THE TREASURER OF THE STATE OF FLORIDA ; DEPARTMENT OF INSURANCE F ! L E D ToM GALLAGHER iy we Treasurer and eat IN THE MATTER OF: Docketed by: WILLIAM B. DUKE CASE NO: 61613-02-AG ea £ 6 -ys72-PL ADMINISTRATIVE COMPLAINT ; ~ TO: WILLIAM B. DUKE ner 2006 Bayview Place a Indian Rocks Beach, Florida 33785 ; Bt WILLIAM B. DUKE 2 8875 Hidden River Parkway Ste. 300 Tampa, Florida 33637 You, WILLIAM B. DUKE, are hereby notified that pursuant to Chapter 626, Florida Statutes, the Insurance Commissioner of the State of Florida, has caused to be made an investigation of your activities while licensed an insurance agent in this state as a result of which it is alleged that: GENERAL ALLEGATIONS 1 You, WILLIAM B. DUKE, are currently licensed in this state as a life and variable annuity contracts salesman, life, health and variable annuity contracts salesman, life insurance agent, and life and health insurance agent. 2. At all times pertinent to the dates and occurrences referred to herein this Administrative Complaint, you, WILLIAM B. DUKE, were licensed in this state as an insurance agent. COUNT I 3. Paragraphs one and two are realleged and incorporated herein by reference. 4. On or about February 19, 1999, you, WILLIAM B. DUKE, visited the home of Thomas C. Beck of Sebring, Florida. You, WILLIAM B. DUKE, solicited Mr. Beck to invest $25,000.00 of his personal retirement savings by purchasing 25 shares of stock in a preferred stock issued by Palm Beach Investment Group, Inc. a Florida corporation. 5. You, WILLIAM B. DUKE, represented to Mr. Beck that the Palm Beach Investment Group, Inc., shares would have a guaranteed 11% annual return the first year and were insured by both the Federal Deposit Insurance Corporation (FDIC) and Great American Insurance Company, through a financial guarantee bond. No return has been received to date and the stock shares are not and never were insured by either the FDIC or Great American Insurance Company. Your representations were false and a material misstatement of fact. Mr. Beck would not have purchased the stock shares, but for these misrepresentations. You, WILLIAM B. DUKE, were aware of these facts. 6. You, WILLIAM B. DUKE, represented to Mr. Beck that the Palm Beach Investment Group shares complied with all Florida and Federal Securities laws and regulations. This representation was false and a material misstatement of fact. In fact, Palm Beach Investment Group, Inc., was not and never has been registered to sell securities in this state nor was it’s preferred stock registered for sale in this state or exempt from such registration, all in violation of sections 517.051, 517.061, and 517.07, Florida Statutes. You, WILLIAM B. DUKE, were not registered in this state to sell securities, in violation of Section 517.12, Florida Statutes. You, WILLIAM B. DUKE, were aware of these facts. 7. You, WILLIAM B: DUKE, failed to inform Mr. Beck that you were not licensed to sell securities, that the Palm Beach Investment Group shares were unregistered, were not Certificates of Deposit, were speculative and involved a very high degree of risk and should not be purchased by anyone who could not afford the loss of his or her entire investment. Mr. Beck would not have purchased the shares if they had been made aware of these facts. 8. The Palm Beach Investment Group shares were not an appropriate investment for individuals of Mr. Beck’s age, financial circumstances and investment experience. These transactions were neither necessary nor in the purchaser’s best interest. You, WILLIAM B. DUKE were aware or should have been aware of these facts. 9. You, WILLIAM B. DUKE, sold the Palm Beach Investment Group shares for the sole purpose of receiving a commission, which you did receive. 10. Palm Beach Investment Group, Inc., in a stipulated settlement agreement and consent order dated November 10, 1999, was ordered by the Florida Department of Banking and Finance to cease and desist from soliciting further stock subscriptions. The stock shares purchased by Mr. Beck are now worthless, and there is no likelihood that the investment or any part thereof will be recovered. As a result, he has suffered a significant financial loss. IT IS THEREFORE CHARGED that you, WILLIAM B. DUKE, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the State Treasurer and Insurance Commissioner which constitute grounds for the suspension or _ revocation of your license(s) and eligibility for licensure: (a) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance. [Section 626.611(7), Florida Statutes] (b) Fraudulent or dishonest practices in the conduct of business under the license or permit. [Section 626.611(9), Florida Statutes] (c) 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] (d) 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] (e) Violation of any lawful order or rule of the Department. [Section 626.621(3), Florida Statutes] # 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] (g) Knowingly: a. Filing with any supervisory or other public official, fom . Making, publishing, disseminating, circulating, c. Delivering to any person, so 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] COUNT II 11. Paragraphs one and two are realleged and incorporated herein by reference 12. On or about January 11, 1999, you, WILLIAM B. DUKE, visited the home of Charles and Carolyn Homs of Brandon, Florida and solicited Mr. and Mrs. Homs to invest $5,000.00 of their personal retirement savings, by purchasing 1 share of stock in a preferred stock issued by Palm Beach Investment Group, Inc. a Florida corporation. 13. You, WILLIAM B. DUKE, represented that the Palm Beach Investment Group, Inc., shares would have a guaranteed 14% annual return the first year and were insured by both the Federal Deposit Insurance Corporation (FDIC) and Great American Insurance Company, through a financial guarantee bond. No return has been received to date and the stock shares are not and never were insured by either the FDIC or Great American Insurance Company. Your representations were false and a material misstatement of fact. Mr. and Mrs. Homs would not have purchased the stock shares, but for these representations. You, WILLIAM B. DUKE, were aware of these facts. 