in the bail bond business, [Section 648.45(2)(e), Florida Statutes] g) Has engaged in fraudulent or dishonest practices in the conduct of business under the license or appointment. [Section 648,45(2)(g), Florida Statutes] h) Has willfully failed to comply with or willfully violated any proper order or rule of the department or willfully violated any provision of this chapter or the insurance code. [Section 648.45(2)(j), Florida Statutes] WHEREFORE, you, EMILIO GALLOR FAROY, are hereby notified that the Chief Financial Officer intends to enter an Order suspending or revoking your licenses and appointments as a limited surety (bail bond) agent or to impose such penalties as may be provided under the provisions of Sections 648.387, 648.442, 648.45, 648.49, 648.50, 648.51, 648.52, 648.53 and 648.571, Florida Statutes, and under the other referenced Sections of the Florida Statutes and the Florida Administrative Code as set out in this Administrative Complaint, Additionally, the Department intends to enter an order to cease and desist from violation of Chapter 626, Part IX, Florida Statutes. 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 DFS Agency Clerk, Tracey Beal, Florida Department of Financial Services, 200 East Gaines Street, Tallahassee, Florida 32399-0390. 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. 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. . (4) 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. 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. 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. syf DATED and SIGNED this 2p day of ) vee , 2009, Hy hg My» ‘ ay TAMMY TESRON ancial Officer CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing ADMINISTRATIVE COMPLAINT and the following ELECTION OF PROCEEDING has been furnished to: EMILIO GALLOR FAROY 3129 Jackson Avenue Coconut Grove, Florida 33133-4432 EMILIO GALLOR FAROY c/o Faroy Bail Bonds, Inc. 2299 SW 27th AVE, Suite 240 Miami, Florida 33145 % by U.S. Certified Mail, restricted delivery, return receipt requested, this 307 day of ; 2009. Thomas A, “Tad” David, Esq. Florida Department of Financial Services Division of Legal Services 200 East Gaines St. 612 Larson Building “ Tallahassee, Florida 32399-0333 (850) 413-4164 Florida Bar Number 0706868 STATE OF FLORIDA DEPARTMENT OF FINANCIAL SERVICES DIVISION OF LEGAL SERVICES . IN THE MATTER OF: EMILIO GALLOR FAROY, CASE NO.: 103162-09-AG 1 : ELECTION OF PROCEEDING I have received and have read the Administrative Complaint filed by the Florida Department of Financial Services ("Department") against me, including the Notice of Rights contained therein, and I understand my options. I am requesting disposition of this matter as indicated below. (CHOOSE ONE) Lo] I do not dispute any of the Department’s factual allegations and I do not desire a hearing. I understand that by waiving my right to a hearing, the Department may enter a final order that adopts the Administrative Complaint and imposes the sanctions sought, including suspending or revoking my licenses and appointments as may be appropriate. 2. I do ‘not dispute any of the Department's factual allegations-and I hereby elect a proceeding to be conducted in accordance with Section 120.57(2), Florida Statutes. In this regard, I desire to(CHOOSE ONE): {) Submit a written statement and documentary evidence in lieu of a hearing; or {] Personally attend a hearing conducted by a department hearing officer in Tallahassee; or [J Attend that same hearing by way of a telephone conference call. 3.0] I do dispute one or more of the Department's factual allegations. I hereby request a hearing pursuant to Section 120.57(1), Florida Statutes, to be held before the Division of Administrative Hearings. I have attached to this election form the information required by Rule 28-106.2015, Florida Administrative Code, as specified in subparagraph (c) of the Notice of Rights. Specifically, 1 have identified the disputed issues of material fact. TO PRESERVE YOUR RIGHT TO A HEARING, YOU MUST FILE YOUR RESPONSE WITH THE DEPARTMENT OF FINANCIAL SERVICES WITHIN TWENTY-ONE (21) ‘DAYS OF YOUR RECEIPT OF THE ADMINISTRATIVE COMPLAINT. THE RESPONSE MUST BE RECEIVED BY THE DEPARTMENT NO LATER THAN 5:00 P.M. ON THE TWENTY-FIRST DAY AFTER YOUR RECEIPT OF THE ADMINISTRATIVE COMPLAINT, The address for filing is: DFS Agency Clerk, Tracey Beal, Florida Department of Financial Services, 200 East Gaines Street, Tallahassee, Florida 32399-0390. Signature Print Name Date: Address: Date Administrative Complaint Received: If you are represented by an attorney or qualified Phone No.: representative, please attach to this election form his or her name, address, telephone and fax numbers Fax No.: 13

Docket for Case No: 10-003185PL