Jul 30 PH hy: OD] ye THE TREASURER OF THE STAT! BM DEPARTMENT OF mavens) Rin ity VE TOM GALLAGHER IN THE MATTER OF: FILED JUN 25 2001 TREASURER AND URANCE col sis Case No. 42238-01-AG CLARENCE KEITH LAMONDA / ADMINISTRATIVE COMPLAINT You, CLARENCE KEITH LAMONDA (LaMonda), are hereby notified that pursuant to the Florida Insurance Code the Treasurer and Insurance Commissioner of the State of Florida has caused to be made an investigation of your activities while - licensed as a life insurance agent in the State of Florida, as a result of which it is alleged that: GENERAL ALLEGATIONS 1. Pursuant to Chapter 626, Florida Statutes, you, CLARENCE KEITH LAMONDA are currently licensed in this state as a life insurance and a health insurance agent. 2. At all times material hereto, you, CLARENCE KEITH LAMONDA, were licensed as an insurance agent in the State of Florida. 3. Pursuant to Chapter 626, Fla. Stat., the State Treasurer, as head of the Department of Insurance, has jurisdiction over your license and licensure. COUNT ONE 4. All General Allegations are here re-alleged and made a part of this Count. 5. On October 31%, 1997, the Insurance Commissioner issued a Consent Order in Case No. 20240-97-C, which, inter alia, required LaMonda to have divested himself of all ownership interest in Accelerated Benefits Corporation (ABC), and to no longer have any association with that corporation except as an investment broker for the same. As evidenced by subsequent corporate minutes reflecting 100% ownership of ABC by his brother, Jess LaMonda, Clarence Keith LaMonda did so divest himself of his ownership interest in ABC. The Consent Order also provided that any proposed re- association between Clarence Keith LaMonda and ABC was subject to favorable resolution of an action which had been brought against LaMonda by the United States Securities and Exchange Commission (SEC), and the department’s written approval. 6. On January 6, 1998, LaMonda violated those Consent Order provisions by re-associating himself with ABC in an ownership capacity prior to resolution of said SEC action, and without the department's written approval. More specifically, LaMonda’s brother, Jess LaMonda, as President and 100% owner of ABC, on January 6, 1998, transferred his 100% ownership interest to the LaMonda Management Family Limited Partnership, the partners to which were Jess LaMonda, and Diverse World Enterprises, Inc., a Nevada corporation. At that time, Diverse World Enterprises accepted that ownership interest. Clarence Keith LaMonda was then President, Secretary, and Treasurer of Diverse World Enterprises, Inc. The acceptance of that ownership interest by Diverse World Enterprises, Inc., gave LaMonda an indirect ownership interest in, and a direct control over the affairs of, ABC. Thus, LaMonda Knowingly and willfully violated the above-referenced Consent Order by unlawfully becoming re-associated with ABC in an ownership and/or control capacity prior to resolution of the SEC action, and without the department’s written consent, only two months after execution of that Consent Order. IT IS THEREFORE CHARGED that Clarence Keith LaMonda has violated or is accountable under one or more of the following provisions of the Florida Insurance Code which constitutes grounds for the suspension or revocation of his insurance licenses: (a) | Demonstrated lack of fitness and trustworthiness to engage in the business of insurance. [Section 626.611 (7), Florida Statutes]; (b) 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] COUNT TWO 7. All General Allegations are here re-alleged and made a part of this Count. 8. On October 31°, 1997, the Insurance Commissioner issued a Consent Order in Case No. 20240-97-C, which, inter alia, required LaMonda to have divested himself of all ownership interest in Accelerated Benefits Corporation (ABC), and to no longer have any association with that corporation except as an investment broker for the same. The Consent Order also provided that any proposed re-association between Clarence Keith LaMonda and ABC was subject to favorable resolution of an action which had been brought against LaMonda by the United States Securities and Exchange Commission (SEC), and the department’s written approval. 