STATE OF FLORIDA OFFICE OF FINANCIAL REGULATION STATE OF FLORIDA, OFFICE OF FINANCIAL REGULATION, Petitioner, Case No.: 53447 v. PALM BEACH WINE MERCHANTS, INC.,, Respondent. ADMINISTRATIVE COMPLAINT Comes now, the State of Florida, Office of Financial Regulation, (“Office”) and files this Administrative Complaint against Palm Beach Wine Merchants, Inc. (“Respondent”), alleging: GENERAL ALLEGATIONS 1. Pursuant to section 560.105, Florida Statutes, the Office is charged with the responsibility of administering and enforcing the provisions of Chapter 560, Florida Statutes. 2. Pursuant to section 560.109, Florida Statutes, the Office may conduct examinations and investigations to determine whether any provision of Chapter 560, Florida Statutes, has been violated. 3. Pursuant to section 560.114(1)(a), Florida Statutes, failure to comply with any provision of Chapter 560, Florida Statutes, or related rule or order, or any written agreement entered into with the Office, constitutes grounds for disciplinary action. Administrative Complaint Palm Beach Wine Merchants, Inc. Page 1 of 11 4. Respondent was at all times material to this Administrative Complaint, a Part IIT Money Services Business licensee pursuant to Chapter 560, Florida Statutes, having been issued license number FT30900151. 5. Respondent's address of record with the Office is 4600 Broadway, West Palm Beach, FL 33407-2902 and its CEO and 48% owner is Gus Petrou. 6. On or about January 7, 2014, the Office conducted an exarnination (#47949) of Respondent's business records that included the period of September 1, 2011 to August 31, 2013, COUNT I 7, The above general allegations are hereby re-alleged and incorporated by reference as if fully stated herein. 8. As a part of the examination, the Office reviewed or attempted to review records of payment instruments exceeding $1,000 that were presented to Respondent for negotiation or payment from September 1, 2011 to August 31, 2013, specifically including Respondent's electronic log of payment instruments received. 9. In approximately 340 out of 3455 entries for payment instruments excceding $1,000 in Respondent's electronic log, Respondent failed to include the identification number presented by conductor, 10. Section 560,310(2)(d), Florida Statutes, requires that if a payment instrument exceeds $1,000, the licensee shall maintain an electronic log. 11. Rule 69V-560.704(5)(a), Florida Administrative Code (2009) provides: (5)(a) In addition to the records required in subsections (1) and (2) for payment instruments $1,000.00 or more, the check casher shall create and maintain an electronic log of payment instruments accepted which includes, al a minimum, the following Administrative Complaint Palm Beach Wine Merchants, Inc. Page Z of 11 : information: 1. Transaction date; 2. Payor name; 3. Payee name; 4, Conductor name. if other than the payee; 5. Amount of payment instrument; 6. Amount of currency provided; 7. Type of payment instrument; a. Personal check; b. Payroll check; c. Government check; d. Corporate check; e. Third party check; or f, Other payment instrument; 8. Fee charged for the cashing of the payment instrunient; 9. Branch/Location where instrument was accepted; 10, Identification type presented by conductor; and 1]. Identification number presented by conductor. 12. Pursuant to Rule 69V-560.1000(98), Florida Administrative Code, a licensee cited for failing to maintain an electronic payment instrument log which reports aggregate payment instruments whose total cashed is greater than $1,000 for the first time is subject to a “B” fine and a “B” suspension. 13. Pursuant to Rule 69V-560.1000(150), Florida Administrative Code, the range for a “B” fine is between $3,500 and $7,500; and, pursuant to Rule 69V-560.1000(151), Florida Administrative Code, the range for a “B” suspension is 10 to 20 days. 14. Thus, Respondent unlawfully failed to include in approximately 340 out of 3455 entries in its electronic payment log the identification number presented by conductor from September 1, 2011 to August 31, 2013, in contradiction and violation of section 560.310, Florida Statutes and Rule 69V-560.704(5)(a), Florida Administrative Code. Administrative Complaint Palm Beach Wine Merchants, Inc. Page 3 of 11 COUNT 15. The above general allegations are hereby re-alleged and incorporated by reference as if fully stated herein. 