DEPARTMENT OF FINANCIAL SERVICES JUN 24 2003 TOM GALLAGHER CHIEF FINANCIAL OFFICER oocisesty CLL IN THE MATTER OF: 0237 {7 EC RUTH CROWELL HAUGHTON CASE NO: 65579-03-AG / ADMINISTRATIVE COMPLAINT TO: RUTH CROWELL HAUGHTON 101 Park Street Safety Harbor, Florida 34695 RUTH CROWELL HAUGHTON 1022 Main Street, Ste. K Dunedin, Florida 34698 agi Hd 72 WAT £0 You, RUTH CROWELL HAUGHTON, 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, RUTH CROWELL HAUGHTON, are currently licensed in this state as a life and variable annuity agent, and life, health and annuity agent. 2. At all times pertinent to the dates and occurrences referred to herein this Administrative Complaint, you, RUTH CROWELL HAUGHTON, 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 20, 2002, you, RUTH CROWELL HAUGHTON, solicited D.C. of Clearwater, Florida to purchase a one-year term certificate of deposit being sold by Money Wise Financial Services. You, RUTH CROWELL HAUGHTON, received from D.C. $94,932.63 of her personal retirement savings to purchase a Certificate of Deposit. You, RUTH CROWELL HAUGHTON, failed to purchase the one- year term Certificate of Deposit. Rather, you, RUTH CROWELL HAUGHTON, induced D.C. to purchase a Trans America Life Insurance Company annuity. 5, You, RUTH CROWELL HAUGHTON, represented to C.D. that the Trans America annuity was the equivalent of a Certificate of Deposit and would have a guaranteed 6.25% annual return for one year after which her funds, principal plus interest, would be returned without penalty. Your representations were false and a material misstatement of fact. The annuity is not a certificate of deposit or its equivalent. The annuity did not pay a 6.25% annual return, it is not financially guaranteed by the Federal Deposit Corporation (FDIC) and C.D. is not entitled to the return of her money after one year. Money can only be withdrawn with the payment by C.D ofa very significant financial penalty. C.D. would not have purchased the annuity, but for these misrepresentations. You, RUTH CROWELL HAUGHTON, were aware of these facts. 6. This transaction were neither necessary nor in the purchaser’s best interest. Asa result, C.D. has lost retirement income. 7. You, RUTH CROWELL HAUGHTON, sold the TranAmerica annuity to C.D. for the sole purpose of receiving a commission, which you did receive. IT IS THEREFORE CHARGED that you, RUTH CROWELL HAUGHTON, 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) Willful misrepresentation of any insurance policy or annuity contract or willful deception with regard to any such policy or contract. [Section 626.611(5), Florida Statutes] (b) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance. [Section 626.611(7), Florida Statutes] (c) Fraudulent or dishonest practices in the conduct of business under the license or permit. [Section 626.611(9), Florida Statutes] (d) 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 626.61 1(13), Florida Statutes] (e) 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] (A) 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, 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] COUNT II 8. Paragraphs one and two are realleged and incorporated herein by reference. 9. On or about June 8, 2001, you, RUTH CROWELL HAUGHTON, solicited L.L. of Clearwater, Florida to purchase a short- term certificate of deposit being sold by Money Wise Financial Services. You, RUTH CROWELL HAUGHTON, received from L.L. $50,000 of her personal retirement savings to purchase a Certificate of Deposit. You, RUTH CROWELL HAUGHTON, failed to purchase the short term Certificate of Deposit. Rather, you, RUTH CROWELL HAUGHTON, induced L.L. to purchase a Trans America Life Insurance Company annuity. 10. You, RUTH CROWELL HAUGHTON, represented to L.L.that the Trans America annuity was the equivalent of a Certificate of Deposit and would have a guaranteed 6.00% annual return without early withdrawal penalties. Your representations were false and a material misstatement of fact. The annuity is not a certificate of deposit or its equivalent. The annuity did not pay a 6.00% annual retum, it is not financially guaranteed by the Federal Deposit Corporation (FDIC) and L.L. is not entitled to the return of her money after one year. Money can only be withdrawn with the payment by L.L. ofa very significant financial penalty. L.L. would not have purchased the annuity, but for these misrepresentations. You, RUTH CROWELL HAUGHTON, were aware of these facts. 