IN THE MATTER OF:
RISK MANAGEMENT CENTER
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REPRF.SFJ\TING
ALEX SINK
CHIEF FINANCIAL OFFICER STATE OF FLORIDA
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APR 2 2010
CASE NO: 109512-10-AG
ADMINISTRATIVE COMPLAINT
TO: RISK MANAGEMENT CENTER
c/o Gene Leverty, Esq. Leverty & Associates CHTD 832 Willow Street
Reno, Nevada 89502
You, RISK MANAGEMENT CENTER, are hereby notified that the Chief Financial Officer of the State of Florida has caused to be made and investigation of your activities while licensed as an insurance agency in this state, as a result of which it is alleged:
GENERAL ALLEGATIONS
. Pursuant to Chapter 626, Florida Statutes, you, RlSK MANAGEMENT CENTER ("RMC"), are currently licensed in this state as an Insurance Agency (21-05).
At all times pertinent to the allegations contained within this administrative complaint, you, RMC, were licensed in this state as an insurance agency, license number LO47265.
At all times material hereto, Mark Hunter Dorfman, a licensed insurance agent,
was the director, owner and agent-in-charge of RMC, located at 2300 Palm Lakes Boulevard, Suite 304, West Palm Beach, Florida 33409.
RMC is a duly licensed insurance agency in this state, having been issued license number 1047265.
During all times material to the allegations in this Administrative Complaint, neither RMC nor Mark Hunter Dorfman held a Florida license as a Managing General Agent.
Pursuant to Chapter 626, Florida Statutes, the Florida Department of Financial Services ("Department") has jurisdiction over your, RMC's, insurance license.
COUNT ONE
The above General Allegations are hereby re-alleged and incorporated herein by reference.
In or about November 2005, Physicians Indemnity Risk Retention Group, Inc. ("PIRRG"), a risk retention group domiciled in Nevada and authorized to do business in Florida, entered into a contract with you, RMC, to provide management services for PIRRG, including, but not limited to, marketing, policy issuance, claims management, and compliance. Pursuant to this agreement, you, RMC, were given the authority to produce, underwrite and bind insurance policies on behalf of PIRRG.
From at least November 2005 until some time in 2009, you, RMC, held yourself out as the Managing General Agent for PIRRG and performed the functions of a Managing General Agent without possessing the requisite licensure.
During that time period, you, RMC, managed all or part of the insurance business ofPIRRG.
IT IS THERFORE CHARGED THAT you, RMC, 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 license and such other penalties as are identified in the "Wherefore" section of this administrative complaint:
Section 626.6215(2), Florida Statutes, which provides that it is violative of the Insurance Code to use an insurance license to circumvent any of the requirements or prohibitions of the Insurance Code.
Section 626.6215(5)(k), Florida Statutes, which provides that it is violative of the Insurance Code to demonstrate a lack of fitness or trustworthiness to engage in the business of insurance arising out of activities related to insurance or the insurance agency with such frequency as to have made the operation of the agency hazardous to the insurance-buying public.
Section 626.112(5), Florida Statutes, which provides that it is violative of the Insurance Code to hold oneself out to be a managing general agent unless licensed and appointed as a managing general agent.
COUNTTWO
The above paragraphs one through eight are hereby re-alleged and incorporated herein by reference.
Pursuant to your, RMC's, contract with PIRRG, you were to collect premiums from insureds on behalf of PIRRG. Other than for specific costs outlined in the Management Agreement, the balance of the premiums were to be forwarded to PIRRG.
From in or about September 2009 until in or about November 2009, you, RMC, systematically withheld premiums rightfully belonging to PIRRG.
Demand was made by PIRRG to you, RMC, for the premiums. Despite this
demand, you, RMC, continued to illegally withhold the premiums.
On November 5, 2009, PIRRG terminated your Management Agreement.
You, RMC, were aware of the termination.
Subsequent to PIRRG's termination of your appointment, you, RMC, continued to collect premium payments from policyholders on behalf of PIRRG after your Management Agreement was terminated.
You, RMC, failed to remit those premium payments to PIRRG.
As a result of your, RMC's, actions, many insureds had the potential of being uninsured as premium payments were not forwarded to PIRRG.
