The Issue Is Respondent, Victoria D. Wiedle, guilty of failure to account for and deliver funds, in violation of Section 475.25(1)(d)1, Florida Statutes, and, if so, what is the appropriate penalty.
Findings Of Fact Petitioner is the state agency charged with the responsibility and duty to prosecute administrative complaints pursuant to Section 20.165 and Chapters 120, 455, and 475, Florida Statutes. At all times material hereto, Respondent Wiedle was a licensed real estate broker, having been issued license number BK-0646846, and was principal broker of Escarosa Realty. Respondent's license is still active. Janice Marlene Christian is a realtor associate. She was an independent contractor with Escarosa Realty from December 1998 until April 1999. Accordingly, Respondent Wiedle was Ms. Christian's registered broker during this time. Ms. Beverly Lewis is the mother-in-law of Ms. Christian's brother. Ms. Lewis came to Ms. Christian in February 1999 because she was interested in looking for and purchasing a house. On February 16, 1999, Ms. Christian facilitated an Exclusive Buyer Brokerage Agreement (the Agreement) on behalf of Escarosa Realty with Ms. Lewis. The Agreement was on a form created by Formulator, a software company. "Florida Association of Realtors" appears on the face of the document. Paragraph 6 of the Agreement reads in pertinent part: RETAINER: Upon final execution of this agreement, Buyer will pay to Broker a non- refundable retainer fee of $0 for Broker's services ("Retainer"). Accordingly, Respondent was not entitled to any money as a retainer fee for broker services pursuant to this agreement. The agreement was signed by Ms. Lewis, Ms. Christian, and Ms. Wiedle and became effective on February 16, 1999. The specified termination date of the agreement was August 17, 1999. On or about February 27, 1999, Ms. Christian tendered an offer to sellers on behalf of Ms. Lewis, for property located at 107 Poi Avenue in Santa Rosa County (subject property). Pursuant to this offer, Ms. Lewis gave a $500.00 check dated February 27, 1999, to Ms. Christian as earnest money. The check is made out as follows: "Escarosa Realty Inc. Escrow". Ms. Lewis wrote in the memo section of the check that the check was escrow money for 107 Poi Terrace. The $500.00 check was deposited in Escarosa Realty's escrow account on March 1, 1999. Respondent accounted for the $500.00 check on the March 1999 monthly reconciliation statement for Escarosa Realty. The seller of the subject property made a counter- offer for a higher price which Ms. Lewis rejected. The testimony differs as to what happened next. According to Ms. Christian, Ms. Christian spoke to Respondent sometime after Ms. Lewis rejected the counter-offer about refunding the escrow money to Ms. Lewis. According to Ms. Christian, Respondent informed her that she did not have to give the escrow money back to Ms. Lewis yet because she had the buyer broker agreement. Ms. Christian further asserts that she filled out a written request on March 16, 1999, on a form entitled "EMD Request," which means earnest money deposit request, and gave it to Respondent who again asserted that the $500.00 did not need to be returned at that time because of the buyer brokerage agreement. Ms. Christian's testimony is consistent with Ms. Lewis's. According to Ms. Lewis, she talked to Ms. Christian about getting a refund of the $500.00 shortly after she rejected the counter-offer. She and Ms. Christian discussed the EMD form. She initially agreed that Respondent could temporarily maintain the escrow funds. However, when Ms. Lewis discovered that the financing she was seeking through the rural development program would take several months, she decided she wanted the money returned. Ms. Christian ended her contract with Escarosa Realty effective April 14, 1999. Because Ms. Christian was no longer at Escarosa, Ms. Lewis contacted Respondent by telephone on or about April 21, 1999. Ms. Lewis informed Respondent about the purchase offer and rejection of the counter-offer for the subject property. According to Ms. Lewis, Respondent initially told her she would return the money to her in the mail. When she did not receive it, Ms. Lewis again called Respondent and was told that the $500.00 would not be returned because of the buyer brokerage agreement was still in place. Ms. Lewis asserts that Respondent never told her any request for a refund of the $500.00 had to be in writing. Ms. Lewis then went to the Escarosa Realty office. Ms. Weidle was not there but Elnora Alexander was there. Ms. Alexander was also a realtor associate who was an independent contractor with Escarosa Realty. Ms. Lewis explained to Ms. Alexander about the circumstances of the subject property and that she wanted her earnest money back. Ms. Alexander gave a copy of the buyer broker agreement to Ms. Lewis. After going to Escarosa Realty, Ms. Lewis had numerous other telephone conversations with Respondent about the money. Respondent denies any knowledge of the Poi Terrace failed transaction until she spoke to Ms. Lewis on the phone. She also denied ever receiving the EMD request from Ms. Christian. Respondent asserts that she repeatedly told Ms. Lewis that she would return the $500.00 if Ms. Lewis would only make a request in writing, but that Ms. Lewis refused. This assertion is not credible. It is inconceivable that after all of the efforts made by Ms. Lewis to get her $500.00 returned to her, that she would refuse to make a written request for the money. In any event, there is no dispute that Ms. Lewis made verbal requests to Respondent for the return of the escrow monies. Respondent Wiedle admits that Ms. Lewis requested the money over the telephone. Further, in an April 2, 2001 letter from Respondent to the Division of Real Estate, Respondent acknowledged that Ms. Lewis asked for a refund of the money in the beginning of May and again in early June of 1999. Clearly, if Respondent Wiedle had not previously been aware of the failed Poi Terrace transaction, she was made aware of it during the telephone conversations with Ms. Lewis. Notwithstanding Respondent's assertion that the reason she did not refund the $500.00 to Ms. Lewis was that the request was not in writing, it is clear from Respondent's testimony and from a letter she wrote to Mr. Clanton, Petitioner's investigator, that she believed the $500.00 was connected to the buyer brokerage agreement, not to any offer for purchase of property. In an undated letter from Respondent Wiedle to Mr. Clanton, Respondent wrote: Dear Mr. Clanton, This is in response to your letter dated August 17th, 1999. First Beverly A. Lewis was refunded her money on August 20, 1999 check #111. Second I would like to respond to her complaint. Beverly A. Lewis signed a Exclusive Buyer Brokerage Agreement with EscaRosa Realty, Inc. on February 16th, 1999 with it to terminate on August 17th 1999. Beverly A. Lewis knew that her deposit was a refundable deposit after the agreement is expired not before. As the Broker of this company I had no contact with Beverly Lewis until the agent Marlene Christian was asked to leave the company. If there ever was a contract for her to purchase a house then her agent Marlene Christian never informed me of nor did she ever provide any such contract. The deposit was given to me with the Exclusive Buyer Brokerage Agreement only. Nor did her agent Marlene ever fill out the EMD refund request form requesting a refund to be given to Beverly A. Lewis. However, The result would have been the same. I asked Beverly Lewis If she had changed her mind on purchasing a house she said no she was still going to buy a house but that she knew if she didn't buy her house through Marlene at her new company that Marlene would make life very hard on her. I told her I was sorry but that is the whole purpose in the contract was to secure your buyers from just going all over the place. . . .