Findings Of Fact Respondent Anglickis is a Florida real estate broker holding license number 0001869. Respondent American Heritage Realty, Inc., is a corporate real estate broker holding license number 0169476. The address of both respondents is 102 East Leland Heights Boulevard, Lehigh Acres, Florida. (P-26.) Respondent Anglickis is president of American Heritage Builders, Inc., respondent American Heritage Realty, Inc., and Lee County Mortgage and Title, Inc. All three companies are located at the same address. (Testimony of Campbell; P-5, P-26.) On March 12, 1979, Louis G. Hofstetter and his wife, Dale I. Hofstetter, both residents of North Carolina, entered into a real estate contract with American Heritage Builders, Inc. Respondent Anglickis signed on behalf of American Hertiage Inc. Under the terms of the contract, the Hofstetters were to Purchase a lot and home to be constructed thereon by American Heritage Builders, Inc. The purchase price included the transfer of a lot owned by the Hofstetters and a cash down payment. (Testimony of Hofstetter; P-1, P-3, P-26.) The contract estimated closing costs to be approximately $2,000". It also contained conflicting conditions relative to the time within which any mortgage financing must be obtained. . . . In the event PURCHASER'S application for mortgage financing is not approved within sixty (60) days from date hereof, all monies receipted for, less cost of credit report, will be returned to the PURCHASER and this contract will be null and void. * * * FOR MORTGAGE TRANSACTIONS: This contract of Purchase and Sale shall be void unless Purchaser's application for Mortgage has been approved by a bank or financial institution and Purchaser has executed the Mortgage Acceptance Form, within four (3) [sic] months from date of this Contract of Purchase. 2/ (P-1, R-1.) On March 12, 1979, the Hofstetters signed a mortgage loan application and submitted it to Lee County Mortgage and Title, Inc. (P-26.) On May 5, 1979, 45 days after accepting the application, Lee County Mortgage and Title, Inc., submitted the Hofstetters' mortgage loan application to First Federal of DeSoto. (Testimony of Archer.) On June 15, 1979 (95 days after receiving the loan application), Lee County Mortgage and Title, Inc., wrote the Hofstetters indicating that the local lender needed additional information on their stock holdings, and enclosing a document titled "Good Faith Estimate of Settlement Charges". This document estimated that closing costs would be $2,754--$754 more than the estimate contained in the real estate contract. (P-5.) On June 22, 1979, the Hofstetters protested the increased closing cost, requested clarification, and provided the requested information on their stock holdings. (Testimony of Hofstetter; P-26.) On July 7, 1979, the Hofstetters notified Lee County Mortgage and Title, Inc., that the increased closing cost deviated from the contract, that they therefore considered the contract cancelled and wanted the deposit refunded. (Testimony of Hofstetter; P-8.) On June 29, 1979, Robert Campbell, vice-president of Lee County Mortgage and Title, Inc., wrote the Hofstetters and explained the meaning of each component of the closing cost. (P-7.) On July 17, 1979, respondent, as president of American Heritage Builders, Inc., wrote a letter to the Hofstetters expressing his position: * * * Let me try and put the contract in the proper perspective for you. It's our contention that you have reluctantly provided to us the information that would enable us to make a proper and expedient application to the lending institution and that much of this information has been confused, causing further delays. In accordance with the contract, you were to make this application as quickly and as expediently as Possible so that the contract would not expire. However, this is not the case. Thus, my immediate Position is that the contract should be expired and all of the deposits, including the cash and the lot which we gave you $6,995.00 trade for, would be forfeited as agreed upon liquidated damages. He ended by outlining other alternatives and repeating his asserted right to cancel the transaction and retain the Hofstetters' deposit as liquidated damages * * * First, the lending institution must make a quick determination based on the facts that they have that you are either eligible or not eligible for a mortgage loan as outlined in our contract. If they still do not have enough information, we have no other choice then but to ask you to pay the increase which we have experienced at this time (price list enclosed), and in paying that increase we would be willing to take another 90 days to try and secure a loan for you. If your mortgage loan is denied, your deposit less the costs of processing your mortgage application will be returned to you. Of course, the third choice is the choice I hope we do not have to take, and that is cancelling this transaction and retaining your monies as agreed upon liquidated damages. (P-9.) Mr. Hofstetter responded on July 22, 1979. He denied that he was responsible for any delay or confusion in the Processing of their loan application; asserted that 93 days had elapsed from the submission of their loan application and Mr. Campbell's letter of June 15, 1979, asking for additional financial information; and informed respondent Anglickis that the contract had already expired by virtue of the clause allowing 60 days to obtain mortgage financing. He then, again, asked that his deposit be returned. (P-10.) On July 30, 1979, respondent Anglickis, as president of American Heritage Builders, Inc., wrote to the Hofstetters indicating that the loan had been approved 3/ and he was prepared to build their home at the contract price. He then addressed Mr. Hofstetter's July 22, 1979, denial of any responsibility for delay in obtaining the mortgage loan: I have reviewed your letter of July 22, 1979 and I understand we certainly have a difference of opinion as to whose fault the delay has been caused by. However, I don't think it's time to look at whose fault the delay might be, since it all has worked out to your satisfaction. The mortgage has been approved and we are ready to build. I expect you will now sign the mortgage papers when receipted for so that we may begin construction immediately. (P-11.) On August 6, 1979, the Hofstetters restated to respondent Anglickis that they were not prepared to go ahead with construction, that the contract became null and void by operation of the 60-day mortgage financing clause, and that the deposit should be immediately returned. (P-12.) On August 31, 1979, respondent Anglickis notified the Hofstetters that, pursuant to the contract conditions, he was retaining their full deposit, including cash and the real estate lot for which they received a $6,995 credit toward the purchase price. The full down payment totaled $10,350. (P-1, P-13.) On September 8, 1979, the Hofstetters replied: We cannot understand why you continue to ignore the provisions of the second sentence of Paragraph Two on the reverse side of Contract No. 1997, dated 12 March 1979. You say you intend to invoke the Provisions of the third sentence of this para- graph, but this sentence is Predicated on the assumption that the mortgage would be approved within sixty (60) days. The mortgage was not approved until late July (your letter of 17 July 1979 indicated it was not yet approved, and your letter of 30 July 1979 stated that it had now been approved), more than 120 days past the date of the original contract. Our Position is as Previously stated on several occasions: on 12 May 1979 the contract became null and void, and on that date our deposit should have been refunded. Any action other than this is illegal, according to the terms of the contract. We are due return of our down payment, plus interest, from 12 May 1979. (P-24.) On October 3, 1979, First Federal of DeSoto, which had continued to process the Hofstetter loan application, issued a commitment approving the requested loan. On October 10, 1979, the Hofstetters rejected the mortgage loan. (P-26.) Subsequently, the Hofstetters wrote letters to the Florida Department of Legal Affairs and the Lehigh Chamber of Commerce complaining of respondent Anglickis' retention of their deposit; they, then, retained an attorney and filed a civil action against respondents in the circuit court of Lee County. That action was settled out-of-court. There is no evidence whatsoever to support respondent Anglickis' assertion to the Hofstetters that they were dilatory or responsible for confusion or delay in obtaining the necessary mortgage financing.
