The Issue At issue in this proceeding is whether respondent committed the offenses set forth in the notice to show cause and, if so, what disciplinary action should be imposed.
Findings Of Fact At all times pertinent hereto, respondent, Margarita B. Santos, held alcoholic beverage license number 23-09660, series 2-APS, for the premises known as Super Discount (the "premises"), located at 8191 N.W. 27th Avenue, Miami, Dade County, Florida. Neither respondent nor the premises were, at the time, authorized to receive or possess U.S.D.A. Food Coupon Books. On or about November 26, 1991, Detective William Hladky of the Metro- Dade Police Department, as well as other officers associated with such agency, began an undercover investigation of the premises. Such investigation was predicated on information Detective Hladky had received from a confidential informant which indicated that persons associated with Super Discount were dealing in stolen property. On November 26 and 27, 1991, and December 4 and 10, 1991, Detective Hladky gave cartons of Florida tax stamped cigarettes, which he had secured from a Winn Dixie Supermarket, to Detective Marvin Baker, who was operating undercover, for the purpose of attempting to sell such cigarettes to persons inside the licensed premises as ostensibly stolen property. Additionally, on December 4 and 10, 1991, U.S.D.A. Special Agent Carol Bennett provided Detective Baker with U.S.D.A Food Coupon Books and on December 19, 1991, provided a Detective Maltbia-Williams with U.S.D.A. Food Coupon Books for the same purpose. At hearing, neither Detective Baker nor Detective Maltbia-Williams appeared, and no competent proof was offered to demonstrate what occurred, if anything, upon the premises with regard to such ostensibly stolen property. Accordingly, petitioner failed to demonstrate, as alleged in the notice to show cause, that respondent either personally or through her agent, servant or employee violated the provisions of Section 812.019(1), Florida Statutes, by trafficking or endeavoring to traffic in cartons of cigarettes she knew or should have known were stolen (Counts 1, 2, 3 and 6); violated the provisions of Section 561.29, Florida Statutes, by purchasing U.S.D.A. Food Coupon Books in a manner not authorized by law (Counts 4, 7 and 9); and violated the provisions of Section 812.019(1), Florida Statutes, by trafficking or endeavoring to traffic in U.S.D.A. Food Coupon Books she knew or should have known were stolen (Counts 5, 8 and 10). 1/ On December 30, 1991, petitioner's Special Agent Dennis Wilson, together with Detective Hladky, entered the premises to arrest respondent and her employees, as a consequence of Detective Hladky's investigation. Incident to such entry, Special Agent Wilson conducted an inspection of the premises and located six one-liter bottles of 86 proof Dawson Deluxe Blended Scotch Whiskey in the premises' stock room. According to respondent, such whiskey was intended as Christmas gifts for the mail carrier and other persons who provided services to the premises, and not for sale at the premises. Incident to respondent's arrest, Special Agent Wilson searched the contents of respondent's purse, and discovered two U.S.D.A. Food Coupon Books, with a value of $50.00 each, whose serial numbers matched those entrusted to Detective Maltbia-Williams on December 19, 1991. According to respondent, one of her employees gave her the books, she proposed to use the coupons to purchase food for a party, and she did not realize that possession of the coupons was illegal. Apart from respondent's testimony, there is no proof as to the manner in which she acquired the coupons or her intended use of the coupons. 2/ In cases involving possession of beverages not permitted to be sold under the license, it is petitioner's established policy to impose a $500.00 fine or 10-day suspension.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a final order be rendered dismissing Counts 1 through 11 of the notice to show cause, finding respondent guilty as charged in Count 12 of the notice to show cause, and assessing a civil penalty in the sum of $500.00 against respondent's license. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 3rd day of September 1992. WILLIAM J. KENDRICK Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 3rd day of September 1992.