9. As evidenced by corporate minutes taken at an October 2, 1998 special joint meeting of the shareholders and directors of ABC, LaMonda attended and 1 EH ee participated in that meeting as the “Shareholders’ Representative from LaMonda Management Family Limited Partnership”, thereby showing a re-association with ABC. - The SEC action had not then been resolved, and the department had not then and has not since then given its written consent to LaMonda’s re-association with ABC. IT 1S THEREFORE CHARGED that Clarence Keith LaMonda has violated or is accountable under one or more of the following provisions of the Florida Insurance Code which constitutes grounds for the suspension or revocation of his insurance licenses: (a) | Demonstrated lack of fitness and trustworthiness to engage in the business of insurance. [Section 626.611 (7), Florida Statutes]; (b) — 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] COUNT THREE 10. All General Allegations are here re-alleged and made a part of this Count. 11. On October 31°, 1997, the Insurance Commissioner issued a Consent Order in Case No. 20240-97-C, which, inter alia, required LaMonda to have divested himself of all ownership interest in Accelerated Benefits Corporation (ABC), and to no longer have any association with that corporation except as an investment broker for the same. The Consent Order also provided that any proposed re-association between Clarence Keith LaMonda and ABC was subject to favorable resolution of an action which had been brought against LaMonda by the SEC, and the department's written approval. . 412. As evidenced by corporate minutes taken at a December 16, 1998 special joint meeting of the shareholders and directors of ABC, LaMonda attended and participated in that meeting as the “Sharehoiders’ Representative from LaMonda Management Family Limited Partnership”, thereby showing a re-association with ABC. At that meeting, inter alia, LaMonda moved that he be re-appointed as Chief Executive Officer and Chairman of The Board of Directors of ABC, “effective immediately, pending approval by the State Of Florida Department of Insurance”. That motion passed. The . department had not then and has not since then given its written consent to LaMonda’s re-association with ABC, let alone his reappointment as its Chief Executive Officer and Chairman of the Board. Further, LaMonda did not even request the department's approval until December 22, 1998, nearly a year after his initial re-association with ABC. 13. Additionally, the SEC action was not resolved favorably to Lamonda; on November 17, 1998, he was required to pay a $50,000 fine and agree to entry of an injunction. Notwithstanding the lack of a favorable resolution of the SEC action, and the lack of departmental approval of such a re-association, LaMonda thereafter acted and has continued to act as the Chief Executive Officer and Chairman of the Board of ABC. IT IS THEREFORE CHARGED that Clarence Keith LaMonda has Violated or is accountable under one or more of the following provisions of the Florida Insurance Code which constitutes grounds for the suspension or revocation of his insurance licenses: (a) | Demonstrated lack of fitness and trustworthiness to engage in the business of insurance. [Section 626.611 (7), Florida Statutes]; (b) 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} fs ak BRP ae CQUNT FOUR 14. All General Allegation are here re-aileged and made a part of this Count. 15. In March, 1999, LaMonda, in has capacity as an officer, or director, or employee of ABC, willfully accepted designation as the beneficiary of an insurance policy sold to ABC by David E. Kolsky. That policy (G-148,673/D2100-1583-01692) was issued to Mr. Kolsky by The United States Life Insurance Company on the basis of Mr. Kolsky’s representations on the insurance policy application. The application was dated _May 22, 1998, and the policy was issued on August 1, 1998. 16. On that insurance policy application, Mr. Kolsky represented that he had . not during the preceding five years consulted any physician or other practitioner or been confined or treated in any hospital or similar institution. That insurance policy application’ and its contents were known to ABC prior to its purchase of the Kolsky policy. 17. However, within the August 6, 1998, viatical settlement application used by ABC to evaluate the prospects of purchasing the aforementioned Kolsky policy, Mr. Kolsky represented that he had been diagnosed HIV positive in 1985 by Dr. Ronaid J. Weiwora, and had been subsequently treated for the same within the five years prior to the relevant insurance application. 