Recommendation Based on the foregoing, it is RECOMMENDED: That the charges against respondent American Heritage Realty, Inc., be dismissed; That respondent Richard A. Anglickis be administratively fined $1,000. DONE and RECOMMENDED this 13th day of October, 1982, in Tallahassee, Leon County, Florida. R. L. CALEEN, Hearing Officer Division of Administrative Hearings The Oaklnd Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 13th day of October, 1982.
The Issue This is a license discipline proceeding in which the Petitioner seeks to have disciplinary action taken against two individual licensees and one corporate licensee on the basis of allegations of several violations of Sections 455.227 and 475.25, Florida Statutes, by each of the Respondents. Each of the three Respondents has been charged in an Administrative Complaint with violation of the following statutory provisions: Sections 455.227(l)(j), 475.25(l)(b), 475.25(l)(j), and 475.25(l)(k), Florida Statutes.
Findings Of Fact Stipulated facts2 Petitioner is a state government licensing and regulatory agency charged with the responsibility and duty to prosecute Administrative Complaints pursuant to the laws of the State of Florida, in particular Section 20.165, Florida Statutes, Chapters 120, 455, and 475, Florida Statutes, and the rules promulgated pursuant thereto. Respondent Robert Ian Law is and was at all times material hereto a licensed real estate broker pursuant to Chapter 475, Florida Statutes, having been issued license number 3000835. The last license issued was as a broker in care of Law Property Services, Inc., t/a Century 21 Law Realty, 190 Malabar Road Southwest 120, Melbourne, Florida 32907. Respondent Benjamin Schiff is and was at all times material hereto a licensed real estate broker pursuant to Chapter 475, Florida Statutes, having been issued license number 0449353. The last license issued was as a broker at 9771 Northwest 41st Street, Miami, Florida 33178. Respondent Florida Home Finders Realty, Inc., is and was at all times material hereto a licensed real estate brokerage corporation pursuant to Chapter 475, Florida Statutes, having been issued license number 1003632. The last license issued was at 1648 Southeast Port St. Lucie Boulevard, Port St. Lucie, Florida 34952. At all times material hereto, Selma Del Carmen Schevers, Cheryl Ann Atwood, Lynn Marie Lake, Barbara Kay Davidson, Carol Ann Chandler, and Beverly J. Klemzak were licensed and operating as qualifying brokers and officers of Respondent Florida Home Finders Realty, Inc. On or about April 18, 1995, the real estate brokerage corporate license (former license number 0027454) of Florida Home Finders, Inc., was voluntarily dropped by Florida Home Finders, Inc. Simultaneously, Florida Home Finders Realty, Inc., submitted documents for and received a real estate brokerage corporate license effective April 18, 1995, from the Florida Division of Real Estate. Benjamin Schiff and Ian R. Law are directors of both Florida Home Finders, Inc., and Florida Home Finders Realty, Inc. Benjamin Schiff is the Chief Financial Officer for both Florida Home Finders, Inc., and Florida Home Finders Realty, Inc. Ian R. Law is the Chief Executive Officer for both Florida Home Finders, Inc., and Florida Home Finders Realty, Inc. On or about May 5, 1995, Selma Schevers and Cheryl Atwood notified various banking institutions of the authorized officers/directors and account signatories for Florida Home Finders, Inc., and Florida Home Finders Realty, Inc. On or about June 14, 1995, at the request of Benjamin Schiff, Selma Schevers and Cheryl Atwood authorized various banking institutions to transfer $2,492,000.00 in security deposits and rental trust funds to an account entitled "Florida Home Finders, Inc.," account number 3603969464 at NationsBank of Florida. At no time material did the Respondents obtain the authorization or permission of the owners of the trust funds to transfer the funds. Subsequent to the transfer referenced in paragraph 10 herein, the funds were used to purchase a certificate of deposit (No. 012897). After the purchase of the certificate of deposit, Cheryl Atwood, at the request of Ian Law, signed a document which placed the certificate of deposit as collateral for a commercial loan (No. 018002410263) from loan officer F. Larry Robinette of County National Bank of South Florida. The terms of the loan were: $2,000,000 principal; Benjamin Schiff and Ian Law as borrowers; proceeds payable to Atlantic Gulf Communities, Corp., as partial payment for the stock of Florida Home Finders, Inc., and two related companies. On or about August 21, 1995, Respondent Law instructed Barnett Bank to transfer $65,000.00 from Florida Home Finders, Inc., Rental Receipts Account No. 2274002335 to Florida Home Finders, Inc., Operating Account No. 2274027149.3 After this transfer Respondent Law instructed the bank to transfer the $65,000.00 from the operating account to Atlantic Gulf Communities Corporation, the former owner of Florida Home Finders, Inc., a formerly licensed real estate brokerage company and predecessor to Respondent Florida Home Finders Realty, Inc. On or about June 14, 1995, the following bank funds transfers were requested to be made to Florida Home Finders, Inc., (FHFI) account No. 3603969464 at NationsBank of Florida from the following accounts: Barnett Bank Acct. Name Acct No. Date Amt. FHFI Rental Receipts Escrow Acct 1700027712 6/22 138,000 Rental Security Deposit Acct 1700027810 6/22 398,000 FHFI Rent Receipts Acct 3388072440 6/21 38,000 FHFI Security Deposit Acct 3388072558 6/21 158,000 FHFI Rent Receipts Escrow Acct 2274002335 6/15 179,000 FHFI Rental Security Escrow 2274002343 6/15 609,000 SunBank Acct Name Acct No. Date Amt. FHFI Escrow-Rental Receipts 0809000005795 6/16 87,000 FHFI Escrow-Rental Security 0809000005806 6/16 285,000 1st Union Nat. Bank Acct Name Acct No. Date Amt. FHFI Rental Receipts-Escrow Acct 2161006787374 6/14 152,000 FHFI Rental Security Escrow Acct 2161006724586 6/14 406,000 1st Bank Acct Name Acct No. Date Amt. FHFI Rental Receipts-Escrow Acct 20-116845-06 6/15 8,000 FHFI Rental Security Escrow 20-116888-06 6/15 34,000 Additional facts based on evidence at hearing Prior to April of 1995, Florida Home Finders, Inc., then a licensed real estate brokerage corporation, engaged in soliciting, obtaining, and leasing to tenants the real property of others, pursuant to contracts between Florida Home Finders, Inc., and the property owners. A substantial majority of the money, probably more than 75 percent of the money, contained in the security deposit accounts and rental receipts accounts that was transferred in mid-June of 1995 was money collected from tenants on behalf of property owners while Florida Home Finders, Inc., was a licensed real estate brokerage corporation.4 Subsequent to the transfers of funds in mid-June of 1995, there was on at least one occasion insufficient funds in some of the security deposit and rental receipts trust accounts to meet disbursement demands. On that occasion the bank paid a number of checks for which Florida Home Finders, Inc., did not have sufficient funds on deposit and requested that Florida Home Finders, Inc., make an immediate transfer of funds to cover the insufficiencies. Shortly thereafter a transfer was made to cover the insufficiencies. Subsequent to the transfers of funds in mid-June of 1995, on some occasions funds that had been collected from new clients after those transfers took place were paid out to meet the demands of clients who were owed money that had been paid to Florida Home Finders, Inc., prior to the mid-June transfers. At the end of March of 1995, Respondents Schiff and Law purchased Florida Home Finders, Inc., a real estate brokerage corporation licensed pursuant to Chapter 475, Florida Statutes, (license number 0027464) from Atlantic Gulf Communities Corporation. The purchase price was three and a half million dollars, with the Respondents to pay $500,000.00 down and the three million dollar balance within three months. One aspect of the business plan of the Respondent's Schiff and Law was to create a separate company to conduct