Findings Of Fact On June 4 and 5, 1981, Petitioner John A. Love sat for the general contractor's licensing examination at Bayfront Auditorium in Miami, Florida. The exam which was administered consisted of three parts. The first part was given the morning of the first day. The second part was given the afternoon of the first day and the third part was given the second day. The Petitioner Love arrived at the auditorium approximately twenty minutes prior to the scheduled starting time of the June 4th exam. Upon arrival the Petitioner Love discovered that the doors to the auditorium were locked and he was required to remain outside in the rain until the doors were open at approximately 7:00 a.m. Once inside the auditorium, the Petitioner Love was given an assigned seat which was located in the rear right center of the room. After being seated, the Petitioner was given the plans and specifications for the exam and told not to open or observe them until told to do so. At about 7:30 a.m. a proctor instructed all examinees to check their examination area to determine if they each had a set of plans and specifications which should have consisted of fifteen pages of plans and nineteen pages of specifications. Examinees were instructed to raise their hands if they did not have all exam materials. The proctors repeated the instructions regarding the number of plans and specifications two or three times. Examinees were also instructed to count the number of pages of plans and specifications in their booklets. After these instructions were given, the examinees were given thirty (30) minutes to study their plans and specifications. At no time prior to the commencement of the construction examination did Petitioner Love raise his hand to indicate he was missing any exam materials. The Petitioner Love did not check his plans and specifications when instructed to do so by the proctor. The construction examination began after the instructions were completed. At that time, all examinees were instructed to open their examination booklets. Inside the booklet was a cover sheet on which was written "Important Instructions--Read Carefully." On the same page was an instruction detailing both the number of pages and plans that the examinee should have and a brief description of what each page should contain. At the end of the instructions was printed, "If you do not have all of these sheets, raise your hands." Petitioner Love failed to read this page of instructions. Approximately two hours after the morning portion of the examination had begun, Petitioner Love raised his hand and informed a proctor that he was missing a page from his plans. Petitioner discovered the missing page when a person seated near him raised his hand to indicate he was missing a page from the plans. The missing page was promptly provided by the proctor; with the process of replacing the sheet taking approximately 5-10 minutes. When the Petitioner Love notified the proctors of the missing page, he was on question twelve of the exam. The Petitioner's scores were 75 percent on the first part, 90 percent on the second part and 45 percent on the third part which gave him an overall grade of 68.70 percent. A grade of 69.01 percent was required to achieve a passing grade. On the first part of the exam the Petitioner missed four questions prior to the challenged incident and only one following it. Petitioner Love has a hearing impairment directly related to his previous occupation as a firefighter. However, the Petitioner never informed the Respondent of his impairment prior to the exam so that special arrangements would be made to accommodate him.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered denying the Petitioner's request that his grade on part one of the June 4, 1981, general contractor's licensing examination be adjusted to reflect an overall passing grade. DONE and ORDERED this 9th day of September, 1982, in Tallahassee, Florida. SHARYN L. SMITH, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 9th day of September, 1982. COPIES FURNISHED: Peter D. Blanc, Esquire Post Office Box 1108 West Palm Beach, Florida 33402 Stephanie A. Daniel, Esquire Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 James Linnan Executive Director Construction Industry Licensing Board Post Office Box 2 Jacksonville, Florida 32202 Samuel R. Shorstein Secretary Department of Professional Regulation Old Courthouse Square 130 North Monroe Street Tallahassee, Florida 32301
Findings Of Fact At all times relevant hereto Petitioners were inmates incarcerated at Lake Correctional Institution (LCI) are affected by the challenged rule, and have standing to bring the rule challenges here involved. Respondent stipulated that neither PPD No. 4.07.05, LCIOP No. 84-3, nor Form 50-16 was promulgated as rules pursuant to the provisions of Chapter 120, Florida Statutes. Prior to receipt of incoming legal mail or sending out legal mail, inmates at LCI are required to sign Form 50-16 acknowledging mailing or receipt of such mail. Some testimony was submitted that on occasion inmates received their legal mail opened contrary to established procedures and directives. Also, one witness testified that he had not always received returned receipts for registered mail. Those parts of PPD 4.07.05 (Exhibit 2) and LCIOP No. 84- 3, which involve action to be taken either by inmates or Department of Corrections personnel, are identical to, or a paraphrasing of, similar provisions in Rules 33-3.03 through 33- 3.12, Florida Administrative Code. Those sections not directly relating to action taken or to be taken constitute internal management memoranda which have no application outside LCI.
