STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BANKING AND ) FINANCE, DIVISION OF FINANCE )

)

Petitioner, )

)

vs. ) CASE NO. 94-1262

) RON COOK and TERESA JELICH, )

)

Respondents. )

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was conducted in this case on July 12, 1994, in West Palm Beach, Florida, before Stuart M. Lerner, a duly designated Hearing Officer of the Division of Administrative Hearings.

APPEARANCES

For Petitioner: John D. O'Neill, Esquire

Assistant General Counsel Department of Banking and Finance

111 Georgia Avenue, Suite 211 West Palm Beach, Florida 33401

For Respondents: Ron Cook, pro se

Teresa Jelich, pro se 1216 Summerwood Circle

West Palm Beach, Florida 33414 STATEMENT OF THE ISSUES

1. Whether the Administrative Complaint should be dismissed on the grounds asserted by Respondents in their Motion for Dismissal?

   
   

2. If not, whether Respondents committed the violations alleged in the Administrative Complaint?

   
   

3. If so, what sanctions should be imposed against them?

PRELIMINARY STATEMENT

On or about January 13, 1993, the Department of Banking and Finance, Division of Finance (hereinafter referred to as the "Department") issued an Administrative Complaint alleging that "Respondents were operating as mortgage brokers in the State of Florida for United Financial International, Inc." without being licensed by the Department as mortgage brokers, in violation of Section 494.093(1), Florida Statutes (1989). Respondents denied the allegations of wrongdoing advanced in the Administrative Complaint and requested an informal hearing. On March 10, 1994, the Department, evidently believing that there were

disputed issues of material fact, referred the case to the Division of Administrative Hearings for the assignment of a Hearing Officer to conduct a formal hearing on the matter.

On May 31, 1994, Respondents filed a motion requesting that the charges against them be dismissed on the ground that the Department has "not act[ed] in a timely manner" in prosecuting them. The Department, on June 2, 1994, filed a response in opposition to Respondents' motion. On June 14, 1994, the Hearing Officer issued an order in which he stated the following concerning Respondents' motion:

The Hearing Officer is without authority to dismiss the Administrative Complaint against Respondents, however, he may recommend that [the Department] take such action.

Accordingly, the parties will be permitted at the final hearing in the instant case, which is presently scheduled to commence on July 12, 1994, to present evidence on the factual issues raised by Respondents' Motion for Dismissal and [the Department's] response thereto, provided that their evidentiary presentations are made in accordance with the provisions of the Order Requiring Prehearing Stipulation issued in

this case on April 7, 1994. In the Recommended Order that he will issue following the final hearing and his receipt of any timely filed post-hearing pleadings, the Hearing Officer will address these factual issues and make

a recommendation as to whether [the Department] should grant Respondents' Motion for Dismissal.

At the final hearing held in this case on July 12, 1994, 1/ the Department presented the testimony of six witnesses: Dudley Phipps; John Archer; Connie Wiscaver; Arthur McCullough; 2/ Ronald Mims; and Donna Butterworth. 3/ The Department also offered 31 exhibits (Petitioner's Exhibits

1 through 31) into evidence, all of which were received by the Hearing Officer. The only evidence offered by Respondents was one exhibit (Respondents' Exhibit 1), which, like the Department's exhibits, was received by the Hearing Officer. In addition to presenting the foregoing evidence, the parties entered into various factual stipulations that were stated on the record.

At the conclusion of the evidentiary portion of the hearing, the Hearing Officer, on the record, advised the parties of their right to file post-hearing submittals and established a deadline (14 days from the filing of the hearing transcript with the Division of Administrative Hearings) for the filing of such submittals. The hearing transcript was filed with the Division of Administrative Hearings on July 26, 1994. On August 9, 1994, the Department and Respondents timely filed post-hearing submittals. The Department's post-hearing submittal contains what are labelled as "proposed findings of fact." A portion of Respondents' post-hearing submittal, specifically the "closing" paragraph thereof, contains assertions that, although not specifically labelled as such, are in the nature of proposed findings of fact. The findings of fact proposed by the parties have been carefully considered and are specifically addressed in the Appendix to this Recommended Order.

