The Issue Has Petitioner, Unlimited Financial Services, LLC (Unlimited), conducted the unlicensed business of insurance in violation of section 626.112(7), Florida Statutes (2011)?1/ Has Unlimited engaged in an unfair or deceptive act or practice, false advertising, as prohibited by section 626.9541(1)(b)?
Findings Of Fact The Department is a state agency charged with administering chapters 624 and 626, Florida Statutes, governing the business of insurance. Unlimited is not a licensed Florida insurance agency. Matthew Dilday, its owner, is not a licensed Florida insurance agent. In the pre-hearing stipulation, Unlimited described itself as "an advertiser who obtains qualified leads for licensed Florida insurance agents." In its advertising materials directed at insurance agents, Unlimited describes itself as "the Nation's most sought after company for advisors in need of new marketing strategies" and "the Nation's No. 1 Annuity Leads and Preset Appointment Program." Unlimited promotes itself on its website as "No. 1 Annuity Lead Provider." Beneath that heading, Unlimited represents: When we talk with our annuity and investment lead prospects, our professionally trained call center staff is adamant about confirming that they have investment assets. When you purchase preset investment or annuity appointments from UFS Marketing [Unlimited], you also receive access to our highly recommended training programs that explain to you the best way to convert leads and appointments into sales. Unlimited's materials say: We provide annuity leads to financial professionals who sell deferred annuities, many who work for insurance companies. We also provide pre-qualified annuity leads programs to independent agents of the insurance companies who collect a commission from the insurance company when they sell an annuity. This commission is usually a a [sic] percentage of the total premium paid by the annuity investor. Unlimited's services facilitate contact between an agent and a potential client in several ways. According to the promotional materials, Unlimited's "Annuity Leads and Preset Appointment Programs are essential to insurance agents and financial advisors." Again, according to the materials, Unlimited sets "thousands of qualified appointments every month for agents nationwide." The program saves agents valuable time in prospecting for qualified prospective customers. Unlimited enters into marketing services agreements with Florida insurance agents and agencies designed to facilitate the marketing of life insurance products to Florida consumers. Unlimited is in the advertising and marketing business and operates a telemarketing call center. Although Mr. Dilday repeatedly testified that Unlimited was simply a "printing company," it is not. It is a direct mail and telemarketing marketing organization focused on developing customer leads for insurance agents.2/ In 2011, Unlimited entered into a contract with Florida Insurance Agent Andy Heygate titled, "Marketing Services Agreement" (Agreement). The "General Purpose" paragraph of the Agreement states: This Agreement will establish a business relationship among and between the aforementioned parties whereby UFS Marketing will supply fulfillment services on behalf of the Customer [Agent Heygate]. Marketing materials will be mailed to the general public on behalf of the Customer in accordance with the instructions received from the Customer and calls will be taken from the general public on behalf of the Customer in accordance with the Customer's instructions. The Agreement details marketing services and the parties' responsibilities. Among other things, it provides: Unlimited will send a mass mailing developed by the customer targeted at individuals who meet a demographic profile selected by the customer. The profile for the Agreement targeted homeowners aged 58-75 who had an annual income of over $30,000 and a home worth $150,000 or more. Unlimited will make a telephone bank available to accept responses from consumers following a script developed by the customer to screen the responses to make appointments or develop leads. Unlimited will make leads available and/or set appointments with consumers resulting from the inquiries generated from the marketing materials. The Agreement defines "Lead" as "a consumer who contacts an UFS Marketing representative in response to the Customer's marketing materials and agrees to be contacted by the Customer." The Agreement defines "Appointment" as "a consumer who contacts UFS Marketing in response to the Customer's marketing materials and schedules an appointment with the Customer for the purpose of discussing the Customer's products or services and