16. In Respondent’s initial license application from 1996, Respondent was asked to provide a list of accounts through which registered activities would be conducted. 17. On or before September 2011, Respondent opened Wells Fargo Account XX977] through which licensed activities are or would be conducted, 18. Respondent failed to report the opening of the Wells Fargo Account XX9771 to the Office within 30 days after the bank account was opened. 19. Section 560.126(2), Florida Statutes, provides in part: A licensee must report, on a form adopted by rule, any change in the information contained in an initial license application form, any amendment to such application, or the appointment of an authorized vendor within 30 days after the change is effective. 20, Pursuant to Rule 69V-560.1000(52), Florida Administrative Code, a licensee cited for failing to report lo the Office any change in application or renewal information for the first time is subject to an “A” fine. 21, Pursuant to Rule 69V-560.1000(150). Florida Administrative Code, the range for an “A® fine is between $1,000 and $3,500. 22. Thus, Respondent unlawfully failed to notity the Office within 30 days of the opening of Wells Fargo Account XX9771 through which registered activities would be conducted, in contradiction and violation of section 560,126(2), Florida Statutes. COUNT IU 23, The above general allegations are hereby re-alleged and incorporated by reference as if fully stated herein. Administrative Complaint Palm Beach Wine Merchants, Inc. Page 4 of 11 24. From September 1, 2011 to August 31, 2013 Respondent cashed corporate payment instruments that exceeded $1,000 without creating or maintaining a customer file that included documentation from the Secretary of State verifying registration as a corporation or fictitious entity for the following entities: oe 8 8 2 © © © BD ea ow Interior Craft Upholstery Dolphin Tire MCD Sprinklers Impact Investigations, Inc. Seashore Building Company Sunshine Roofing K F Dover Construction Michael Patrick Hardwood Flooring, Inc. All Star Plumbing Green Touch Industries D.W.L, Management, LLC Mike Lang Contractors, Inc. Panetta Development 25. From September 1, 2011 10 August 31, 2013 Respondent cashed corporate payment instruments that excecded $1,000 without creating or maintaining a customer file that included Articles of Incorporation for the following entities: eo ¢e 8® 89 © 8@ © &@ © oO 8 Interior Craft Upholstery Dolphin ‘Tire MCD Sprinklers Impact Investigations, Inc. Seashore Building Company Sunshine Roofing K F Dover Construction Michael Patrick Hardwood Flooring, Inc, All Star Plumbing Green Touch Industries D.W.L. Management, LLC Mike Lang Contractors, Inc. Administrative Complaint Palm Beach Wine Merchants, Itic. Page § of 11 26. From September 1, 2011 to August 31, 2013 Respondent cashed corporate payment instruments that excecded $1,000 without creating or maintaining a customer file that included documentation of the occupational license for the following entities: Interior Craft Upholstery Dolphin Tire MCD Sprinklers Impact Investigations, Inc. Seashore Building Company Sunshine Roofing K F Dover Construction Michael Patrick Hardwood Flooring, Inc. All Star Plumbing Green Touch Industries D.W.L. Management, LLC Panetta Development © ¢eoe?8 ¢ @ 89 © @ @ 27. From September 1, 2011 to August 31, 2013 Respondent cashed corporate payment instruments that exceeded $1,000 without creating or maintaining a customer file that included a copy of the search results screen page from Compliance Proof of Coverage Query Page webpage from the Florida Department of Financial Services — Division of Workers’ Compensation website for the following entities: Interior Craft Upholstery Dolphin Tire MCD Sprinklers Impact Investigations, Inc. Seashore Building Company Sunshine Roofing K F Dover Construction Michael Patrick Hardwood Flooring, Inc. All Star Plumbing Green Touch Industries D.W.L. Management, LLC Mike Lang Contractors, Inc. Best Protective Services Panetta Development e@ 8 @ ee ee 8 © © € ae 8 @ Administrative Complaint Palm Beach Wine Merchants, Inc. Page 6 of 11 28. Section 560,310(2)(a), Florida Statutes’ provides in part: (2) If the payment instrument exceeds $1,000, the following additional information must be maintained: (a) Customer files, as prescribed by rule, on all customers who cash corporate payment instruments that exceed $1,000. 