FINDINGS OF FACT

Based upon the evidence adduced at hearing, the factual stipulations into which the parties have entered, and the record as a whole, the following Findings of Fact are made:

1. From approximately October of 1989, to February of 1990, Respondents were employed as telephone consultants by United Financial International, Inc. (hereinafter referred to as "UFI"), a Florida-based business owned by Laura Correa and Anita "Ann" Cuevas that offered to provide assistance to consumers seeking various types of loans, including mortgage loans.

   
   

2. Respondents were not then, nor have they ever been, licensed by the Department as mortgage brokers in the State of Florida.

   
   

3. Furthermore, at no time did UFI have a license or registration issued by the Department to operate as a mortgage broker, mortgage brokerage business, correspondent mortgage lender or mortgage lender, although it did have at least one employee during the period of Respondents' employment, telephone consultant John Archer, who possessed a Department-issued mortgage broker's license.

   
   

4. As telephone consultants for UFI, Respondents answered and screened telephone calls placed by potential UFI clients. Among the callers Respondent Cook screened were Dudley Phipps and Arthur McCullough. Among the callers Respondent Jelich screened was Connie Wiscaver. Phipps, McCullough and Wiscaver were all interested in obtaining mortgage loans.

   
   

5. While on the telephone with a potential client, Respondents, as a general rule, identified themselves by name, explained to the caller the services offered and fees charged by UFI, and obtained from the caller the following information, which they recorded on a form provided by their employer: the caller's name, address, telephone number, date of birth, social security number, employer, salary, financial standing, and credit history; and the type, amount and purpose of the loan sought by the caller. Respondents also typically asked what the caller hoped for in terms of interest rate, size of monthly payments and loan repayment schedule. In addition, they indicated what items the caller needed to send to UFI to complete the caller's loan application package.

   
   

6. The representations that Respondents made during a typical telephone conversation with a potential client seeking a mortgage loan gave the impression that, if the caller submitted a complete loan application package along with the requisite loan application processing fee, and everything "checked out," Respondents would make the arrangements necessary for the caller to obtain the mortgage loan he or she wanted from one of the lenders with whom UFI had an established relationship.

   
   

7. UFI management, in writing, instructed all of its telephone consultants, including Respondents, to incorporate the following in their presentation to potential clients and it randomly monitored the consultants' telephone conversations to make sure that these instructions were being followed:

   
   

   1. We Co-Broker loans.

   2. We are not lenders nor do we have a Funding Committee to evaluate the Loan

      Package after we receive it.

   3. It takes twenty one (21) to thirty (35) [sic] business days from the day we receive ALL the information to evaluate the package.

   4. We have an application Fee of $399.00.

   5. MANDATORY

      Please use these statements to increase your credibility and assertiveness with potential clients.

      1. The maximum life of the loan will be determined by the investor/lender.

      2. The interest rates will be fixed and vary between 12-18 percent.

      3. The application fee is non-refundable and the assessed fees to your loan are separate from the application fee.

      4. There will be a Brokerage fee of 1-5 percent assessed to your loan upon closing.

   6. To increase your potential, please make sure when your [sic] finishing with your potential client to ask them [sic] when they [sic] would like to obtain a loan.

   7. Also in your closing statements be sure

      to tell your client to Bill Recipient with our Federal Express/Express Mail Service to Guarantee overnight delivery. Be advised this is for the return of the Application Fee Only! The application istself [sic] is returned at the client's own expense.

   8. The client may pay the application fee by personal check; however, as the checks will be out-of-state it will take approximately (21) days for the check to clear which will hold up the clients [sic] processing. Therefore, we recommend a money order to expidite [sic] the process. We do not like to use regular mail for sending the money orders, we rather the client use our courier sevice [sic].

      (see above)

   9. If you need assistance please do not hesitate to phone us at 1-800-729-5666. We want to help you secure the funds you require as soon as possible. We sincerely thank you for giving us the opportunity to serve you.

