THE TREASURER OF THE STATE OF FLORIDA DEPARTMENT OF INSURANCE FEB 21 9000 BILL NELSON TREASURER ANO INSURANCE COMMISSIONER Docketed bys de IN THE MATTER OF DONALD WILLIAM SABO CASE NO.: 28891-99-AG / ADMINISTRATIVE COMPLAINT TO: DONALD WILLIAM SABO 129 Glen Cove Place Ponte Vedra Beach, Florida 32082-3638 62: Hd €2 WH 00 qa i- DONALD WILLIAM SABO 3631 Blanding Boulevard Jacksonville, FL 32210-5240 YOU, DONALD WILLIAM SABO, are hereby notified that the Insurance Commissioner of the State of Florida has caused to be made an investigation of your activities while licensed as an insurance agent in this state, as a result of which it is alleged: GENERAL ALLEGATIONS 1. Pursuant to Chapter 626, Florida Statutes, you, DONALD WILLIAM SABO, license identification number A229488, are currently licensed in this state as a Residential Property and Casualty Joint Underwriting Agent ("“RCPJUA”), and as a general lines agent. wy) wy] 2. At all times pertinent to the dates and occurrence referred to herein, you, DONALD WILLIAM SABO, were licensed in this state to transact property and casualty insurance. 3. Pursuant to Chapter 626, Florida Statutes, the Florida Department of Insurance has jurisdiction over your insurance licenses and appointments. 4. During all times material to the allegations contained in this complaint you, DONALD WILLIAM SABO, operated the Sunshine State Insurance Group of Arlington, Inc. (“Sunshine State”) insurance agency at 3631 Blanding Boulevard, Jacksonville, Florida. 5. At all times pertinent to the allegations of this complaint, you, DONALD WILLIAM SABO, were the designated primary agent for Sunshine State. 6. At all times pertinent to the allegations of this complaint you, DONALD WILLIAM SABO, also held corporate officer positions with two insurance agency corporations: Sunshine Insurance Services, Inc. (“Sunshine Insurance”) and Sunshine State. The corporate address of each corporation is shown as 6506 Beach Boulevard, Jacksonville, Florida 32216. You also transacted business and were listed as a signer on a third Ww ww] WY agency’s bank account, that of Sunshine Casualty Insurance, Inc. of 8122-1 Lem Turner Road, Jacksonville, Florida (“Sunshine Casualty”) . 7. As a corporate gfficer of Sunshine State and Sunshine Insurance, and as the designated primary agent for Sunshine State, you, DONALD WILLIAM SABO, knew or should have known of the activities of salaried employees under your direct supervision and control and you were responsible and accountable for all of the activities of the staff at the agency locations described above for the times and occurrences as hereafter presented. References to you, DONALD WILLIAM SABO, include persons acting under your direct supervision and control at the agencies described herein. 8. You; DONALD WILLIAM SABO, are also listed as a signor on the Sunshine State agency accounts at both SouthTrust Bank. and Florida Telco Credit Union. COUNT I 9. The above General Allegations numbered one through eight are hereby realleged and fully incorporated herein by reference. 10. On or about October 10, 1997, you, DONALD WILLIAM SABO, 7] YW were notified that the Department desired to conduct an examination of records at all three of your agency locations as described above. 11. In response to this notification, and with the willful and specific purpose of preventing Department investigators from obtain access to business records required to be kept by the Florida Insurance Code, you, DONALD WILLIAM SABO, directed one or more of your employees to pull and destroy insurance file records. 12. These records included insureds’ and lienholders’ copies of declaration pages, insurance binders and quote sheets showing $25.00 agency fees, copies of agency checks to the insurers demonstrating the amount of money sent to the insurers, and copies of the separate checks that insureds had presented for towing and rental insurance products. IT IS THEREFORE CHARGED that you, DONALD WILLIAM SABO, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the Department of Insurance which constitute grounds for the suspension or revocation of your insurance licenses: (a) The licensee shall keep and make available to the YU UW department books, accounts, and records as will enable the department to determine whether such licensee is complying with the provisions of this code. Every licensee shall preserve books, accounts, and records pertaining to a premium payment for at least 3 years after payment. [Section 626.561(2), Florida Statutes] (b) Every person being examined or investigated, and its officers, attorneys, employees, agents, and representatives, shall make freely available to the department or its examiners or investigators the accounts, records, documents, files, information, assets, and matters in their possession or control relating to the subject of the examination or investigation. (Section 624.318(2), Florida Statutes]; (c) Any individual who willfully obstructs the department or its examiner in the examinations or investigations authorized by this part is guilty of a misdemeanor and upon conviction shall be punished as provided in section 624.15, Florida Statutes. [Section 624.318(6), Florida Statutes] ; (d) Every agent transacting any insurance policy must maintain in his or her office, or have readily accessible by electronic or photographic means, such records of policies Ww] 7] transacted by him or her as to enable the policyholders and department to obtain all necessary information, including daily reports, applications, change endorsements, or documents signed or initialed by the insured concerning such policies. [Section 626.748, Florida Statutes]; (e) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance. [Section 626.611(7), Florida Statutes] ; (£) Fraudulent or dishonest practices in the conduct of ” business under the license or permit. [Section 626.611(9), Florida Statutes]; (g) Willful failure to comply with, or willful violation of, any proper order or rule of the department or willful violation of any provision of this code. [Section 626.611(13), Florida Statutes] ; ‘ (h) Violation of any provision of this code or of any other law applicable to the business of insurance in the course of dealing under the license or permit. {Section 626.621(2), Florida Statutes] ; (i) In the conduct of business under the license or permit, engaging in unfair methods of competition or in unfair or WwW ww] deceptive acts or practices, as prohibited under part xX of this chapter, or having otherwise shown himself to be a source of injury or loss to the public. [Section 626.621(6), Florida Statutes]. COUNT II 13. Paragraphs one through eight are realleged and incorporated herein by reference. 14. During January and February, 1997, Jerlyn Evans, went to the Sunshine Insurance agency location on Beach Boulevard and consulted with Tinnia Merrle (“Tina”) Tufegdzic, an employee of that agency, regarding the purchase of automobile insurance. 