(emphasis supplied) Respondent refunded the $500.00 to Ms. Lewis on August 10, 1999. At hearing, Respondent volunteered that there was a previous complaint against her for failing to return money she held under a buyer brokerage agreement with a former client. In that instance, the Probable Cause Panel of the Florida Real Estate Commission found no probable cause but issued a letter of guidance to Respondent.1
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law set forth herein, the evidence of record and the demeanor of the witnesses, it is RECOMMENDED: That a final order be entered by the Florida Real Estate Commission finding the Respondent, Victoria D. Wiedle, guilty of violating Section 475.25(1)(d), Florida Statutes, in that she failed to deliver escrow money upon demand, imposing a fine of $1,000.00, and placing Respondent Wiedle on probation for a period of two years. As conditions of probation, Respondent should be required to attend a continuing education course which addresses appropriate handling of escrow funds and be subject to periodic inspections and interviews by a Department of Business and Professional Regulation investigator. DONE AND ENTERED this 14th day of June, 2002, in Tallahassee, Leon County, Florida. BARBARA J. STAROS Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 14th day of June, 2002.
Findings Of Fact In early July, 1972, Donald R. and Pamela S. Leininger (buyer) entered into a contract to purchase a residence through Sun Up Realty with its salesman, Bernard Zapel. The real property involved and Sun Up Realty were owned by Defendant, Norman N. Zipkin either as sole proprietor or as sole shareholder of the corporation in whose name the property was held. Disclosure of the role of Defendant as owner-seller was not an issue in these proceedings. Buyer executed two contracts for the purchase of the property both dated July 9, 1972. The first contract acknowledged receipt of $100 as a deposit with a down payment to be made of $1750 with the buyer obtaining a mortgage of $33,250. Noted on this contract are two additional payments of $650 and $1,000. All of these deposits were payable to and deposited in Sun Up Realty's Escrow Account. The second deposit receipt contract was also dated July 9, 1972 and receipt of $1750 was thereon acknowledged by seller. The sale price of $35,000 applied to both contracts. The second contract provided as terms and conditions of sale that the buyer would make an additional deposit of $1700 before closing and that buyer was to apply for, qualify, and obtain a mortgage insured by FHA. Papers to so qualify were sent to the bank but buyer never qualified for the loan. The Administrative Complaint indicates that the first document executed by the buyer provided for an FHA insured mortgage; the evidence presented was as noted above. Apparently to allow buyer additional time to qualify for the loan Defendant leased the premises to buyer pursuant to lease agreement (Exhibit 5). Although Defendant testified buyer paid him nothing while he occupied the house pursuant to this lease agreement, in his deposition (Exhibit 1) buyer presented a receipt for one month's rent paid to the seller for the premises. Buyer never qualified for the mortgage because the lending agency was never satisfied from whence the additional $1700 down payment was to come. Although no evidence was presented on this point it appears that this additional deposit was required for buyer to reach a 10 percent down payment on the price of the residence. The July 9, 1972 deposit receipt contract that was in effect with respect to this transaction provides in pertinent part: "2. An additional sum of seventeen hundred dollars ($1700) shall be deposited with Escrow Agent before closing. In the event such sum is not so deposited, Seller at his option may cancel and terminate this agreement." "3. Buyer to apply for, qualify for, and obtain a Mortgage insured by the FHA Section in an amount not less than $31,550. In the event the Buyer fails to qualify for said mortgage, all said deposit shall be returned immediately, less the cost of the credit report. "14. It is mutually agreed that the trans action shall be closed and the Buyer shall pay the balance of the first payment and execute any and all papers necessary to be executed by him for the completion of this purchase within days from the aforementioned abstract of title, or such time as shall reasonably be required by seller to make such title good, otherwise the herein named Escrow Agent is hereby directed by both Seller and Buyer to divide the monies being held by said Escrow Agent, under the terms under this Contract between the Seller and Broker herein named as hereinafter provided." "It is further agreed that in case of default by the Buyers, the Seller may at his option take legal action at law and/or in equity to enforce this Contract, in which event, the Buyer shall pay reasonable attorney fees and court costs; or else the Seller may at his option retain one half of the deposit herein paid as considera tion for the release of the Buyer by the Seller from any and all further obligations under this Contract to the Seller, which release shall be implied from such act of retention by the Seller." Buyer quit the premises in October, 1972 and thereafter demanded return of his deposit from seller. By letter from buyer's attorney (Exhibit 6) dated March 19, 1973 demand was made for return of the deposit. By letter dated March 23, 1973 (Exhibit 7) Seller denied the refund of the deposit on grounds that the buyer had breached the contract as the Buyer had qualified for and been approved for a mortgage by the Collateral Mortgage Co. The money was withdrawn from the escrow account and paid to the seller. Defendant is an attorney, mortgage broker, general contractor, developer and real estate broker. For the past decade he has devoted most of his energies toward real estate development. This is the first time charges have been preferred against him by the Florida Real Estate Commission.
