04 24> DF Past DEPARTMENT OF FINANCIAL SERVICES 04 APRS PH USI OWISIOH ADMINISTRA HEARINGS TOM GALLAGHER CHIEF FINANCIAL OFFICER F | L FE D IN THE MATTER OF MAR 24 2004, FUNERARIA NATIONAL SUR CORPORATION, a Florida Corporation, ZABIDA HASIN, Individually, and as Docketed by: x Ly a Principal, Registered Agent, and Preneed ' Sales Agent of Funeraria Nacional Sur Corporation, SHEIKH RAFAIY Case No. 66825-03-FC ALKHALIFA, a/k/a HILBERT MAHABIR, Individually, and as Principal and Preneed Sales Agent of Funeraria Nacional Sur Corporation. Certificate of Authority No. 0400093 / ADMINISTRATIVE COMPLAINT TO: Funeraria National Sur Corporation Zabida Hasin Sheikh Rafaiy Alkhalife, a/k/a Hilbert Mahabir 6871 SW 40" Street Miami, Florida, 33155 You, Funeraria National Sur Corporation, Zabida Hasin, and Sheikh Rafaiy Alkhalifa, a/k/a Hilbert Mahabir, are hereby notified that, pursuant to Chapter 497, Florida Statutes, the Chief Financial Officer of the State of Florida has caused to be made an examination of your activities while certified in this state to sell preneed funeral and cemetery services, as a result of which it is alleged: GENERAL ALLEGATIONS L. Funeraria Nacional Sur Corporation (hereinafter “Funeraria”), is a Florida profit corporation. At all times relevant to the dates and occurrences referred to herein, Funeraria was licensed by the Department of Financial Services (hereinafter “the Department”) to sell funeral and cemetery preneed contracts pursuant to the provisions of Chapter 497, Florida Statutes, “The Funeral and Cemetery Services Act” (hereinafter “the Act.”). Funeraria’s principal place of business is located at 6871 Bird Road, Miami, Florida, 33166. 2. Zabida Hasin (hereinafter “Hasin”) is a principal and registered agent agent of Funeraria. At all times relevant to the dates and occurrences referred to herein, Hasin was licensed by the Department as a. preneed sales agent for Funeraria pursuant to the Act. ; 3. Sheikh Rafaiy Alkhalifa a/k/a Hillbert Mahabir (hereinafter “Alkhalifa’’), is the previously undisclosed owner cf Funeraria, and manages its operations. Alkhalifa is currently registered as a Funeraria preneed sales agent with the Department under the name of Hilbert Mohabir, He was first registered from February 29, 1996 until March 1, 2000. He became registered again on March 14, 2002. 4. Funeraria has a orior history of violations of the Act. The Department conducted an examination of Funeraria in 2000, covering the period January 1, 1996 to June 30, 2000. In the course of the examination, the Department’s examiner requested copies of all preneed . contracts sold by Funeraria during the examination period. As a result of the examination, Funeraria entered into a stipulation with the Department wherein Funeraria admitted trusting violations, fund deficits and contracting insufficiencies. Hasin, on behalf of Funeraria, agreed to cease and desist from violations of the Act, and to pay an administrative fine. to 5. The Department has jurisdiction over the certification and registration of Funeraria, Hasin, and Alkhalifa, pursuant to the Act. COUNT I 6. The above allegations are hereby realleged and fully incorporated by reference. 7. No person may sell, or receive any funds for payment on, a preneed contract without first having a valid certificate of authority (hereinafter “COA”). As a predicate to the issuance of a COA, the person must be a licensed cemetery company, funeral establishment or direct disposal establishment. f 8. The Board of Funeral and Cemetery Services (hereinafter “Board”’) can issue or renew a certificate of authority if upon investigation by the Board it appears that the principals, including directors, officers, stockholders owning more than 10% of the voting stock of the applicant, and other persons who can direct the management of the applicant, are of good moral character and have reputations for fair dealing in business matters. 9. From 1996 to the present, Hasin has consistently reported in Funeraria’s applications for COA, that she is the one hundred percent owner, sole control, and president of Funeraria, most recently in March of the year 2003. 10. Contrary to her statements, the Department has recently learned through the sworn testimony of Hasin and Alkalifa, that Hasin is not the owner of Funeraria; rather, Alkhalifa manages and operates Funeraria and is currently, and for several years has been, its sole owner and sole shareholder. 11. Alkhalifa owns several funeral homes and funeral related businesses, including Funeraria La Catolica, Funeraria Cubana, Funeraria Nacional Latina, and Discount Flowers. 