is defined by [enumerated criteria]." The criteria include that the consumer has indicated "they are receiving regular statements for an investment or retirement plan," and the consumer has "indicated they will have their statements available at the time of the review." The Agreement requires the agent to pay Unlimited a fee. The "[f]ees are based upon the number of marketing pieces sent and resources required to take inbound calls, schedule appointments and develop leads on behalf of the [agent]." The fees are for the full range of services provided for in the Agreement, not just printing and mailing the postcards. The marketing materials and mass mailing the Agreement refers to are a postcard, which is an exhibit to the Agreement. The front address side of the postcard in very small print reads: Privacy Law Notice: This notice is provided in accordance with Federal Privacy Laws. The Policy of this agency is to protect the privacy rights of all consumers who respond to this notice. This agency DOES NOT POSSESS OR DISCLOSE NON-PUBLIC PERSONAL INFORMATION TO THIRD PARTIES IN ANY INSTANCE. If you choose to have an existing policy or contract reviewed by a licensed agent, that agent is also required to adhere to the state and federal consumer and privacy protection laws. Important information: This notice is being sent to you as a possible holder of an in-force annuity contract. This agency does not have a direct affiliation with the insurance carrier through which you are currently contracted. The agency is contracted with agents licensed to conduct insurance business in your state. This notice should be disregarded if you do not currently have an in-force annuity contract. The word "agency" evokes the concept of a government or insurance agency. Unlimited is not an agency. The description of Unlimited as an agency is false. The back side of the postcard in larger print states: This communication is to inform you that you may have an annuity that has reached the end of its surrender period. The end of a surrender period is a positive event that means an owner may cash in an annuity or make withdrawals without incurring a surrender charge. A surrender charges is a fee levied by an insurance company on an annuity contract for withdrawals before the end of the time set by the contract (the surrender period). Please contact the Annuity Department to discuss your options. (877) 836-2333 The first sentence on the back side of the postcard creates the impression that the sender has some knowledge of the financial circumstances and holdings of the addressee. The statement in the text box is an accurate statement. The overall import of the postcard, including the "Privacy Law Notice," the reference to Unlimited as an "agency," and references to the recipient having an annuity, create the impression that the sender has financial information about the recipient and some formal relationship with the recipient. This is so despite the disclaimers "may have" and "possible holder." It is also so despite the sentence stating the "agency" does not have a "direct" affiliation with the recipient's insurance carrier. Use of "direct" necessarily implies a relationship of some sort. The script is also an exhibit to the Agreement. The script calls for the operator to tell the caller: [I]f you've held an annuity for some time and you're due for a quick service review. This review will cover important contract features and make sure you are receiving all the benefits you are entitled to. The review will also cover information on how to stop paying taxes on your retirement investments. Have you been getting your statements on a regular basis? The script directs the operator to make sure the statement is a statement for an investment, not for social security. It also directs the operator to ensure that the amount of the last statement exceeded $20,000. The script calls for the operator to schedule an appointment with the agent and emphasize the importance of bringing the account statement. It does not provide for the recipient bringing the annuity contract, which is the document that would have terms such as the surrender period. After covering the annuity information and appointment conversation, the script goes on to lead the operator through similar questioning about an IRA or 401K and life insurance. The script is attached to this Recommended Order as Exhibit A. The Agreement requires Unlimited to provide the agent with recordings of every call resulting in an appointment or lead. The Agreement also contains several disclaimers. For instance it states: "UFS Marketing shall not participate in any sales activity or other business conducted by the