The Issue The issue presented is whether Respondent is guilty of the allegations contained in the Administrative Complaint filed against her, and, if so, what disciplinary action should be taken against her, if any.
Findings Of Fact At all times material hereto, Respondent has been a real estate salesperson in the State of Florida, having been issued license number 0611282. At all times material hereto, Respondent was employed by Steven J. David at Century 21 Tri City Realty, Inc., in Fort Lauderdale as a licensed real estate salesperson. Her duties were selling and leasing real estate and managing properties owned by her employer. She was paid a commission on transactions she handled. In November 1996, Mike Nickas began receiving late notices from various mortgage companies which held mortgages on properties owned by him and David. He and David began investigating how that could be. They discovered that Respondent had written seventeen checks totaling in excess of $8,000 during 1996 from the business accounts payable to "cash" or to herself and had forged Nickas' signature to those checks. Those payable to "cash" were endorsed and cashed by her. Respondent was not a signatory on those accounts. In order to hide her theft, Respondent wrote in the checkbook that each check was "void" or wrote false entries as to the amount of the check and the payee. Further, when the bank statements arrived at the business each month, Respondent removed the unauthorized checks from the envelope. Respondent was not authorized to sign Nickas' name to any of those checks. Further, Respondent was not authorized to write those checks payable to herself or to write them payable to "cash" and then cash them herself. When David and Nickas confronted Respondent with their discovery, she admitted that she had written the checks without authorization. Respondent's employment was terminated.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered finding Respondent guilty of the allegations in the Administrative Complaint filed against her and revoking her license as a real estate salesperson. DONE AND ENTERED this 13th day of October, 1998, in Tallahassee, Leon County, Florida. LINDA M. RIGOT 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 Filed with the Clerk of the Division of Administrative Hearings this 13th day of October, 1998. COPIES FURNISHED: Steven W. Johnson, Esquire Department of Business and Professional Regulation Division of Real Estate 400 West Robinson Street, No. N 308 Orlando, Florida 32801 Stephen Post, Esquire 600 South Andrews Avenue Fort Lauderdale, Florida 33301 Lynda L. Goodgame, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792 Henry M. Solares, Division Director Department of Business and Professional Regulation Division of Real Estate 400 West Robinson Street Orlando, Florida 32802
The Issue The issue is whether Respondent committed unlawful employment practices contrary to Section 760.10, Florida Statutes (2007),1 by discriminating against Petitioner based on her race or color in its failure to promote her or in its decision to terminate her employment.
Findings Of Fact Wal-Mart is an employer as that term is defined in Subsection 760.02(7), Florida Statutes. Petitioner, an African-American female, was hired by Wal-Mart on or about August 26, 2004. At the time of her dismissal, she worked as a Customer Service Manager ("CSM") on the overnight shift, from 10 p.m. to 7 a.m. As a CSM, Petitioner performed various cashiering and supervisory duties at the front end of the store. These duties included conducting cash transactions and making refunds to customers. Petitioner's employment with Wal-Mart was terminated on November 13, 2007, for a category of offense styled "Gross Misconduct--Integrity Issue" related to fraudulent returns. In plain language, Petitioner was alleged to have stolen money from Wal-Mart by issuing "refunds" to nonexistent customers and pocketing the money from the cash register. Wal-Mart has a "Coaching for Improvement" policy setting forth guidelines for progressive discipline. See endnote 4, supra, for a brief description of the disciplinary progression. While the progressive discipline process is used for minor and/or correctable infractions such as tardiness, "gross misconduct" constitutes a ground for immediate termination. The coaching policy explicitly sets forth "theft," "dishonesty," and "misappropriation of company assets" as examples of gross misconduct. Prior to her termination, Petitioner's most recent three progressive "coachings" related to her habitual poor attendance and punctuality. A verbal coaching for misconduct related to attendance/punctuality was issued on January 5, 2007. A written coaching for misconduct related to attendance/punctuality was issued on February 23, 2007. A "decision day" for misconduct related to attendance/punctuality was issued on August 24, 2007, because Petitioner had accumulated six unauthorized absences since the written coaching in February. All of these coachings pre-dated Petitioner's Complaint by more than 365 days. Petitioner conceded that these coachings were unrelated to the reasons for her dismissal from employment. Apart from her unconvincing testimony about an allegedly malfunctioning store time-clock, Petitioner essentially conceded that she had persistent problems arriving on time for work. Petitioner also conceded that, aside from hearsay and rumor on the floor of the store, she had no personal knowledge of anyone else's coachings and thus had no basis for comparing her disciplinary history to that of any other Wal-Mart employee. Wal-Mart's "Promotion & Demotion Criteria" expressly provide that an employee is not eligible for a promotion to management trainee if he or she has an active written coaching. A written coaching is "active" for a period of one year after its issuance, meaning that Petitioner would not have been eligible for promotion to management trainee until February 24, 2008, had she not been discharged on November 13, 2007. Wal-Mart's "Career Preference" system is a computer program that allows employees to express their interest in promotion to other positions. An employee may log onto the Career Preference system and indicate her interest in a particular job. If an employee has not indicated her interest, she is not considered to have applied for the position and will not be considered for that job opening. A