Findings Of Fact Under Section 26 of the United States Code Section 125, the federal government allows employers to establish programs that provide a federal income pre-tax benefit to employees. To maintain the pre-tax benefit, the employer is required to administer the program in compliance with applicable federal laws, rules and regulations. Employers participating in the 125 pre-tax program are required to implement a written plan (Cafeteria Plan) and take deductions from an employee’s earned income that are credited to the employee’s flexible spending account (FSA) for the purpose of paying medical and/or dependent care expenses. The State of Florida has developed such a plan. The FSA program is managed by Respondent, Department of Management Services. Petitioner, James D. Wells, Jr., has maintained a FSA daycare reimbursement account since 1994. During the 2005 plan year, Petitioner was an enrolled member of the Daycare Reimbursement program. In 2005, Petitioner contributed $3,000.00 to his account. The reimbursement filing deadline for Plan Year 2005 was April 17, 2006. The deadline for 2005 occurred because the normal deadline day of April 15th fell on a weekend. Therefore, the deadline was moved by rule to the first regular business day following April 15th. Petitioner obtained a receipt for eligible expenses for 2005 totaling $3800.00 from the Immanuel Baptist Church Daycare. On March 27, 2006, he took the receipt to his office. While at work, he filled out the appropriate reimbursement request form. Petitioner placed these documents in an envelope with the correct postage and address on it. He placed the envelope in his inter-office mail receptacle. Mail placed in the inter-office receptacle is picked up by an employee of Petitioner’s agency, taken to the agency mailroom, and there picked up by the U.S. Postal Service. The inter-office mail receptacle is neither owned nor controlled by the U.S. Postal Service. Consequently, personal mail is not postmarked until it is received at the U.S. Postal Service. There is no evidence that Petitioner’s envelope was received by the U.S. Postal Service or that it was postmarked by the U.S. Postal Service. The address on the People First reimbursement form reads: “People First Service Center, Flexible Spending Account, Post Office Box 1800, Tallahassee, Florida 32302-1800.” The address is a post office box of the U.S. Postal Service, owned by Fringe Benefits Management Company (FBMC). FBMC is a private entity that processes benefits for various private and public employees, including the State of Florida’s flexible spending accounts. FBMC does not have access to any information regarding a claimant’s dependents and does not verify the authenticity of the names of the dependents or whether the claimant has dependents. FBMC uses Post Office Box 1800 specifically for FSA reimbursement requests submitted by all employees of FBMS clients. The U.S. Postal Service separates all of the mail addressed to Post Office Box 1800 and places it in bins, which are picked up each day by FBMC mailroom employees. The mailroom employees deliver the mail to the claims area at FBMC. Mail processors open each piece of mail and enter the name and/or social security number of the claim and amount of requested reimbursement in the FBMC computer system. Each claim is labeled as pending in the system. For each batch of 50 reimbursement requests entered into the system, the mail processors print a list of the 50 claims and attach the associated paper work for each claim into a batch. Each batch of 50, the list and actual forms are then delivered to “adjudicators” who again input the name and/or social security number directly from the reimbursement form. The adjudicator also determines whether the attached documentation supports the amount of the claim. Once the adjudicator enters the 50 requests into the system, the adjudicator prints another list of names. If either the mail processor or adjudicator enters incorrect information into the computer system, the adjudicator will produce a list that does not match the mail processor’s list. At that point, the mail processor’s list and the adjudicator’s list are reconciled. During reconciliation, if the adjudicator discovers a claim form that does not appear in the pending computer file, the adjudicator will add the name to the pending file or personally deliver the request to the mail processor to enter into the pending file. If the identification data of the claimant entered by the adjudicator matches the information in the “pending file,” and if the backup documentation in support of the claim is adequate as to amount, FBMC authorizes payment; if not, the claim is denied. The claim information is then sent to Convergys to process the claim. Convergys is a private entity that administers the State of Florida human resources and personnel system. Convergys has subcontracted with FBMC to process the payments of FSA requests for reimbursement. Upon receipt of files from FBMC, Convergys responds to all reimbursement requests it receives from FBMC. It either processes payment for approved requests or provides written notification that the claim has not been approved for payment. In June 2006, Petitioner had not received any information regarding his claim and had not received the documents back from the post office. He called the agency and discovered that it did not have any record of his claim. He explained that he had mailed it prior to April 17, 2006. Both FBMC and Convergys searched their records for Petitioner’s claim. Convergys had no record of receiving Petitioner’s claim from FBMC. FBMC searched every “James Wells” in its database listed for each employer-client to whom reimbursements were paid for the 2005 Plan Year. No payment was processed for any other James Wells. FBMC also physically searched all claims from all employees of all its clients, beginning March 27, 2006, through April 22, 2006. Each claim was pulled and each sheet of paper attached to each claim was reviewed. Petitioner’s claim was not located. Given the mail and claim handling procedures used by FBMC in processing claims, it does not appear that Respondent received Petitioner’s claim by April 17, 2006. Therefore, Petitioner’s claim for reimbursement was not timely filed in 2005, and Petitioner is not entitled to reimbursement. The request for hearing should be dismissed.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is: RECOMMENDED that the Respondent issue a Final Order finding that Petitioner did not timely file his reimbursement request, is not entitled to reimbursement and dismissing the request for hearing. DONE AND ENTERED this 14th day of December, 2007, in Tallahassee, Leon County, Florida. S DIANE CLEAVINGER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 14th day of December, 2007. COPIES FURNISHED: Linda South, Secretary Department of Management Services 4050 Esplanade Way Tallahassee, Florida 32399-0950 John Brenneis, Esquire Department of Management Services 4050 Esplanade Way Tallahassee, Florida 32399-0950 James D. Wells, Jr. Department of Highway Safety and Motor Vehicles 2900 Apalachee Parkway, Mail Stop 47 Tallahassee, Florida 32399 Sonja P. Matthews, Esquire Department of Management Services Office of the General Counsel 4050 Esplanade Way, Suite 260 Tallahassee, FL 32399-0950
The Issue The issue is whether Respondent, a certified law enforcement and correctional officer, stole money from inmates, in violation of Section 943.13(7), Florida Statutes.
