FILED STATE OF FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULAT Date =: 7/26/2012 Filo # FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION, Petitioner, v. Case No. 2011-006956 PAUL DRAKE, Respondent. / ADMINISTRATIVE COMPLAINT The Department of Business and Professional Regulation (Petitioner) files this Administrative Complaint before the Florida Real Estate Commission against PAUL DRAKE, (Respondent) and alleges: 1. Petitioner is the state agency charged with regulating the practice of real estate pursuant to Section 20.165, Florida Statutes, and Chapters 120, 455, and 475, of the Florida Statutes. 2. Respondent is licensed as a Real Estate Broker having been issued license number 3073258. 3. Respondent’s address of record is 455 Bow Line Drive, Naples, Florida 34103, 4. At all times material hereto, Respondent was the qualifying broker of Paul Drake, LLC, d/b/a Rothchilds International Realty LLC, (Paul Drake, LLC), and Rothchilds International Realty, LLC (Rothchilds International Realty), both of which are real estate corporations registered with Petitioner, Ospastment of Bushes and Professional Regulation Deputy Agency Clerk CLERK = Evette Lawson-Proctor 5. On or about January 19, 2010, Joseph and Constance Staszak (the Staszaks) and Steven and Conchetta Papesca (the Papescas) executed a contract for the purchase and sale of property located at 3935 Loblolly Bay Drive, Unit 202, Naples, Florida (Subject Property). 6. Respondent represented the Staszaks, the buyers, in the transaction. 7. On or about January 19, 2010, the Staszaks gave Respondent a $13,500.00 check, payable to Rothchilds Realty, which was to serve as an earnest money deposit for the purchase of Subject Property. 8. On or about January 26, 2010, in accordance with the Inspections clause of the purchase and sale contract, the Staszaks elected to terminate their offer to purchase Subject Property. 9. On or about January 26, 2010, the Staszaks notified Respondent of their intent to terminate the offer and made a request for the return of their earnest money deposit. 10. On January 29, 2010, the Papescas made a conflicting demand for the escrowed funds. 11. On or about January 10, 2011, Joseph Staszak sent Respondent an email regarding the preparation and filing of an Escrow Disbursement Order (EDO). 12. On or about February 8, 2011, Mr. Staszak filed this complaint with the Division of Real Estate. 13. On or about March 8, 2010, Brenda Fioretti, the Papescas’ broker, suggested in an email to Respondent that he begin the EDO procedure. 14. On or about March 20, 2011, Respondent filed a Request for Escrow Disbursement Order with the Division of Real Estate. 15, On or about October 18, 2011, the Division of Real Estate issued an Amended EDO in DBPR Case No. 20110200650RD, instructing the parties to pursue arbitration, 16. Respondent was required to file an interpleader action with the court to facilitate settlement if the parties were unable to agree to arbitration 17, The EDO required Respondent to report the selected means of settlement to the FREC within thirty days. 18, Respondent failed to notify the FREC of the selected settlement method within thirty days of the Order. 19, On February 17, 2012, Petitioner’s Investigator Rick Kerans sent Respondent a request to conduct an office inspection and escrow review, 20. On March 13, 2012, the Staszak’s attorney, Mr. Neale, sent a letter to the Division of Real Estate stating that the parties had not agreed to arbitration and that Respondent had failed to initiate an interpleader action. 21. On March 23, 2012, Investigator Kerans sent an email to Respondent identifying three prospective dates for the Division to perform an office inspection at Respondent’s license location. 22. On March 27, 2012, Investigator Kerans notified Respondent by email that the Department would be conducting an office inspection and audit at Respondent’s license location on April 4, 2012 at 10:30 a.m, 23. Respondent did not respond to Investigator Keran’s March 27, 2012 email concerning the office inspection and escrow audit. 24, On April 3, 2012, Respondent email to Investigator Kerans stated that Respondent would not be returning to Naples until April 5, 2012, 25. On April 3, 2012, Investigator Kerans requested that Respondent provide the Department with two or three dates prior to April 20, 2012 for the inspection to take place. 26. On April 9, 2012, Respondent replied to Investigator Kerans, stating that he was available for the office inspection and audit on April 19, 2012 or April 20, 2012, 27. On April 19, 2012, Investigator Kerans performed an office inspection at .the Rothchilds International Realty, LLc office located at 455 Bow Line Drive, Naples, Florida. 28. Investigator Kerans was unable to perform an escrow audit because Respondent failed to provide business records and bank statements for review. 29. At no time during the course of this investigation did Respondent provide credible documentation to support his claims as to the whereabouts of the Staszak’s $13,500.00 deposit. 30. As of May 4, 2012, Respondent had not filed an interpleader action with the court or provided complete brokerage records for inspection by the Department. COUNT ONE 31. Petitioner re-alleges and incorporates by reference the allegations set forth in paragraphs one (1) through thirty (30) as L£ fully set forth herein, 32. Section 475,25(1) (b), Florida Statutes, subjects a real estate licensee to discipline for: [Committing] fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealings by trick, scheme or devise, culpable negligence, or breach of trust in any business transaction. 33, Respondent violated Section 475,25(1) (b), Florida Statutes, in one or more of the following ways: a. By engaging in dishonest dealings by trick, scheme, or device when he failed to account for a $13,500.00 deposit that was to be placed in trust for clients; b. By failing to inform his clients that he was required to request an Escrow Disbursement Order from the FREC. 34. Based on the foregoing, Respondent violated Section 475.25(1) (0), Florida Statutes, by committing dishonest dealings, breach of trust or culpable negligence in the real estate transaction involving Subject Property. COUNT TWO 35. Petitioner re~alleges and incorporates by reference the allegations set forth in paragraphs one (1) through thirty (30) as if fully set forth herein. 