15. Although Ms. Tufegdzic was not, for the time periods and occurrences alleged herein, a licensed insurance agent, with the knowledge and consent of you, DONALD WILLIAM SABO, Ms. Tufegdzic regularly, and not simply on an incidental basis, gave quotes over the telephone, took insurance applications, explained coverages, issued receipts, inspected vehicles, completed premium finance agreements, cut drafts, wrote agency checks and accepted premiums for insurance coverage at Sunshine State. 16. Ms. Evans requested full insurance coverage for her vehicle, specifically requesting towing and rental insurance. YW Nw] Ms. Tufegdzic falsely advised Ms. Evans that in order for her (Evans) to obtain towing and rental insurance coverage, she would first have to have an accident. 17. You, DONALD WILLIAM SABO, knowing that Ms. Tufegdzic was unlicensed to act as an insurance agent, authorized her to give such insurance quotations over the telephone, take applications, explain coverages, accept premium payments and otherwise manage the Sunshine State office on University Boulevard from December, 1996 to February, 1997. 18. Ms. Evans purchased an automobile insurance policy, through the assistance of Ms. Tufegdzic, making a cash down payment of $239.00 on January 30, 1997. However, the down payment shown on the premium finance contract furnished by Gemstone Premium Finance was only $229.00, leaving $10.00 that was not accounted for in the transaction. An examination of extant agency records provides no explanation for the $10.00 discrepancy. IT IS THEREFORE CHARGED that you, DONALD WILLIAM SABO, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the Department of Insurance which constitute grounds for the suspension or revocation of your wy) 7 licenses and appointments as a life and health insurance agent: (a) Knowingly collecting as a premium or charge for insurance any sum in excess of or less than the premium or charge _ applicable to such insurance, in accordance with the applicable classifications and rates as filed with and approved by the department, and as specified in the policy; or, in cases when classifications, premiums, or rates are not required by this code to be filed and approved, premiums and charges in excess of or less than those specified in the policy and as fixed by the insurer. [Section 626.9541(1)(0)2., Florida Statutes (1997); (b) Willful misrepresentation of any insurance policy or annuity contract or willful deception with regard to any such policy or contract, done either in person or by any form of dissemination of information or advertising. [Section 626.611(5), Florida Statutes]; (c) No person shall be, act as, or advertise or hold himself or herself out to be an insurance agent, customer representative, solicitor, or adjuster unless he or she is. currently licensed and appointed. No agent, customer ° representative, or solicitor shall solicit or otherwise transact as agent, customer representative, or solicitor, or represent or WU YW hold himself or herself out to be an agent, customer representative, or solicitor as to, any kind or kinds or insurance as to which he or she is not then licensed and appointed. (d) abetting any person in the violation of or to violate a provision of the insurance code or any order or rule of the Department. {Subsection 626.621(12), Florida Statutes] ; (e) {Subsections 626.112 (1)and (2), Florida Statutes]; Knowingly aiding, assisting, procuring, advising, or The following types of conduct by unlicensed staff are allowable as long as they are done only on a basis “incidental” to the employee’s main duties: (1) (3) Taking an application for insurance in the agent's office, as set forth in rule 4-222.020, for a person who has called or come into the office. Giving quotes in the agent’s office, as set out in rule 4-222.020, to persons calling or coming into the office and asking for a quote. Receiving premium at the agent’s office. Receiving premium does not include the handling of premium by mailroom personnel or other unlicensed personnel who handle mail. [Rule 4-222.050, Florida Administrative (£) personnel. (1) (2) (3) (g) engage in YW Y Code.}; The following actions are never allowable by unlicensed Comparing insurance products; advising as to insurance needs or insurance matters; or interpreting policies or coverages. Binding new, additional, or replacement coverage for new or existing customers; or binding coverage on or recording additional property under existing policies. Soliciting the sale of insurance by telephone, in person, or by other communication. However, the unlicensed person may telephone persons to set appointments for licensed and appointed agents, customer representatives, or solicitors, or to obtain basic policy information as to existing insurance coverage. The unlicensed person may not engage ina substantive discussion of insurance products. [Rule 4- 222.060, Florida Administrative Code]; Demonstrated lack of fitness or trustworthiness to the business of insurance. [Section 626.611(7), Florida Statutes] ; WY WY (h) Fraudulent or dishonest practices in the conduct of business under the license or permit. [Section 626.611(9), Florida Statutes] ; (i) Willful failure to comply with, or willful violation of, any proper order or rule of the department or willful violation of any provision of this code. [Section 626.611(13), Florida Statutes] ; (j) Violation of any provision of this code or of any other law applicable to the business of insurance in the course of dealing under the license or permit. [Section 626.621(2), Florida Statutes] ; (kK) Violation of any lawful order or rule of the department. [Section 626.621(3), Florida Statutes] ; (1) In the conduct of business under the license or permit, engaging in unfair methods of competition or in unfair or deceptive acts or practices, as prohibited under part X of this chapter, or having otherwise shown himself to be a source of injury or loss to the public. [Section 626.621(6), Florida Statutes] ; (m) No person shall engage in this state in any trade practice which is defined in this part as, or determined pursuant ao) WY to s. 626.951 or s. 626.9561 to be, an unfair method of competition or an unfair or deceptive act or practice involving the business of insurance. {Section 626.9521, Florida Statutes]; | (n) Knowingly making, issuing, circulating, or causing to be made, issued, or circulated, any estimate, illustration, circular, statement, sales presentation, omission, or comparison, which misrepresents the benefits, advantages, conditions, or terms of any insurance policy. (Section 626.9541(1) (a)l., Florida Statutes] ; (o) Knowingly making, publishing, disseminating, circulating, or placing before the public, or causing, directly or indirectly, to be made, published, disseminated, circulated, or placed before the public: 1. In a newspaper, magazine, or other publication, 2. In the form of a notice, circular, pamphlet, letter, or poster, 3. Over any radio or television station, or 4. In any other way placing before the public an advertisement, announcement, or statement containing any assertion, representation, or statement with respect to the business of insurance, which is untrue, deceptive, or misleading. 