1 8. . “ABC and LaMonda knew of the mutually repugnant representations made in the insurance policy application and the viatical settlement application relative to Kolsky’s Ss health status. 19. ) ABC nonetheless decided to purchase the policy, and thereafter entered into a course of conduct designed to conceal that purchase from the insurer so as to defeat the insurer's potential for invoking the contestability provisions of the policy. 20. LaMonda’s willful acceptance of the beneficiary designation was a part of the conduct designed to conceal the purchase from the insurer and thereby defeat the potential for invoking the contestability provisions of the policy. 24, LaMonda did not report the aforementioned medical status inconsistencies to the department as required by law. IT 1S THEREFORE CHARGED that Clarence Keith LaMonda has violated or is accountable under one or more of the following provisions of the Florida Insurance Code which constitutes grounds for the suspension or revocation of his insurance license: (a) Demonstrated lack of fitness and trustworthiness to engage in the business of insurance. [Section 626.611 (7), Florida Statutes]; (b) 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]; (c) Failure to report knowledge or belief of the commission of a fraudulent insurance act or any other act which, upon conviction, constitutes a felony or misdemeanor under the Insurance Code or Section 817.234, F. S. [Section 626.989(6), F. S.]. COUNT FIVE 22. All General Allegation are here re-alleged and made a part of this Count. 23. In June, 1996, LaMonda, in has capacity as an officer, or director, or employee of ABC, willfully accepted designation as beneficiary of an insurance policy sold to ABC by Jeffery D. Ross. That policy (1 090297831) was issued to Mr. Ross by _ the Massachusetts General Life insurance company on the basis of Mr. Ross’ representations on the insurance policy application. The application was dated May 16, 1996, and the policy was issued on June 26, 1996. ee 24. On that insurance policy application, Mr. Ross represented that he had no medical condition not listed on the application form. That form did not mention AIDS, ARC., or HIV. That insurance policy application and its contents were known to ABC prior to its purchase of the Ross policy. 25. However, within the August 6, 1998, viatical settlement application used by ABC to evaluate the prospects of purchasing the aforementioned Ross policy, Mr. Ross represented that he had been diagnosed HIV positive in 1996, and subsequently received treatment for the same. 26. ABC knew of the mutually repugnant representations made in the insurance policy application and the viatical settlement application relative to Ross’ health status. ” 27. ABC nonetheless decided to purchase the policy, and thereafter entered into a course of conduct designed to conceal that purchase from the insurer so as to defeat the insurer's potential for invoking the contestability provisions of the policy. 28. LaMonda’s willful acceptance of the beneficiary designation was a part of the conduct designed to conceal the purchase from the insurer and thereby defeat the potential for invoking the contestability provisions of the policy. 29. _ LaMonda did not report the aforementioned medical status inconsistencies to the department. ITIS THEREFORE CHARGED that Clarence Keith LaMonda has violated or is accountable under one or more of the following provisions of the Florida Insurance Code which constitutes grounds for the suspension or revocation of his insurance licenses: Sones pete gee angen npg ae: (a) | Demonstrated lack of fitness and trustworthiness to engage in the business of insurance. [Section 626.611 (7), Florida Statutes]; (b) Willful failure to comply with, or willful violation of, any proper order or rule of the department or willful violation cf any provision of this code. [Section 626.611(13), Florida Statutes]: ' (c) Failure to report knowledge or belief of the commission of a fraudulent insurance act or any other act which, upon conviction, constitutes a felony or misdemeanor under the Insurance Code or Section 817.234, F. S. [Section 626.989(6), F. S1]. .WHEREFORE, you, Clarence Keith LaMonda, are hereby notified that the insurance Commissioner and Treasurer intends to enter an Order revoking your license and eligibility for licensure as a life insurance agent and a health insurance agent or to impose such penalties as may be provided under the provisions of Sections 626.611, 626.621, 626.641, 626.681, and 626.691, Florida