Customer." It also states that "UFS Marketing shall not supervise or monitor the sales activity or other business activities of the Customer." The Agreement provides for the agent/customer to approve both the postcard and the script. The Agreement also includes several assertions by the agent/customer that they are properly qualified and licensed in the states where the appointments will be scheduled. In 2011, Unlimited mailed marketing postcards to Phyllis Sukut and Angie Perez Cabrera in Florida. The postcards were part of Unlimited's fulfillment of its Agreement with Mr. Heygate. Unlimited mailed approximately 240,000 of the postcards to Florida addresses. A copy of the postcard sent to Ms. Sukut pursuant to the Agreement is attached to this Recommended Order as Exhibit B. The postcard is identical to the Agreement's sample, except that it asks her to contact the "Scheduling Department," instead of the "Annuity Department" and includes the statement, "[w]ithdrawals may, however, still be subject to tax consequences." Before mailing the postcards, Unlimited did not know the insurance, investment, or financial circumstances of Ms. Sukut and Ms. Perez Cabrera. The postcard confused Ms. Sukut because it did not come from her insurance company, and she did not understand the references to "agency" and "surrender period." She called the number and spoke to a gentleman who wanted to schedule an appointment to discuss her "expiring" annuity. She declined. The gentleman gave her a number to call and Mr. Heygate's name, if she changed her mind. Ms. Sukut contacted her insurance agent, Ed Ludden, about it. Ms. Perez Cabrera also sent the card that she received to Mr. Ludden. Mr. Ludden forwarded the postcards to Prudential, who held the women's policies. He was concerned that somehow Prudential's confidential information about Ms. Sukut and Ms. Perez Cabera had been compromised. Even an experienced insurance agent like Mr. Ludden received the impression that the sender of the postcard had information about the recipients. Mr. Ludden also contacted the Department and provided the postcards to it.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Financial Services enter a final Cease and Desist Order: (1) finding that Unlimited Fulfillment Services, LLC, has engaged in the unlawful transaction of insurance; (2) finding that Unlimited Fulfillment Services, LLC, has engaged in a misleading or deceptive trade practice; and (3) ordering Unlimited Fulfillment Services, LLC, to cease and desist all written and oral insurance marketing or advertising efforts in Florida by means of direct mail, use of the internet, or telemarketing, unless and until it is properly licensed in the State of Florida. DONE AND ENTERED this 28th day of June, 2013, in Tallahassee, Leon County, Florida. JOHN D. C. NEWTON, II Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 28th day of June, 2013.
The Issue Whether Respondents directly or indirectly represented or aided an unauthorized insurer, an insurance or annuity product; whether Respondents knew or reasonably should have known that the annuity contracts with the unauthorized insurer violated Section 626.901, Florida Statutes; whether Respondents knowingly placed before the public a statement, assertion, or representation with respect to the business of insurance that was untrue, deceptive, or misleading; whether Respondents knowingly caused to be made, published, disseminated, circulated, delivered, or placed before the public any false material statement; whether Respondents demonstrated a lack of fitness and trustworthiness to engage in the business of insurance; whether Respondents engaged in unfair or deceptive practices or otherwise showed themselves to be a source of injury or loss to the public; and whether Respondents otherwise acted in violation of the Florida Insurance Code provisions as specifically detailed in Petitioner’s Amended Administrative Complaint, and, if so, what penalty, if any, should be imposed on Richard P. Eberhardt’s insurance agent license and/or Nancy Eberhardt’s license.