7] ww] [Section 626.9541(1) (b), Florida Statutes] ; (p) False statements and entries. - 1. Knowingly: a. Filing with any supervisory or other public official, b. Making, publishing, disseminating, circulating, c. Delivering to any person, d. Placing before the public, e. Causing, directly or indirectly, to be made, published, disseminated, circulated, delivered to any person, or placed before the public, any false material statement. [Section 626.9541(1) (e)1., Florida Statutes] ; (q) Knowingly making any misleading representations or incomplete or fraudulent comparisons or fraudulent material omissions of or with respect to any insurance policies or insurers for the purpose of inducing, or tending to induce, any person to lapse, forfeit, surrender, terminate, retain, pledge, assign, borrow on, or convert any insurance policy or to take out a policy of insurance in another insurer. [Section 626.9541(1) (1), Florida Statutes]; {r) No person shall be, act as, or advertise or hold WY YW himself or herself out to be an insurance agent, customer representative, solicitor, or adjuster unless he or she is currently licensed and appointed. {Section 626.112(1), Florida Statutes]. COUNT III 19. Paragraphs one through eight are realleged and incorporated herein by reference. 20. During December, 1996, Tara Lyn Martin, went to the Sunshine State agency location and told you, DONALD WILLIAM SABO, that she wanted to purchase the minimum amount of insurance coverage allowed by law. She specifically told you that she did not want to purchase any towing service plan because her husband owned a towing service. She was unaware that she had been | charged for any such motor vehicle service as she was handed several papers collectively and told where to sign without giving any informed consent to the purchase of a motor vehicle towing service. 21. You, DONALD WILLIAM SABO, accepted a cash down payment from Tara Lyn Martin in the amount of $125.00 on December 11, 1996. However, the down payment shown on the premium finance contract furnished by Gemstone Premium Finance was only $85.00, YU 7] leaving $40.00 that was not accounted for in the transaction. 22. An examination of extant agency records shows that Tara Lyn Martin was charged $30.00 for a WorldWide Travel Service, Inc. travel club, for the unwanted towing service, and was also charged an additional $10.00. There is no explanation for the “30410” notation shown as “premium” on the travel plan contract and your records do not explain how this additional $10.00 fee was applied. IT IS THEREFORE CHARGED that you, DONALD WILLIAM SABO, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the Department of Insurance which constitute grounds for the suspension or revocation of your licenses and appointments as a life and health insurance agent: (a) Knowingly collecting as a premium or charge for insurance any sum in excess of or less than the premium or charge applicable to such insurance, in accordance with the applicable classifications and rates as filed with and approved by the department, and as specified in the policy; or, in cases when classifications, premiums, or rates are not required by this code to be filed and approved, premiums and charges in excess of or less than those specified in the policy and as fixed by the wy YW insurer. [Section 626.9541(1)(o)2., Florida Statutes (1997); (b) Charged an insurance applicant for a specific ancillary coverage or product, in addition to the cost of the motor vehicle | insurance coverage applied for, without the informed consent of the applicant. [Section 626.9541(1) (z)3., Florida Statutes] (c) Willful misrepresentation of any insurance policy or annuity contract or willful deception with regard to any such policy or contract, done either in person or by any form of dissemination of information or advertising. [Section 626.611(5), Florida Statutes] ; (d) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance. [Section 626.611(7), Florida Statutes]; (e) Fraudulent or dishonest practices in the conduct of ; business under the license or permit. [Section 626.611(9), Florida Statutes] ; (£) Willful failure to comply with, or willful violation of, any proper order or rule of the department or willful violation of any provision of this code. [Section 626.611(13), Florida Statutes] ; (g) Violation of any provision of this code or of any other UY YW law applicable to the business of insurance in the course of dealing under the license or permit. [Section 626.621(2), Florida Statutes] ; (h) Violation of any lawful order or rule of the department. [Section 626.621(3), Florida Statutes] ; (i) In the conduct of business under the license or permit, engaging in unfair methods of competition or in unfair or deceptive acts or practices, as prohibited under part X of this chapter, or having otherwise shown himself to be a source of injury or loss to the public. [Section 626.621(6), Florida Statutes] ; (j) No person shall engage in this state in any trade | practice which is defined in this part as, or determined pursuant to s. 626.951 or s. 626.9561 to be, an unfair method of competition or an unfair or deceptive act or practice involving the business of insurance. {Section 626.9521, Florida Statutes]; (k) Knowingly making, issuing, circulating, or causing to be made, issued, or circulated, any estimate, illustration, circular, statement, sales presentation, omission, or comparison, which misrepresents the benefits, advantages, conditions, or terms orf any insurance policy. [Section 626.9541(1) (a)1., 7] YW Florida Statutes] ; (1) Knowingly making, publishing, disseminating, circulating, or placing before the public, or causing, directly or indirectly, to be made, published, disseminated, circulated, or placed before the public: 1. In a newspaper, magazine, or other publication, 2. In the form of a notice, circular, pamphlet, letter, or poster, 3. Over any radio or television station, or 4. In any other way placing before the public an advertisement, announcement, or statement containing any assertion, representation, or statement with respect to the / business of insurance, which is untrue, deceptive, or misleading. [Section 626.9541(1) (b), Florida Statutes] ; (m) False statements and entries. - 1. Knowingly: a. Filing with any supervisory or other public official, b. Making, publishing, disseminating, circulating, c. Delivering to any person, d. Placing before the public, WU UY e. Causing, directly or indirectly, to be made, published, disseminated, circulated, delivered to any person, or placed before the public, any false material statement. [Section 