Statutes, and under the other referenced sections of the Florida Statutes set out in this Administrative Complaint. DONE AND ORDERED this aah day of June, 2001. iA KENNEY SHIPLEY Deputy Insurance Commissioner eee BMPS MIE Hos ow rb 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 a right to request a hearing to contest this action by the Department. You may request a hearing by filing a Petition. The Petition must be in writing and signed by you. The Petition requesting a hearing must be directed to the General Counsel, acting as the Agency Clerk for the Department of Insurance. If you respond by U.S. Mail, the Petition 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 should be delivered to 612 Larson Building, 200 East Gaines Street, Tallahassee, Florida 32399-0333. The Petition must be received by the Department within twenty-one (21) days of the date of your receipt of this notice. Mailing the Petition on the twenty-first day will not preserve your right to a hearing. YOUR FAILURE TO SO ENSURE THAT THE PETITION REPLYING TO THIS ADMINISTRATIVE COMPLAINT IS RECEIVED BY THE DEPARTMENT WITHIN TWENTY-ONE (21) DAYS WILL CONSTITUTE A WAIVER OF YOUR RIGHT TO REQUEST A HEARING ON THE MATTERS ALLEGED HEREIN AND AN ORDER OF REVOCATION WILL BE ENTERED AGAINST YOU. You may be entitled to a hearing on the proposed agency action pursuant to Sections 120.569 and 120.57, Florida Statutes. If the Petition requests a hearing, it must comply with all of the requirements of Rule 28-106, Florida Administrative Code, and must specifically contain: (a) The name and address of each agency affected and each agency's file or identification number, if known (see Case Number on the Administrative Complaint); (b) The name, address, and telephone number of the petitioner (For the purpose of requesting hearing in this matter, you are the “petitioner”.); the name, address, and telephone number of the petitioner's representative, if any, which shall be the address for service purposes during the course of the proceeding; and an explanation of how the petitioner's substantial interests will be affected by the agency determination; (c) A statement of when and how the petitioner received notice of the agency decision (the Administrative Complaint to which your petition is responding); (d) A statement of all disputed issues of material fact. If there are none, the petition must so indicate; (e) A concise statement of the ultimate facts alleged, including the specific facts the petitioner contends warrant reversal or modification of the agency's proposed action; (f) A statement of the specific rules or statutes the petitioner contends require reversal or modification of the agency's proposed action; and (g) A statement of the relief sought by the petitioner, stating precisely the action petitioner wishes the agency to take with respect to the agency's proposed action. Your failure to substantially comply with any of those requirements will result in your petition being dismissed as provided for in Rule 28-106.201(4) F.A.C. ADDITIONAL RIGHTS “Ifa hearing of any type is requested, you have the right to hire an attorney to represent you, to testify in your own behalf, to call and to cross-examine witnesses, and to compel the attendance of witnesses and the production of documents by subpoena. Failure to follow the procedure outlined with regard to your response to this notice may result in the request being denied. All prior oral communication or correspondence in this matter shall be considered freeform agency action, and no such oral communication or correspondence shall operate as a valid request for an administrative proceeding. Any request for an administrative proceeding received prior to the date of this notice shall be deemed abandoned unless timely renewed in compliance with the guidelines as set out above. Mediation of this matter is not available, and no department attorney will discuss this matter with you until the Petition has been received by the Department of Insurance. CERTIFICATE OF SERVICE | HEREBY CERTIFY that a true and correct copy of the foregoing Administrative Complaint was sent by Certified U.S. Mail to Clarence Keith LaMonda clo raoe nh eepetis Corporation 105 E. Robinson Street, Suite 318, Orlando, Fla. 32802 thi ay of June, 2001. Michael W. Davidson, Esq. Florida Department of Insurance Division of Legal Services 200 E. Gaines Street, Suite 612 Tallahassee, Florida 32399-0333 (850) 413-4178

Docket for Case No: 01-003046PL