      
      

8. In most cases, Respondents followed these instructions.

   
   

9. As compensation for performing their duties as UFI telephone consultants, Respondents received a percentage (either 20 or 30 percent) of the non-refundable loan application processing fee submitted by each caller whose call they screened.

   
   

10. In an effort to encourage a caller to submit the fee, Respondents sometimes told the caller that, based upon the preliminary information provided, the chances of the desired loan being approved "looked good." They never stated, however, that loan approval was "guaranteed."

    CONCLUSIONS OF LAW

    
    

11. Respondents have argued that the Administrative Complaint issued against them should be dismissed due to prosecutorial delay on the part of the Department. There has been no showing, however, that, in issuing the instant Administrative Complaint and referring the matter to the Division of Administrative Hearings, the Department has violated any time limit prescribed by statute or rule. Moreover, the evidence does not establish that any delay by the Department in issuing the Administrative Complaint and referring the matter to the Division prejudiced, in any material way, Respondents' defense of the charges lodged against them or otherwise impaired the fairness of this administrative proceeding. Under such circumstances, the Department should reject Respondents' argument that dismissal of the instant Administrative Complaint is warranted on the ground of prosecutorial delay. See Carter v. Department of Professional Regulation, Board of Optometry, 613 So.2d 78, 81 (Fla. 1st DCA 1993); Farzad v. Department of Professional Regulation, 443 So.2d 373, 375-76 (Fla. 1st DCA 1983); Landes v. Department of Professional Regulation, 441 So.2d 686 (Fla. 2d DCA 1983).

    
    

12. At all times material to the instant case, Section 494.093(1), Florida Statutes (1989), provided that "[i]t is unlawful, and a violation of the provisions of this chapter, for any person: To act as a mortgage broker in this state without a mortgage broker license issued by the department."

    
    

13. The term "mortgage broker," as used in Section 494.093(1), Florida Statutes (1989), was defined in Section 494.02(3), Florida Statutes (1989), as "any person who for compensation or gain, or in the expectation of compensation or gain, either directly or indirectly, negotiates, acquires, sells, or arranges for, or offers to negotiate, acquire, sell, or arrange for, a mortgage loan or mortgage loan commitment."

    
    

14. The term "mortgage loan," as used in the foregoing definition, was defined in Section 494.02(2), Florida Statutes (1989), as "any loan secured by a mortgage on real property or any loan secured by collateral which has a mortgage lien interest in real property."

    
    

15. Section 494.093(1), Florida Statutes (1989), did not contain the element of scienter, and therefore a person may be found guilty of having violated its provisions, notwithstanding that person's good faith belief, at the time of the violation, that he was acting in compliance with the law. Cf. Santacroce v. Department of Banking and Finance, 608 So.2d 134, 136 (Fla. 4th DCA 1992)(Section 517.12(1), Florida Statutes, prohibiting a person from selling securities in Florida unless the person has been registered with the Department "does not contain the element of scienter, and thus appellant's asserted good faith belief that he was registered [on the date of the alleged transactions] is irrelevant" and does "not provide him with a defense to section 517.12").

    
    

16. Section 494.03, Florida Statutes (1989), exempted from the mortgage broker licensing requirements of Chapter 494, Florida Statutes, "[n]atural persons at least 18 years of age and employed by a certified [mortgage brokerage business registered pursuant to Chapter 494, Florida Statutes (1989)], when acting within the scope of the[ir] employment," but provided that the "burden of establishing [in any administrative proceeding] the right to any [such] exemption shall be upon the party claiming the benefit of such exemption." A "mortgage brokerage business," as that term was used in Chapter 494, Florida Statutes, was defined in Section 494.02(4), Florida Statutes (1989), as "any person which employs a mortgage broker or mortgage brokers, or which, either

    directly or indirectly, makes, negotiates, acquires, sells, or arranges for, or offers to make, negotiate, acquire, sell, or arrange for, a mortgage loan or mortgage loan commitment for compensation or gain, or in the expectation of compensation or gain."