626.9541(1) (e)1., Florida Statutes] ; (n) Knowingly making any misleading representations or incomplete or fraudulent comparisons or fraudulent material omissions of or with respect to any insurance policies or insurers for the purpose of inducing, or tending to induce, any person to lapse, forfeit, surrender, terminate, retain, pledge, assign, borrow on, or convert any insurance policy or to take out a policy of insurance in another insurer. [Section 626.9541(1) (1), Florida Statutes] ; (o) Sliding by either: 1. Representing to the applicant that a specific ancillary coverage or product is required by law in conjunction with the purchase of motor vehicle insurance when such coverage or product is not required; 2. Representing to the applicant that a specific ancillary coverage or product is included in the motor vehicle policy applied for without an ww] Ww) additional charge when such charge is required; or 3. Charging an applicant for a specific ancillary coverage or product, in addition to the cost of the motor vehicle insurance coverage applied for, without the informed consent of the applicant. [Subsection 626.9541(1) (z), Florida Statutes]. COUNT _IV 23. Paragraphs one through eight are realleged and incorporated herein by reference. 24. During January, 1998, Eugene Mobley, Jr., went to the Sunshine State agency location on Beach Boulevard with the intention of purchasing only automobile insurance. A woman working at the agency completed the application and Mr. Mobley was then “given a bunch of papers to sign and did not realize that towing was included.” 25. Mr. Mobley later discovered that he had been charged $65.00 for a towing service that was not offered nor explained to him. He would not have knowingly purchased such a service because the new Chevy S-10 truck that he had just purchased, had a warranty which included towing. 26. Mr. Mobley was also surprised to discover that the YW YW insurance policy he purchased had a $2,000 PIP deductible. Mr. Mobley has stated that “the $2,000 PIP deductible was given to me without my knowledge.” When Mr. Mobley later had the PIP deductible changed to a zero deductible in accordance with his original intention, the U.S. Security Insurance Company billed Mr. Mobley an additional $64.00. Sunshine State failed to submit all the underwriting requirements for the deductible change ina timely fashion with the result that Mr. Mobley’s insurance coverage was cancelled on or about April 13, 1998. IT IS THEREFORE CHARGED that you, DONALD WILLIAM SABO, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the Department of Insurance which constitute grounds for the suspension or revocation of your licenses and appointments as a life and health insurance agent: (a) Knowingly collecting as a premium or charge for insurance any sum in excess of or less than the premium or charge applicable to such insurance, in accordance with the applicable classifications and rates as filed with and approved by the department, and as specified in the policy; or, in cases when classifications, premiums, or rates are not required by this code to be filed and approved, premiums and charges in excess of or wy) WW less than those specified in the policy and as fixed by the insurer. [Section 626.9541(1)(0)2., Florida Statutes (1997); (b) Charged an insurance applicant for a specific ancillary — coverage or product, in addition to the cost of the motor vehicle insurance coverage applied for, without the informed consent of the applicant. [Section 626.9541(1) (z)3., Florida Statutes] (c) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance. [Section 626.611(7), Florida Statutes] ; (d) Fraudulent or dishonest practices in the conduct of business under the license or permit. [Section 626.611(9), Florida Statutes] ; (e) Willful failure to comply with, or willful violation of, any proper order or rule of the department or willful violation of any provision of this code. [Section 626.611(13), Florida Statutes]; (f) Violation of any provision of this code or of any other law applicable to the business of insurance in the course of dealing under the license or permit. [Section 626.621({2), Florida Statutes] ; (g) Violation of any lawful order or rule of the 7] WwW department. [Section 626.621(3), Florida Statutes]; (h) In the conduct of business under the license or permit, engaging in unfair methods of competition or in unfair or deceptive acts or practices, as prohibited under part X of this chapter, or having otherwise shown himself to be a source of injury or loss to the public. [Section 626.621(6), Florida Statutes] ; (i) No person shall engage in this state in any trade practice which is defined in this part as, or determined pursuant to s. 626.951 or s. 626.9561 to be, an unfair method of competition or an unfair or deceptive act or practice involving the business of insurance. {Section 626.9521, Florida Statutes]; (j) Knowingly making, issuing, circulating, or causing to be made, issued, or circulated, any estimate, illustration, circular, statement, sales presentation, omission, or comparison, which misrepresents the benefits, advantages, conditions, or terms of any insurance policy. [Section 626.9541(1) (a)l., Florida Statutes] ; (k) Knowingly making, publishing, disseminating, circulating, or placing before the public, or causing, directly or indirectly, to be made, published, disseminated, circulated, WU WY or placed before the public: 1. In a newspaper, magazine, or other publication, 2. In the form of a notice, circular, pamphlet, letter, or poster, . 3. Over any radio or television station, or 4. In any other way placing before the public an advertisement, announcement, or statement containing any assertion, representation, or statement with respect to the business of insurance, which is untrue, deceptive, or misleading. {Section 626.9541(1) (b), Florida Statutes]; (1) False statements and entries. - 1. Knowingly: a. Filing with any supervisory or other public official, b. Making, publishing, disseminating, circulating, c. Delivering to any person, d. Placing before the public, e. Causing, directly or indirectly, to be made, published, disseminated, circulated, delivered to any person, or placed before the public, any false material statement. [Section 626.9541(1) (e)1., Florida Statutes] ; 7) WY (m) Knowingly making any misleading representations or incomplete or fraudulent comparisons or fraudulent material omissions of or with respect to any insurance policies or insurers for the purpose of inducing, or tending to induce, any person to lapse, forfeit, surrender, terminate, retain, pledge, assign, borrow on, or convert any insurance policy or to take out a policy of insurance in another insurer. [Section 626.9541(1) (1), Florida Statutes] ; (n) Sliding by either: 4. Representing to the applicant that a specific ancillary coverage or product is required by law in conjunction with the purchase of motor vehicle insurance when such coverage or product is not required; Representing to the applicant that a specific ancillary coverage or product is included in the motor vehicle policy applied for without an additional charge when such charge is required; or Charging an applicant for a specific ancillary coverage or product, in addition to the cost of the motor vehicle insurance coverage applied for, wy 7] without the informed consent of the applicant. [Subsection 626.9541(1) (z), Florida Statutes]. COUNT V 27. Paragraphs one through eight are realleged and incorporated herein by reference. 