Findings Of Fact Petitioner certified Respondent on March 22, 1993, as a law enforcement officer and issued her certificate number 135498. Petitioner certified Respondent on July 25, 1995, as a correctional officer and issued her certificate number 156433. At all relevant times, Respondent was employed by the Hendry County Sheriff’s Office as a correctional officer. On October 12, 1995, deputies of the Hendry County Sheriff’s Office arrested Ernesto Estepes and escorted him to the Clewiston Substation. At the substation, Mr. Estepes turned over to a deputy $132 in cash and other personal items, including a watch and wallet. Deputies later transported Mr. Estepes to the Hendry County jail, where the $132 and other personal items were transferred. The booking officer received all of the items, including the cash, and turned them over to Respondent. Four days later, when deputies went to find the items, including the cash, to return to Mr. Estepes, they found that everything was missing, including the property receipt that the jail booking officer had completed. Respondent stole Mr. Estepes’ property, including the cash. The property was never recovered. On October 29, 1995, Hendry County Sheriff’s deputies arrested Jose Ramos. They escorted him to the Clewiston Substation, from where he was later transported to the Hendry County jail. The deputy who transported Mr. Ramos received from Mr. Ramos $112.04 in cash and other personal items, consisting of a gold Citizen quartz watch, silver chain, leather belt, and wallet. The deputy completed a property receipt for these items. At the jail, Respondent handled the booking process, which included receipt of the inmate’s property, including cash. Shortly after Mr. Ramos arrived at the jail, Respondent substituted a fraudulent property receipt for the actual property receipt. The fraudulent receipt stated that Mr. Ramos arrived at the jail with only the clothes he was wearing and was unable to sign the receipt. Respondent took the property and cash with an intent to derive Mr. Ramos permanently of these items. Mr. Ramos was released shortly after his arrest, but was not given his property. Deputies searched the jail, including the booking area, but were unable to find the property. Shortly after a thorough search had been completed, the property, except for the cash, reappeared in the booking area, which had been searched previously to no avail. The property items were returned to Mr. Ramos. The Hendry County Sheriff’s Office reimbursed the cash to the two inmates. Respondent resigned prior to the completion of the internal affairs investigation.
Recommendation It is RECOMMENDED that the Criminal Justice Standards and Training Commission enter a final order revoking the law enforcement and correctional certificates previously issued to Respondent. ENTERED in Tallahassee, Florida, on June 4, 1997. ROBERT E. MEALE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings on June 4, 1997. COPIES FURNISHED: Karen D. Simmons Assistant General Counsel Florida Department of Law Enforcement Post Office Box 1489 Tallahassee, Florida 32302-1489 Anne Dox-Haynes 1447 Ford Circle Lehigh Acres, Florida 33936 A. Leon Lowry, II, Director Division of Criminal Justice Standards and Training Post Office Box 1489 Tallahassee, Florida 32302-1489 Michael Ramage, General Counsel Florida Department of Law Enforcement Post Office Box 1489 Tallahassee, Florida 32302-1489
The Issue At issue in this proceeding is whether respondent committed the offenses set forth in the administrative action, as amended, and, if so, what disciplinary action should be imposed.
Findings Of Fact At all times material herein, respondent, Qasem Shahinda d/b/a Ismael and Son Supermarket, held alcoholic beverage license number 23-10720, series 2- APS, for the premises located at 14528 Lincoln Boulevard, Miami, Florida. At all times material hereto, respondent was authorized to receive U.S.D.A. food stamps in exchange for food items, and had received training prior to such authorization from the United States Department of Agriculture as to, inter alia, items of merchandise which could or could not be exchanged for food stamps. In December 1992, U.S.D.A. Investigator William Bethel (Bethel) and U.S.D.A. Investigative Aide Mary Pierce (Pierce) commenced an investigation of the licensed premises to ascertain whether nor not persons associated with the premises were complying with State and Federal law regarding the acceptance of U.S.D.A. food stamps. In each instance, Bethel accompanied Pierce to the premises and provided her with the U.S.D.A. food stamps used in the investigation. On December 10, 1992, Pierce entered the license premises with $30.00 in U.S.D.A. food stamps. At or about 1:20 p.m. that date, a female clerk on the premises accepted food stamps in exchange for merchandise which, in addition to eligible items, included the following ineligible items: a six-pack of Old Milwaukee Beer, one pack of Winston cigarettes, one pack of Newport cigarettes, and one Massengill disposable douche. On April 14, 1993, Pierce entered the licensed premises with $65.00 in U.S.D.A. food stamps. At or about 12:30 p.m., another female clerk accepted $32.79 worth of food stamps in exchange for merchandise which, in addition to eligible items, included the following ineligible items: a six-pack of Old Milwaukee Beer and one pack of Newport cigarettes. 1/ On April 14, 1993, Investigator Bethel entered the licensed premises with $45.00 in U.S.D.A. food stamps in furtherance of the above described investigation. At or about 12:35 p.m., the same female clerk accepted $38.97 worth of food stamps in exchange for merchandise which, in addition to eligible items, included the following ineligible items: a six-pack of Old Milwaukee Beer, one box of Cheer detergent, and one box of Clorox dry bleach. 2/ On April 28, 1993, Pierce entered the licensed premises with $55.00 in U.S.D.A. food stamps in furtherance of the above described investigation. At or about 11:40 a.m., the same female clerk she had encountered on April 14, 1993, accepted $53.85 worth of food stamps in exchange for merchandise which, in addition to eligible items, included the following ineligible items: a six-pack of Old Milwaukee Beer, one pack of Winston cigarettes, one pack of Newport cigarettes, one roll of Reynolds Foil, and one box of Hefty kitchen bags. 3/ Pierce returned to the premises on April 28, 1993, with $65.00 in U.S.D.A. food stamps. At or about 11:55 a.m., Pierce met with the same female clerk and sold her the $65.00 in U.S.D.A. food stamps for $25.00 in United States currency. 4/ On July 19, 1993, Pierce entered the licensed premises with $140 in U.S.D.A. food stamps in furtherance of the above described investigation. At or about 12:45 p.m., a male clerk accepted food stamps in exchange for merchandise which, in addition to eligible items, included an ineligible pack of Winston cigarettes. Moreover, the same male clerk purchased from Pierce $130.00 in U.S.D.A. food stamps (two full $65.00 books) for $70.00 in United States currency.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a final order be rendered finding respondent guilty of the aforesaid violations and assessing a $2,000.00 civil penalty. DONE AND ORDERED in Tallahassee, Leon County, Florida, this 8th day of March 1995. WILLIAM J. KENDRICK Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 8th day of March 1995.