    
    

17. At all times material to the instant case, Sections 494.052 and 494.055(1)(l), Florida Statutes (1989), collectively, authorized the Department to take one or more of the following actions against persons found to have violated Section 494.093(1), Florida Statutes (1989): deny them a license; suspend or revoke any license they have been granted; place them on probation, if they are licensed or applying for a license; issue them a reprimand; and impose upon them an administrative fine not exceeding $5,000.00 "for each count or separate offense." 4/ In addition, Section 494.072, Florida Statutes (1989), authorized the Department to issue and serve a cease and desist order upon those persons it had reason to believe had violated Section 494.093(1), Florida Statutes (1989).

    
    

18. In those cases where the penalty adversely impacts upon a previously granted license, the person's guilt must be established by clear and convincing evidence. See Ferris v. Turlington, 510 So.2d 292 (Fla. 1987); Pic N' Save v. Department of Business Regulation, 601 So.2d 245 (Fla. 1st DCA 1992); Munch v. Department of Professional Regulation, 592 So.2d 1136 (Fla. 1st DCA 1992); Newberry v. Florida Department of Law Enforcement, 585 So.2d 500 (Fla. 3d DCA 1991); Pascale v. Department of Insurance, 525 So.2d 922 (Fla. 3d DCA 1988). "The evidence must be of such weight that it produces in the mind of the trier of fact a firm belief or conviction, without hesitancy, as to the truth of the allegations sought to be established." Slomowitz v. Walker, 429 So.2d 797, 800 (Fla. 4th DCA 1983).

    
    

19. Where the penalty does not affect a previously granted license, the violation need be established by only a preponderance of the evidence. See Allen v. School Board of Dade County, 571 So.2d 568, 569 (Fla. 3d DCA 1990).

    
    

20. Regardless of the penalty imposed, it may be based only upon the violations specifically alleged in the administrative complaint. See Kinney v. Department of State, 501 So.2d 129, 133 (Fla. 5th DCA 1987); Hunter v. Department of Professional Regulation, 458 So.2d 842, 844 (Fla. 2d DCA 1984).

    
    

21. The instant Administrative Complaint alleges that Respondents violated Section 494.093(1), Florida Statutes (1989), "by operating as mortgage brokers without a mortgage broker's license" when they were employed by UFI. 5/

    
    

22. The record in the instant case establishes that Respondents did indeed act in violation Section 494.093(1), Florida Statutes (1989), as alleged in the Administrative Complaint, when, as unlicensed telephone consultants working for UFI, an unregistered mortgage brokerage business, 6/ they offered to make the arrangements necessary for callers to whom they spoke to obtain the mortgage loans the callers were seeking.

    
    

23. Taking into account all of the circumstances of the instant case, the Hearing Officer concludes that the appropriate penalty to impose upon Respondents for having violated Section 494.093(1), Florida Statutes (1989), as alleged in the Administrative Complaint, is to fine them $5,000.00 each. 7/

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby

RECOMMENDED that the Department enter a final order finding Respondents guilty of having violated Section 494.093(1), Florida Statutes (1989), as alleged in the Administrative Complaint, and imposing upon each of them an administrative fine of in the amount of $5,000.00 for having engaged in such wrongdoing.

DONE AND ENTERED in Tallahassee, Leon County, Florida, this 19th day of August, 1994.

STUART M. LERNER

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 19th day of August, 1994.

ENDNOTES

1/ The final hearing was originally scheduled to commence on June 15, 1994, but was continued and rescheduled at the request of the Department.

2/ Phipps, Archer, Wiscaver and McCullough testified by telephone with the permission of the Hearing Officer.

3/ Phipps and McCullough had dealings with Respondent Cook, and Wiscaver had dealings with Respondent Jelich, during the period that Respondents were employed by United Financial International, Inc. Archer and Butterworth were two of Respondents' coworkers at United Financial International, Inc. Mims is a financial examiner supervisor with the Department.