28. On or about August 19, 1997, David L. Brown, went to the Sunshine State agency location and purchased automobile insurance, making a premium down payment of $118.00. There is an unexplained “10$ agency fee” charge shown on the Receipt and Binder Certificate. The Sunshine State quote sheet shows an unexplained “opt 10” and total premium of $546.00 29. However, the insurance application indicates the total premium was actually $536.00 and the ETI Financial Corporation contract also shows a total premium of only $536.00 and a down payment of $108.00, leaving $10.00 that was not accounted for in the transaction. 30. An examination of extant agency records reveals nothing that will account for the unexplained $10.00 discrepancy. IT IS THEREFORE CHARGED that you, DONALD WILLIAM SABO, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the Department of Insurance UY 7] which constitute grounds for the suspension or revocation of your licenses and appointments as a life and health insurance agent: (a) Knowingly collecting as a premium or charge for insurance any sum in excess of or less than the premium or charge applicable to such insurance, in accordance with the applicable classifications and rates as filed with and approved by the department, and as specified in the policy; or, in cases when classifications, premiums, or rates are not required by this code to be filed and approved, premiums and charges in excess of or less than those specified in the policy and as fixed by the insurer. [Section 626.9541(1)(o)2., Florida Statutes (1997); (b) Willful misrepresentation of any insurance policy or annuity contract or willful deception with regard to any such policy or contract, done either in person or by any form of dissemination of information or advertising. [Section 626.611(5), Florida Statutes] ; (c) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance. [Section 626.611(7), Florida Statutes] ; (d) Fraudulent or dishonest practices in the conduct of business under the license or permit. [Section 626.611(9), Ww Ww Florida Statutes]; (e) Willful failure to comply with, or willful violation of, any proper order or rule of the department or willful violation of any provision of this code. [Section 626.611(13), Florida Statutes] ; (£) Violation of any provision of this code or of any other law applicable to the business of insurance in the course of dealing under the license or permit. [Section 626.621(2), Florida Statutes] ; (g) Violation of any lawful order or rule of the department. [Section 626.621(3), Florida Statutes] ; (h) In the conduct of business under the license or permit, engaging in unfair methods of competition or in unfair or deceptive acts or practices, as prohibited under part X of this chapter, or having otherwise shown himself to be a source of injury or loss to the public. [Section 626.621(6), Florida Statutes] ; (i) No person shall engage in this state in any trade practice which is defined in this part as, or determined pursuant to s. 626.951 or s. 626.9561 to be, an unfair method of competition or an unfair or deceptive act or practice involving Ww ww] the business of insurance. [Section 626.9521, Florida Statutes]; (3) Knowingly making, issuing, circulating, or causing to be made, issued, or circulated, any estimate, illustration, circular, statement, sales presentation, omission, or comparison, which misrepresents the benefits, advantages, conditions, or terms of any insurance policy. [Section 626.9541(1) (a)1., Florida Statutes]; (kK) Knowingly making, publishing, disseminating, circulating, or placing before the public, or causing, directly or indirectly, to be made, published, disseminated, circulated, or placed before the public: 1. In a newspaper, magazine, or other publication, 2. In the form of a notice, circular, pamphlet, letter, or poster, 3. Over any radio or television station, or 4. In any other way placing before the public an advertisement, announcement, or statement containing any assertion, representation, or statement with respect to the business of insurance, which is untrue, deceptive, or misleading. {Section 626.9541(1) (b), Florida Statutes] ; (1) False statements and entries. - UW Nw 1. Knowingly: a. Filing with any supervisory or other public official, b. Making, publishing, disseminating, circulating, c. Delivering to any person, d. Placing before the public, e. Causing, directly or indirectly, to be made, published, disseminated, circulated, delivered to any person, or placed before the public, any false material statement. [Section 626.9541(1) (e)1., Florida Statutes]; (m) Knowingly making any misleading representations or incomplete or fraudulent comparisons or fraudulent material omissions of or with respect to any insurance policies or insurers for the purpose of inducing, or tending to induce, any person to lapse, forfeit, surrender, terminate, retain, pledge, assign, borrow on, or convert any insurance policy or to take out a policy of insurance in another insurer. [Section 626.9541(1) (1), Florida Statutes). COUNT VI 31. Paragraphs one through eight are realleged and incorporated herein by reference. 31 Ww WY 32. On or about April 26, 1997, Jimmy L. Daniel, went to the Sunshine State agency location and purchased automobile insurance, making a premium down payment of $100.00. 33. However, a copy of the premium finance agreement contract shows that only $78.00 was applied toward the premium down payment, thus leaving $22.00 that was not accounted for in the transaction. 