Findings Of Fact General facts applicable to both Respondents Respondent, Richard Eberhardt (RE), is currently licensed in the State of Florida as a Life Including Variable Annuity & Health Life, Life & Health, and Health insurance agent. RE was initially licensed by Petitioner as a non- resident insurance agent on May 6, 2004. Previously, RE was a licensed insurance agent in Nebraska, Indiana, and Arizona. Respondent, Nancy Eberhardt (NE), is currently licensed in the State of Florida as a Life Including Variable Annuity, Life Including Variable Annuity & Health, Life, Life & Health, and Health insurance agent. NE was initially licensed by Petitioner as a non-resident insurance agent on January 2, 2003, and then as a resident agent on October 5, 2004. Previously, NE was a licensed insurance agent in Arizona. Petitioner has historically mailed, and subsequently made available on line, the Intercom, an insurance agent newsletter. The heading to the newsletter, reads in part: “Publication for Agents and Adjusters from the State of Florida Department of Financial Services.” These newsletters contained warnings regarding unauthorized sales of insurance products, and explanations as how an agent could verify whether or not an insurer was authorized to do business in Florida. Petitioner’s records evidence that the newsletters were distributed to insurance agents from the July – October 1996 through December 2006 editions. Respondents became licensed Florida agents in January 2003, and it is a reasonable assumption that they received or had computer access to those publications. Both Respondents are listed in Petitioner’s records as being the owners of LLQ Consulting, LLC. Respondent NE is listed as being the insurance agent-in-charge of LLQ Consulting, LLC. Pursuant to records on file with the Florida Secretary of State, LLQ Consulting, LLC, is an Arizona-limited liability company that is authorized to do business in Florida. Respondent RE was originally listed as manager; however, since April 22, 2005, Respondent NE has been listed as the manager. At all times pertinent to the dates and occurrences referred to herein, Respondents were licensed in Florida as insurance agents. Petitioner has jurisdiction over Respondents’ insurance agent licenses and appointments, pursuant to statute. National Foundation of America (NFOA) The NFOA is a registered Tennessee corporation that was formed on January 27, 2006, and headquartered in Franklin, Tennessee. Respondents assert that the difference between a charitable gift annuity and a charitable installment bargain sale is that a charitable gift annuity is under Internal Revenue Code (IRC) Section 501(m) and the payout to the investor is based on a mortality table of the donor’s expected life. Therefore, it is a tax free exchange of an asset by a donor at less than the asset’s fair market value to a charitable organization in exchange for an annuity issued by the charitable organization. On the other hand, Respondents argue that an installment bargain sale is under Section 453 of the IRC and 26 C.R.F. Sections 1.1011-2 of the IRC regulations. It is an exchange of an asset owned by the donor at less than fair market value to a charitable organization in exchange for an annuity. The IRS allows the donor to deduct the difference between the fair market value of the asset and the amount that the charitable organization pays for the asset. The payout of the annuity is for a specific term and not tied to a mortality table. Therefore, NCF did not consider the Charitable Installment Purchase to be an insurance transaction or the sale of an insurance product under state insurance laws. Nevertheless, an NFOA Corporate Resolution, dated April 16, 2006, provides for the corporate authority to “liquidate stocks, bonds, and annuities . . . in connection with charitable contributions or transactions. . . .” This same resolution also provides for the corporate ability to “enter into and execute planned giving or charitable contribution transactions with donors, including executing any and all documentation related to the acceptance or acquisition of a donation, . . . given in exchange for a charitable gift annuity. “ On September 18, 2006, the State of Washington Office of Insurance Commissioner issued an Order to Cease and Desist in the matter of National Foundation of America, Richard K. Olive, and Susan L. Olive, Order No. D06-245. The Order, among other things, was based on NFOA’s having not been granted a Certificate of Authority (COA) as an insurer in Washington and having not been granted tax exempt status under Section 501(c)(3) of the IRC. On April 13, 2007, the OIR issued an Immediate Final Order (IFO) in the matter of National Foundation of America, Richard K. Olive, Susan L. Olive, Breanna McIntyre, and Robert G. DeWald, Case No. 89911-07, finding that the activities of NFOA, et al., constituted an immediate danger to the public health, safety or welfare of Florida consumers. OIR further found that, in concert, NFOA, et al., were “soliciting, misleading, coercing and enticing elderly Florida consumers to transfer and convey legitimate income tax deferred annuities for the benefit of themselves and their heirs to NFOA in exchange for charitable term certain annuities”; and that NFOA, et al., had violated