printout of Petitioner's Career Preference history was entered into evidence. It indicates that she never applied for a promotion to department manager. On April 13, 2006, Petitioner attempted to indicate her interest in the management trainee program. However, the Career Preference system will allow only qualified employees to indicate an "interest" and thereby be considered for a job; less-than-qualified employees are shown to have an aspirational "goal" of attaining the position. As of April 13, 2006, Petitioner had at least one active written coaching in her employment file,6 had not completed the prerequisites for the management trainee program, and was therefore ineligible for the position. Thus, the Career Preference system did not list her as having an "interest" in the management trainee position and she was not considered for the job. The evidence indicates that Petitioner was not qualified or eligible for a promotion at any time during the 365-day period preceding the filing of her Complaint. Wal-Mart's asset protection coordinators ("APCs") and Market Asset Protection Managers ("MAPMs") work under an entirely different chain of command than those employees involved in store operations. APCs and MAPMs are not involved in day-to-day decisions regarding employee discipline or promotions. Sandra Raines is the APC for Wal-Mart Store 5326, where Petitioner worked. Her job is to supervise and investigate integrity and facility safety issues, including instances of suspected theft by Wal-Mart employees. Ms. Raines reports directly to Melanie Clemons, the MAPM for 12 stores in Market 481, including Store 5326. Ms. Clemons supervises 12 APCs as to their asset protection duties, which includes allegations of internal theft by Wal-Mart employees. As part of her job, Ms. Raines reviews a weekly refund review report. This report provides information regarding suspicious transactions, such as refunds in excess of $50 for which the customer did not provide a receipt. The report provides information necessary to trace the transaction: the operator number of the cashier, the number of the register on which the transaction occurred, and whether the transaction was hand-keyed. It is usual Wal-Mart refund practice to scan the Universal Product Code ("UPC") bar code from the receipt into the register. A "hand-keyed" transaction is one in which the register operator manually overrides the register's protocol and types the information into the register, rather than scanning in the UPC bar code. Ms. Raines testified that, though there are legitimate reasons for using this procedure, a hand-keyed transaction is one of the "red flags" that cause her to look more deeply into a transaction. In the course of reviewing the November 3, 2007, weekly refund review report, Ms. Raines noticed a sale of $963.92 in merchandise at 3:47 a.m. on October 24, 2007, conducted by Petitioner. She also noticed a refund of $212.92 related to that receipt at 3:29 a.m. on November 2, 2007. The refund was hand-keyed. The large amount of the refund, the odd hour at which it occurred, and the fact that it was hand-keyed, combined to rouse Ms. Raines' curiosity. Ms. Raines reviewed the electronic journal, a record of every transaction that takes place in the store. She was able to obtain the original receipt from the October 24, 2007 purchase and the receipt for the November 2, 2007 refund. The refund receipt indicated that the returned item was a recliner chair. Ms. Raines' suspicions became greater as she wondered who would return a recliner at 3:29 a.m., then further intensified when she noted the original receipt showed that no recliner was purchased. Ms. Raines' preliminary review of the refund report and the receipts led her to believe that Catherine Durso, a white female CSM working the overnight shift, conducted the refund transaction. Ms. Durso's operator number was on the refund receipt. Ms. Raines began reviewing store surveillance footage to find visual evidence that Ms. Durso had committed a fraudulent return. Ms. Raines reviewed the video of the original October 24, 2007, sale and saw no recliner. However, she did observe Petitioner printing an additional copy of the sales receipt approximately 11 minutes after the sale. Ms. Raines next reviewed the video of the November 2, 2007 refund transaction. She saw no recliner chair7 and no customers present at the register at the time of the refund. Instead, Ms. Raines saw Petitioner conducting the refund transaction on Ms. Durso's register at 3:47 a.m. Ms. Durso was not to be seen in the surveillance footage of this transaction. Based on all the evidence before her, Ms. Raines concluded that Petitioner hand-keyed a fraudulent cash refund for $212.92, using the UPC code for a recliner chair and the transaction number from the reprinted receipt she had kept from the October 24, 2007 sale. At this point, Petitioner had recorded a cash refund of $212.92 but had not taken any money from the register. Ms. Raines therefore continued to watch the video to "kind of see what's going to happen next." At 6:03 a.m., Petitioner recorded a "no sale" transaction on the same register she had used for the refund. A "no sale" can only be performed by a CSM or a member of management because it involves opening the register drawer without actually recording a sale. A "no sale" is typically used when the cashier needs to change out larger bills for smaller ones. On this "no sale," Petitioner appeared to be merely sorting money. However, Petitioner recorded a second "no sale" three minutes later, at 6:06 a.m. This time, Petitioner removed money from the large-bill slot of the register and concealed the money in a black jacket draped over her left arm. Petitioner admitted removing the money from the register and placing it under her jacket. She claimed that she did so in order to safely move the money from the front of the store to the accounting office in the back. This claim was not credible. Ms. Raines testified that there is never a situation in which a CSM should hide money under a jacket. Wal-Mart provides blue register bags for transporting money and requires their use, for reasons of safety and employee integrity. Based on her observation of the fraudulent return transaction, and the removal and concealment of money from the register drawer, Ms. Raines concluded that Petitioner was stealing money from Wal-Mart. Ms. Raines