IT IS THERFORE CHARGED THAT you, RMC, 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 license and such other penalties as are identified in the "Wherefore" section of this administrative complaint:
Section 626.6215(2), Florida Statutes, which provides that it is violative of the Insurance Code to use an insurance license to circumvent any of the requirements or prohibitions of the Insurance Code.
Section 626.6215(5)(a), Florida Statutes, which provides that it is violative of the Insurance Code to misappropriate, convert, or unlawfully withhold moneys belonging to insurers or beneficiaries or to others received in the conduct of business with such frequency as to have made the operation of the agency hazardous to the insurance-buying public.
Section 626.6215(5)(d), Florida Statutes, which provides that consistently violating any provision of the Insurance Code or any other law applicable to the business of insurance in the course of dealing under the license with such frequency as to have made the
operation of the agency hazardous to the insurance-buying public, is violative of the Insurance Code.
Section 626.6215(5)(f), Florida Statutes, which provides that it is violative of the Insurance Code to fail or refuse, upon demand, to pay over to any insurer the agency represents or has represented any money coming into the agency's hands belonging to the insurer with such frequency as to have made the operation of the agency hazardous to the insurance-buying public.
Section 626.6215(5)(k), Florida Statutes, which provides that it is violative of the Insurance Code to demonstrate a lack of fitness or trustworthiness to engage in the business of insurance arising out of activities related to insurance or the insurance agency with such frequency as to have made the operation of the agency hazardous to the insurance-buying public.
COUNT THREE
The above General Allegations are hereby re-alleged and incorporated herein by reference.
Since October 9, 2009, you, RMC, have maintained with the Department that your business address is 10404 Carmen Lane in Royal Palm Beach, Florida.
The Department investigation, which included an inspection of RMC, revealed that your business address is actually 2300 Palm Beach Lakes Boulevard in West Palm Beach, Florida.
You, RMC, failed to update your business address with the Department.
IT IS THERFORE CHARGED THAT you, RMC, 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 such other penalties as are identified in the "Wherefore" section of this administrative complaint:
(a) Section 626.551, Florida Statutes, which provides that every licensee shall notify the department in writing within 60 days after a change of name, residence address, principal business street address, mailing address, contact telephone numbers, including a business telephone number, or e-mail address.
WHEREFORE, you, RMC, are hereby notified that the Chief Financial Officer intends to enter an Order suspending or revoking your license as an insurance agency or to impose such penalties as may be provided under the provisions of Sections 626.611, 626.621, 626.681, 626.691, 626.692, 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 28-106, 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 Julie Jones, 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 TIDS NOTICE WILL CONSTITUTE A WAIVER OF YOUR RIGHT TO REQUEST A PROCEEDING ON THE MATTERS ALLEGED HEREIN AND AN ORDER OF SUSPENSION OR REVOCATION WILL BE ENTERED AGAINST YOU.
If you request a proceeding, you must provide information that complies with the
requirements of Rule 28-106.2015, Florida Administrative Code. As noted above, completion of the attached Election of Proceeding form conforms to these requirements. Specifically, your response must contain:
The name, address, and telephone number, and facsimile number (if any) of the respondent (for the purpose of requesting a hearing in this matter, you are the "respondent").
The name, address, telephone number, facsimile number of the attorney or qualified representative of the respondent (if any) upon whom service of pleadings and other papers shall be made.
A statement requesting an administrative hearing identifying those material facts that are in dispute. If there are none, the petition must so indicate.
A statement of when the respondent received notice of the administrative complaint.
A statement including the file number to the administrative complaint.
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 evidep.ce 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 Depart:rhent attorney will discuss this matter with you until the response has been received by the Department.
, 2010.
t\:?t
NancyRo
!> Division Dir tor, Agents and Agency Services
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CERTIFICATE OF SERVICE
I HEREBY CERTIFY that a true and correct copy of the foregoing ADMINISTRATIVE COMPLAINT and ELECTION OF PROCEEDING has been furnished by Certified Mail to:
Risk Management Center, c/o Gene Le7rty, Esq., Leverty & Associates'CHTD, 832 Willow Street, Reno, Nevada 89502 this fl I)_ day of 2010.
f-IU·
Ellen M. Simon
Chief Counsel
Department of Financial Services Division of Legal Services
612 Larson Building
Tallahassee, Florida 32399-0333