34. An examination of extant agency records reveals nothing that will account for the unexplained $22.00 discrepancy. IT IS THEREFORE CHARGED that you, DONALD WILLIAM SABO, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the Department of Insurance which constitute grounds for the suspension or revocation of your licenses and appointments as a life and health insurance agent: (a) Kmowingly collecting as a premium or charge for insurance any sum in excess of or less than the premium or charge applicable to such insurance, in accordance with the applicable classifications and rates as filed with and approved by the department, and as specified in the policy; or, in cases when classifications, premiums, or rates are not required by this code to be filed and approved, premiums and charges in excess of or UW wy) less than those specified in the policy and as fixed by the insurer. [Section 626.9541(1)(o)2., Florida Statutes (1997); (b) Willful misrepresentation of any insurance policy or annuity contract or willful deception with regard to any such policy or contract, done either in person or by any form of dissemination of information or advertising. [Section 626.611(5), Florida Statutes]; (c) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance. [Section 626.611(7), Florida Statutes] ; (d) Fraudulent or dishonest practices in the conduct of business under the license or permit. {Section 626.611(9), Florida Statutes] ; (e) Willful failure to comply with, or willful violation of, any proper order or rule of the department or willful - violation of any provision of this code. [Section 626.611(13), Florida Statutes] ; (£) Violation of any provision of this code or of any other law applicable to the business of insurance in the course of dealing under the license or permit. [Section 626.621(2), Florida Statutes] ; vey [vey UW UY (g) Violation of any lawful order or rule of the department. [Section 626.621(3), Florida Statutes]; (h) In the conduct of business under the license or permit, . engaging in unfair methods of competition or in unfair or deceptive acts or practices, as prohibited under part X of this chapter, or having otherwise shown himself to be a source of injury or loss to the public. [Section 626.621(6), Florida Statutes] ; (i) No person shall engage in this state in any trade practice which is defined in this part as, or determined pursuant to s. 626.951 or s. 626.9561 to be, an unfair method of competition or an unfair or deceptive act or practice involving the business of insurance. {Section 626.9521, Florida Statutes]; (j) Knowingly making, issuing, circulating, or causing to be made, issued, or circulated, any estimate, illustration, circular, statement, sales presentation, omission, or comparison, which misrepresents the benefits, advantages, conditions, or terms of any insurance policy. {Section 626.9541(1) (a)1l., Florida Statutes] ; (k) Knowingly making, publishing, disseminating, circulating, or placing before the public, or causing, directly WY YW or indirectly, to be made, published, disseminated, circulated, or placed before the public: 1. In a newspaper, magazine, or other publication, 2. In the form of a notice, circular, pamphlet, letter, or poster, 3. Over any radio or television station, or 4. In any other way placing before the public an advertisement, announcement, or statement containing any assertion, representation, or statement with respect to the business of insurance, which is untrue, deceptive, or misleading. (Section 626.9542 (1) (b), Florida Statutes] ; (1) False statements and entries. - 1. Knowingly: a. Filing with any supervisory or other public official, b. Making, publishing, disseminating, circulating, c. Delivering to any person, d. Placing before the public, e. Causing, directly or indirectly, to be made, published, disseminated, circulated, delivered to any person, or placed before the public, any false material statement. [Section YU YW 626.9541(1) (e)1., Florida Statutes]; (m) Knowingly making any misleading representations or incomplete or fraudulent comparisons or fraudulent material omissions of or with respect to any insurance policies or insurers for the purpose of inducing, or tending to induce, any person to lapse, forfeit, surrender, terminate, retain, pledge, assign, borrow on, or convert any insurance policy or to take out a policy of insurance in another insurer. [Section 626.9541(1) (1), Florida Statutes]. COUNT. VII 35. Paragraphs one through eight are realleged and incorporated herein by reference. 36. On or about May 1, 1997, Jackolyn Meade, went to the Sunshine State agency location and purchased automobile insurance, making a premium down payment of $110.00. 37. However, a copy of the quote sheet shows an “OPT 10” included in the premium quotation. Documents received from the Atlas Specialty Underwriters, Inc. (for Connecticut Indemnity Insurance Company) show a down payment of only $100.00 as being applied to the actual purchase of insurance, thus leaving $10.00 that was not accounted for in the transaction. 36 YW Y 38. An examination of extant agency records reveals nothing that will account for the unexplained $10.00 discrepancy. IT IS THEREFORE CHARGED that you, DONALD WILLIAM SABO, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the Department of Insurance which constitute grounds for the suspension or revocation of your licenses and appointments as a life and health insurance agent: (a) Knowingly collecting as a premium insurance any sum in excess of or less than applicable to such insurance, in accordance classifications and rates as filed with and department, and as specified in the policy; classifications, premiums, or rates are not or charge for the premium or charge with the applicable approved by the or, in cases when required by this code to be filed and approved, premiums and charges in excess of or less than those specified in the policy and as fixed by the insurer. [Section 626.9541(1) (o)2., Florida Statutes (1997); (b) Willful misrepresentation of any insurance policy or annuity contract or willful deception with regard to any such policy or contract, done either in person or by any form of dissemination of information or advertising. 626.611(5), Florida Statutes]; [Section YW 7] (c) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance. [Section 626.611(7), Florida Statutes]; (d) Fraudulent or dishonest practices in the conduct of business under the license or permit. {Section 626.611(9), Florida Statutes] ; (e) Willful failure to comply with, or willful violation of, any proper order or rule of the department or willful violation of any provision of this code. [Section 626.611(13), Florida Statutes] ; (£) Violation of any provision of this code or of any other law applicable to the business of insurance in the course of dealing under the license or permit. [Section 626.621(2), Florida Statutes] ; (g) Violation of any lawful order or rule of the department. [Section 626.621(3), Florida Statutes]; {h) In the conduct of business under the license or permit, engaging in unfair methods of competition or in unfair or deceptive acts or practices, as prohibited under part X of this chapter, or having otherwise shown himself to be a source of injury or loss to the public. (Section 626.621(6), Florida Ww UW Statutes] ; (i) No person shall engage in this state in any trade practice which is defined in this part as, or determined pursuant | to s. 626.951 or s. 626.9561 to be, an unfair method of competition or an unfair or deceptive act or practice involving the business of insurance. [Section 626.9521, Florida Statutes]; (j) Knowingly making, issuing, circulating, or causing to be made, issued, or circulated, any estimate, illustration, circular, statement, sales presentation, omission, or