continued her investigation, and discovered two additional fraudulent returns performed by Petitioner. Both of these returns were hand-keyed, and both used the receipt from the October 24, 2007 purchase. One refund transaction occurred on October 24, 2007, the same date as the purchase. Petitioner hand-keyed a refund for a recliner chair in the amount of $212.92, the same amount as the November 2, 2007 refund. The second refund occurred on October 26, 2007. Petitioner hand- keyed a $249.09 fraudulent refund for a Barbie Jeep, a battery- operated toy car large enough to hold two young children. No Barbie Jeep was purchased on October 23, 2007. For both of these refunds, Petitioner used the same $963.92 receipt from October 24, 2007, that Ms. Raines observed Petitioner reprinting 11 minutes after the actual purchase. Ms. Raines viewed the store video to confirm that no customers were present when these refunds were conducted. She also confirmed that no recliner or Barbie Jeep entered the store on the dates in question. Finally, Ms. Raines observed that on October 13, 2007, Petitioner's register was $300 short at the end of her shift. The surveillance video for that date showed Petitioner performing nine "no sale" transactions. Under the guise of performing an audit of the cash register, Petitioner was removing money from the drawer. Ms. Raines notified her supervisor, Ms. Clemons, of her observations and her conclusion that Petitioner conducted several fraudulent refunds in order to steal money from Wal- Mart. Ms. Clemons reviewed the evidence gathered by Ms. Raines. She reviewed the store videos to verify that Petitioner conducted three fraudulent refund transactions. At the conclusion of her independent review of the evidence, Ms. Clemons was convinced that Petitioner had stolen money from Wal-Mart. Ms. Raines and Ms. Clemons scheduled an interview with Petitioner on November 13, 2007. At this interview, Ms. Clemons terminated Petitioner's employment with Wal-Mart because of gross misconduct. During the interview, Petitioner admitted that she conducted fraudulent returns. She wrote out a statement in her own words: I had a couple of returns that were not actually returns. They were used for emergency personal purposes due to severe hardship and past-due medical bills. To my recollection, it has only started just recently around October 2007 and only 3x's that I remember. I do apologize for the integrity issue and am willing to pay back the 3 that I know and remember. I felt I was pushed over the edge by personnel and corporate or none of this would have happened. Everyone goes through hardships and I guess it was just my turn and that's how I chose to deal with [sic]. Again, I apologize and am willing to repay Wal-Mart, given the opportunity. At the hearing, Petitioner unconvincingly claimed that she was "coerced" into writing the above statement by a promise that Wal-Mart would not pursue criminal charges for the theft if she made a written confession. She claimed that the statement was not true, but was the result of putting herself "in a theatrical acting mode," imagining what would make someone do the things of which she stood accused. This testimony was not credible. Ms. Raines and Ms. Clemons credibly testified that Petitioner was not coerced into admitting her guilt. Ms. Clemons stated that she offered Petitioner the opportunity to write a statement out of adherence to Wal-Mart procedures. Ms. Clemons did not need the statement. She already had all the evidence she needed and would have fired Petitioner whether or not she wrote the statement. Petitioner admitted that she was discharged solely as a result of the investigation performed by Ms. Raines and Ms. Clemons. Petitioner was criminally prosecuted for the theft. She pled guilty and was convicted of grand theft, was sentenced, and paid restitution to Wal-Mart. Petitioner testified that she does not believe and does not contend in this forum that either Ms. Raines or Ms. Clemons discriminated against her because of her race or color. She testified that the discrimination did not involve Ms. Raines and Ms. Clemons: "I was fired by them, but the case of discrimination goes way before that." Even if the time-barred elements of the Complaints were considered, Petitioner provided no evidence beyond her bare assertions that she suffered from discrimination on account of her race or color. She believed that Ms. Durso received favored treatment, not because she was white and Petitioner was black, but because Ms. Durso had relatives in management and friends in the store. Also, Ms. Durso had computer skills that Petitioner lacked, which at times enabled Ms. Durso to sit at a desk in the back of the store while Petitioner did the heavy lifting in the front. Given Petitioner's obvious lack of candor as to the central issue of her termination, the undersigned is reluctant to base tangential findings on Petitioner's word alone. Even if Petitioner's testimony were credited as to the preferential treatment accorded Ms. Durso, Petitioner alleged no motive related to race or color in any of this treatment. Petitioner offered no record evidence that she was qualified for, applied for, and was denied a promotion. To the contrary, the evidence showed that Petitioner kept herself ineligible for promotion under Wal-Mart rules by having written "coachings" on her record for persistent lateness and unapproved absences from work. Petitioner offered no evidence that a similarly situated employee of another race or color committed a similar theft and was not discharged from employment with Wal-Mart. The greater weight of the evidence establishes that Petitioner was terminated from her position with Wal-Mart due to gross misconduct on the job in form of fraudulent refunds that attempted to cover her theft of money from her employer. The greater weight of the evidence establishes that Wal-Mart has not discriminated against Petitioner based on her race or color.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Florida Commission on Human Relations issue a final order finding that Wal-Mart Stores East, L.P. did not commit any unlawful employment practices and dismissing the Petition for Relief. DONE AND ENTERED this 6th day of April, 2010, in Tallahassee, Leon County, Florida. S LAWRENCE P. STEVENSON 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 6th day of April, 2010.