4/ The Department is still authorized by statute to impose these sanctions upon those who act "as a mortgage broker . . . without a current, active license" issued by the Department. Such statutory authority, however, is now found in Section 494.0041, Florida Statutes (1993).

5/ Contrary to the assertion made by the Department in its post-hearing submittal, Respondents were not charged with, and therefore they cannot be found guilty of and penalized for, violating Section 494.08(4)(a), Florida Statutes (1989), which provided that "[n]o unlicensed or unregistered person shall charge or receive any commission, bonus, or fee in connection with arranging for, negotiating, selling or purchasing a mortgage loan to any person operating in this state not licensed or registered under the provisions of this act."

6/ Because UFI, their employer, was not registered with the Department as a mortgage brokerage business, Respondents were not exempt, by operation of Section 494.03(3)(a), Florida Statutes (1989), from the mortgage broker licensing requirements of Chapter 494, Florida Statutes (1989).

7/ The maximum fine that can be imposed for a violation of Section 494.093(1), Florida Statutes (1989), is "$5,000 for each count or separate offense." Inasmuch as the Administrative Complaint does not contain multiple counts against either Respondent, nor does it specifically allege that either Respondent committed multiple violations of Section 494.093(1), Florida Statutes (1989), neither Respondent may be fined in excess of $5,000.00, as the Department proposes in its post-hearing submittal both Respondents should.

There has been no allegation made, nor proof submitted, that since the termination of their employment with UFI in February of 1990, Respondents have acted in violation of any Florida statutory or rule provision regulating the mortgage brokerage business. Accordingly, contrary to the suggestion made by the Department in its post-hearing submittal, there is no need to issue a cease and desist order in the instant case.

The Department further suggests in its post-hearing submittal that Respondents be ordered to pay a "refund of any fee or commission directly or indirectly assessed and charged on a mortgage finance transaction that exceeds the maximum fees or commissions [that were allowable under Chapter 494, Florida Statutes (1989)] for each of the violations of Chapter 494, Florida Statutes, and applicable rules thereunder, committed by Respondent[s]." Were Respondents charged with and found guilty of receiving fees or commissions in excess of the maximum fees and commissions that were prescribed in Section 494.08, Florida Statutes (1989), the Department would be authorized, pursuant to Section 494.072(2), Florida Statutes (1989), to order such a refund. The Administrative Complaint, however, does not allege such wrongdoing on the part of Respondents and therefore the Department, in the instant case at least, may not enter the refund order proposed in its post-hearing submittal.

APPENDIX TO RECOMMENDED ORDER IN CASE NO. 94-1262

The following are the Hearing Officer's specific rulings on the proposed findings of fact set forth in the parties' post-hearing submittals:

The Department's Proposed Findings of Fact

1. Rejected as a finding of fact because it is more in the nature of a statement of the law.

2. Accepted and incorporated in substance, although not necessarily repeated verbatim, in this Recommended Order.

3. First and second sentences: Not incorporated in this Recommended Order because they would add only unnecessary detail to the factual findings made by the Hearing Officer; Third sentence: Rejected as a finding of fact because it is more in the nature of a summary of testimony than a finding of fact based upon such testimony; Fourth sentence: Rejected because it is not supported by persuasive competent substantial evidence. Moreover, even if true, it would add only unnecessary detail to the factual findings made by the Hearing Officer.

4. Rejected because it is not supported by persuasive competent substantial evidence. Moreover, even if true, it would add only unnecessary detail to the factual findings made by the Hearing Officer.

5. Accepted and incorporated in substance.

6. First and third sentences: Accepted and incorporated in substance; Second sentence: To the extent that this proposed finding suggests that Respondents were hired by UFI to solicit over the telephone loans from prospective lenders, as opposed to applications for loans and accompanying loan application processing fees from prospective borrowers, it has been rejected because it is not supported by persuasive competent substantial evidence.

7. First sentence: Accepted and incorporated in substance; Second sentence: Rejected because it is not supported by persuasive competent substantial evidence. Moreover, even if true, it would add only unnecessary detail to the factual findings made by the Hearing Officer.

