STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF INSURANCE, )

)

Petitioner, )

)

vs. ) CASE NO. 79-333

) RICHARD WILLIAM RIEMENSCHNEIDER, )

)

Respondent. )

)

RECOMMENDED ORDER

This matter came on for hearing in Orlando, Florida, before the Division of Administrative Hearings, by its duly designated Hearing Officer, Robert T. Benton, II, on April 18, 1979. The Division of Administrative Hearings received a transcript of proceedings on May 22, 1979. On July 9, 1979, the Division of Administrative Hearings received the deposition of W. A. Carrigan. On July 20 and 23, 1979, the Division of Administrative Hearings received the parties' proposed findings of fact and conclusions of law. The proposed findings of fact have been adopted to the extent their substance has been incorporated into the following findings of fact but have been rejected otherwise. The parties were represented by counsel:

For Petitioner: Patrick F. Maroney, Esquire

428-A Larson Building Tallahassee, Florida 32301

For Respondent: James W. Markel, Esquire and

Leslie King O'Neal, Esquire Post Office Drawer 1991 Orlando, Florida 33802

By administrative complaint dated December 18, 1978, as amended on January 30, 1979, petitioner alleged that respondent completed group insurance application forms for Peter Paulson, Bob Webb, Brian Williams, Christine Williams, Robert Jackson, Muriel Carter, Kim Stone, Janice P. Boynton and Virginia Birch, knowingly using fictitious information and "writ[ing] or caus[ing] to be written the fictitious signature" of each fictitious applicant; that respondent, doing business as Carrie and Associates, submitted the application to Professional Insurance Company (PIC); that PIC paid respondent advance commissions in reliance on the applications; and that, in one instance, respondent "did write or cause to be written the unauthorized signature of William Carigan [sic] as agent on the aforementioned applications"; all in violation of Sections 626.611(5), (6), (7), (9) and (13); 626.621(2) and (6); and 626.9541(11)(a), Florida Statutes (1977).

FINDINGS OF FACT

1. Respondent has worked in the insurance business some eleven years, including a five year stint with the Metropolitan Life Insurance Company in New

   York and two years with Gulf Life Insurance Company. Although respondent remained an ordinary agent for Independent Life Insurance Company until January of 1978, he and a partner, William Andrew Carrigan, contracted, in October of 1977, with Gordon Burnham, one of PIC's managing general agents, to act as general agents for the sale of life, health and disability insurance on a franchise group basis. On behalf of PIC, they sought out employers willing to let them offer insurance to their employees and to arrange for payment of premiums by payroll deduction.

   
   

2. Under the arrangement with PIC, respondent's partnership, Carrie & Associates, was permitted to borrow, subject to a weekly maximum, the lesser of

   $250.00 or "fifty percent of [the] annualized commission," p. 21, Lee Logan's deposition, whenever respondent or his partner sold an insurance policy and submitted the appropriate papers to PIC. The indebtedness respondent and his partner incurred in receiving the advance was to be gradually reduced, as premiums on the policy were paid to PIC. In the event a policy was cancelled before the advance was repaid, PIC was authorized to look to other policies sold by the same agents for repayment.

   
   

3. Respondent and his partner regularly asked for advances and ordinarily received them within a week of forwarding a new policy application to PIC. Ordinarily, the first month's premium was required to accompany an application for a new policy. When, however, a new policy was sold to an employee of an employer who already deducted PIC premiums from employees' paychecks, there was no requirement that the first month's premium accompany the papers respondent or his partner furnished PIC. In the event PIC received no premium within 30 days, PIC was authorized to look to other policies sold by the partnership for repayment of the advance.

   
   

4. By February of 1978, Carrie & Associates had sold insurance policies to employees of, among other businesses, Tower Coiffures in Lakeland and Seminole Bakery in Sanford. Business was slow that February, so respondent decided to write applications for insurance policies for nonexistent people, in order to improve his cash flow. He wrote an application for life insurance for a fictitious Peter Paulson, whom he described as a 34 year old Texan, 5 feet 9 inches tall, weighing 149 pounds, and whom he falsely reported to be an employee of Seminole Bakery. He wrote an application for life and health insurance for a fictitious Bob Webb, falsely reporting him as an employee of Seminole Bakery, and on Rohnda (sic) Webb, Bob's imaginary wife. In connection with the Webb application, respondent signed his partner's name in a blank on a form entitled "Signature of Soliciting Agent," only apprising his partner afterwards.

   
   

5. Respondent wrote applications for insurance for fictitious persons named Brian Williams, Christine Williams, Robert Jackson, Muriel Carter and Kim Stone, whom he falsely reported to be employees of Seminole Bakery, as well as for Kim's fictitious spouse, Ronald Stone. He wrote applications for life and health insurance for a fictitious Virginia Birch and for a fictitious Janice D. Boynton, falsely reporting them as employees of Tower Coiffures.

   
   

6. In each instance, respondent forwarded the falsified papers to PIC and, in each instance, PIC advanced money on the strength of the papers. At the time of the hearing, respondent (who is no longer licensed as an agent with PIC) and his partner owed PIC $5,342.31, representing unrepaid commission advances on lapsed or fictitious policies, together with accrued interest. At the time of the hearing, proceeds from policies still in force applied against this indebtedness at the rate of $60.48 per month.

7. Charles William "Bill" Honaker employed respondent as an insurance agent, at the time of the hearing. Mr. Honaker began in the insurance business in 1953. Since that time he has seen "bogus" policies many times, yet he has never heard of a state license revocation for a one-time bogus business problem.

   
   

   CONCLUSIONS OF LAW

   
   

8. The parties' stipulations and the evidence adduced by the parties demonstrated that respondent was guilty of "willful deception with regard to [more than one] policy." Section 626.611(5), Florida Statutes (1977). By this conduct, respondent has "demonstrated lack of fitness or trustworthiness to engage In the business of insurance." Section 626.611(7) Florida Statutes (1977). Petitioner demonstrated that respondent was guilty of "[f]raudulent or dishonest practices in the conduct of business," Section 626.611(9), Florida Statutes (1977), and of "[m]aking false or fraudulent statements...relative to [more than one] application for an insurance policy for the purpose of obtaining

...money, or other benefits from any insurer." Section 626.9541(11)(a), Florida Statutes (1977).

RECOMMENDATION

Upon consideration of the foregoing, it is RECOMMENDED:

That petitioner revoke respondent's license as an insurance agent. DONE and ENTERED this 27th day of July, 1979, in Tallahassee, Florida.

ROBERT T. BENTON, II

Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 27th day of July, 1979.

COPIES FURNISHED:

Patrick F. Maroney, Esquire 428-A Larson Building Tallahassee, Florida 32301

James W. Markel, Esquire and Leslie King O'Neal, Esquire Post Office Drawer 1991 Orlando, Florida 33802

Docket for Case No: 79-000333

Orders for Case No: 79-000333