14, You, WILLIAM B. DUKE, represented to Mr. and Mrs. Homs that the Palm Beach Investment Group shares complied with all Florida and Federal Securities laws and regulations. This representation was false and a material misstatement of fact. In fact, Palm Beach Investment Group, Inc., was not and never has been registered to sell securities in this state nor.was it’s preferred stock registered for sale in this state or exempt from such registration, all in violation of sections 517.051, 517.061, and 517.07, Florida Statutes. You, WILLIAM B. DUKE, were not registered in this state to sell securities, in violation of Section 517.12, Florida Statutes. You, WILLIAM B. DUKE, were aware of these facts. 15. You, WILLIAM B. DUKE, failed to inform Mr. and Mrs. Homs that you were not licensed to sell securities, that the Palm Beach Investment Group shares were unregistered, were speculative and involved a very high degree of risk and should not be purchased by anyone who could not afford the loss of his or her entire investment. Mr. and Mrs. Homs would not have purchased the shares if she had been made aware of these facts. 16. | The Palm Beach Investment Group shares were not an appropriate investment for individuals of Mr. and Mrs. Homs’ age, financial circumstances and investment experience. These transactions were neither necessary nor in the purchaser’s best interest. You, WILLIAM B. DUKE were aware or should have been aware of these facts. 17. You, WILLIAM B. DUKE, sold the Palm Beach Investment Group shares for the sole purpose of receiving a commission, which you did receive. 18. Palm Beach Investment Group, Inc., in a stipulated settlement agreement and consent order dated October 19, 1999, was ordered by the Florida Department of Banking and Finance to cease and desist from soliciting further stock subscriptions. The stock shares purchased by Charles and Carolyn Homs are now worthless, and there is no likelihood that the investment or any part thereof will be recovered. As a result, she has suffered a significant financial loss. IT IS THEREFORE CHARGED that you, WILLIAM B. DUKE, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the State Treasurer and Insurance Commissioner which constitute grounds for the suspension or revocation of your license(s) and eligibility for licensure: Sections 626.611(7); 626.611(9); 626.611(13); 626.621(2); 626.621(3); 626.621(6); and 626.9541(1)(e)1, Florida Statutes as more particularly alleged above. WHEREFORE, you, WILLIAM B. DUKE, are hereby notified that the Insurance Commissioner and Treasurer intends to enter an Order revoking or suspending your licenses and eligibility for licensure or to impose such penalties as may be proper under the provisions of Sections 626.611, 626.621, 626.681, 626.691, 626.692 and 626.9521 Florida Statutes, under the procedures and rules set forth in this Administrative Complaint. NOTICE OF RIGHTS You have the right to request a proceeding to contest this action by the Department pursuant to sections 120.569 and 120.57, Florida Statutes, and Rule 28-107, Florida Administrative Code. The proceeding request must be in writing, signed by you, and must be filed with the Department within twenty-one (21) days of your receipt of this notice. Completion of the attached Election of Proceeding form and/or a petition for administrative hearing will suffice as a written request. The request must be filed with the General Counsel as acting Agency Clerk, at the Florida Department of Insurance, 612 Larson Building, 200 East Gaines Street, Tallahassee, Florida 32399-0333. Your written response must be received by the Department no later than 5:00 p.m. on the twenty-first day after your receipt of this notice. Mailing the response on the twenty-first day will not preserve your right to a hearing. YOUR FAILURE TO RESPOND IN WRITING WITHIN TWENTY-ONE (21) DAYS OF YOUR RECEIPT OF THIS NOTICE WILL CONSTITUTE 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 you request a proceeding, you must provide information that complies with the requirements of Rule 28-107.004, Florida Administrative Code. As noted above, completion of the attached Election of Proceeding form conforms to these requirements. Specifically, your response must contain: (a) The name and address of the party making the request, for purpose of service; (b) A statement that the party is requesting a hearing involving disputed issues of material fact, or a hearing not involving disputed issues of material fact; and (c) A reference to the notice, order to show cause, administrative complaint, or other communication that the party has received form the agency. If a hearing of any type is requested, you have the right to be represented by counsel or other qualified representative at your expense, to present evidence and argument, to call and cross-examine witnesses, and to compel the attendance of witnesses and the production of documents by subpoena. If a proceeding is requested and there is no dispute of material fact, the provisions of section 120.57(2), Florida Statutes, apply. In this regard, you may submit oral or written evidence in opposition to the action taken by the Department or a written statement challenging the grounds upon which the Department has relied. While a hearing is normally not required in the absence of a dispute of fact, if you feel that a hearing is necessary, one will be conducted in Tallahassee, Florida, or by telephonic conference call upon your request. However, if you dispute material facts which are the basis for the Department’s action, you must request an adversarial proceeding pursuant to sections 120.569 and 120.57(1), Florida Statutes. 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, Florida. 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 pursuant to section 120.573, Florida Statutes, is not available. No Department attorney will discuss this matter with you until the response has been received by the Department of Insurance. DATED this 47¢ _ day of July , 2002. KENNEY SHIPLEY Deputy Insurance Co CERTIFICATE OF SERVICE I HEREBY CERTIFY that a copy of the foregoing has been furnished to: WILLIAM B. DUKE, 12328 Capri Circle North, Treasure Island, FL 33706, WILLIAM B. DUKE, at 2006 Bayview Place, Indian Rocks Beach, Florida 33785 and 8875 Hidden ae Parkway, Ste. 300, Tampa, Florida 33637 by U.S. Certified Mail this 47th day of , 2002. bows ~f ( 2 pf James A. Bossart, Esquire ( i Bar No.:374598 Florida Department of Insurance Division of Legal Services 612 Larson Building 200 East Gaines Street Tallahassee, Florida 32399-0333 (850) 413-4125

Docket for Case No: 02-004572PL