36, Section 475.25(1) (d)1, Florida Statutes, subjects a real estate licensee to discipline for: [Failure] to account or deliver to any person, including a licensee under this chapter, at the time which has been agreed upon or is required by law or, in the absence of a fixed time, upon demand of the person entitled to such accounting and delivery, any personal property such as money, fund, deposit, check, draft, abstract of title, mortgage, conveyance, lease, or other document or thing of value... if the licensee, in good faith, entertains doubt as to what person is entitled to the accounting and delivery of the escrowed property, or if conflicting demands have been made upon the licensee for the escrowed property, which property she or he still maintains in her or his escrow or trust account, the licensee shall promptly notify the commission of such doubts or conflicting demands and shall promptly: (a) Request that the commission issue an escrow disbursement order determining who is entitled to the escrowed property; (b) With the consent of all parties, submit the matter to arbitration; (c) By interpleader or otherwise, seek adjudication of the matter by a court; or (d) With the written consent of all parties, submit the matter to mediation, 37. Respondent violated Section 475.25(1) (djl, Florida Statutes, in one or more of the following ways: a. By failing to account for a $13,500.00 deposit that was to be placed in trust for his clients; b. By failing to promptly notify the Commission of conflicting demands for the escrowed funds; Cc. By failing to promptly request that the Commission issue an escrow disbursement order determining who was entitled to the escrowed funds; or d. By failing to file an interpleader action with the court after the parties would not consent to arbitration. 38. Based on the foregoing, Respondent violated Section 475.25(1) (d)1, Florida Statutes, by failing to account for an earnest money deposit, failing to notify the FREC of conflicting demands for the funds, failing to request the issuance of an escrow disbursement order, and failing to timely I file an interpleader action with the court. COUNT THREE 39. Petitioner re~alleges and incorporates by reference the allegations set forth in paragraphs one (1) through thirty (30) as if fully set forth herein. H 40. Section 475,25(1)(e), Florida Statutes, subjects a licensee to discipline for violating any of the provisions of Chapter 475 or any lawful order or rule made or issued under the provisions of Chapters 455 or 475, 41. Rule 6102~-10.032(b) (2), Florida Administrative Code, states: If a broker has requested an Escrow Disbursement Order and the broker is notified in writing that no Escrow Disbursement Order will be issued, then the broker shall institute another settlement procedure and so notify the Commission within 30 business days after the broker’s receipt of such notification, 42. Respondent violated Section 475.25(1)(e), Florida Statutes, by violating Rule 61032-10.032(b) (2), Florida Administrative Code, when Respondent failed to institute settlement procedures and so notify the Commission within 30 business days of receipt of the Escrow Disbursement Order. COUNT FOUR 43. Petitioner re~alleges and incorporates by reference the allegations set forth in paragraphs one (1) through thirty (30) as if fully set forth herein. 44, Section 475.5015, Florida Statutes, subjects a licensee to discipline for : Failing to keep and make available to the department such books, accounts, and records as will enable the department to determine whether such broker is in compliance with the provisions of this chapter. Each broker shall preserve at least one legible copy of all books, accounts, and records pertaining to her or his real estate brokerage business for at least 5 years from the date of receipt of any money, fund, deposit, check, or draft entrusted to the broker or, in the event no funds are entrusted to the broker, for at least 5 years from the date of execution by any party of any listing agreement, offer to purchase, rental property management agreement, rental or lease agreement, or any other written or verbal agreement which engages the services of the broker. 45. Respondent violated Section 475.5015, Florida Statutes, when Respondent failed to provide to Petitioner a copy of all books, accounts, and records pertaining to his real estate brokerage businesses for the past five years. WHEREFORE, Petitioner respectfully requests the Florida Real Estate Commission enter an order imposing one or more of the following penalties: suspension or permanent revocation of Respondent(s) license(s), restriction of practice, imposition of an administrative. fine, issuance of a reprimand, placement of Respondent(s) on probation, corrective action, assessment of costs related to the investigation and prosecution of the case, and any other relief that the Commission deems appropriate. SIGNED this 26th of July, 2012. KEN LAWSON, Secretary Department of Business and Professional Regulation By: Megan Demartini Megan Demartini Assistant General Counsel Florida Bar No.93569 Department of Business and Professional Regulation Office of the General Counsel 1940 North Monroe Street Suite 42 ; Tallahassee, FL 32399-2202 (850) 717-1555 - Telephone (850) 414-6749 - Facsimile PCP Date: 7/16/2012 PCP MEMBERS: Darla Furst/Ralph McCoig NOTICE OF RIGHTS PLEASE BE ADVISED that mediation under Section 120.573, Florida Statutes, is not available for administrative disputes involving this type of agency action, PLEASE BE FURTHER ADVISED that Respondent has the right to request a hearing to be conducted in accordance with Sections 120.569 and 120.57, Florida Statutes, to be represented by counsel or other qualified representative, to present evidence and argument, to call and cross-examine witnesses, and to ‘have subpoenas and subpoenas duces tecum issued on his or her behalf if a hearing is requested. Rule 28-106,111, Florida Administrative Code, provides in part that if Respondent fails to request a hearing within twenty-one (21) days of receipt of an agency pleading, Respondent waives the right to request a hearing on the facts alleged. NOTICE REGARDING ASSESSMENT OF COSTS Respondent is placed on notice that Petitioner has incurred costs related to the investigation and prosecution of this matter, Pursuant to Section 455,227(3) (a), Florida Statutes, the Board, or the Petitioner when there is no Board, may assess costs related to the investigation and prosecution of the case excluding costs associated with. an attorney's time, against the Respondent in addition to any other discipline imposed. 19

Docket for Case No: 13-001996PL