The Issue At issue in this proceeding is whether Respondent committed the offenses set forth in the administration action and, if so, what penalty should be imposed.
Findings Of Fact At all times material hereto, Respondent, Kamel Supermarket, Inc., held alcoholic beverage license number 23-01444, series 2 APS, for the business known as Kamel Supermarket (the "premises"), located at 3601 Grand Avenue, Miami, Dade County, Florida. Jamal E. Rahma was the sole stockholder and officer of Respondent. In May 1995, U.S.D.A. Special Agent John Karlovitch, now a Deputy U.S. Marshall, began an undercover investigation of the premises. Such investigation was predicated on information received which indicated that persons associated with Kamel Supermarket were purchasing U.S.D.A. Food Coupons for cash and at less than their face value. On May 17, 1995, Special Agent Karlovitch gave Bernadette Hargrett, an Investigative Operative operating undercover, four U.S.D.A. Food Coupon Books having an aggregate face value of $200, for the purpose of attempting to sell such books to employees of the licensed premises. Ms. Hargrett entered the licensed premises and met with an unknown male, who appeared to be an employee, and sold him the four coupon books for $150 in cash. On May 31, 1995, Special Agent Karlovitch gave Ms. Hargrett U.S.D.A. Food Coupons having an aggregate face value of $400, for the purpose of attempting to sell such coupons to employees of the licensed premises. Ms. Hargrett entered the licensed premises and met with a different male than on the first occasion, who also appeared to be an employee, and sold him the food coupons for $300 in cash. On August 9, 1995, Special Agent Karlovitch gave Ms. Hargrett U.S.D.A. Food Coupons having an aggregate face value of $800, for the purpose of attempting to sell such coupons to employees of the licensed premises. Ms. Hargrett entered the licensed premises, met with the same unidentified male as on May 31, 1995, and sold him the food coupons for $600 in cash. On September 7, 1995, Special Agent Karlovitch gave Ms. Hargrett U.S.D.A. Food Coupons having an aggregate face value of $1,000, for the purpose of attempting to sell such coupons to employees of the licensed premises. Ms. Hargrett entered the licensed premises, met with Jamal E. Rahma, and, following some discussion, sold him the food coupons for $750 in cash. Pertinent to Mr. Rahma's knowledge of the impropriety of his conduct, it is observed that before he would purchase the coupons, Mr. Rahma took Ms. Hargrett outside the store and into his car to discuss the transaction. Also, pertinent to Mr. Rahma's knowledge of the impropriety of his conduct, as well as the appropriate penalty, the proof demonstrated that while Kamel Supermarket was at one time authorized to accept food coupons, its authorization was revoked in 1993 for similar misconduct, and that Kamel has previously been the subject of two previous disciplinary actions by Petitioner for similar misconduct. Those actions, one in 1993 and one in 1994, were resolved by consent order and the payment of a civil penalty.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be rendered revoking Respondent's alcoholic beverage license. DONE AND ORDERED this 29th day of October, 1997, in Tallahassee, Leon County, Florida. WILLIAM J. KENDRICK Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 29th day of October, 1997. COPIES FURNISHED: James D. Martin, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-1007 Jamal Rahma c/o Kamel Supermarket 3601 Grand Avenue Miami, Florida 33129 Major Jorge Herrera Augusta Building, Suite 100 8685 Northwest 53rd Terrace Miami, Florida 33166 Richard Boyd, Director Division of Alcoholic Beverages and Tobacco Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399 Lynda L. Goodgame, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399
Findings Of Fact Santa Cruz Marketing, Inc., d/b/a SMI (hereinafter referred to as SMI), a Delaware corporation, is located at Suite 29, 1280 South Powerline Road, Pompano Beach, Florida 33069. Although SMI began operating as a business in Florida in December of 1988, it was not authorized to do business in Florida until December of 1991. At all times material hereto, Edward Winders has been the president/secretary, Jim Winders has been the vice president/treasurer, and Cecil Butler has been the general manager for SMI. Edward Winders and Jim Winders each own 50% of the stock of SMI. Cecil Butler has no ownership interest in SMI and is simply a salaried employee. Edward Winders and Jim Winders are responsible for the day-to-day operation of the business. Although Cecil Butler has some unidentified level of supervisory responsibility over some of the other employees, no evidence was offered that he in any way participates in management decisions regarding the operation of the business itself. SMI advertises by placing ads in newspapers throughout the United States. Its ad reads as follows: "Easy credit card, cash advance, $5000 credit line, no credit check! Call 1-800-347-0773." SMI's business operations consist of the following units: the origination department, the customer service department, the clerical section, and the shipping section. When a call is placed using the toll-free number, that telephone call is answered by an account representative in the origination department. A written script called a credit card presentation is utilized by the account representative. The account representatives do not deviate from that script. The account representative obtains basic information from the caller, gives a brief program description, and then causes to be sent a