real estate brokerage activities and to continue to engage in property management activities with the existing corporation, Florida Home Finders, Inc. Respondents Schiff and Law met with all managers and employees of Florida Home Finders, Inc., during the first week of April of 1995 to explain the business plan to them. At that time they also explained that they intended to utilize the provisions of Section 83.49(1), Florida Statutes, to hold security deposits in a manner which would allow them to pay interest to tenants. Respondents Schiff and Law were not involved in the day to day operations of either Florida Home Finders, Inc., or Florida Home Finders Realty, Inc. At the time the Respondents Schiff and Law purchased Florida Home Finders, Inc., the corporation maintained at least three types of accounts for deposits received from its operations: sales escrow accounts, rental receipts accounts, and security deposit accounts. Each of the seven offices of Florida Home Finders, Inc., maintained its own separate set of accounts. The sales escrow accounts maintained by Florida Home Finders, Inc., contained money derived from purchasing and leasing transactions. The rental receipts accounts maintained by Florida Home Finders, Inc., contained money received from tenants for the payment of rent. The use of these funds was governed by the property management agreements with the landlords. Typically, the funds in these accounts would be used to pay for such things as maintenance and repairs to the rental properties, mortgage payments due on the rental properties, and/or property management fees, with any excess funds being periodically paid to the respective landlords. The security deposit accounts maintained by Florida Home Finders, Inc., contained money received from tenants for security deposits to be held to guarantee the tenants' performance under their respective rental agreements. Shortly after the formation of Florida Home Finders Realty, Inc., and its licensure as a real estate brokerage corporation, the sales escrow accounts of Florida Home Finders, Inc., were transferred to Florida Home Finders Realty, Inc. There were no irregularities in any of the sales escrow accounts while they were under the control of either of these two corporations. Following the creation of Florida Home Finders Realty, Inc., Florida Home Finders, Inc., did not engage in any licensed real estate brokerage activities. All such activities were conducted by Florida Home Finders Realty, Inc., after it was licensed as a brokerage corporation. On or about June 27, 1995, Florida Home Finders, Inc., posted a security deposit bond in the amount of $250,000.00 with the Florida Secretary of State in an effort to comply with Section 83.49(1)(c), Florida Statutes. None of the landlords and none of the tenants were ever provided with notice that money had been transferred from the security deposit accounts and from the rental receipts accounts. None of the landlords and none of the tenants were ever provided with notice that Florida Home Finders, Inc., had posted a bond with the Florida Secretary of State and intended to rely on the provisions of Section 83.49(1)(c), Florida Statutes. Subsequent to the transfer of the $2,492,000.00 to the NationsBank account, the funds were used to purchase three separate certificates of deposit. One certificate of deposit in the amount of $242,000.00 was purchased from NationsBank and secured a loan of the same amount. The second certificate of deposit in the amount of two million dollars was purchased from County National Bank in Miami in the name of Florida Home Finders, Inc., and was used to secure a personal loan to Respondents Schiff and Law in the amount of two million dollars. The third certificate of deposit in the amount of $250,000.00 was purchased from NationsBank in the name of Florida Home Finders, Inc., and was used as security for the bond posted with the Florida Secretary of State. The loan proceeds secured by two of the certificates of deposit described above, plus $100,000.00 from the operating account of Florida Home Finders, Inc., at Barnett Bank, were used to pay Atlantic Gulf Communities Corporation against the balance of the purchase price of Florida Home Finders, Inc. Between the time of the mid-June transfer of funds from the accounts of Florida Home Finders, Inc., and the freezing of the assets of Florida Home Finders, Inc., in September of 1995, Florida Home Finders, Inc., was able to pay all current demands for funds from tenants and landlords. As of September 21, 1995, all funds transferred from the various security deposit and rental receipt accounts of Florida Home Finders, Inc., remained in accounts and financial instruments in the name of Florida Home Finders, Inc. However, $2,242,000.00 of those financial instruments in the name of Florida Home Finders, Inc., were pledged as security for personal loans of the Respondents Schiff and Law and were not available to Florida Home Finders, Inc., while those personal debts remained unpaid.
Recommendation For all of the foregoing reasons, it is RECOMMENDED that a Final Order be entered in these consolidated cases to the following effect: Dismissing all six of the counts of the Administrative Complaint which were voluntarily dismissed by the Petitioner; Dismissing Counts X and XIX (10 and 19) against the corporate Respondent Florida Home Finders Realty, Inc., on the basis of the insufficiency of the evidence; Concluding that the Respondent Law is guilty of violations of Sections 475.25(1)(b) and 475.25(1)(k), Florida Statutes, as charged in Counts VII and XVII (7 and 17); Concluding that the Respondent Schiff is guilty of violations of Sections 475.25(1)(b) and 475.25(1)(k), Florida Statutes, as charged in Counts VIII and XVIII (8 and 18); Imposing a penalty against the Respondent Law consisting of the revocation of his real estate broker license and an administrative fine in the amount of two thousand dollars; and Imposing a penalty against the Respondent Schiff consisting of the revocation of his real estate broker license and an administrative fine in the amount of two thousand dollars. DONE AND ENTERED this 22nd day of April, 1997, in Tallahassee, Leon County, Florida. MICHAEL M. PARRISH Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32301-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 22nd day of April, 1997.
Findings Of Fact At all times relevant hereto, James W. McKibbon was not licensed as a mortgage broker in Florida (Exhibit 1). MorBanc Financial Corporation was initially registered as a mortgage broker in Florida on February 27, 1989, and remained registered through June 15, 1990 (Exhibit 1). In August 1988, Respondent was employed by Sovereign Savings Bank to procure qualified home purchases needing mortgage money to be lent by Sovereign. MorBanc Financial Corporation was incorporated circa 1988 to become a mortgage brokerage firm. It opened a bank account and an office from funds contributed by its organizers. Respondent was offered shares in MorBanc and was elected president of the company. No evidence was submitted that Respondent was an investor in MorBanc. Thomas Pollak moved to Florida in 1988 and contracted to purchase a residence. The real estate agent with whom he was working recommended he seek a loan through MorBanc which was located in the same building with the real estate agent. Pollak assumed that MorBanc was a licensed mortgage broker in Florida. McKibbon's business card shows him as President of MorBanc Financial Corporation and lists FHA-VA-Conventional -- presumably loans that can be brokered by MorBanc. Respondent never told Pollak that he or MorBanc were mortgage brokers, and no applications for a mortgage loan completed by Pollak contained the name MorBanc. Instead, all of the application forms used were those used by Sovereign Savings Bank, and the loan application was submitted to Sovereign Savings Bank. The bank paid Respondent for procuring loans. MorBanc, prior to becoming registered as a mortgage broker, processed no loans from clients procured by Respondent McKibbon and paid McKibbon no commission or other compensation.