provisions of the FIC, including Sections 624.401 and 626.901, Florida Statutes. NFOA has never held a license or COA to transact insurance or annuity contracts in Florida, nor has NFOA ever been registered pursuant to Section 627.481, Florida Statutes, for purposes of donor annuity agreements. NFOA was never a registered corporation with the Florida Department of State, Division of Corporations. New Life Corporation of America (“NLCA”) d/b/a National Community Foundation (“NCF”) has been registered with OIR as a Section 627.481, Florida Statutes, donor annuity organization, since October 1997. NCLA subsequently changed its name to New Life International (“NLI”), which continued to use the d/b/a/ NCF. NLI is presently registered as a donor annuity organization with OIR. NFOA appealed OIR’s IFO to the First District Court of Appeal of Florida (1st DCA). The 1st DCA dismissed NFOA’s appeal on July 24, 2007. Therefore, NFOA operated as an unauthorized insurer in Florida. On May 17, 2007, the Internal Revenue Service (IRS) sent a letter to the Texas Department of Insurance stating that NFOA was not classified as an organization exempt from federal income tax as an organization described in Section 501(c)(3) of the IRC. On May 23, 2007, the Tennessee Department of Commerce and Insurance (DCI) filed a Verified Petition for Appointment of Receiver for Purposes of Liquidation of National Foundation of America; Immediate and Permanent Injunctive Relief; Request for Expedited Hearing, in the matter of Newman v. National Foundation of America, Richard K. Olive, Susan L. Olive, Breanna MyIntyre, Kenny M. Marks, and Hunter Daniel, Chancery Court of the State of Tennessee (“Chancery Court”), 20th Judicial District, Davidson County, Case No.: 07-1163-IV. The Verified Petition states at paragraph 30: NFOA’s contracts reflect an express written term that it is recognized by the IRS as a charitable non-profit organization under Section 501(c)(3) of the Internal Revenue Code (Prosser, attachment 4), and NFOA represents in multiple statements and materials that the contract will entitle the customers to potential generous tax deductions related to that status. The IRS states that it has granted NFOA no such designation. The deceptive underpinning related to NFOA’s supposed tax favored treatment of its contracts permeates it entire business model and sales pitch. This misrepresentation has materially and irreparably harmed and has the potential to harm financially all its customers and the intended beneficiaries of the contracts. These harms are as varied in nature and degree as the circumstances of all those individuals’ tax conditions, the assets turned in to NFOA, and the extent to which they have entrusted their money and keyed their tax status and consequences to reliance on such an organization. On August 2, 2007, the Commissioner for the Tennessee DCI, having determined that NFOA was insolvent with a financial deficiency of at least $4,300,000.00, filed a Verified Petition to Convert Rehabilitation by Entry of a Final Order of Liquidation, Finding of Insolvency, and Injunction, in the matter of Newman v. National Foundation of America, et al. On September 11, 2007, pursuant to a Final Order of Liquidation and Injunction entered in the matter of Newman v. National Foundation of America, et al., the Chancery Court placed NFOA into receivership after finding that the continued rehabilitation of NFOA would be hazardous, financially and otherwise, and would present increased risk of loss to the company’s creditors, policy holders, and the general public. On February 6, 2008, the IRS sent a letter to the court appointed Tennessee DCI Receiver (“Receiver”) for NFOA stating that NFOA does not qualify for exemption from federal income tax as an organization described in Section 501(c)(3) of the IRC. The IRS, in determining that NFOA did not qualify for tax exempt status, stated that the sale of NFOA annuity plans has a “distinctive commercial hue” and concluded that NFOA was primarily involved in the sale of annuity plans that “constitute a trade or business without a charitable program commensurate in scope with the business of selling these plans.” The IRS letter also provides that consumers may not take deductions on their income tax returns for contributions to NFOA. Insurance Agent’s Duties An insurance agent has a fiduciary duty to his or her clients to ensure that an insurer is authorized or otherwise approved by OIR as an insurer in Florida prior to the insurance agent selling the insurer’s product to his client. There are several methods by which an insurance agent could verify whether or not an insurer was authorized or otherwise approved (hereinafter “authorized”) as an insurer in Florida by OIR. It is insufficient for an insurance agent to depend on the assurances of the insurer itself or his or her insurance business peers as to whether an insurer needs to be authorized in Florida. Respondents asserted that, prior to selling NFOA annuities in 2006, they had performed due diligence in order to determine whether or not NFOA was authorized in Florida. Respondents testified that at the time they performed their due diligence, they viewed a State of Florida website that seemingly indicated that OIR does not regulate donor annuities. Respondents’ testimony lacks credibility as to the timing of Respondents’ claimed due diligence. The websites that seemingly indicate that OIR does not regulate donor annuities did not come into existence until September 12, 2008, for OIR and January 16, 2009, for Petitioner, which would have been several years after any due diligence that Respondents claim that they performed. As further noted below, the sale of the NFOA annuities to Mr. Bisch and Ms. Clark occurred in 2006, well in advance of the September 2008 and January 2009 creation of any websites that might seemingly indicate a lack of OIR regulation of donor annuity organizations. While the OIR 2008 and DFS 2009 websites may be somewhat confusing, at all times relevant to these matters, donor annuity organizations have been and continue to be regulated by OIR pursuant to Section 627.481, Florida Statutes, and Florida Administrative Code Rules 69O-202.001 and 69O-202.015. Due to the importance of income tax considerations in a consumer’s decision making process as to whether or not to purchase an insurance product, insurance agents have a fiduciary duty to their clients to verify the validity of any representations that an insurer’s product has an IRC Section 501(c)(3) tax exempt status, prior to the insurance agent’s selling the product to his or her clients. There are several methods by which insurance agents could verify whether or not an insurer has an IRS 501(c)(3) tax exempt status. Respondents admitted, in their testimony, that they had depended on the assurances of others and assumed that NFOA did not need to be authorized as an insurer in Florida. Respondents also admitted in their testimony that, but for the different names, the NFOA paperwork was the same as that of NCF. Respondent’s testimony is contradictory and lacks credibility in that NCF was qualified and registered with OIR as a donor annuity organization and NFOA was not. Nevertheless, Respondents claim NFOA was not and did not need to be regulated by OIR. Respondents testified that they had verified with the IRS that NFOA had applied for Section 501(c)(3) tax exempt status. However, Respondents were aware that the tax exempt status had not been granted to NFOA at any time relevant to this proceeding. Respondents knew income tax considerations were materially important to their clients. However, none of the NFOA materials nor any Florida consumer contracts signed or provided by Respondents to their clients contain any disclaimer language informing consumers that the Section 501(c)(3) tax exempt status had been applied for but had yet to be granted by the IRS. Respondents received commissions totaling $22,062.80 for selling NFOA annuities to Florida consumers. Respondents have failed to return any of these commissions to the Receiver for NFOA in the state of Tennessee. Count I: Consumer – Jacob Bisch On February 20, 2006, Respondents solicited and induced Jacob Bisch of Cape Coral, Florida, then aged 75, to transfer or otherwise surrender ownership of his existing annuity contract with Allianz Life Insurance Company in return for an NFOA annuity. The NFOA agreement that the consumer entered into was signed by Respondent RE. Bisch credibly testified as to both Respondents’ involvement in the sale of the NFOA annuity. NE wrote a letter asking that the commission for this sale be issued in her name. The commission check was ultimately paid to LLQ Consulting, LLC, a company owned by both Respondents and which NE was registered as the insurance agent- in-charge. Respondents knew or reasonably should have known that NFOA was not an authorized insurer in Florida. Respondents, by use of the NFOA donor annuity agreement, knowingly misrepresented to Bisch that NFOA was a charitable non-profit organization under Section 501(c)(3) of the IRC, even though Respondents knew or should have known that NFOA did not hold tax exempt status with the IRS. Bisch’s testimony was credible that tax considerations were the prime consideration in the purchase of the NFOA annuity from Respondents. Based upon Respondents’ transaction of