packet of information called the first mailer to the caller. The script utilized by the account representative, however, does not tell the account representative how to answer questions from the callers. No evidence was offered as to any procedures SMI may have in place for assuring the correctness of answers given to callers' questions. The credit card presentation script tells the caller that he or she has reached the "easy credit card division," advises the caller that "our credit card offers a $5,000 line of credit which includes cash advance availability, now our major credit cards are also available regardless of credit history!", advises the caller that there are no annual fees and that the lifetime membership is a "one time processing fee," advises the caller that he or she is participating in a "limited membership drive," and advises the caller that "all the information on our credit card will be in your package along with our customer service number." The first mailer greets the "prospective member," refers to SMI's credit card program, encloses a pre-approved application, sets forth the amount of SMI's "lifetime membership fee," encloses a "100% money-back guarantee certificate," encourages the recipient to return his or her application and membership fee within 10 days, and promises a $100 gift certificate usable on the charge balance. The lifetime membership fee is $75 if paid by money order or cashier's check and $85 if paid by personal check or C.O.D. No further information is given regarding the details of SMI's "credit card program." An enclosure in the first mailer is a one-page sheet entitled "Special Notice." It features a facsimile of a Visa card and a facsimile of a MasterCard card. The short text includes the following language: Mail today and receive all these privileges. *CASH ADVANCES *VISA CARD AVAILABLE *MASTERCARD AVAILABLE *$100.00 MERCHANDISE CERTIFICATE *ADD POSITIVE INFORMATION ON YOUR CREDIT REPORT HAPPY SHOPPING!!!! The enclosed return envelope is directed to Santa Cruz Marketing, Inc. The line underneath that states that the envelope is going to "SMI Card Distribution Center." If the recipient does not immediately comply, a second mailer is sent five days later. The enclosures are the same as in the first mailer. The "dear prospective member" letter is different and is "just a friendly reminder that we have not received your lifetime membership fee for your pre-approved $5,000 credit card." It encourages the recipient to "take advantage of this unique credit card offer!" and advises the recipient that if the recipient's deadline has already expired, then a call should be placed to SMI's customer service department at a non-toll-free number. After the recipient submits the pre-approved application and pays the membership fee, he or she then receives the membership package. That package begins with a letter greeting the "new card member" and contains the following introductory paragraph: Welcome to the wonderful world of home shopping with your SMI credit card. As a preferred card member, you are offered the opportunity to purchase merchandise from our fantastic color catalogues filled with a wide variety of items. Attached to the letter is an SMI credit card. That letter is the first advice given by SMI to its new "lifetime member" that he or she has paid $75 to join a home shopping club. The letter further advises the recipient that purchasing merchandise from SMI's catalogues will "enable you to establish that A+ credit rating you have always desired, but which may have been denied to you in the past." The letter further advises that SMI will submit monthly statements to the member and that the member can then pay 10% of the balance (with a minimum payment of $15) or the balance can be paid in full. The letter also advises that the new member will pay no interest charges on his or her purchases, "but please remember in order to help you establish your A+ credit rating, your payments must be made on time." The membership packet also contains two merchandise catalogues, an order form, and a price list. According to the price list and the terms of SMI's home shopping program, two prices are available to an SMI member. For each item, the member may pay a specified cash price and a specified shipping charge. Alternatively, the member can pay a credit price, which is higher than the cash price. If the member chooses to purchase the item on credit, the member will pay the higher price as follows: the member includes with his or her order form a specified portion of the credit price as a down payment on the item, with the balance of the credit price being charged to the member's charge account. The member paying the higher credit price will also pay the specified shipping charge. The promised $100 merchandise certificate is included in the membership packet. The certificate specifies that it can only be applied to the credit portion of an order after the down payment for that order is paid and that the certificate is void after 30 days from the date on which the membership was issued. The membership packet includes, for the first time, a description of SMI's cash advance program. The description of that cash advance program begins as follows: Once you have established a sufficient credit record with SMI, you will be extended 'cash advance privileges'. Simply prove your credit worthiness by shopping with your SMI credit card. All you have to do is, charge and pay for at least $500.00 of purchases of your unpaid balance. Once you have done that, you have qualified for a cash advance of $250.00. CASH ADVANCES OFFERS Immediate cash No interest charge Low