Recommendation It is recommended that the charges against James W. McKibbon that he acted as a mortgage broker without being licensed to do so in Florida be dismissed. ENTERED this 20th day of July, 1990, in Tallahassee, Florida. K. N. AYERS 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 20th day of July, 1990. APPENDIX Petitioner's Proposed Findings Not Accepted. 2. Respondent helped set up the furniture in the office that was provided by one of the financial founders of MorBanc. Not accurate to call Respondent "instrumental" in this task. Teresa Tyler was the real estate agent procuring the contract with Pollak. No evidence was submitted that she was Respondent's real estate salesperson. While Pollak testified that Respondent mentioned he (Respondent) could work with more than one lender, the only lender mentioned by Respondent was Sovereign, and the loan was processed through Sovereign. COPIES FURNISHED: Stephen M. Christian, Esquire Office of Comptroller 1313 Tampa Street, Suite 615 Tampa, FL 33602-3394 William G. Reeves General Counsel Department of Banking and Finance The Capitol Plaza Level, Room 1302 Tallahassee, Florida 32399-0350 James W. McKibbon 5770 Dartmouth Avenue St. Petersburg, FL 33710 Honorable Gerald Lewis Comptroller State of Florida The Capitol Tallahassee, FL 32399-0350 =================================================================
Findings Of Fact Respondent was issued Mortgage Broker License No. 3082 on September 3, 1974 by Petitioner. Respondent conducted certain transactions under its Mortgage Broker License during the period from September, 1973 until April, 1974. Respondent found client investors who had funds which they wished to invest in mortgages which would pay a greater return in interest than the average land mortgage. The transactions involved the purchase of a promissory note from a land development corporation secured by a mortgage deed on land ostensibly owned by the developer, in which the latter reserved the right and was authorized to convey the premises to a purchaser under an installment land contract subject to the lien of the mortgage. The deed further provided that the developer would deliver to a bank as an escrow agent a copy of any such agreement for deed and a quitclaim deed which would be held in escrow unless a default was established under the mortgage deed. What the investor would receive in such cases would be the developer's assignment of an agreement for deed collateralized by the mortgage deed. The issuance of these high interest notes were for the purpose of enabling the development company to make certain improvements on the land which they were obligated to do under sales contracts. In the transactions in question, Respondent dealt through Financial Resources Corporation of Ft. Lauderdale, Florida to which he remitted the investors funds, less an amount retained for fees or commissions. The land developer/borrower would then issue the note and mortgage in the face amount of the total investment made by the investor. The detailed procedure was that when an investor inquired concerning such mortgages, Respondent would determine from Financial Resources Corporation if any were available. It was the practice of Respondent's President then to look at the land development, determine if, in fact, the land was in development and had streets and the like, and to read pertinent documents concerning the development. He would then proceed to accept the full sum of the investment from the investor pursuant to an agreement by which the investor, in consideration of the stated sum, would authorize Respondent to use its best efforts to secure collateralized promissory notes at a minimum percentage of interest on the declining balance with principal and interest payable monthly if held to maturity. Respondent would then deposit the investor's check, usually on the same day as received, and then in several days send a notice to Financial Resources Corporation authorizing it to prepare and execute a self-amortizing monthly principal and interest promissory note with quitclaim deed in the amount of the investment, together with a check representing the proceeds of the Investment less the Respondent's fee or commission, and a sum for intangible tax on the transaction. Financial would thereafter return to Respondent a copy of the note and mortgage in exchange for the funds remitted. The recorded mortgages would be sent to Respondent within a month or so thereafter. Respondent had no agreements in writing with the land developer, nor with Financial Resources Corporation. Respondent claimed that its fees for services were set by Financial Resources Corporation which usually amounted to about 12 percent of the face amount of the investment, but which was sometimes more and frequently less than that authorized under the applicable statutes and regulations. Respondent did not maintain an escrow bank account and all funds received from investors were deposited into the corporate bank account of the firm. Respondent's agreements with investors set no specific term or period of time in which the secured promissory notes were to be obtained although its president would customarily tell investors that it would take some time for the transaction to be consummated, and that they could not expect to receive the recorded mortgages right away (testimony of Mr. Montague, Petitioner's Exhibits 2-10). Respondent discontinued transactions as described above in April, 1974 because he was dissatisfied with the business. He had been informed that certain lands under some of the mortgages had not been sold until after the mortgage had been executed and that this was in violation of State law. In the fall of that year, he received a memorandum from the State Comptroller on the subject of escrow accounts, dated October 11, 1974, which warned mortgage brokers in the state concerning the practice of remitting investors' funds to land developers in anticipation of receiving a recorded mortgage and note (testimony of Mr. Montague, Respondent's Exhibit 9). In 1975,a financial examiner from Petitioner's office was sent to the office of Respondent to examine his books and records. Pursuant to that examination, it was determined that Respondent had committed various violations of Chapter 494, F.S. on certain transactions. The following findings of fact are made with respect to the transactions in question: Allegation: That Respondent took and received deposits of money from Robert E. Creighton, Hazel R. Hardesty, J. Wilfred Caron, Rose A. Hoadley, Margaret A. Gregory and Willard A. Kotthaus, in the regular course of business, and failed to immediately place such said funds in an escrow or trust account as required by Section 494.05(1) , F.S. As heretofore stated, the Respondent did not maintain an escrow trust account with respect to any of the above-stated transactions. The above- mentioned individuals had authorized Respondent to disburse the funds immediately upon receipt (testimony of Mr. Montague, Supplemented by Exhibits 3- 8). Allegation: Respondent failed to maintain adequate records in violation of Section 494.06(3), F.S., in that its files contained no written agreements on transactions with Della W. Shaw, Lantana Sheet Metal and A.C. Inc., and another transaction with Lantana Sheet Metal. The agreement between Della Shaw and Respondent, although not present in Respondent's file at the time of examination of its records by Petitioner's representative, had been executed on October 15, 1975, and presently is contained in the records of the Respondent. It had been taken out temporarily by one of Respondent's associates who also had Della Shaw as a client. Respondent had entered into two transactions with the trustee of the pension fund and profit sharing plan of Lantana Sheet Metal, one for ten thousand dollars from the pension fund and one for three thousand dollars from the profit sharing plan. At the time of these investments there were written contracts which were executed by the parties. The books and records of both the pension fund and the profit sharing fund were maintained at Respondent's office by a firm which administered both plans. The agreements pertaining to the Lantana transactions were requested and withdrawn from Respondent's files by the trustee of the Lantana funds. Consequently, they did not appear in the records of the corporation at the time of examination by Petitioner's representative (Petitioner's Exhibits 2 and 4; Respondent's Exhibit 10). Allegation: Respondent failed on numerous loan purchase agreements to establish the term for which the agreement was to remain in force before the return of the deposit for nonper- formance could be required by the investor, in violation of Chapter 3-3.06, F.A.C. The transactions in question did not involve applications for mortgage loan, but agreements to purchase secured promissory notes. Respondent's clients were investors/purchasers, not borrowers (testimony of Mr. Montague; Petitioner's Exh. 2-10). Allegation: Respondent charged and accepted fees or commissions in excess of the maximum allowable in violation of Section 494.08(4), F.S., and Chapter 3-3.08(3) and (4), F.A.C., on trans- actions involving Rosa Eichelberger, overcharge of $10.90, Lantana Sheet Metal, overcharge of $62.60; Lantana Sheet Metal, overcharge of $10.91; Rose A. Hoadley, overcharge of $9.10; and Margaret A. Gregory, overcharge of $9.10.