11. This transaction were neither necessary nor in the purchaser’s best interest. Asa result, L.L. has lost retirement income. 12. You, RUTH CROWELL HAUGHTON, sold the Trans America annuity to L.L. for the sole purpose of receiving a commission, which you did receive. IT IS THEREFORE CHARGED that you, RUTH CROWELL HAUGHTON, 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(5); 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 in Count I above. COUNT Ii 13. Paragraphs one and two are reafleged and incorporated herein by reference. 14. On or about March 1, 2001, you, RUTH CROWELL HAUGHTON, solicited R.M.J. of Clearwater, Florida to purchase a short- term certificate of deposit being sold by Money Wise Financial Services. You, RUTH CROWELL HAUGHTON, received from R.M.J. $25,000 of her personal retirement savings to purchase a Certificate of Deposit. You, RUTH CROWELL HAUGHTON, failed to purchase the short term Certificate of Deposit. Rather, you, RUTH CROWELL HAUGHTON, induced R.M.J. to purchase a Trans America Life Insurance Company annuity. 15. You, RUTH CROWELL HAUGHTON, represented to R.M.J. that the Trans America annuity was the equivalent of a Certificate of Deposit and would have a guaranteed 10% annual return without early withdrawal penalties. Your representations were false and a material misstatement of fact. The annuity is not a certificate of deposit or its equivalent. The annuity does not pay a 10% annual return, it is not financially guaranteed by the Federal Deposit Corporation (FDIC) and R.M.J. is not entitled to the return of her money after one year. Money can only be withdrawn with the payment by L.L. of a very significant financial penalty. L.L. would not have purchased the annuity, but for these misrepresentations. You, RUTH CROWELL HAUGHTON, were aware of these facts. 16. This transaction were neither necessary nor in the purchaser’s best interest. Asa result, R.M.J. has lost retirement income. 17. You, RUTH CROWELL HAUGHTON, sold the Trans America annuity to R.M.J. for the sole purpose of receiving a commission, which you did receive. IT IS THEREFORE CHARGED that you, RUTH CROWELL HAUGHTON, 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(5); 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 in Count I above. COUNT IV 18. Paragraphs one and two are realleged and incorporated herein by reference. 19. On or about March 7, 2001, you, RUTH CROWELL HAUGHTON, solicited L.A. of Clearwater, Florida to purchase a short- term certificate of deposit being sold by Money Wise Financial Services. You, RUTH CROWELL HAUGHTON, received from L.A. $132,000 of his personal retirement savings to purchase a Certificate of Deposit. You, RUTH CROWELL HAUGHTON, failed to purchase the short term Certificate of Deposit. Rather, you, RUTH CROWELL HAUGHTON, induced L.A. to purchase a Trans America Life Insurance Company annuity. 20. You, RUTH CROWELL HAUGHTON, represented to L.A.that the Trans America annuity was the equivalent of a Certificate of Deposit and would have a guaranteed annual return without early withdrawal penalties. Your representations were false and a material misstatement of fact. The annuity is not a certificate of deposit or its equivalent. The annuity did not pay an annual return as represented, it is not financially guaranteed by the Federal Deposit Corporation (FDIC) and L.A. is not entitled to the return of his money after one year. Money can only be withdrawn with the payment by L.A. of a very significant financial penalty. L.L. would not have purchased the annuity, but for these misrepresentations. You, RUTH CROWELL HAUGHTON, were aware of these facts. 21. This transaction were neither necessary nor in the purchaser’s best interest. Asa result, L.A. has lost retirement income. 22. You, RUTH CROWELL HAUGHTON, sold the Trans America annuity to L.A. for the sole purpose of receiving a commission, which you did receive. IT IS THEREFORE CHARGED that you, RUTH CROWELL HAUGHTON, 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 626.61 1(5); 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 in Count I above. COUNT V 23. Paragraphs one and two are realleged and incorporated herein by reference. 