comparison which misrepresents the benefits, advantages, conditions, or terms of any insurance policy. [Section 626.9541(1) (a)1l., Florida Statutes]; (kK) Knowingly making, publishing, disseminating, circulating, or placing before the public, or causing, directly or indirectly, to be made, published, disseminated, circulated, or placed before the public: 1. In a newspaper, magazine, or other publication, 2. In the form of a notice, circular, pamphlet, letter, or poster, 3. Over any radio or television station, or 4. In any other way placing before the public an UY WY advertisement, announcement, or statement containing any assertion, representation, or statement with respect to the business of insurance, which is untrue, deceptive, or misleading. . [Section 626.9541(1) (b), Florida Statutes] ; (1) False statements and entries. - 1. Knowingly: a. Filing with any supervisory or other public official, b. Making, publishing, disseminating, circulating, c. Delivering to any person, d. Placing before the public, e. Causing, directly or indirectly, to be made, published, disseminated, circulated, delivered to any person, or placed before the public, any false material statement. [Section 626.9541(1) (e)1., Florida Statutes] ; (m) Knowingly making any misleading representations or incomplete or fraudulent comparisons or fraudulent material omissions of or with respect to any insurance policies or i insurers for the purpose of inducing, or tending to induce, any person to lapse, forfeit, surrender, terminate, retain, pledge, assign, borrow on, or convert any insurance policy or to take out 40 iw) UY a policy of insurance in another insurer. [Section 626.9541(1) (1), Florida Statutes]. COUNT VIII 39. Paragraphs one through eight and ten through twelve are realleged and incorporated herein by reference. 40. During the Department’s attempt to inspect records at all three agency locations as described above, records were not available to allow for the sampling of terminated policies which resulted in refunds due to consumers. In order to complete the sampling process, records were requested of and obtained from premium finance companies utilized by Sunshine State, Sunshine Services and Sunshine Casualty. 41. Contact letters were sent to individual consumers from the samples provided by the premium finance companies to verify whether refunds due the consumers had actually been received by them. 42. Because of your corporate business relationships and banking responsibilities with respect to each of the three agencies as above described, you, DONALD WILLIAM SABO, along with your wife, Madalyn A. Sabo and your son, Donald Sabo, Jr., also corporate officers and signers on the agencies’ bank accounts, 41 YU 7] had a fiduciary duty to report, account for, and refund monies when such were due insurance consumers at each of the three agency locations. 43. You, DONALD WILLIAM SABO, failed to refund $51.71 due Jerlyn Evans after she notified Sunshine State to cancel her automobile insurance policy purchased in February, 1997, because her automobile had been totaled in an accident in July, 1997. 44. You, DONALD WILLIAM SABO, failed to refund $46.00 due David Lewis after he notified Sunshine State to cancel his automobile insurance policy purchased in 1996 because he had obtained insurance through another agency, Insurance World. 45. You, DONALD WILLIAM SABO, failed to refund $152.00 due Sheila Altman, after she notified Sunshine State that she was due refunds because of changes she had made during the one and one- half years of automobile insurance coverage she had through that agency. 46. You, DONALD WILLIAM SABO, failed to refund $41.25 to Carol and Angela Orr, husband and wife, after they cancelled their insurance with Sunshine State in June, 1997 because they experienced a premium increase with no explanation. 47. You, DONALD WILLIAM SABO, failed to refund $83.75 to 42 WY Y Benjamin Lane, after he canceled his insurance when his automobile failed to pass an inspection. 48. You, DONALD WILLIAM SABO, failed to refund $50.54 to Melissa Crews in August, 1997, after she canceled her automobile insurance on her Hyundai because it was not driveable and purchased insurance through Sunshine State on her new Oldsmobile. She received neither a credit for the cancellation, nor a credit toward the purchase of insurance on the Oldsmobile. 49. You, DONALD WILLIAM SABO, failed to refund $32.30 due to Melvine Buxton in June, 1997, or otherwise credit her account her Sunshine State account, after she made changes in her automobile insurance coverage which warranted such refund or credit. | 50. You, DONALD WILLIAM SABO, failed to refund $30.17 due to Yolanda Wade after she cancelled her automobile coverage through Sunshine State in 1997 because of an unpaid claim. 51. You, DONALD WILLIAM SABO, failed to refund $204.55 due to Stevey L. Barnes after he cancelled his policy with Sunshine State because he had previously asked for towing coverage and did not receive it. 52. You, DONALD WILLIAM SABO, failed to refund $59.03 due 43 7] WY to Tammy Clifton after she received a notice in October, 1996 that her policy obtained through Sunshine State was being cancelled. IT IS THEREFORE CHARGED that you, DONALD WILLIAM SABO, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the Department of Insurance which constitute grounds for the suspension or revocation of your licenses and appointments as a life and health insurance agent: (a) All premiums, return premiums, or other funds belonging to insurers or others received by an agent, solicitor, or adjuster in transactions under his license shall be trust funds so received by the licensee in a fiduciary capacity; and the licensee in the applicable regular course of business shall account for and pay the same to the insurer, insured, or other person entitled thereto. [Section 626.561(1), Florida Statutes]; (b) The licensee shall keep and make available to the department books, accounts, and records as will enable the department to determine whether such licensee is complying with the provisions of this code. Every licensee shall preserve books, accounts, and records pertaining to a premium payment for at least 3 years after payment; provided, however, the 44 Ww iw) preservation of records by computer or photographic reproductions or records in photographic form shall constitute compliance with this requirement. All other records shall be maintained in accordance. with s. 626.748. The 3-year requirement shall not apply to insurance binders when no policy is ultimately issued and no premium is collected. [Section 626.561(2), Florida Statutes] ; (c) Any agent, solicitor, or adjuster who, not being lawfully entitled thereto, either temporarily or permanently diverts or appropriates such funds or any portion thereof to his or her own use or deprives the other person of a benefit therefrom. [Section 626.561(3), Florida