FROM : Mar 22 2006 9:08 FAX NO. + 85845749? Mar. 22 2666 89:85AM Pe FLORIDA _ DEPARTMENT OF FINANCIAL SERVICES TOM GALLAGHER CHIEF FINANCIAL OFFICER STATE OF FLORIDA FEB 20 2006 IN THE MATTER OF: Zo CASE NO.: 81586-06-AG MICHAEL 8. JUNCK ADMINISTRATIVE COMPLAINT TO: MICHAEL S, JUNCK 900 Fox Valley Drive, Suite 100 Longwood, FL 32779 MICHAEL 8. JUNCE 2759 Orchard Drive Apopka, FL 32712 You, MICHAEL 8. JUNCK, license LD. #A135747, are hereby notified that the Chief Financial Officer of the State of Florida has caused to be made an investigation of your activitics 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, MICHAET. 8. JUNCK, are currently licensed in this state as a Life Incl Variable Annuity (2-14), Life Incl Var Annuity & Health (2-15), Life (2-16), Life & Health (2-18), Health (2-40) Agent. 2. At all times pertinent to the dates and occurrences referred to herein, you, RICK ALLEN JAYE, were licensed in this state as an insurance agent. 3. Pursuant to Chapter 626, Florida Statutes, the Florida Department of Financial Services has jurisdiction over your insurance licenses and appointments. Mar 22 2006 9:08 FROM : FAX NO. + 85845749? Mar. 22 2866 89:66AM Po 4. At all times material herein, you, MICHAEL 8. JUNCK, as a licensed insurance agent, in concert with one Rick Allen Jaye, your business pariner, and a licensed insurance agent, and one Lewis Donald Guess, a non-resident licensed insurance agent, actively participated and implemented a false and fraudulent scheme to defraud members of the public, particularly medical doctors, by soliciting their participation in a number of purported "insurance arrangements" to avoid taxation. Your acheme involved solicitation of investment in "tax deductible savings programs” through "supplemental insurance arrangements” with unauthorized insurers, COUNT I 5. The above general allegations are hereby realleged and fully incorporated herein by reference. 6. In or around 1999, you, MICHAEL 8. JUNCK, as a licensed insurance agent, in concert with Rick Allen Jaye and Lewis Donald Guess, participated in effecting the sale to DSD, MLD., and his wife, ND, certain flexible premium insurance policies issued by Indianapolis Life Insurance Company, being policies number 00010059811 and B05007254, for which the said DSD provided a premium check in the sum of THREE HUNDRED FIFTY THOUSAND DOLLARS ($350,000.00) payable to Xelan 419 Welfare Benefit Trust. In connection with that transaction, you, in conjunction with Rick Allen Jaye and Lewis Donald Guess, caused false witness to and altered signatures to the insurance application submitted to the said Indianapolis | Insurance Company, caused Lewis Donald Guess, a person unknown to the said DSD and ND, to be named as the trustee of and the ownership of their insurance policy to be vested in an entity known as Xelan 419 Welfare Benefit Trust, and further, participated in the sale to ND of a purported policy of disability insurance issued by a company known as Doctor's Benefit Insurance Company, Ltd. The said DSD, M.D. and ND were enticed to invest in your scheme, as aforesaid, based upon false and fraudulent representations that such would provide a means of tax avoidance. Neither Xelan 419 Welfare Benefit Trust or Doctor's Benefit Insurance Company, Ltd. were authorized to transact insurance business in the state of Florida. Mar 22 2006 9:08 FROM : FAX NO. + 85845749? Mar. 22 2866 89:66AM Pie IT IS THEREFORE CHARGED that you, MICHAEL 8 JUNCK, have violated or are accountable under the following provisions of the Florida Insurance Code and Rules of the Department of Financial Services which constitute grounds for the suspension or revocation of your licenses and appointments: (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 practice of business under the license or appointment. [Section 626.611(9), Florida Statutes]; (c) Willful failure to comply, 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) Knowingly making a false or fraudulent written or oral statement or representation on, or relative to, an application or negotiation for an insurance policy for the purpose of obtaining a fee, commission, money, or other benefit from any insurer, agent, broker, or individual. [Section 626.9541(1)(k)1., Florida Statutes; (e) In the conduct of business under the license or appointment, engaging in unfair methods of competition or unfair or deceptive acts or practices, as prohibited under part IX of this chapter, or having otherwise having shown himself or herself to be a source of envy or loss to the public. [Section 626.621(6), Florida Statutes]; and (f) No person shall, from offices or by personnel or facilitics located in this state, or in any other state or country, directly or indirectly act as agent for, or otherwise represent or aid on behalf of another, any insurer not then authorized to transact such business in this state. [Section 626.901(1), Florida Statutes]. WHEREFORE, you, MICHAEL 8. TUNCK, are hereby notified that the Chief linancial Officer intends to enter an Order suspending ot revoking your licenses and appointments as an insurance agent or to impose such penalties as may be provided under the provisions of Sections FROM : Mar 22 2006 9:09 FAX NO. + S584o7r4ogr Mar. 22 2666 89:66AM Pil 626.611, 626.621, 626.681, 626.691, and 626.9521, Florida Statutes, and under the other referenced Sections of the Florida Statutes as set out 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 Financial Services, 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 from the agency. Mar 22 2006 9:09 FROM : FAX NO. + S584o7r4ogr Mar. 22 2666 83:a7rAM Pl2 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. Ifa 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 aubmnit 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 ig 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 Financial Services. Mar 22 2006 9:09 FROM : FAX NO. + S584o7r4ogr Mar. 22 2666 83:27AM Pls DATED and SIGNED this 2064 day of fa chr ihe ty, 2006, KAREN CHANDLER Deputy Chief Financial Officer CERTIFICATE OF SERVICE I] HEREBY CERTIFY that a true and correct copy of the foregoing ADMINISTRATIVE COMPLAINT and ELECTION OF PROCEEDING has been furnished to: MICHAEL 8. JUNCK, 900 Fox Valley Drive, Suite 100, Longwood, FL 32779; and MICHAEL 8. JUNCK, 2759 Orchard Drive, Apopka, FL 32712, by Certified Mail this AVZH _ day of Fed rsaag 2006. Dean Andrews Division of Legal Services 200 East Gaines St. 612 Larson Building Tallahassee, Florida 32399-0333 (850) 413-4242 Florida Bar Number 0001959

Docket for Case No: 06-001030PL