IN THE MATTER OF:

CHIEF FINANCIAL OFFICER

JEFF ATWATER

STATE OF FLORIDA

FILED

NOV O 9 2011

LYNN MARIE ARRUDA

                                                          I

ADMINISTRATIVE COMPLAINT

TO: LYNNMARIEARRUDA

3035 Mabry Lane

Orlando, Florida 32822

CASE NO.: 115394-11-AG

You, LYNN MARIE ARRUDA, are hereby notified that the Chief Financial Officer of the State of Florida has caused to be made an investigation of your activities while licensed as a life including variable annuity (2-14) agent and as a life (2-16) agent, in this state, as a result of which it is alleged:

GENERAL ALLEGATIONS

1. Pursuant to Chapter 626, Florida Statutes, and the Florida Insurance Code, the Florida Department of Financial Services ("Department") has jurisdiction over your insurance agent licenses, appointments, and eligibility for licensure.

2. The Department and the Board of Funeral, Cemetery, and Consumer Services ("Board"), created within the Division of Funeral, Cemetery and Consumer Services of the Department, have jurisdiction over your licensure as a direct disposer and any activity within the funeral service industry, pursuant to the provisions of Section 20.121, and Chapter 497, Florida Statutes, the Florida Funeral, Cemetery, and Consumer Services Act ("Act").

   
   

   Filed September 18, 2012 2:12 PM Division of Administrative Hearings

   
   

3. Pursuant to Chapter 626, Florida Statutes, you, LYNN MARIE ARRUDA, currently are licensed in this state as a life including variable annuity agent (2-14) (License Number D046388). You, LYNN MARIE ARRUDA, were granted the aforementioned life including variable annuity agent (2-14) license on or about August 2, 2000, based upon an application you submitted to the Department under the name by which you were formerly known, to wit: Lynn-Marie Coffey.

4. At all times pertinent to the dates and occurrences referred to herein, you, LYNN MARIE ARRUDA, were licensed in this state as life including variable annuity agent (2-14).

5. From on or about August 2, 2000, until the license expired on August 31, 2006, you, LYNN MARIE ARRUDA, were licensed also as a life agent (2-16) in this state, pursuant to Chapter 626, Florida Statutes.

6. According to information in the Department's records you, LYNN MARIE ARRUDA, were conducting insurance business during times pertinent to the allegations in this Administrative Complaint.

7. According to Department records you, LYNN MARIE ARRUDA, were appointed by Southland National Insurance Corporation ("SNIC") during times relevant to the allegations in this Administrative Complaint. SNIC is the only insurer that ever appointed you to transact insurance business under your life including variable annuity agent (2-14) license in the state of Florida.

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8. The above General Allegations are hereby realleged and fully incorporated herein by reference.

9. You, LYNN MARIE ARRUDA, are licensed by the Division as a direct disposer

(license ID No. F042107), having been so licensed on or about August 27, 1999, by the statutory predecessor of the Department.

I 0. Florida Secretary of State's records show that at the time of your initial licensure as a life including variable annuity (2-14) agent in August of 2000, you, LYNN MARIE ARRUDA, were the President of Affordable Funeral Options, Inc. ("Affordable").

1. According to the Articles of Incorporation filed by Affordable, the purpose of the corporation was "including but not limited to providing funeral services and cremations to patrons in the state of Florida, and elsewhere".

2. On your application for licensure as a life including variable annuity (2-14) agent, you indicated that you were employed by Dove Funeral Chapel & Crematory ("Dove"), which at the time was a fictitious name registered to Affordable, and you listed "President" as your position with Dove.

3. Section 626.785, Florida Statutes, provides that

   
   

   The department shall not grant or issue a license as life agent to any individual found by it to be untrustwmihy or incompetent, or who does not meet the following qualifications: ... Must not be a funeral director or direct disposer, or an employee or representative thereof, or have an office in, or in connection with, a funeral establishment, except that a funeral establishment may contract with a life insurance agent to sell a preneed contract as defined in Chapter 497.

   
   

   Section 626.785(1)(d), Florida Statutes (2000).

   
   

4. Therefore, at the time of your licensure you, LYNN MARIE ARRUDA, did not meet the qualifications for licensure as a life agent or a life including variable annuity agent pursuant to Section 626.785(1)(d), Florida Statutes.