29. Rule 69V-560.704(4)(d), Florida Administrative Code (2009) provides: (4) In addition to the records required in subsections (1) and (2), for payment instruments exceeding $1,000.00, the check casher shall: OR (d) Create and maintain a customer file for each entity listed as the payee on corporate payment instruments and third party payment instruments accepted by the licensee. Each customer file must include, at a minimum, the following information: 1. Documentation from the Secretary of State verifying registration as a corporation or fictitious entity showing the listed officers and FEID registration number. If a sole proprietor uses a fictitious name or is a natural person, then the customer file shall include the social security number of the business owner and documentation of the fictitious name filing with the Secretary of State, 2. Articles of Incorporation or other such documentation which establishes a legal entity in whatever form authorized by law. For purposes of this rule a sole proprietor operating under a fictitious name registered with the Secretary of State shall not have to present such documentation. 3. Documentation of the oocupational license from the county where the entity is located. ; 4. A copy of the search results screen page from Compliance Proof of Coverage Query Page webpage from the Florida Department of Financial Services — Division of Workers’ Compensation website (http://www. fldfs,com/WCAPPS/Compliance _POC/wPages/query.asp). 5. Documentation of individuals authorized to negotiate payment instruments on the corporation or fictitious entity's behalf including corporate resolutions or powers of attorney. Payment instruments for insurance claims where there are multiple payees shall be exempt from this provision provided that the maker of the check is an insurance company and the licensee has obtained and retained documentation as to the identity of the natural person listed as a payee on such payment instrument. 30. Pursuant to Rule 69V-560.1000(95), Florida Administrative Code, a licensee cited for failing to maintain customer files on all customers who cash corporate or third-party payment 'Fonnerly numbered as Section 360.310(1)(a), Florida Statutes Administrative Complaint Palin Beach Wine Merchants, Inc. Page 7 of 11 instruments exceeding $1,000 for the first time is subject to a “B” fine, and a “B” suspension, 31. Pursuant to Rule 69V-560,1000(150), Florida Administrative Code, the range for a “B” fine is between $3,500 and $7,500; and, pursuant to Rule 69V-560.1000(151), Florida Administrative Code, the range for a “B™ suspension is 10 to 20 days. 32. Thus, Respondent unlawfully failed to maintain tequired customer files on all customers who cash corporate or third-party payment instruments exceeding $1,000 from September 1, 2011 to August 31, 2013 in contradiction and violation of Section 560.310, Florida Statutes and Rule 69V-560.704(4)(d), Florida Administrative Code. COUNT IV 33, The above general allegations are hereby re-alleged and incorporated by reference as if fully stated herein. 34. The Office sent Respondent an invoice dated January 29, 2014, for the costs of the examination in the amount of $1,216.69, 35. Respondent received the invoice on or about J anuary 31, 2014. 36. Respondent failed to remit payment for the full amount of the invoice within 30 days from the date of the invoice. 