The Issue The issue in this case is whether the Petitioner’s application for licensure as a mortgage broker should be approved.
Findings Of Fact Petitioner resides in Riverwoods, Illinois. He has four children, and is married to Sharon Wheat-Hester. Petitioner received his undergraduate degree from Wake Forest University in North Carolina. Petitioner also received a master’s degree and doctorate degree in theology from Share-A- Prayer and Word Theological School in Whitewater, Wisconsin. Petitioner is currently employed as the director of a ministry called Marketplace Movement Network. The ministry provides advice to businesses on Chritian business ethics. In that regard, Petitioner has published one book on the subject of Christian ethics in business. Petitioner is also the President and shareholder of Hester International, Inc., a Florida Corporation that since 1995, provides mortgage brokerage services in the State of Illinois and several other states. The corporation’s principal office is located in Illinois. The business has an established client list and referral list. Additionally, Petitioner is currently licensed as a mortgage broker in the Illinois, California, North Carolina and Hawaii. He has not had any disciplinary action taken against him in those states. On January 25, 1996, prior to the present license application at issue here, Petitioner sought licensure as a mortgage broker in Florida with the Florida Department of Banking and Finance, Respondent’s predecessor agency. On the 1996 application Petitioner answered “no” to a question that asked whether he had ever had a license revoked. Petitioner’s 1996 application was denied for a material misrepresentation or omission. Petitioner did not challenge the 1996 denial. On February 16, 2004, also prior to the present application, Petitioner again applied for a mortgage broker license. On this application, question number six asked: Have you had a license, or the equivalent, to practice any profession or occupation denied, revoked, suspended, or otherwise acted against which involved fraud, dishonest dealing, or any other act of moral turpitude? Yes No A “Yes” answer to question six required the applicant to attach details, provide a copy of allegations, and also supply documentation of the final disposition of the case. In response to question number six, Petitioner appeared to have marked both the answers “yes” and “no”, but then circled “yes.” On the second page of the application, Petitioner explained his answer to question number six, stating that he had had a real estate license ten years ago and that he had been involved with a dispute for $2,500 and lost the case. The explanation further stated that Petitioner was moving to Illinois at the time, so he voluntarily surrendered his license. On April 1, 2004, without investigating the facts to refresh his memory, Petitioner provided the requested signed letter of explanation. Subsequently, he withdrew his February application because he did not have time to deal with the ongoing questions the agency had regarding his application. Around July 13, 2004, after discussing the February 2004 application with Respondent, Petitioner submitted a revised Application for Licensure as a Mortgage Broker in the State of Florida. In response to question six, Petitioner marked “no” based on his memory that his real estate agent’s license had been “voluntarily surrendered.” Petitioner also submitted character reference letters. Additionally, Petitioner discussed with Respondent any proof of rehabilitation since the “voluntary surrender” of his real estate license. On page two of the July application, Petitioner wrote that his “only blemish” was a voluntary surrender of a real estate license in 1992. Petitioner stated, “[t]his was ‘not’ an act of moral turpitude or fraud.” In a deficiency letter dated July 28, 2004, the Office requested additional information from the Petitioner, including a signed statement explaining his side of the occurrence. On September 30, 2004, the Office received the same statement the Petitioner had previously forwarded to the Office for his February 2004 application. Petitioner again did not avail himself of the opportunity to discover the true facts surrounding the claimed surrender of his license. In the second paragraph of this explanatory letter Petitioner stated that the disciplinary action that led to surrender of his real estate license arose out of a transaction involving one of his customers who rented property to a third- party renter. Petitioner stated that the rental transaction between his customer and the third-party renter occurred in the lobby of Petitioner’s office without his knowledge or help. According to Petitioner’s, somewhat confusing, explanatory letter, the customer did not have the right to rent the house, but collected $2,500 from the renter and then left the state. Later, Petitioner discovered that the customer had closed in escrow and gained temporary occupancy of the home, thereby enabling the customer to ostensibly rent the home. Petitioner further explained that the renter sued him for the $2,500 and prevailed because the transaction took place in Petitioner’s lobby. Petitioner stated he lost the case because his attorney, Scott Hester (also his brother), was unavailable to make the closing argument and Petitioner had to do his own summation. In fact, Petitioner’s brother never represented Petitioner in the renter’s case because he did not have time to undertake the case. Petitioner did not supply the names of the people referenced in the letter because he did not remember them. As will be seen, at the time of the explanatory letter, Petitioner’s memory of the facts surrounding his license surrender is, at best, faulty. On April 19, 2005, the Office issued its Denial Letter, denying Petitioner’s application for licensure as a mortgage broker. As grounds for denial under Section 494.041(2)(c), (g), (i) and (q), Florida Statutes, the letter stated in relevant part: The Office’s background investigation and information you provided revealed the following: You answered Question #6 on your application as “no”, when it asks if you have had a license, or the equivalent, to practice any profession or occupation denied, revoked, suspended, or otherwise acted against which involved fraud, dishonest dealing, or any other act of moral turpitude. On or about May 7, 1996, the Florida Department of Banking and Finance, Division of Finance, denied your application for a license as a mortgage broker for making a material misstatement of fact on their application. On or about December 8, 1992, after the State of Florida, Department of Professional Regulation, Division of Real Estate conducted an investigation, you surrendered your license with that agency and entered into a written agreement stating that you agreed to have your license revoked. Accordingly, the Real Estate Commission did revoke your license in their meeting of January 19, 1993 effective December 8, 1992. The Investigative Report attached to the Final Order to revoke reveals that you were sued for dishonest conduct and subsequently, on March 25, 1992, ordered to pay Johannes Fruhwirt $7,800 plus post- judgment interest. This order was by the County Court of Broward County as a result of a Final Judgment, Case #9103333 CC53 and a Writ of Execution. The investigation revealed that Hester left the State of Florida without leaving word of his whereabouts. Apparently, that judgment was never satisfied. On May 14, 1991 you promised to pay $3000 to Leonard Schoenfeld when closing occurred on a home Mr. Schoenfeld was purchasing. Closing occurred shortly afterward, and you have never made that payment. On or about July 17, 1995, the State of Illinois received an Application Form to Operate as a Residential