12. Alkhalifa contracted Funeraria’s preneed business to Juan Ramos (hereinafter “Ramos”), who controlled the preneed sales and salespeople. Ramos had a sales force of approximately thirty people. The first year of the arrangement, Ramos’s group sold 1.5 million dollars worth of preneed business in the State of Florida. Alkhalifa charged that Ramos’s preneed salespeople used fraudulent methods to sell preneed contracts and pocket the money. 13.Neither Alkhalifa nor Ramos were ever disclosed as principals in Funeraria’s initial or renewal COA applications. 14. Funeraria consistently reported in its initial application and subsequent renewal applications to the Department that it had no parent corporation, subsidiaries or branch offices, and no management, ownership or control other than Hasin. The reports were misleading and in violation of section 837.06, Florida Statutes. IT IS THEREFORE CHARGED, that you, Funeraria National Sur Corporation, have violated or are accountable under the following provisions of the Act and rules of the Department which constitute grounds for discipline, including suspension or revocation of your Certificate of Authority: (a) Violating any provision of the Act. [Section 497.233(1)(a), Florida Statutes]; (b) Violating any rule of the Department. [Section 497.233(1)(b), Florida Statutes); (c) Failing to divulge and submit required information for every principal of the applicant. [Section 497.407, Florida Statutes}, (d) Failing to file a historical sketch for every person with power to direct the management or policies of the applicant. [Fla. Admin. Code R. 69K-5.002]; (e) Procuring a certificate of authority by material misstatement or fraudulent misrepresentation. [Section 45'7.233(1)(e), Florida Statute]; (f) Filing a report required by the Act which the certificateholder knows to be false. [Section 497.233(1)(h), Florida Statutes]. COUNT TWO 15, The above allegations are hereby realleged and fully incorporated by reference. IT IS THEREFORE CHARGED, that you, ZABIDA HASIN, have violated or are accountable under the following provisions of the Act which constitute grounds for discipline, including the suspension or revocation of your registration as a preneed sales agent: (a) Procuring a certificate of authority or any other registration authorized by the Act by material misstatement or fraudulent misrepresentation. [Section 497.233(1)(e), Florida Statutes]; (b) Filing a report required by the Act which the certificateholder or registrant knows to be false. [Section 497.233(1)(h)]. COUNT THREE 16. The above general and specific allegations are hereby realleged and fully incorporated by reference. 17. Pursuant to the provisions of section 497.439 of the Act, any individual who offers preneed contracts to the public, executes preneed contracts on behalf of a certificateholder, or collects money from the sale of preneed contracts, must be registered with the Department as a preneed sales agent. A prenced sales agent must be affiliated with a particular COA holder as a predicate to licensure. 18. Any insurance business transacted under Act must comply with the provisions of section 497.439, Florida Statutes, as well as the provisions of section 626.785, Florida Statutes. That section, entitled “Qualifications for [life insurance] License,” provides that a funeral wn director, direct disposer, or an employee or representative thereof or anyone having an office in, or in connection with, a funeral establishment may not be licensed except under very limited circumstances. The first circumstance under which a funeral establishment, or employee or affiliate thereof may be involved in the sale of life insurance is when a funeral establishment contracts with a licensed life insurance agent to sell preneed contracts and a limited policy of insurance covering the expense of final disposition of the insured. The second circumstance under which a funeral establishment may be involved in the sale of life insurance is where an employee of a funeral establishment which holds a certificate of authority under the Act obtains an agent’s license to sell only policies of life insurance covering the expense of a prearrangement for funeral services or merchandise so as to provide funds at the time the services and merchandise are needed. 19. After Alkhalifa terminated his preneed relationship with Ramos, he allowed Ramos to use Funeraria’s COA. as a predicate to sell Homestead preneed contract fulfillment (life insurance) policies, even though, by his own sworn testimony, their preneed arrangement had been terminated and Ramos was no longer affiliated with Funeraria. 