Statutes] ; (d) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance. [Section 626.611(7), Florida Statutes] ; (e) Demonstrated lack of reasonably adequate knowledge and technical competence to engage in the transactions authorized by the license or permit. [Section 626.611(8), Florida Statutes]; (£) Fraudulent or dishonest practices in the conduct of business under the license or permit. [Section 626.611(9), Florida Statutes]; 45 WU 7] (g) Misappropriation, conversion, or unlawful withholding of moneys belonging to insurers or insureds or beneficiaries or to others and received in conduct of business under the license. {Section 626.611(10), Florida Statutes] ; (h) Willful failure to comply with, or willful violation of, any proper order or rule of the department or willful violation of any provision of this code. [Section 626.611(13), Florida Statutes] ; (i) Violation of any provision of the Florida Insurance Code or of any other law applicable to the business of insurance in the course of dealing under the license or appointment. [Section 626.621(2), Florida Statutes] ; (j) Failure or refusal, upon demand, to pay over to any insurer he represents or has represented any money coming into his hands belonging to the insurer. [Section 626.621(4), Florida Statutes]. WHEREFORE, you, DONALD WILLIAM SABO, are hereby notified that the Treasurer and Insurance Commissioner intends to enter an Order suspending or revoking your licenses and appointments as an insurance agent or to impose such penalties as may be provided under the provisions of Sections 626.611, 46 WY WW 626.621, 626.681, 626.691, 626.692, and 626.9521, Florida Statutes, and under the other referenced sections of the Florida Statutes as set out in this Administrative Complaint. 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 Pursuant to Sections 120.569 and 120.57, Florida Statutes and Rule 28-106, Florida Administrative Code (F.A.C.), you have the right to request a proceeding to contest this action by the Department. You may elect a proceeding by completing the attached Election of Rights form or filing a Petition. Your Petition or Election of a proceeding must be in writing and must be filed with the General Counsel acting as the Agency Clerk, Department of Insurance. If served by U.S. Mail, the Petition or Election should be addressed to the Florida Department of Insurance at 612 Larson Building, Tallahassee, Florida 32399- 0333. If Express Mail or hand delivery is utilized, the Petition or Election should be delivered to 612 Larson Building, 200 East Gaines Street, Tallahassee, Florida 32399-0333. The Petition or 47 YW 7] Election must be received by, and filed in the Department within twenty-one (21) days of the date of your receipt of this notice. YOUR FAILURE TO RESPOND TO THIS ADMINISTRATIVE COMPLAINT WITHIN TWENTY-ONE (21) DAYS WILL GONSTITUTE A WAIVER OF YOUR RIGHT TO REQUEST A PROCEEDING ON THE MATTERS ALLEGED HEREIN AND AN ORDER OF REVOCATION WILL BE ENTERED AGAINST YOU. If a proceeding is requested and there is no dispute of fact the provisions of Section 120.57(2), Florida Statutes would apply. In this regard you may submit oral or written evidence in opposition to the action taken by this agency or a written statement challenging the grounds upon which the agency has relied. While a hearing is normally not required in the absence of a dispute in fact, if you feel that a hearing is necessary one will be conducted in Tallahassee, Florida or by telephonic conference call upon your request. If you dispute material facts which are the basis for this agency’s action you may request a formal adversarial proceeding pursuant to Sections 120.569 and 120.57(1), Florida Statutes. If you request this type of proceeding, the request must comply with all of the requirements of Rule 28-106, F.A.C. and contain a) A statement identifying with particularity the 48 YW VY allegations of the Department which you dispute and the nature of the dispute; (ob) An explanation of what relief you are seeking and believe you are entitled.to; (c) Any other information which you contend is material. 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. If you request a hearing, you have the right to be represented by counsel, or other qualified representative, to take testimony, to call and cross-examine witnesses, and to have subpoena and subpoena duces tecum issued on your behalf. You are hereby notified that mediation under Section 120.573, Florida Statutes, is not available. Failure to follow the procedure outlined with regard to your response to this notice may result in the request being denied. All prior correspondence in this matter shall be considered freeform agency action, and no such correspondence shall operate as a valid request for an administrative proceeding. Any request for administrative proceeding received prior to the date of this 49 =! + WY wv] notice shall be deemed abandoned unless timely renewed in compliance with the guidelines as set out above. DATED and SIGNED this 2ist day of February, 2000.. s ILL NELSON Treasurer and Insurance Commissioner 50 ww] VY STATE OF FLORIDA DEPARTMENT OF INSURANCE IN THE MATTER OF: DONALD WILLIAM SABO Case No.: 28891-99-AG / ELECTION OF RIGHTS I have received and have read the Administrative Complaint filed 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) 1. C[€ ] I do not desire a proceeding. The Department may enter a final order revoking my license(s) . 2. I do not dispute any of the Department's factual allegations and I hereby elect an informal 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 [ ] attend an informal hearing to be held in Tallahassee; or { ] attend an informal hearing by way of a telephone conference call. 3. [— J I do dispute the Department's factual allegations. I have attached to this form a statement indicating the specific issues of fact which are disputed and other required information indicated in the Notice of Rights. I hereby request a formal adversarial proceeding pursuant to Sections 120.569 and 120.57(1), Florida Statutes to be held before the Division of Administrative Hearings. DATE: Signature of Petitioner TO PRESERVE YOUR RIGHT TO A Name: PROCEEDING, YOU MUST RETURN THIS FORM WITHIN TWENTY-ONE Address: (21) DAYS OF RECEIPT TO THE DEPARTMENT OF INSURANCE AT THE ADDRESS INDICATED IN THE NOTICE OF RIGHTS. Phone: 51 V CERTIFICATE OF SERVICE I HEREBY CERTIFY that at foregoing ADMINISTRATIVE COMPLAINT has been furnished WILLIAM SABO, 129 Glen Cove Pl 32082-3638 and to DONALD WILLIAM SABO, Sunshine State 3631 Blanding Blvd., Jacksonvi Certified U.S. Mail this 21st rue and correct copy of the to: DONALD ace, Ponte Vedra Beach, Florida Insurance, lle, Florida 32210-5240 by day of February, 2000. David J. Buse Florida Department of Insurance Division of Legal Services 645 Larson Building 200 East Gaines Street Tallahassee, Florida (850) 413-4146 32399-0333 Fla. Bar No. 140945 52

Docket for Case No: 00-001248