Findings Of Fact Respondent is and at all material times has been a licensed real estate broker in the State of Florida. He holds license number 0404010. On or about October 14, 1985, Respondent, as seller, entered into a purchase and sale contract with William and Lois Ehmke, as buyers, with respect to Respondent's condominium known as Unit 502 of Blind Pass Lagoon Condominiums located at 9825 Harrell Avenue, Treasure Island, Florida. The Ehmke contract called for a purchase price of $85,000, which included $15,000 as an earnest money deposit. The contract form provided a paragraph for the closing date, but this was left blank. The only special clause in the contract provided that: The Buyer(s) shall pay $550.00 monthly beginning the date said unit is occupied by buyer and until buyers home in Deluth, Minn. is sold. At the time of closing upon Condo Unit 502, Phase 3, the buyers' shall reimburse the Seller the difference between $550.00 and actual costs to carry the unit per month. ($755.00 plus 90.00 maintenance, or $300.pr [i.e., $300 per month]. The Ehmkes duly paid Respondent the $15,000 deposit and moved into the condominium, which they occupied continuously from October, 1985, through December, 1986. The Ehmkes paid Respondent $550 per month for each month of their occupancy. When making the deal, the Ehmkes were aware that the average time that a house remained unsold on the market in Deluth was 210 days. They knew that the market was very slow because of a sluggish local economy. They expected their house to be sold in about 210 days. After 210 days passed and the house had not sold after the Ehmkes' good faith efforts to sell it, the Ehmkes asked Respondent to refund their $15,000 deposit. Respondent refused. Negotiations resulted in Respondent returning to the Ehmkes $10,000 of the deposit in July, 1987. Respondent did not stand in a confidential or fiduciary relationship with the Ehmkes. William Ehmke had owned and operated a restaurant in Deluth and, after meeting Respondent, initiated discussions with Respondent concerning Mr. Ehmke's desire to purchase property in Florida. Respondent showed the Ehmkes other properties and informed them from the start that Respondent and his daughter owned the condominium unit in question. The mortgage payments, insurance, taxes, and maintenance fees on the condominium unit were about $850 per month in October, 1985. During the period that the Ehmkes occupied the condominium unit, the maintenance fees went up by $30 per month and there was a $1200 special assessment. All of these expenses were borne by Respondent. However, Mr. Ehmke was aware that every month he was losing $300 of his deposit toward these expenses. The fair rental value of the condominium unit from December 1 through April 30 each year is $1400 to $1600 per month. By the time that the Ehmkes vacated the unit, Respondent had paid at least $3000 in monthly expenses over the rent received and the $1200 the special assessment. He had also lost at least $3000 in premium seasonal rentals. Mr. Ehmke has since received his real estate salesman's license. He admits that the $5000 retained by Respondent does not cover Respondent's out-of- pocket expenses. He also admits that he has no complaints about the transaction in retrospect. Frank Myles owns all of the stock of Myles, Inc., which owned Unit 202 of Blind Pass Lagoon Condominiums in Treasure Island. Having been neighbors with Respondent for two years and also involved part-time in real estate sales, Mr. Myles mentioned to Respondent that he was trying to sell his unit. After their conversation, Respondent delivered to Mr. Myles a contract for the purchase and sale of his unit. The contract was executed by all parties on July 29, 1986. The buyers were Ralph and Margaret Magno, who had recently purchased another unit in the same complex through Respondent as the broker. The purchase price was $94,000 to be paid cash at closing, as Mr. Myles had said he desired. The contract contained no contingencies, such as for financing, which was also consistent with Mr. Myles' previous instructions to Respondent. The contract called for a closing on or before August 25, 1986, and provided that time was of the essence. The Magnos paid an earnest money deposit of $8000 to Pat Jano and Associates, "reg. real estate broker." The form language of the contract provided that Respondent was to "hold said earnest money or deposit and act as escrow agent until closing of deal ..." The contract elsewhere provided that if the purchaser failed to perform any of his obligations, then he "shall forfeit said earnest money or deposit; and the same shall be retained by the Seller as liquidated damages, and the escrow agent is hereby authorized by the purchaser to pay over to the Seller the earnest money or deposit." In the event of a default by the purchaser, the earnest money would be divided equally between Respondent and the seller. On or about August 13 or 14, 1986, the Magnos discovered that the financing terms that they had arranged with a third-party lender could no longer be obtained. Respondent promptly notified Mr. Myles of the problem. Mr. Myles and Respondent tried unsuccessfully to resolve the problem with the lender, which ultimately declined to make the loan. When first informed of the buyers' financing problems, Mr. Myles told Respondent that the two of them should push the sellers through to closing. (Tr. 82.) Immediately after this conversation with Respondent, Mr. Myles stepped aside so that his lawyer could handle what had become a "shaky" deal. (Tr. 84.) On August 16, 1986, Respondent refunded all of the earnest money to the Magnos by delivering to Mr. Magno a check drawn on Respondent's escrow account in the amount of $8000 and payable to Mr. Magno. Respondent returned the deposit without the prior knowledge of Mr. Myles or consent of Myles, Inc. (Tr. 73 and 8.) Mr. Myles' lawyer sent a letter dated August 20, 1986, to Respondent informing him that Myles, Inc. intended to proceed to closing and would not consent to the release of the earnest money deposit to the Magnos. Mr. Myles appeared at the closing at the time and place specified in the contract. The Magnos did not appear. Myles, Inc. never received its share of the forfeited deposit. Myles, Inc., through Mr. Myles, stated in a letter dated May 13, 1987, that it was "no longer" pursuing any legal action against Respondent and that no suits were filed and no further action would be taken. During a lengthy meeting with Petitioner's investigator, Respondent never suggested that he had had Myles' permission to return the Magnos' deposit. Rather, he said only that he had returned the deposit out of "loyalty" to the Magnos. At the hearing, Respondent testified that he told Mr. Myles that Respondent was going to return the deposit to the Magnos and Mr. Myles' only reaction was that "those are the breaks." (Tr. 129.) This apparent inconsistency between the testimony of Mr. Myles and Respondent, both of whom were credible witnesses, is reconciled by the finding that Mr. Myles never consented to the release of the earnest money, but Respondent misunderstood their conversation in this regard. Since October 16, 1986, Respondent's principal place of business has been 7345 Bay Street, St. Petersburg, Florida. Respondent failed to maintain a sign at this location from October 16, 1986, through January 8, 1987. He was having a sign prepared by a third party during that time.