20. Alkhalifa conspired with Ramos to circumvent the Act as well as the provisions of the Insurance Code. IT IS THEREFORE CHARGED, that you, Sheikh Rafaiy Alkhalifa a/k/a Hillbert Mahabir, have violated or are accountable under the following provisions of the Act and rules of the Department which constitute grounds for discipline, including the suspension or revocation of your registration as a preneed sales agent: (a) Fraud, deceit, misrepresentation, incompetency, or misconduct in the sale of preneed contracts, or any other activity authorized by this chapter. [Section 497.233(1)(i), Florida Statutes]; (b) Violating any provisions of the Act. [Section 497.233(1)(a), Florida Statutes]; (c) All preneed sales agents and funeral directors acting as preneed sales agents must be affiliated with the certificateholder that they are representing. [Section 497.439(2), Florida Statutes]. COUNT FOUR 21. The above general and specific allegations are hereby realleged and fully incorporated by reference. 22. Atall times relevant to the dates and occurrences referred to herein, Funeraria was fully responsible and accountable for the activities of its principals and preneed sales agents pursuant to Section 497.439, Florida Statutes. IT IS THEREFORE CHARGED, that you, Funeraria National Sur Corporation, have violated or are accountable under the following provisions of the Act and rules of the Department which constitute grounds for discipline, including the suspension or revocation of your Certificate of Authority: (a) Violating any provision of the Act. [Section 497,233(1)(a), Florida Statutes]; (b) Violating any Department rule. [Section 497.233(1)(b), Florida Statutes]; (c) Failing to divulge and submit required information for every principal of the applicant so that the Department may determine the suitability of the applicant for certification and registration. [Section 497.407, Florida Statutes]; (d) Failing to file a historical sketch for every person with power to direct the management or policies of the applicant. [Fla. Admin. Code 69K-5.002]; (e) Procuring a certificate of authority by material misstatement or fraudulent misrepresentation. [Section 497.233(1)(e), Florida Statute; (f) Filing a report required by the Act which the certificateholder knows to be false. (Section 497.233(1)(h)]; (g) Fraud, deceit, misrepresentation, incompetency, or misconduct in the sale of preneed contracts, or any other activity authorized by this chapter. [Section 497.233(1)(i), Florida Statutes]; (h) Allowing someone who is not affiliated with the certificateholder to use the certificateholders COA to sell preneed and last expense policies when the law requires that a preneed sales agent must be affiliated with the certificateholder that they are representing. [Section 497.439(2), Florida Statutes]. WHEREFORE, you, Funeraria National Sur Corporation, Zabida Hasin, and Sheikh Rafaiy Alkhalifa, a/k/a Hillbert Mahabir, are hereby notified that the Department intends to enter an Order revoking your Certificate of Authority and your registration as preneed sales agents, or impose such penalties as may be provided under the provisions of sections 497.233(2), 497.435, 497.519, Florida Statutes, and Fla. Admin. Code R. 69K-11. % 4 EN NOTICE OF RIGHTS ‘i You have the right to request a proceeding to contest wai dps ° Pepartment pursuant to sections 120.569 and 120.57, Florida Statutes, Ke aif 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 Financial Services, 612 Larson Building, 200 East Gaines Street, Tallahassee, Florida 32399-0333. The Department must receive your written response 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 cay 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 Proceedings 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 from the agency. oS er RRMA SHE He IN WARN = If a hearing of any type is requested, you have the right to be represented by counsel or other qualified representative al 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. 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 your response is received by the Department of Financial Services. DATED: this £4YYZ day of March, 2004. ~~ NE KAREN CHANDLER Deputy Chief Financial Officer CERTIFICATE OF SERVICE I HEREBY CERTIFY that a copy of the foregoing ADMINISTRATAIVE COMPLAINT has been furnished to Funeraria National Sur Corporation, Zabida Hasin,and Sheikh Rafaiy Alkhalife, a/k/a Hilbert Mahabir, 6871 SW 40" Street, Miami, Florida, 33155, by U.S. Certified Mail this ax Y 7k. _ day of March, 2004. Div‘Sion of Legal Services 612 Larson Building Tallahassee, Florida 32399-0333 (850) 413-4110 Fla. Bar No. 97569

Docket for Case No: 04-001342