8-9. Rejected because they are not supported by persuasive competent substantial evidence. Moreover, even if true, they would add only unnecessary detail to the factual findings made by the Hearing Officer.

1. First sentence: To the extent that this proposed finding suggests that Respondents actually made the "arrangements for applicants to receive mortgage loans," as opposed to simply offering to make such arrangements, it has been rejected because it is not supported by persuasive competent substantial evidence; Second sentence: Not incorporated in this Recommended Order because it would add only unnecessary detail to the factual findings made by the Hearing Officer.

2. First sentence: Accepted and incorporated in substance; Second and third sentences: To the extent that these proposed findings suggest that Respondents actually made the "arrangements for the loan amount to include the principle [sic], interest, taxes and insurance (PITI) in the mortgage loan," as opposed to simply offering to make such arrangements, they have been rejected because they are not supported by persuasive competent substantial evidence. Moreover, even if true, they would add only unnecessary detail to the factual findings made by the Hearing Officer.

3. First sentence: Accepted and incorporated in substance; Second, third and fourth sentences: Not incorporated in this Recommended Order because they would add only unnecessary detail to the factual findings made by the Hearing Officer.

4. Not incorporated in this Recommended Order because it would add only unnecessary detail to the factual findings made by the Hearing Officer.

5. First sentence: Accepted and incorporated in substance; Second and third sentences: Not incorporated in this Recommended Order because they would add only unnecessary detail to the factual findings made by the Hearing Officer.

6. Accepted and incorporated in substance.

7. Rejected as a finding of fact because it is more in the nature of a summary of testimony than a finding of fact based upon such testimony.

8. Accepted and incorporated in substance.

9. Rejected as a finding of fact because it is more in the nature of a summary of testimony than a finding of fact based upon such testimony.

10. To the extent that this proposed finding states that Respondent Jelich told Wiscaver that Wiscaver's loan was "approved," it has been rejected because it is not supported by persuasive competent substantial evidence. To the extent that it states that Jelich "told Wiscaver that the processing would start as soon as the $399.00 application fee was received," it has been accepted and incorporated in substance.

11. Accepted and incorporated in substance.

12. Not incorporated in this Recommended Order because, even if true, it would add only unnecessary detail to the factual findings made by the Hearing Officer.

13. To the extent that this proposed finding suggests that all of UFI's telephone consultants were licensed mortgage brokers, it has been rejected because it is not supported by persuasive competent substantial evidence. Otherwise, it has been accepted and incorporated in substance.

14. Accepted and incorporated in substance.

15. First sentence: To the extent that this proposed findings suggests that all of UFI's telephone consultants were licensed mortgage brokers, it has been rejected because it is not supported by persuasive competent substantial evidence. Otherwise, it has been accepted and incorporated in substance; Second sentence: Accepted and incorporated in substance; Third sentence: Rejected as a finding of fact because it is more in the nature of a summary of testimony than a finding of fact based upon such testimony.

16. Accepted and incorporated in substance.

17. First sentence: Rejected as a finding of fact because it is more in the nature of a summary of testimony than a finding of fact based upon such testimony; Second sentence: Rejected because it is not supported by persuasive competent substantial evidence. Moreover, even if true, it would add only unnecessary detail to the factual findings made by the Hearing Officer.

18. First sentence: Rejected because it is not supported by persuasive competent substantial evidence. Moreover, even if true, it would add only unnecessary detail to the factual findings made by the Hearing Officer; Second sentence: Rejected as finding of fact because it is more in the nature of legal argument.

19. First sentence: Not incorporated in this Recommended Order because it would add only unnecessary detail to the factual findings made by the Hearing Officer; Second sentence: Accepted and incorporated in substance.

20. Not incorporated in this Recommended Order because it would add only unnecessary detail to the factual findings made by the Hearing Officer.

21. To the extent that this proposed finding states that Respondent Cook told callers that "it looked good, looked real good" that their loan application would be approved, it has been accepted and incorporated in substance. Otherwise, it has been rejected because it is not supported by persuasive competent substantial evidence.