Mortgage Licensee in the name of Hester International, Inc. on which you were listed as 50% owner. You signed the “Verification” portion of that form and your signature was notarized on June 20, 1995 indicating that you verified as being true all data entered onto that form. However, you responded “N/A” to Part III, Question #10 which asks that you list all licenses which you or your firm have applied for and been denied and/or any and all licenses issued to you or your firm which were subsequently suspended or revoked. You therefore failed to disclose the revocation of your license with the Florida Division of Real Estate that occurred in 1992. On the same application filed with the State of Illinois, in response to Part III, question 19(m), you did not disclose that a judgment had been entered against you on grounds of fraud, misrepresentation, or deceit. The renewal for Hester International Inc., with the State of Illinois, states under the section labeled, “Averment of License” in item “s” that the licensee will advise the Commissioner in writing of any changes to the information submitted on the most recent application for license within 30 days of said change. The State of Illinois reports that you never disclosed the denial of a mortgage broker license in 1996 with the State of Florida . (i) On November 18, 2004 in an electronic filing for corporation reinstatement for Hester International, Inc., you certified that as Registered Agent you maintained an office at 6278 N. Federal Highway, Suite #305 in Ft. Lauderdale, Florida. In fact, that address is a mail drop leased to one Carl Thames, CPA. The signage required by Section 48.091(2), Florida Statutes, does not appear, and you and Hester International, Inc. are unknown at this location. In pre-hearing interrogatories, the Office asked Petitioner to provide more information about the transaction involving the transaction that had led to the revocation of his real estate license, including the identity of those individuals. Even though the importance of accuracy was apparent since Petitioner was now in litigation, Petitioner, again, without investigating the facts and relying solely on his improving memory answered the interrogatories posed to him. In his answers, Petitioner identified the “customer” who had collected the money as Leonard Schoenfeld and the “renter” as Johannes Fruhwirt. Petitioner went on, in his answers, to describe the transaction with Mr. Schoenfeld and Mr. Fruhwirt. This description is similar to the explanation offered in the explanatory letters supplied for his earlier applications. In his response to Requests for Admissions, Petitioner denied that in May of 1991 he acted as a real estate broker in the auction of a home located at 14884 Equestrian Way in Wellington, Palm Beach County, Florida, and that he had been unable to deliver a mortgage at an agreed interest rate. Petitioner also denied that he had agreed to pay $3,000 for closing costs as deferred interest payments. Despite these denials, Petitioner admitted that he had signed an agreement to pay $3,000 to Mr. Schoenfeld. Petitioner explained these denials by claiming that these funds were never due because the agreement to pay $3,000 was contingent on closing. Since the real estate deal never closed, the $3,000 was never due. At his July 15, 2005, deposition, Petitioner essentially reaffirmed the inaccurate account of events in his interrogatory answers. At the deposition, Petitioner was asked to review documents related to the Schoenfeld transaction. Those documents included: (1) a copy of the May 14, 1991, agreement wherein he agreed to pay Mr. Schoenfeld $3,000, (2) a handwritten letter wherein he agreed to pay Mr. Schoenfeld the money that he owed him, and (3) a warranty deed on property purchased by Mr. Schoenfeld. When he was shown the May 14, 1991, agreement, Respondent testified that he did not know why he would have agreed to pay Mr. Schoenfeld $3,000. Even when he was shown the deed on the property and even though he had notarized the signatures on that deed, Petitioner maintained that the deal never closed and he never owed the $3000. At hearing, Petitioner’s various and growing explanations during discovery significantly differ from his testimony. Petitioner testified that throughout his various explanations he had confused and combined several individuals into one transaction. Even though he knew that the true facts of these transactions were important to consideration of his application and in answering discovery in this case, Petitioner did not make any real attempt to refresh his memory of these transactions until shortly before the hearing. In fact, the Schoenfeld and Fruhwirt transactions involved different real estate deals and had nothing to do with each other. The Schoenfeld transaction occurred in 1991 and involved the sale of real property located at 14884 Equestrian Way in Wellington, Florida. Mr. Schoenfeld was Petitioner’s customer. As part of the transaction, Petitioner guaranteed he could get a mortgage at a certain rate. After failing to get Mr. Schoenfeld a mortgage at a certain rate, Petitioner agreed to pay Mr. Schoenfeld $3,000 upon closing. When Petitioner failed to pay Mr. Schoenfeld the $3,000 on closing, he asked Mr. Schoenfeld if he could make payments of $200 a month. In a letter to Mr.Schoenfeld, Petitioner confirmed that he would pay Mr. Schoenfeld the amount that was owed. Petitioner made two payments and then stopped making payments. In a letter dated July 1, 1991, Mr. Schoenfeld complained about his dealings with Petitioner to the Division of Real Estate. A few days before Mr. Schoenfeld’s deposition on July 25, 2005, Petitioner paid Mr. Schoenfeld $2,600. Mr. Schoenfeld accepted the payment since the money was still owed to him. However, the payment had been delayed for 14 years and did not include interest for those years. Petitioner testified that he made the payment because, once he remembered the details of the transaction, he felt morally obligated to pay Mr. Schoenfeld what he had promised. However, fulfillment of this obligation also occurred with this litigation pending and after denials that any money was due Mr. Schoenfeld. In short, Petitioner did not pay Mr. Schoenfeld the money that was due him for 14 years until Petitioner was forced to acknowledge the true facts of the Schoenfeld transaction in this litigation. The Fruhwirt transaction involved a man named Mark Ritter who was a client of Petitioner. Mr. Fruhwirt met with Mark Ritter at a house he wanted to rent. Eventually, Mr. Ritter sent him to Petitioner to complete a lease agreement. Mr. Ritter did not know about leases and said Petitioner was a friend whose real estate office could set up the lease contract. Mr. Fruhwirt met Petitioner at his real estate office. Since it was lunchtime, they went to a nearby Burger King to finalize the lease. While at Burger King, Mr. Fruhwirt paid Petitioner $2,850 on the lease. Petitioner’s testified that he did not receive any money from Mr. Fruhwirt and did not accompany Mr. Fruhwirt to Burger King. Petitioner testified that Mr. Ritter and Mr. Fruhwirt met in his lobby and both went to Burger King to finalize the lease arrangement. However, given Petitioner’s past faulty memory, Petitioner’s testimony is not credible. At some point, Mr. Fruhwirt moved into the house. Subsequently, Mr. Fruhwirt received a letter from an attorney representing the real owner demanding that he vacate the premises. Mr. Fruhwirt then discovered that Mr. Ritter was not the owner and had to hire an attorney to sort out his continued occupancy of the property. Eventually Mr. Fruwhirt bought this property. Mr. Fruhwirt sued Petitioner and the real estate office for the recovery of the $2,850 he had paid to rent the house. Petitioner was found liable, but