Recommendation Based on the foregoing, it is recommended that a final order be entered dismissing Counts I, II and IV of the Administrative Complaint and finding Respondent guilty of the allegations set forth in Counts III and V of the Administrative Complaint. It is recommended that the Final Order impose an administrative fine of $1000 with respect to Count III and a reprimand with respect to Count V. ENTERED this 20th day of May, 1988, in Tallahassee, Florida. ROBERT E. MEALE Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 20th day of May, 1988. APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-4391 Treatment Accorded Petitioner's proposed Findings 1,3-5. Adopted. 2,6. Rejected as unnecessary and irrelevant. The location of Respondent's "principal office and each branch office" is relevant under Section 475.22 to determine where he was required to maintain a sign. The statute does not refer to the office registered with Petitioner. 7-8,16. Adopted. 9-.14. Adopted. 15,17. Rejected as unnecessary. 18. Rejected as unnecessary and irrelevant for the reason set forth for rejecting the proposed findings in paragraphs 2 and 6. Treatment Accorded Respondent's Proposed Findings Rejected as legal argument, except that Respondent and the Ehmkes entered into a contract. Last sentence - rejected as unnecessary and irrelevant. Remainder rejected as contrary to the greater weight of the evidence. Rejected as unnecessary, except that the blast sentence is adopted as to the sign being made. COPIES FURNISHED: Steven W. Johnson, Esquire Department of Professional Regulation Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802 Brian E. Johnson, Esquire 7190 Seminole Boulevard Seminole, Florida 34642 Darlene F. Keller Executive Director Division of Real Estate 400 West Robinson Street Orlando, Florida 32801 William O'Neil General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750
Findings Of Fact In the beginning of the hearing, proof was made that the Respondent, William W. Buchanan, was a licensed real estate salesman in the State of Florida, in an active capacity from June 18, 1973 thru March 31, 1976. This proof was established through Petitioner's Exhibit no. 1, which is a certification and copies of the real estate registration document. The Respondent, while employed by Joe Z. Lovingood, Inc., his corporate broker employer, took checks from the corporate check book. Three of the checks that were taken from that checkbook were forged by making the Respondent the payer and showing the signature of Joe Z. Lovingood. These checks were dated May 7, 1974, and May 31, 1974. There were two checks of May 7, 1974 for $600 and 2,500 respectively and the May 31, 1974 check was for $500. The Petitioner's Exhibit no. 2 is a xerox copy of the aforementioned checks. The originals of the checks were not produced because they are in the care and custody of the State Attorney's Office for Sarasota County, Florida. The owner of Joe Z. Lovingood, Inc., Mr. Joe Z. Lovingood, did not allow these acts, nor allow any employee within his employ to authorize the Respondent to take the checks from the check book to make the checks payable to the Respondent nor to forge Mr. Lovingood's signature. Furthermore, neither Mr. Lovingood nor any employee of his corporation who was acting upon his authority allowed the Respondent to negotiate these checks, although the Respondent did negotiate them and expend the funds for his own personal use. The exhibits which show the Respondent's negotiation of the checks are Petitioner's Exhibits no. 3 and no. Petitioner's Exhibit no. 3 is a copy of a bank statement of the Joe Z. Lovingood corporation which indicates debits placed against the corporate bank account in the amount of the aforementioned checks. The Petitioner's composite Exhibit no. 4 shows copies of the forged checks with the endorsement signature on the back together with deposit credits, found in the bank statement on the Respondent's account. In addition, the testimony of the bank official of the Respondent's bank indicated a partial cash withdrawal from the amount of the $600 and $500 checks which were negotiated through the Respondent's bank. Joe Z. Lovingood, Joan Lovingood, his wife, and Harold Merritt, the former accountant for Joe Z. Lovingood, Inc., established that the Respondent had told them about taking the checks from the corporate checkbook, and forging the signature of Joe Z. Lovingood after practicing to sign the signature. They also testified that the Respondent told them that he had intercepted bank statements at the post office in order to cover up the theft of the checks and subsequent forgery. After the discovery of Mr. Buchanan's acts, Mr. Lovingood notified the Petitioner. In addition after consultation with his legal adviser and the prosecutors of the jurisdiction, he determined to give the Respondent an opportunity to reimburse Joe Z. Lovingood, Inc. To accomplish this end, Mr. Lovingood co-signed a note in the amount of $3,000 which the Respondent took out in order to improve Mr. Buchanan's financial position. The Respondent agreed to pay back the $3,600 that he had taken from the corporation together with interest and also to repay the $3,000 loan with interest. A statement of his agreement can be found in his letter of July 8, 1974, addressed to Joe Z. Lovingood, as President of Joe Z. Lovingood, Inc., which is Petitioner's Exhibit no. 5 and in his letter of July 8, 1974, addressed to the National Bank of Sarasota which is Petitioner's Exhibit no. 6. Through the date of the hearing, these funds had not been paid to the National Bank of Sarasota. In August of 1974, the Respondent entered into discussion with one Walter E. Lingard about the purchase of real estate. Out of the conversation a deposit was made in the amount of $200 and a receipt for deposit, offer to purchase and contract for sale was entered into by the Respondent and Mr. Lingard. Mr. Lingard was approached by Mr. Buchanan on the question of the purchase of property and informed him that a better piece of property was available in another location and the $200 deposit would be allowed as a partial deposit on the substituted parcel. The contract document on the first parcel contemplated for purchase is Petitioner's Exhibit no. 9. Petitioner's Exhibit no. 10 is a copy of the check from Mr. Lingard and Petitioner's Exhibit no. 11 is a copy of the contract pertaining to the substituted parcel of land. The deposit check was written to William Buchanan at the request of William Buchanan who told Mr. Lingard that he would see that it was placed with his employer, Joe Z. Lovingood, Inc. In September of 1974, the Respondent entered into a conversation with one Hans Hellmann. The nature of this conversation concerned the investment of Mr. Hellmann's money in a real estate purchase. To this end, Mr. Hellmann deposited $2,500 with the Respondent through a check made out to William W. Buchanan. Again, this check was made out to Mr. Buchanan at his request with an assurance to Mr. Hellmann that the deposit would be placed with Joe Z. Lovingood, Inc. The Petitioner's Exhibit no. 7, is a copy of a contract document and Petitioner's Exhibit no. 8 is a copy of the deposit check. Neither Mr. Joe Z. Lovingood nor any employee within his corporation knew of the negotiations, contracts or deposit checks which had been entered into between Mr. Lingard and the Respondent and Mr. Hellmann and the Respondent. Mr. Lovingood found out about these matters when his office was contacted about the status of one of the contracts. Joe Z. Lovingood, Inc. did not receive the deposit checks, at any time. The proceeds of the deposit checks that have been mentioned, were appropriated to the use of the Respondent, without the knowledge and authority of Mr. Joe Z. Lovingood or any employee within his corporation. Restitution for the amounts of the deposit checks has never been made to Mr. Lingard or Mr. Hellmann. The details of the contracts and the fact that the money was appropriated to Mr. Buchanan's use, were related by the Respondent, to Mr. Joe Z. Lovingood, his wife and Mr. Merritt.