monthly payments No processing fee Cash advances up to $2,500.00 According to the program, a cash advance of $2,500 would only be available if a member had charged and paid for $5,000 worth of purchases. The flyer also recites that the $100 merchandise certificate does not apply to cash advances. The next flyer contained in the membership packet is entitled "Qualify for a Visa or MasterCard." That flyer features facsimiles of both a MasterCard and a Visa card. The description of that portion of SMI's program begins as follows: Simply prove your credit worthiness by using your SMI Credit card. Just charge and pay for at least $750.00 of your unpaid balance. It's as simple as that! Once you have established a sufficient credit record, you will be sent a 'GOOD CREDIT REFERENCE LETTER' that you can use when applying for credit elsewhere. Plus, you will receive a 'MAJORITY APPROVED' application for a visa or mastercard with 'NO SECURITY DEPOSIT REQUIRED.' UNSECURED - NO SECURITY DEPOSIT REQUIRED (WE WILL DO IT FOR YOU) A $380.00 IMMEDIATE CREDIT LINE CASH ADVANCES COMPETITIVE INTEREST RATES ONE TIME PROCESSING CHARGE ONLY $35.00 ANNUAL CHARGE MAJORITY APPROVED WE ARE SO SURE THAT YOU WILL BE APPROVED THAT WE WILL SEND YOU A 'CASHIERS CHECK FOR $380.00' IF YOU DO NOT QUALIFY. The flyer points out that the $100 merchandise certificate does not apply to this part of the program. Another flyer contained in the membership packet explains a second way in which a member can qualify for a Visa or MasterCard as follows: New Collateralized Credit Card Program You Can Now Obtain a Major Bank Credit Card even though you may have previously been turned down! Under the 'collateralized credit card program' the member may obtain a secured major bank credit card which 'requires a security deposit equal to your initial credit limits.' If the member returns the coupon requesting details, SMI provides the name of another company, Access Credit Card Company, which company would charge an additional fee to provide the member with an application from New Era Bank. If the member followed that procedure, he or she would most likely obtain a Visa or MasterCard bank card from New Era Bank with a credit limit equal to the amount of money the member was willing to deposit in New Era Bank since that bank approves the majority of such applications. The membership packet contains three additional flyers. The first one relates to the SMI jewelry catalogue and explains that most gold items are sold by weight at current gold market prices, that prices fluctuate daily with the market, and that the member should check with SMI's ordering department by phone to receive current market prices. The second flyer gives the member information on joining the Select Coupon Club by paying a membership fee of $19.95 and receiving coupons for use at the supermarket. The third flyer describes a program whereby the member can pay $14.95 postage and handling and receive a Hotel Express Membership Directory and membership discount at participating hotels and resorts. A customer cannot obtain an SMI credit card prior to payment of the $75 membership fee. A customer cannot obtain credit for purchasing products from SMI's catalogues prior to payment of the membership fee. The SMI catalogues, received after payment of the fee, are not available to the general public. The customer is not informed prior to paying the membership fee, either during telephone conversations with SMI account representatives or from the first two mailers, that the credit card which the customer would receive can only be used to purchase goods from the two SMI catalogues. Although prospective members are advised in the first and second mailers that Visa and MasterCard cards are available, they are not told how they can obtain such cards until after they have paid their fee. Until after payment of the fee, they are not told that they can obtain a secured, i.e., a fully collateralized bank card by depositing in that bank monies equivalent to the credit limit then extended to them by the bank. Customers are not told prior to the payment of their membership fee, either by SMI account representatives during telephone conversations or in the first or second mailers, that the obtaining of a secured Visa or MasterCard card from New Era Bank will also require the payment of a processing fee and will carry a minimum $500 deposit requirement. Until after payment of the fee, they are not told that the alternative is to charge and pay for $750 worth of merchandise from SMI's two catalogues (not including the amount paid as a down payment on each item purchased) which amounts to $850 worth of charged merchandise if the customer uses the $100 gift certificate, in exchange for SMI then giving the customer a letter saying the customer is a good credit risk, which the customer can then present in applying for credit elsewhere. No evidence was offered that any other organization considers SMI's letter of recommendation meaningful. Prior to the payment of the fee, the prospective member is not advised that the cash advances which he or she would become entitled to receive are limited to an amount of one-half of the total balance the member has paid on the member's SMI charge account balance. No member has received a cash advance from SMI. No members have obtained a Visa or MasterCard card by charging and then paying for $750 worth of products from SMI's catalogues. Other than those documents previously described, no other documents, contracts, or statements are provided by SMI to prospective members or members. SMI purchases the products found in its catalogues at the distributorship