24. On or about May and September, 2000, you, RUTH CROWELL HAUGHTON, solicited C.P. and L.P. of Clearwater, Florida to purchase a short- term certificate of deposit being sold by Money Wise Financial Services. You, RUTH CROWELL HAUGHTON, received from C.P. and L.P. $50,000 of their personal retirement savings to purchase a Certificate of Deposit. You, RUTH CROWELL HAUGHTON, failed to purchase the short term Certificate of Deposit. Rather, you, RUTH CROWELL HAUGHTON, induced L.L. to purchase a Trans America Life Insurance Company annuity. 25. You, RUTH CROWELL HAUGHTON, represented to C.P. and L.P. that the Trans America annuity was the equivalent of a Certificate of Deposit and would have a guaranteed 6.00% annual return for five years without early withdrawal penalties. Your representations were false and a material misstatement of fact. The annuity is not a certificate of deposit or its equivalent. The annuity did not pay a 6.00% annual return, it is not financially guaranteed by the Federal Deposit Corporation (FDIC) and C.P. and L.P. are not entitled to the return of their money after five years. Money can only be withdrawn with the payment by L.L. of a very significant financial penalty. C.P. and L.P. would not have purchased the annuity, but for these misrepresentations. You, RUTH CROWELL HAUGHTON, were aware of these facts. 26. This transaction were neither necessary nor in the purchaser’s best interest. Asa result, C.P. and L.P. have lost retirement income. 27. You, RUTH CROWELL HAUGHTON, sold the Trans America annuity to L.L. for the sole purpose of receiving a commission, which you did receive. IT IS THEREFORE CHARGED that you, RUTH CROWELL HAUGHTON, 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(5); 626.611(7); 626.611(9); 626.61 1(13); 626.621(2); 626.621(3); 626.621(6); and 626.9541(1)(e)1, Florida Statutes as more particularly alleged in Count I above. COUNT VI 28. Paragraphs one and two are realleged and incorporated herein by reference. 29, On or about March 1, 2001, you, RUTH CROWELL HAUGHTON, solicited R.M.J. of Clearwater, Florida to purchase a short- term certificate of deposit being sold by Money Wise Financial Services. You, RUTH CROWELL HAUGHTON, received from R.M_J. $25,000 of her personal retirement savings to purchase a Certificate of Deposit. You, RUTH CROWELL HAUGHTON, failed to purchase the short term Certificate of Deposit. Rather, you, RUTH CROWELL HAUGHTON, induced R.M.J. to purchase a Trans America Life Insurance Company annuity. 30. You, RUTH CROWELL HAUGHTON, represented to R.M.J. that the Trans America annuity was the equivalent of a Certificate of Deposit and would have a guaranteed 10% annual return without early withdrawal penalties. Your representations were false and a material misstatement of fact. The annuity is not a certificate of deposit or its equivalent. The annuity does not pay a 10% annual return, it is not financially guaranteed by the Federal Deposit Corporation (FDIC) and R.M.J. is not entitled to the return of her money after one year. Money can only be withdrawn with the payment by L.L. ofa very significant financial penalty. L.L. would not have purchased the annuity, but for these misrepresentations. You, RUTH CROWELL HAUGHTON, were aware of these facts. 31. This transaction were neither necessary nor in the purchaser’s best interest. Asa result, R.M_J. has lost retirement income. 32. You, RUTH CROWELL HAUGHTON, sold the Trans America annuity to R.M.J. for the sole purpose of receiving a commission, which you did receive. WHEREFORE, you, RUTH CROWELL HAUGHTON, 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 626.61 1, 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 Tequest 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 To meanness a enaaementie wuuteta nee sent ec | 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. Ifa 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 24th dayof June , 2003. N CHANDLER Deputy Chief Financial Officer CERTIFICATE OF SERVICE 24th dayof June , 2003 Salat ARG ames A. Bossart, Esquire Fla. Bar No.:374598 Florida Department of F. inancial Services Division of Legal Services 612 Larson Building 200 East Gaines Street Tallahassee, Florida 32399-0333 (850) 413-4125

Docket for Case No: 03-002719PL