the real estate office was found not liable because the transaction happened off its premises at Burger King. On March 25, 1992, the Broward County Court entered a judgment of $7,800 against Petitioner, finding that Petitioner had “breached his duty to disclose that Mark Ritter was not the owner of the involved property.” After Mr. Fruhwirt obtained the judgment, Petitioner declared bankruptcy. Mr. Fruhwirt pursued an adversary action in Petitioner’s bankruptcy proceedings. Subsequently, the Bankruptcy Court cited “11 U.S.C. 523 A(2) and 11 U.S.C. 523 A(4)” and refused to discharge the judgment debt. The Bankruptcy Court’s Order refusing to discharge the debt clearly conflicts with Dr. Hester’s repeated implications and statements that this debt was discharged in bankruptcy. Unable to collect from Petitioner, Mr. Fruhwirt filed with the Florida Real Estate Recovery Fund. The fund paid $2,850 to Mr. Fruhwirt and suspended Petitioner’s license. Mr. Fruhwirt used the money to defray some of his legal expenses. To date, Petitioner has not paid Mr. Fruhwirt any money on the judgment. The Fruwhirt transaction led to the revocation of Petitioner’s real estate license and, on January 19, 1993, the Florida Real Estate Commission entered a final order revoking Petitioner’s real estate license. Despite Petitioner’s testimony that he never received a copy of the documents, the certificate of service for the final order indicates it was sent to Petitioner at 1101 Hidden Cove, Salem, SC 29676, which was the address where Petitioner was living at that time. Again, Petitioner’s testimony is not credible. The Final Order referenced a December 8, 1992, agreement in which Petitioner agreed that his license would be revoked. In the December 8, 1992 agreement, entitled “Affidavit for the Voluntary Surrender of License, Registration, Certificate/Permit for Revocation,” signed by Petitioner, he agreed to the revocation of his license and to not apply for a new real estate license for ten years from the effective date of revocation. In particular, the December 8, 1992 agreement stated, “[t]he effective date of the revocation shall be upon signing this document.” Notwithstanding the clear language revoking the license, at the hearing, Petitioner maintained that because he had voluntarily surrendered his license, he did not believe his license had been revoked. In referring to the agreement he had signed, he testified that the agreement said, “that my license will be inactive, not revoked” and denied ever seeing the other documents revoking his license. This testimony is simply not credible and demonstrates Petitioner’s propensity to see or remember things in a way that is more flattering to him, irrespective of reality. The affidavit signed by Petitioner clearly stated that Petitioner’s license would be and was revoked upon signing. In 1995, Hester International applied to operate as a residential mortgage licensee in Illinois. The application identified Petitioner as the vice president and Sharon Hester as the president. Page one of the application indicated the application had to be executed “by two officers or all directors if the applicant/licensee is a corporation.” The application was signed by Petitioner and his wife. Petitioner did not disclose to Illinois that a judgment had been entered against him in Florida or that his real estate license had been revoked or suspended. Question 10 in Part III of the Application asked: “LIST ALL LICENSES WHICH YOU OR YOUR FIRM HAVE APPLIED FOR AND BEEN DENIED AND/OR ANY AND ALL LICENSES ISSUED TO YOU OR YOUR FIRM WHICH WERE SUBSEQUENTLY SUSPENDED OR REVOKED.” Petitioner responded “N/A.” (Id.). Question 19(m) in Part III of the Application asked: UNDER PENALTY OF PERJURY, I(WE) STATE THAT ALL OF THE FOREGOING IS TRUE AND CORRECT TO THE BEST OF MY (OUR) KNOWLEDGE AND FURTHER STATE THAT AS THE APPLICANT/LICENSEE: . . . (m) Has not committed a crime against the law of this State, any other state or the United States, involving moral turpitude, fraudulent or dishonest dealing, and that no final judgment has been entered against it in a civil action upon grounds of fraud, misrepresentation or deceit which has not previously been reported to the Commissioner. The evidence did not demonstrate that the emphasized clauses in question 10 or the “I(WE)” in 19(m) direct such questions to individuals signing the application. One reasonable interpretation of the language is that the questions are directed to the business entity applying for the license. In short, the I(WE) language is simply language in a form meant to cover multiple types of business entities ranging from sale proprietorships to corporations. Therefore, Petitioner was not required by Illinois to disclose matters which involved him personally. To date, Illinois has not filed any disciplinary action against Petitioner or Hester International. Thus, the failure to disclose personal judgments or license actions to Illinois in a corporate application for licensure does not support a finding of dishonesty or denial of Respondent’s application at issue here. At some point, Hester International’s corporate status had to be reinstated in Florida. Petitioner reinstated the company’s corporate status in November of 2004. Petitioner filed as registered agent at 6278 North Federal Highway #305, Fort Lauderdale, Florida. Petitioner had not lived at this address for some 15 years, but had lived there for seven years with his girlfriend. The evidence showed that Petitioner simply forgot to change the registered agent’s address and was not acting dishonestly. Once he discovered his mistake, Petitioner amended his filing to reflect the appropriate address. Again, these facts do not form a basis to deny Petitioner’s license application. Finally, Petitioner testified that until Spring 2005, he and his wife were 50/50 owners of Hester International, Inc., as reflected on the application and license renewals in Illinois. In September 2004, Ms. Hester submitted Hester International, Inc.’s application for Florida licensure as a mortgage broker business. The Hester International business application was submitted after the Office had denied Petitioner’s license application in 1996 and was scrutinizing his July 2004 application. In the application, Ms. Hester identified herself as 100 percent owner of the Hester International. Petitioner did review this application, but he intentionally did not take part in its filing. The purported change in ownership was not adequately explained at hearing and appears to have been done in order to forestall any problems with licensure of the corporation due to Petitioner’s participation in the corporation. While the change of ownership is troubling, given Petitioner’s history, and also adds to the evidence that Petitioner is less than forthright in his memory and past business dealings, the change of ownership for the corporation’s licensure application does not, by itself, support a denial of Petitioner’s application. On the other hand, too many inconsistencies exist between Petitioner’s hearing testimony and his earlier accounts to conclude that Respondent can be trusted to hold a mortgage brokerage license. At worst, the evidence shows that Petitioner is not truthful or acts with integrity. At best, the evidence shows that Respondent has the ability to convince himself of facts that do not quite fit the truth, but are more flattering to him. Under either scenario, Petitioner’s appreciation of honesty, truthfulness and integrity are suspect. Neither Petitioner’s letters supporting his good character, nor his success in his ministry demonstrates sufficient rehabilitation to overcome what appears to be long-time evasive behavior. Therefore, Petitioner’s application for licensure as a mortgage broker should be denied.