insurance, Bisch presently anticipates losing approximately $26,320.04. This amount includes a surrender penalty of $16,823.04 incurred for transferring his original Allianz annuity to NFOA, and after receiving partial refunds from the NFOA Receiver. Based upon Respondents’ transaction of insurance with Bisch, Respondents were paid a commission of $4,062.80 by NFOA. Count II: Consumer – Fay Ann Clark Culminating on May 8, 2006, Respondents solicitated and induced Fay Ann Clark of Ft. Myers, Florida, then aged 70, to write a check for $200,000.00 in return for an NFOA annuity. The NFOA agreement that Clark entered into, and which was signed by Respondent RE, was entered into less than three weeks after Clark requested rescission of two NCF annuities that Respondents had previously sold Clark. Proceeds from the rescission of the NCF annuities enabled Clark to purchase the NFOA annuity. Prior to the rescission of the NCF annuities, on or about October 21, 2005, Clark had surrendered two Allianz Life Insurance Company annuities. Proceeds from the surrender of the Allianz annuities were used to purchase the NCF annuities. Respondent NE signed the NCF annuities agreement and was the advisor. Respondent NE, by use of a check drawn on Respondents’ joint checking account, refunded Respondents’ commission for the NCF sales to Clark. Sales documentation and correspondence clearly and convincingly evidence both Respondents’ involvement in Clark’s Allianz to NCF and NCF to NFOA transactions. Respondents knew or reasonably should have known that NFOA was not an authorized insurer in Florida. Respondents, by use of the NFOA donor annuity agreement, knowingly misrepresented to Clark that NFOA was a charitable non-profit organization under Section 501(c)(3) of the IRC, even though Respondents knew NFOA was not tax exempt. Based upon Respondents’ transaction of insurance, Clark paid $200,000.00 for an NFOA annuity, paid $7,971.00 in penalties to the IRS (U.S. Treasury), and presently anticipates losing approximately $42,000.00. Clark has received a partial refund from the NFOA Receiver. Based upon Respondents’ transaction of insurance with Clark, Respondents were paid a commission of $18,000.00 by NFOA. Petitioner has proven by clear and convincing evidence that Respondents directly or indirectly represented or aided an unauthorized insurer to do business in Florida. Petitioner has proven by clear and convincing evidence that Respondents knew or reasonably should have known that the annuity contracts they contracted with clients were with an unauthorized insurer. Petitioner has proven by clear and convincing evidence that Respondents knowingly placed before the public a statement, assertion, or representation with respect to the business or insurance that was untrue, deceptive or misleading. Petitioner has proven by clear and convincing evidence that Respondents knowingly caused to be made, published, disseminated, circulated, delivered, or placed before the public a false material statement. Petitioner has proven by clear and convincing evidence that Respondents demonstrated a lack of fitness and trustworthiness to engage in the business of insurance. Petitioner has proven by clear and convincing evidence that Respondents engaged in unfair and deceptive practices or showed themselves to be a source of injury to the public. Neither Respondent has had prior disciplinary charges filed against them in Florida.
Recommendation Based upon the foregoing Finds of Facts and Conclusions of Law, it is RECOMMENDED that a final order be entered by the Department of Financial Services: Finding that Respondents violated Subsections 626.901(1), 626.901(2), 626.9541(1)(b)4., 626.9541(1)(e)1.e., 626.611(7), 626.621(2), and 626.621(6), Florida Statutes, as charged in Counts I and II of Petitioner’s Amended Administrative Complaints; Revoking Respondent Richard Eberhardt’s, licenses and appointments issued or granted under or pursuant to the Florida Insurance Code; Revoking Respondent Nancy Eberhardt’s, licenses and appointments issued or granted under or pursuant to the Florida Insurance Code; 4. Providing that if either of the Respondents, subsequent to revocation, makes an application to Petitioner for any licensure, a new license will not be granted if the applicant Respondent fails to prove that he or she has otherwise satisfied the financial losses of his or her NFOA clients or if the applicant Respondent otherwise fails to establish that he or she is eligible for licensure. DONE AND ENTERED this 27th day of April, 2010, in Tallahassee, Leon County, Florida. S DANIEL M. KILBRIDE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 27th day of April, 2010.
