STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FLORIDA REAL ESTATE COMMISSION, )

)

Petitioner, )

)

vs. ) CASE NO. 76-1340

)

HARRY A. YEARGIN, )

)

Respondent. )

)

RECOMMENDED ORDER

A hearing was held pursuant to notice at 1919 Beachway Road, Jacksonville, Florida on September 10, 1976 before Stephen F. Dean, assigned Hearing Officer of the Division of Administrative Hearings. This matter came on to be heard upon the denial of the application of Harry A. Yeargin as a real estate salesman by the Florida Real Estate Commission for violation of Title 18, U.S. Code, Section 215. By its order of June 2, 1976, the Commission denied the application of Harry A. Yeargin on the basis that the applicant had been charged by indictment in the United States District Court, Middle District of Florida, Jacksonville Division, with the violation of Title 18, U.S. Code, Section 215, a Federal Misdemeanor, and therefore lacked the necessary qualifications sufficient for registration as a salesman under Subsection 475.17, F.S., in that he failed to make it appear that he is honest, truthful, trustworthy, of good character and bears a good reputation for fair dealing or that he is qualified to make real estate transactions and conduct negotiations with safety to investors and to those with whom he may undertake a relationship of trust and confidence.

APPEARANCES

For Petitioner: Randy J. Schwartz, Esquire

2699 Lee Road

Winter Park, Florida 32789

For Petitioner: W. O. Birchfield, Esquire

3000 Independent Square

Jacksonville, Florida 32202 FINDINGS OF FACT

1. Harry A. Yeargin completed some years ago a real estate salesman's course and more recently completed the real estate broker's course as presented by the University of North Florida. Yeargin obtained a 4.0 or "A" for his work in the real estate broker's course at the University of North Florida.

   
   

2. Harry A. Yeargin has made application for licensure as a real estate salesman to the Florida Real Estate Commission. On said application, Yeargin indicated that he was currently under indictment for alleged violation of Title

   18, U.S. Code, Section 215. A copy of said indictment was introduced as Exhibit

   1 by the Florida Real Estate Commission.

   
   

3. Said indictment charges in Count 2 that Harry Alvin Yeargin on January 12, 1970 did knowingly cause Carl Jonathan Nill, being an officer, that is, Vice President of the State Bank of Jacksonville, the deposits of which were then insured by the Federal Deposit Insurance Corporation, to receive and agree to receive the sum of $875.00 from Harry Alvin Yeargin as a fee and commission, otherwise than provided by law, for procuring and endeavoring to procure an extension of a loan in the amount of approximately $114,000.00 for Donald A. Wagley from said bank; in violation of Title 18, U.S. Code, Sections 215 and 2.

   
   

4. At that time the federal reserve requirements for the ratio of money on deposit to money on loan had been increased to restrict the amount of monies available for loans. However, by increasing the amount of money on deposit, a bank would be able to increase the amount of money which it could loan. One method of increasing deposits was by seeking deposit of monies in time deposits.

   
   

5. For arranging the deposit of monies in time certificates in banks, money brokers receive from two and one-half to three points from persons seeking to borrow money from banks in which time certificates had been deposited in their behalf. The brokers, in turn, paid two points to the investors for placing their money in time certificates and took one-half to one point as a personal commission for their services. It was the practice to split the commission with persons who referred borrowers to money brokers.

   
   

6. Harry A. Yeargin, on 12 January 1970, was an officer of the American National Bank in Jacksonville, Florida. In addition, he was in his own right a money broker. In that capacity, he was contacted by Carl Nill, an officer of the State Bank of Jacksonville, to arrange for the deposit of time certificates with the State Bank of Jacksonville.

   
   

7. Donald A. Wagley, a person at that time unknown to Yeargin, was seeking the renewal of a loan which he had with the State Bank of Jacksonville. The State Bank of Jacksonville was unable to renew the loan because of the restrictive federal reserve ratio requirements. Nill, an officer of the State Bank, contacted Yeargin as a money broker to arrange for the deposit of monies in time certificates in the State Bank of Jacksonville, thereby increasing the deposits in the bank to a degree that the bank could renew Wagley's loan.

   Wagley paid to Yeargin two and one-half to three points for the deposit of the time certificates, two points of which Yeargin paid directly to the depositors. Yeargin split his fee for arranging the Loans with Nill, and sent him a check in the amount of $875.00 for that service. It is upon these facts that the alleged violation of Title 18, U.S. Code, Section 215 and 2 were based.

   
   

8. Harry A. Yeargin was initially named in two indictments in the United States District Court, Middle District of Florida, Jacksonville Division. The first indictment contained two counts of violation of Title 18, U.S. Code, Section 215, which were based on circumstances which were substantially similar to those related above. The counts in the first indictment have been dismissed by the Federal Court with prejudice to the U.S. Government.

   
   

9. The remaining indictment, which is the one in question, has not been brought to trial and because of the lack of Federal Judges within the U.S. District Court, Middle District of Florida, and according to various witnesses, no reasonable estimate as to when this indictment might be brought to trial is possible.

10. A substantial number of witnesses were called and testified with regard to their knowledge of the applicant, Harry A. Yeargin. These witnesses included persons who had knowledge of Yeargin's reputation concerning Yeargin's social, religious, and business relationships within the community. Yeargin has a reputation in the community for honesty, truthfulness, trustworthiness, good character and fair dealing. His experience in banking, his association with Roy

    F. Smith, Jr., and Associates, Inc. and successful completion of academic studies on real estate brokerage indicate his qualifications to make real estate transactions. Yeargin's excellent service as an organizational treasurer since his indictment and his having been asked to serve a second term are indicative of his ability to handle fiduciary relationships. Yeargin's reputation in the community has been unimpaired by the indictment among those who know him personally.

    
    

    CONCLUSIONS OF LAW

    
    

11. It would appear that the only evidence of any unfitness by Harry Yeargin to be a real estate salesman is the Federal Indictment for violation of Title 18, U.S. Code, Sections 215 and 2. An indictment is not evidence of guilt nor may it be considered as such. Clearly, it is the law in this country that every individual is presumed innocent until proven guilty. The evidence upon which the Federal Grand Jury based its indictment was not introduced at hearing. The only evidence contained in the record of factual circumstances surrounding the indictment is the testimony of the applicant, Harry A. Yeargin.

    
    

12. There is no evidence that Yeargin's activities as a money broker were illegal or unethical. The money which Yeargin's principals placed in time deposits was insured, they received the regular interest rate paid by the bank plus an additional 2 percent paid in full at the time of deposit, and they had no liability on any loan made by the bank.

    
    

13. In light of the applicant's explanation of the circumstances and the substantial evidence as to his reputation in the community for honesty, truthfulness, trustworthiness and good character and in consideration of his experience and education in matters relating to real estate transactions, the Hearing Officer finds that Harry A. Yeargin is qualified for licensure as a real estate salesman.

RECOMMENDATION

The Hearing Officer, based upon the foregoing Findings of Fact and Conclusions of Law, recommends that the Real Estate Commission accept the application of Harry A. Yeargin.

DONE and ORDERED this 16th day of September, 1976 in Tallahassee, Florida.

STEPHEN F. DEAN, Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304

(904) 488-9675

COPIES FURNISHED:

Randy James Schwartz, Esquire Florida Real Estate Commission 2699 Lee Road

Winter Park, Florida 32789

W. O. Birchfield, Esquire 3000 Independent Square Jacksonville, Florida 32202

Docket for Case No: 76-001340

Orders for Case No: 76-001340