37. Section 560.1092(1), Florida Statutes, provides in part: (1) Each licensee examined shall pay to the office the expenses of the examination at the rates adopted by the commission by rule. Such expenses shall include actual travel expenses, reasonable living expense allowance, compensation of the examiner or other person making the examination, and necessary attendant administrative costs of the office directly related to the examination. Travel expense and living expense allowance are limited to those expenses incurred on account of the examination and shall be paid by the examined licensee together with compensation upon presentation by the office to the licensee of a detailed account of the charges and expenses after a detailed statement. has been filed by the examiner and approved by the office, Administrative Complaint Palm Beach Wine Merchants, Inc. Page 8 of 11 38. Rule 69V-560.504(5), Florida Administrative Code (2009), provides in relevant part: (5) The Office will invoice licensces for the costs of the examination and licensees will have 30 days from the date of the invoice to remit payment for invoiced expenses to the Office, 39. Pursuant ta Rule 69V-560.1000(3), Florida Administrative Code, a licensee cited for failing to pay to the Office the expenses of an examination, for the first time is subject to an “A” fine, and an “A” suspension. 40. Pursuant to Rule 69V-560.1000(150), Florida Administrative Code, the range for an “A” fine is between $1,000 and $3,500; and, pursuant to Rule 69V-560.1000(151), Florida Administrative Code, the range for an “A” suspension is 3 to 10 days. 41. Thus, Respondent failed to timely pay to the Office the expenses of an examination, in contradiction and violation of section 560.1 092(1), Florida Statutes and Rule 69V-560.504(5), Florida Administrative Code. WHEREFORE, Respondent, Palm Beach Wine Merchants, Inc. is hereby notified that the Office intends to impose a fine of $15,900, a suspension of 30 days, and require payment of the balance of the exam fee of $689.80 along with payment of the collection agency fee of $158.65. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] Administrative Complaint Palm Beach Wine Merchants, Inc. Page 9 of 11 NOTICE OF RIGHTS The licensec is entitled to be represented by counsel or other qualified representative, The licensee also has the right to Tequest a hearing pursuant to sections 120.569 and 120.57, Florida Statutes. Such request must comply with Rules 28-106.2015 and 28-106.104, Florida Administrative Code. An Election of Proceeding form is attached for your convenience. Any such request must be filed as follows: By Mail or Fax OR By Hand Delivery Office of Financial Regulation Office of Financial Regulation P.O. Box 8050 General Connsel’s Office Tallahassee, FL 32314-8050 The Fletcher Building, Suite 118 Phone: (850) 410-9987 101 East Gaines Street Fax: (850) 410-9914 Tallahassee, FL 32399-0379 Phone: (850) 410-9987 TO PRESERVE THE RIGHT TO A HEARING, A WRITTEN RESPONSE MUST BE FILED WITH THE OFFICE OF FINANCIAL REGULATION WITHIN TWENTY-ONE (21) DAYS AFTER THE RECEYPT OF THE ADMINISTRATIVE COMPLAINT. SAID RESPONSE MUST BE RECEIVED BY THE OFFICE NO LATER THAN 5:00 P.M. ON THE TWENTY-FIRST DAY AFTER THE RECEIPT OF THE ADMINISTRATIVE COMPLAINT. A FAILURE TO TIMELY RESPOND IN WRITING WILL CONSTITUTE A WAIVER OF THE LICENSEE'S RIGHT TO REQUEST A HEARING AND A FINAL ORDER MAY BE ENTERED WITHOUT FURTHER NOTICE. You may not make an oral request for an administrative hearing. With regard to a written request, if you fail to follow the outlined procedure, your request may be dismissed, Any request for an administrative proceeding received prior to the date of this notice is deemed abandoned and to be considered, must be timely renewed in compliance with the procedure set forth above. Mediation of this matter pursuant to section 120.573, Florida Statutes, is not available. Administrative Complaint Palm Beach Wine Merchants, Inc. Page 10 of 11 DATED and SIGNED this |B day or_A\9 DR J. BREAKSPEAR Commissioner | ce of Financial Regulation Fla, Bar No. 0506877 400 W. Robinson St., $-225 Orlando, Florida 32801-1799 (407) 245-0601; fax (407) 245-0806 jennifer lozano@flofr.com CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing Administrative Complaint has been furnished by certified U.S. mail, Return Receipt Requested, to Palm Beach Wine Merchants, Inc., attention Gus Petrou, CEO, at 4600 Broadway. West Palm Beach, FL 33407-2902 this | Oday of A, 4 204 91 71599 9991 7054 3459 Gaga _fSsistant General Counsel & Office of Financial Regulation Fla. Bar No, 0506877 400 W. Robinson St., 8-225 Orlando, Florida 32801-1799 (407) 245-0601; ‘fax (407) 245-0806 Jjennifer.lozano@flofr.com Administrative Complaint Palm Beach Wine Merchants, Inc, Page 11 of 11

Docket for Case No: 14-005821