5. A financial examination of Dove was conducted by and under the jurisdiction and

   I

   
   

   authority of the Division on or about March 24, 2009.

   
   

6. During the aforementioned financial examination, documents were collected

   
   

   
   

   showing that you, LYNN MARIE ARRUDA, were actively engaged in the funeral business.

   
   

7. During the examination it was determined that, you, LYNN MARIE ARRUDA, engaged in the sale of preneed funeral contracts on behalf of Dove.

8. Additionally, you, LYNN MARIE ARRUDA, are listed as a funeral director on multiple contracts executed between Dove and various consumers.

9. As long as you, LYNN MARIE ARRUDA, are "a funeral director or direct disposer, or an employee or representative thereof, or have an office in, or in connection with, a funeral establishment," you will not be qualified to be licensed as a life insurance agent under the Florida Insurance Code.

10. You, LYNN MARIE ARRUDA, do not fulfill the criteria or qualify for a life agent's license under Rule 69B-211.003, Florida Administrative Code, or the statutory provisions cited therein.

11. Further, even if your relationship and employment with any and all funeral businesses is severed, you, LYNN MARIE ARRUDA, have violated the Florida Insurance Code for many years through your ongoing activity as "a funeral director or direct disposer, or an employee or representative thereof, or have an office in, or in connection with, a funeral establishment."

IT IS THEREFORE CHARGED that you, LYNN MARIE ARRUDA, have

violated or are accountable under one or more of the following provisions of the Florida Insurance Code and/or the Florida Administrative Code, which constitute sufficient grounds for the suspension or revocation of your license(s) or appointment(s) as an insurance agent in this state:

1. Section 626.611(1), Florida Statutes, which provides that it is a violation for any

   
   

   
   

   applicant, agent, title agency, adjuster, customer representative, service representative, or managing general agent to lack of one or more of the qualifications for the license or appointment as specified in the Florida Insurance Code.

2. Section 626.611(4), Florida Statutes, which provides that it is a violation for any applicant, agent, title agency, adjuster, customer representative, service representative, or managing general agent to willfully use, her license to circumvent any of the requirements or prohibitions of the Florida Insurance Code.

3. Section 626.611(8), Florida Statutes, which provides that it is a violation for any applicant, agent, title agency, adjuster, customer representative, service representative, or managing general agent to demonstrate a lack of reasonably adequate knowledge and technical competence to engage in the transactions authorized by the license or appointment.

4. Section 626.611(13), Florida Statutes, which provides that it is a violation for any applicant, agent, title agency, adjuster, customer representative, service representative, or managing general agent to willfully fail to comply with, or willfully violate, any proper order or rule of the department or willfully violate of any provision of this code.

5. Section 626.621(1), Florida Statutes, which provides that any applicant, agent, title agency, adjuster, customer representative, service representative, or managing general agent, in the conduct of business under the license or appointment, may be disciplined for any cause for which issuance of the license or appointment could have been refused had it then existed and been known to the department.

6. Section 626.621(2), Florida Statutes, which provides that it is a violation for any applicant, agent, title agency, adjuster, customer representative, service representative, or managing general agent, in the conduct of business under the license or appointment, to violate

   
   

   
   

   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 appointment.

7. Section 626.621(3), Florida Statutes, which provides that it is a violation for any applicant, agent, title agency, adjuster, customer representative, service representative, or managing general agent, in the conduct of business under the license or appointment, to violate any lawful order or rule of the department, commission, or office.

WHEREFORE, you, LYNN MARIE ARRUDA, are hereby notified that the Chief Financial Officer intends to enter an Order suspending or revoking your licenses and appointments as an insurance agent or imposing such penalties, including administrative fines and restitution, as may be provided under the provisions of Sections 626.611, 626.621, 626.631, 626.641, 626.651, 626.661, 626.681, 626.691, 626.692 and 626.711, Florida Statutes, and under

the other referenced Sections of the Florida Statutes and the Florida Administrative Code as set out in this Administrative Complaint. Additionally, the Department intends to enter an order to cease and desist from any violation of Chapter 626, Florida Statutes. You are further notified that any order entered in this case revoking or suspending any license or eligibility for licensure held by you shall also apply to all other licenses and eligibility held by you under the Florida Insurance Code.