22. Rejected because it is not supported by persuasive competent substantial evidence.

32-33. Rejected as findings of fact because they are more in the nature of summaries of testimony than findings of fact based upon such testimony.

34. Rejected as a finding of fact because it is more in the nature of legal argument.

Respondent's Proposed Findings of Fact

Assertion that "[w]e were not part of ownership or management:" Accepted and incorporated in substance.

Assertion that "[w]e were never in any decision-making capacity": Accepted and incorporated in substance.

Assertion that "[w]e in fact were hired as telephone operators and our job was to fill out a questionnaire form which is what we did:" Accepted and incorporated in substance to the extent that it suggests that filling out the questionnaire was a part of Respondents' "job" at UFI. To the extent that it suggests that Respondents had no other job duties, it has been rejected because it is not supported by persuasive competent substantial evidence.

Assertion the "[w]e were under the impression that we were working for a legitimate company:" Rejected because it is not supported by persuasive competent substantial evidence.

COPIES FURNISHED:

John D. O'Neill, Esquire Assistant General Counsel Department of Banking and

Finance

111 Georgia Avenue, Suite 211 West Palm Beach, Florida 33401

Ron Cook Teresa Jelich

1216 Summerwood Circle

West Palm Beach, Florida 33414

Honorable Gerald Lewis Comptroller, State of Florida The Capitol, Plaza Level Tallahassee, Florida 32399-0350

William G. Reeves, Esquire General Counsel

Department of Banking and Finance

The Capitol, Suite 1302 Tallahassee, Florida 32399-0350

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions to this recommended order. All agencies allow each party at least 10 days in which to submit written exceptions. Some agencies allow a larger period of time within which to submit written exceptions. You should contact the agency that will issue the final order in this case concerning agency rules on the deadline for filing exceptions to this recommended order. Any exceptions to this recommended order should be filed with the agency that will issue the final order in this case.

================================================================= CORRECTED AGENCY FINAL ORDER

=================================================================

STATE OF FLORIDA DEPARTMENT OF BANKING AND FINANCE

DIVISION OF FINANCE

DEPARTMENT OF BANKING AND FINANCE, DIVISION OF FINANCE,

vs.

Administrative Proceeding

Petitioner, No.: 1922a-S-8/93 DOAH Case No. 94-1262

RON COOK and TERESA JELICH,

Respondents.

/

CORRECTED FINAL ORDER

This matter has come before the undersigned as Head of the Department of Banking and Finance, Division of Finance, ("Department"), for the entry of a final order against Ron Cook and Teresa Jelich (hereinafter "Respondents") in the above referenced proceeding. On August 19, 1994, a hearing officer from the Division of Administrative Hearings submitted his Recommended Order, a copy of which is attached hereto as Exhibit "A". None of the parties have filed exceptions to the Recommended Order.

Upon review and consideration of the Recommended Order and the complete record of this proceeding, the following are the Agency Heads Findings of Fact and Conclusions of Law:

FINDINGS OF FACT

The hearing officer's Findings of Fact are hereby adopted and incorporated herein as the Findings of Fact of this Final Order.

MODIFICATIONS TO CONCLUSIONS OF LAW OF RECOMMENDED ORDER

The hearing officer's Conclusions of Law set forth in the first paragraph of footnote 7 of the Recommended Order wherein he contends that the maximum fine which can be imposed is $5,000.00 based upon "pleading technicalities" is rejected as contrary to the law. Nothing in Section 494.093(1), Florida Statutes, suggests that the amount of the fine is dependent on such a narrow construction. In fact, Section 494.093(1), Florida Statutes, refers that findings of "violations" of the statutes may be the basis for the fine amount, and the number of violations for calculation of an appropriate fine is an evidentiary matter capable of proof. Indeed, the evidence before the Agency in this case demonstrates repeated instances of unlicensed activity, each incidence of which constitutes a separate violation of the law and forms the basis for increasing the fine penalty, if such was warranted. Having stated the

foregoing, the fine amount recommended by the Hearing Officer appears to be sufficiently punitive for regulatory purposes in this case.