cost, a lower price than members pay for the products when they purchase from SMI. As of July 1, 1991, SMI had 12,567 members. By the time of the final hearing in this cause, SMI had over fifteen thousand members. Eighty-four members had purchased items from the SMI catalogues. Petitioner received a consumer complaint regarding SMI in February of 1990. On June 28, 1990, Petitioner served on SMI a subpoena requesting that SMI provide to Petitioner the following information: Name of surety bonding company, location of surety bond and copy of surety bond; location and account number of Florida escrow account, proof of account; copy of information statement and consumer contract. SMI was unable to respond to the subpoena by providing that information because it did not have those items. SMI did respond to the subpoena, however, by providing copies of its advertising and the materials used in its mailers and membership packages. SMI further obtained a bond pursuant to Petitioner's direction to do so. In a series of letters from SMI's attorney to Petitioner, SMI submitted revised advertising and revised informational documents requesting Petitioner's approval of the revisions to bring SMI in compliance with the Department's requirements. The Department failed to respond to SMI's requests. Rather, on March 21, 1991, the Department served on Jim Winders and Cecil Butler an Administrative Complaint for Entry of a Cease and Desist Order and Imposing Penalties, alleging that Jim Winders and Cecil Butler were operating as a credit service organization without fully complying with Chapter 817, Florida Statutes. Jim Winders and Cecil Butler timely requested a formal hearing, and this cause was transferred to the Division of Administrative Hearings. While this administrative proceeding was pending, on July 1, 1991, the activities of loan brokers became regulated, and responsibility therefor was assigned to the Department. On August 12, 1991, the Department filed its Amended Complaint for Entry of a Cease and Desist Order and Imposing Penalties which included the allegations in the original Administrative Complaint, named SMI as a Respondent for the first time, added allegations that the three Respondents were operating as loan brokers, and further added allegations that the three Respondents were operating as retail sellers.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered Finding Respondents SMI and Jim Winders guilty of the allegations contained in the Amended Complaint for Entry of a Cease and Desist Order and Imposing Penalties as described in this Recommended Order; Finding Respondent Cecil Butler not guilty of the allegations contained within the Amended Complaint for Entry of a Cease and Desist Order and Imposing Penalties; Ordering Respondent SMI to cease and desist from violations of the statutes regulating the operation of credit service organizations, loan brokers, and retail sellers; Ordering Respondent Jim Winders to cease and desist from violations of the statutes regulating the operation of credit services organizations and loan brokers; Imposing an administrative fine against Respondent SMI in the sum of $90,000 to be paid by a date certain; and Imposing an administrative fine against Respondent Jim Winders in the sum of $6,000 to be paid by a date certain. DONE and ENTERED this 12th day of March, 1992, at Tallahassee, Florida. LINDA M. RIGOT Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 SC 278-9675 Filed with the Clerk of the Division of Administrative Hearings this 12th day of March, 1992. APPENDIX TO RECOMMENDED ORDER The Department's proposed findings of fact numbered 1-30, 34-46, 56, 57, 59- 66, 71-83, 85-89, and 91 have been adopted either verbatim or in substance in this Recommended Order. The Department's proposed findings of fact numbered 31, 32, 95, and 96 have been rejected as not constituting findings of fact but rather as constituting argument of counsel, conclusions of law, or recitation of the testimony. The Department's proposed findings of fact numbered 33 and 97 have been rejected as being contrary to the evidence in this cause. The Department's proposed findings of fact numbered 84, 90, 92-94, and 111 have been rejected as being irrelevant to the issues under consideration in this cause. The Department's proposed findings of fact numbered 47-55, 58, and 67-70 have been rejected as being unnecessary to the issues involved herein. The Department's proposed findings of fact numbered 98-106 have been rejected as being subordinate to the issues herein. The Department's proposed findings of fact numbered 107-110 have been rejected as not being supported by any competent evidence in this cause. Respondents' proposed findings of fact numbered 1-3 have been adopted either verbatim or in substance in this Recommended Order. Respondents' proposed findings of fact numbered 4-11 have been rejected as not constituting findings of fact but rather as constituting argument of counsel, conclusions of law, or recitation of the testimony. Respondents' proposed findings of fact numbered 12-19 have been rejected as being subordinate to the issues herein. COPIES FURNISHED: Bridget L. Ryan, Esquire Richard Bisbee, Esquire Department of Banking and Finance Office of the Comptroller The Capitol, Suite 1302 Tallahassee, Florida 32399-0350 Jan Peter Weiss, Esquire Parkway Plaza-Suite 21 1280 South Powerline Road Pompano Beach, Florida 33069 Honorable Gerald Lewis Comptroller, State of Florida The Capitol, Plaza Level Tallahassee, Florida 32399-0350 William G. Reeves, General Counsel Department of Banking and Finance Room 1302, The Capitol Tallahassee, Florida 32399-0350