Recommendation Based upon the Findings of Fact and Conclusions of Law, it is RECOMMENDED: A Final Order be entered denying Petitioner’s application for licensure as a mortgage broker. DONE AND ENTERED this 4th day of November, 2005, 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 4th day of November, 2005. COPIES FURNISHED: C. Scott Hester, Esquire 13843 Longs Landing Road East Jacksonville, Florida 32225 Robert H. Schott, Esquire Gregg Morton, Esquire Department of Financial Services 200 East Gaines Street Fletcher Building, Suite 526 Tallahassee, Florida 32399-0376 Carlos G. Muniz, General Counsel Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0307 Honorable Tom Gallagher Chief Financial Officer Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300
The Issue The issue presented is whether Petitioner achieved a passing grade on the September 28, 1993, mortgage broker examination.
Findings Of Fact On September 28, 1993, Petitioner took the mortgage broker examination. To pass the examination, a candidate must receive a minimum score of 75. Petitioner was advised that she had achieved a score of only 74. Petitioner was afforded an opportunity to review the examination questions and her answers thereto, and she did so on October 15, 1993. She questioned her failure to receive credit for ten of her answers on that examination and provided written explanation for why she believed her answers to those questions were correct. Petitioner's written challenges and explanations regarding her answers to those ten questions were reviewed by a subject matter expert and by a psychometrician employed by National Assessment Institute, the company responsible for creating and administering the Florida mortgage broker examination. Both experts determined that Petitioner's answers to those ten questions were incorrect and that her explanations therefor were without merit. Petitioner was advised that she was entitled to no extra credit for her answers on that examination, and this proceeding ensued. At the final hearing in this cause, Petitioner admitted and agreed that the answers which she had chosen for questions numbered 2, 20, and 23 of the examination were incorrect. Petitioner, accordingly, withdrew her challenge to the grading of her answers to those three questions and proceeded forward regarding her answers to seven questions only. Petitioner chose answer "D" to question numbered one. The correct answer was "A". Petitioner was not able to correctly answer that question because she was unfamiliar with a term used in the question. That term is found in the "Fannie Mae" guidelines. Petitioner's answer is not correct. Petitioner chose answer "A" to question numbered 19, but the correct answer is "C". Petitioner's suggestion that both answers are correct is not persuasive. Petitioner chose only part of the correct answer, and multiple choice "C" contained all of the information necessary for a correct answer. Partial credit is not given for partial answers on the mortgage broker examination; rather, to receive credit for an answer, a candidate must choose the answer which completely responds to the question. Since Petitioner's chosen answer was an incomplete answer, her answer was not correct. Petitioner thought that "C" was the correct answer to question numbered 33, but only answer "A" was correct. That basic question regarding title insurance and the correct answer were taken from the Handbook of the Florida Association of Mortgage Brokers, one of the required reference materials. Petitioner chose answer "D" for question numbered 35, but only answer "C" was correct. As with question numbered 33, Petitioner based her answer on her experience as a real estate broker in New York. The question and answer, however, can be found in the "Fannie Mae" guidelines. As her answer to question numbered 36, Petitioner chose answer "A". However, the only correct answer was answer "C". Petitioner's answer involved a different type of insurance than the kind involved in the question. Petitioner believed that choice "B" was the correct answer to question numbered 59. However, the correct answer was choice "D". The question tested Petitioner's understanding of the definitions found in Chapter 494, Florida Statutes. Petitioner's choice of a more generic term was incorrect. As her answer to question numbered 98, Petitioner chose "C", but only "B" was a correct answer. This question used the same term found in question numbered one. Since Petitioner did not understand that term, which is found in the "Fannie Mae" guidelines, she did not know the correct answer to either question numbered one or question numbered 98. Petitioner is not entitled to extra credit for her answers to any of the questions challenged in this proceeding. Petitioner failed to achieve a passing grade on the September 28, 1993, mortgage broker examination.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered finding that Petitioner failed to achieve a passing score on the September 28, 1993, mortgage broker examination and denying Petitioner's application for licensure as a mortgage broker. DONE and ENTERED this 31st day of March, 1995, 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 Filed with the Clerk of the Division of Administrative Hearings this 31st day of March, 1995. APPENDIX TO RECOMMENDED ORDER Petitioner's proposed findings of fact numbered 1-4a have been rejected as not constituting findings of fact but rather as constituting argument. Respondent's proposed findings of fact numbered 9, 11, 16, 17, 20, 23, 26, 29, 32, 35, 38, and 39 have been adopted either verbatim or in substance in this Recommended Order. Respondent's proposed findings of fact numbered 6, 8, 10, 12-15, 18, 19, 21, 22, 24, 25, 27, 28, 30, 31, 33, 34, 36, 37, 40, and 41 have been rejected as being subordinate to the issues herein. Respondent's proposed finding of fact numbered 7 has been rejected as not constituting a finding of fact but rather as constituting a conclusion of law. COPIES FURNISHED: Helena Weisfeld Chirico c/o Robert Weisfeld 2739 Parkview Drive Hallandale, Florida 33009 Helena Weisfeld Chirico Post Office Box 800 Hunter, New York 12442 John D. O'Neill, Esquire Assistant General Counsel The Comptroller's Office 111 Georgia Avenue, Suite 211 West Palm Beach, Florida 33401 Honorable Robert F. Milligan Comptroller, State of Florida The Capitol, Plaza Level Tallahassee, Florida 32399-0350 Harry Hooper, General Counsel Department of Banking and Finance Room 1302, The Capitol Tallahassee, Florida 32399-0350
Findings Of Fact 1. On January 8, 1975, the United States District Court, District of Delaware, entered a "judgment and probation/commitment order," finding petitioner guilty of violating Title 18, United States Code, Sections 1010 and 371. These charges involved, inter alia, making, passing, uttering and publishing false statements and forged instruments in connection with the obtaining of mortgage insurance under the provisions of the National Housing Act. Petitioner was fined $2,500.00 and sentenced to serve three years imprisonment, the remainder to be suspended after six months and petitioner to be placed on probation for the remaining thirty months. On or about July 9, 1976, petitioner applied to respondent for registration as a mortgage solicitor. For the reason that petitioner was found guilty as described in paragraph one above, respondent determined that petitioner did not meet the proper qualifications to be licensed and issued its notice of intent to deny said license. In his answer and request for a hearing, petitioner admitted the material factual allegations of the complaint. Petitioner did not appear and therefore offered no evidence in his own behalf.
Recommendation Based upon the findings of fact and conclusions of law recited above, it is recommended that petitioner's application for registration as a mortgage solicitor be DENIED. DONE AND ORDERED in Tallahassee, Leon County, Florida, this 13th day of April, 1977. DIANE D. TREMOR Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 13th day of April, 1977 COPIES FURNISHED: Mr. David L. Pierce 891 West Tropical Way Plantation, Florida 33317 Richard E. Gentry, Esquire Assistant General Counsel Office of the Comptroller The Capitol Tallahassee, Florida 32304 Joseph M. Ehrlich Deputy Director Division of Finance Department of Banking and Finance 335 Carlton Building Tallahassee, Florida 32304 Comptroller Gerald A. Lewis The Capitol Tallahassee, Florida 32304