MODIFICATION TO PENALTY

The correct penalty in this case, in addition to the fines imposed, include the entry of a cease and desist order pursuant to Section 494.0014, Florida Statutes, [then 494.072, Florida Statutes (1989)] for violations of unregistered mortgage brokerage activity. The Department is increasing the recommended penalty against both respondents by adding an order to Cease and Desist from violating 494.093(1), Florida Statutes, (see Criminal Justice Standards and Training Commission v. Bradley, 17 F.L.W. 5193 (Fla. 1992)) for the following reasons:

1. Section 494.072, Florida Statutes (now section 494.0014, Florida Statutes), allows the Department to enter a cease and desist order against any person who violates, has violated or is about to violate any provision of Chapter 494, Florida Statutes. Entry of such an order is not prohibited if a person has stopped violating the statutes in question but in fact looks to, among other things, the issue of past conduct. The hearing officer's conclusion of law set forth in the second paragraph of footnote 7 of the Recommended Order, wherein he appears to require evidence of continuing violations of Chapter 494 after Respondents' termination of employment does not comport with that statutory scheme and is therefore rejected as contrary to the law.

   
   

2. Considering the correct statutory interpretation, as set forth above, and considering the ample evidence of unlicensed activity as reflected in the hearing officer's findings and conclusions as well as exhibits 1 through 31 of the Department, there appears no legal reason not to require the Respondents to cease and desist from violating Section 494.093, Florida Statutes (1989), as amended. Therefore, it is

ORDERED:

The hearing officer's Conclusions of Law are hereby adopted and incorporated herein as the Conclusions of Law of this Final Order, except as modified above.

1. The Respondents are hereby found guilty of having violated Sections 494.093(1), Florida Statutes (1989);

   
   

2. That Respondent, Ron Cook, shall pay instanter an administrative fine in the amount of five thousand and 0/100 dollars ($5,000.00) payable to "Regulatory Trust Fund" c/o Gerald Lewis, Comptroller, and mailed to Suite 1302, The Capitol, Tallahassee, Florida 32399-0350;

   
   

3. That Respondent, Teresa Jelich, shall pay instanter an administrative fine in the amount of five thousand and 0/100 dollars ($5,000.00) payable to "Regulatory Trust Fund" c/o Gerald Lewis, Comptroller, and mailed to Suite 1302, The Capitol, Tallahassee, Florida 32399-0350.

   
   

4. The Respondents are ordered to CEASE AND DESIST from violating 494.093(1), Florida Statutes (1989), as amended.

DONE AND ORDERED in Tallahassee, Leon County, Florida, this 12th day of October, 1994.

GERALD LEWIS, as Comptroller and Head of the Department of Banking and Finance

NOTICE OF RIGHTS

The parties are advised that within thirty (30) days of the date of this Final Order they may seek judicial review of this Final Order by filing a Notice of Appeal with the Clerk, Department of Banking and Finance, Legal Section, The Capitol, Tallahassee, Florida 32399-0350, and by filing a second copy of such Notice of Appeal with the appropriate filing fee with the Clerk of the District Court of Appeal, First District, 300 Martin L. King, Jr., Boulevard, Tallahassee, Florida 32399-1850, or with the clerk of the District Court wherein the parties reside.

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a true and correct copy of the foregoing Final Order and Notice of Rights was furnished by Regular U.S. Mail, postage prepaid, to: Ron Cook, 1216 Summerwood Circle, West Palm Beach, Florida 33414 and to Teresa Jelich, 1216 Summerwood Circle, West Palm Beach, Florida 33414, this 12th day of October, 1994.

H. RICHARD BISBEE Deputy General Counsel

Office of the Comptroller Suite 1302, The capitol

Tallahassee, Florida 32399-0350

(904) 488-9896

cc: Linda G. Dilworth, Director Division of Finance

John O'Neill

Assistant General Counsel Clerk, DOAH

Docket for Case No: 94-001262

Orders for Case No: 94-001262