NOTICE OF RIGHTS

You have the right to request a proceeding to contest this action by the Department of Financial Services ("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 DFS Agency Clerk, Julie Jones, Florida Department of Financial Services, 200 East Gaines Street,

Tallahassee, Florida 32399-0390. 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 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:

1. 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").

2. 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.

3. A statement requesting an administrative hearing identifying those material facts that are in dispute. If there are none, the petition must so indicate,

4. A statement of when the respondent received notice of the administrative complaint.

5. 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 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 Depatiment 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 wi!l 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.

DATED and SIGNED this _q_·_\h_day of (\)OJeCC\()·e[ , 2011.

Gregory Thomas

Director, Agents and Agency Services

CERTIFICATE OF SERVICE

9

I HEREBY CERTIFY that a true and correct copy of the foregoing ADMINISTRATIVE COMPLAINT and the following ELECTION OF PROCEEDING has been furnished to Lynn Marie A1ruda, at lmarrud 812@aol.com, by electronic mail, delivered and read receipts requested, this

'l'- day ofQVeroberc , 2011.

2 ·Q

Thomas A. "Tad" David, Esq.

Florida Department of Financial Services Division of Legal Services

200 East Gaines St. 612 Larson Building

Tallahassee, Florida 32399-0333

(850) 413-4164

Florida Bar Number 0706868

STATE OF FLORIDA DEPARTMENT OF FINANCIAL SERVICES

· DIVISION OF LEGAL SERVICES

IN THE MATTER OF:

LYNN MARIE ARRUDA

/

CASE NO.: 115394-11-AG

ELECTION OF PROCEEDING

I have received and have read the Administrative Complaint filed by the Florida Department of Financial Services

)

("Department11 against me, including the Notice of Rights contained therein, and I understand my options. I am requesting

disposition of this matter as indicated below. (CHOOSE ONE)

1. [ ] I do not dispute any of the Department's factual allegations and I do not desire a hearing. I understand that by waiving my right to a hearing, the Department may enter a final order that adopts the Administrative Complaint and imposes the sanctions sought, including suspending or revoking my licenses and appointments as may be appropriate.

   
   

2. I do not dispute any of the Department1s factual allegations and I hereby elect a proceeding to be conducted in accordance with Section 120.57(2), Florida Statutes. In this regard, I desire to (CHOOSE ONE):

   
   

   [ ] Submit a written statement and documentary evidence in lieu of a hearing; or

   
   

   [ ] Personally atten a hearing conducted by a department hearing officer in Tallahassee; or

   
   

   . [ ] Attend that same hearing by way of a telephone conference call.

   
   

3. [ ] I do dispute one or more of the Department's factual allegations. I hereby request a hearing pursuant to Section 120.57(1), Florida Statutes, to be held before the Division of Administrative Hearings. I have attached to this election form the information required by Rule 28-106.2015, Florida Administrative Code, as specified in subparagrnph (c) of the Notice of Rights. Specifically, I have identified the disputed issues of material fact.

TO PRESERVE YOUR RIGHT TO A HEARING, YOU MUST FILE YOUR RESPONSE WITH THE DEPARTMENT OF FINANCIAL SERVICES WITHIN TWENTY-ONE (21) DAYS OF YOUR RECEIPT OF THE ADMINISTRATIVE COMPLAINT. THE RESPONSE MUST BE RECEIVED BY THE DEPARTMENT NO LATER THAN 5:00 P.M. ON THE TWENTY-FIRST DAY AFTER YOUR RECEIPT OF THE ADMINISTRATIVE COMPLAINT.

The address for filing is: DFS Agency Clerk, Julie Jones, Florida Department of Financial Services, 200 East Gaines Street, Tallahassee, Florida 32399-0390.

Signature

Date:                                                                                  

Print Name

Address:                                                                                              

Date Administrative

Complaint Received:                                                  

I you arc represented by an attorney or: qualified Phone No.:                                                                                       _ representative, please attach to this election form his

or her name, address, telephone and fax numbers Fax No.:                                                                                        

Docket for Case No: 12-003136PL