Recommendation It is recommended that the registration of the registrant, William W. Buchanan, be revoked. DONE and ORDERED this 18th day of June, 1976, in Tallahassee, Florida. CHARLES C. ADAMS, Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: William W. Buchanan 503 North Brink Avenue Sarasota, Florida 33577 Charles C. Felix Associate Counsel Florida Real Estate Commission 2699 Lee Road Winter Park, Florida 32789
The Issue Whether part of Florida Administrative Code Rule 69V- 560.704, particularly subsections (4)(d) and (5)(a), exceed Respondent’s rulemaking authority; enlarge, modify or contravene the specific provisions of law implemented; or are arbitrary or capricious, and thus, constitute an invalid exercise of delegated legislative authority pursuant to section 120.52(8), Florida Statutes.
Findings Of Fact Respondent is the state agency charged with the regulation and enforcement of chapter 560, Florida Statutes,2/ relating to money services businesses and their authorized vendors. Chapter 560, Part I, governs money services business generally, which includes check cashers. Chapter 560, Part III, governs check cashers. Petitioner is a licensed check casher pursuant to section 560.303. As a licensee, Petitioner is required to comply with Respondent’s duly-adopted administrative rules governing check cashers. Petitioner challenges parts of Florida Administrative Code Rule 69V-560.704, “Records to Be Maintained by Check Cashers,” as an invalid exercise of delegated legislative authority. Respondent cites section 560.105 as the specific authority to adopt the rule. Section 560.105 provides as follows: 560.105 Supervisory powers; rulemaking.— The office shall: Supervise all money services businesses and their authorized vendors. Have access to the books and records of persons the office supervises as necessary to carry out the duties and functions of the office under this chapter. Issue orders and declaratory statements, disseminate information, and otherwise administer and enforce this chapter and all related rules in order to effectuate the purposes, policies, and provisions of this chapter. The commission may adopt rules pursuant to ss. 120.536(1) and 120.54 to administer this chapter. The commission may adopt rules requiring electronic submission of any forms, documents, or fees required by this chapter, which must reasonably accommodate technological or financial hardship and provide procedures for obtaining an exemption due to a technological or financial hardship. Rules adopted to regulate money services businesses, including deferred presentment providers, must be responsive to changes in economic conditions, technology, and industry practices. Respondent cites section 560.310, as the law implemented by the challenged rule. Section 560.310 provides as follows: 560.310 Records of check cashers and foreign currency exchangers.— A licensee engaged in check cashing must maintain for the period specified in s. 560.1105 a copy of each payment instrument cashed. If the payment instrument exceeds $1,000, the following additional information must be maintained or submitted: Customer files, as prescribed by rule, on all customers who cash corporate payment instruments that exceed $1,000. A copy of the personal identification that bears a photograph of the customer used as identification and presented by the customer. Acceptable personal identification is limited to a valid driver license; a state identification card issued by any state of the United States or its territories or the District of Columbia, and showing a photograph and signature; a United States Government Resident Alien Identification Card; a passport; or a United States Military identification card. A thumbprint of the customer taken by the licensee when the payment instrument is presented for negotiation or payment. The office shall, at a minimum, require licensees to submit the following information to the check cashing database or electronic log, before entering into each check cashing transaction for each payment instrument being cashed, in such format as required by rule: Transaction date. Payor name as displayed on the payment instrument. Payee name as displayed on the payment instrument. Conductor name, if different from the payee name. Amount of the payment instrument. Amount of currency provided. Type of payment instrument, which may include personal, payroll, government, corporate, third-party, or another type of instrument. Amount of the fee charged for cashing of the payment instrument. Branch or location where the payment instrument was accepted. The type of identification and identification number presented by the payee or conductor. Payee’s workers’ compensation insurance policy number or exemption certificate number, if the payee is a business. Such additional information as required by rule. For purposes of this subsection, multiple payment instruments accepted from any one person on any given day which total $1,000 or more must be aggregated and reported in the check cashing database or on the log. A licensee under this part may engage the services of a third party that is not a depository institution for the maintenance and storage of records required by this section if all the requirements of this section are met. The office shall issue a competitive solicitation as provided in s. 287.057 for a statewide, real time, online check cashing database to combat fraudulent check cashing activity. After completing the competitive solicitation process, but before executing a contract, the office may request funds in its 2014-2015 fiscal year legislative budget request and submit necessary draft conforming legislation, if needed, to implement this act. The office shall ensure that the check cashing database: Provides an interface with the Secretary of State’s database for purposes of verifying corporate registration and articles of incorporation pursuant to this section. Provides an interface with the Department of Financial Services’ database for purposes of determining proof of coverage for workers’ compensation. The commission may adopt rules to administer this section, require that additional information be submitted to the check cashing database, and ensure that the database is used by the licensee in accordance with this section. (emphasis added). Florida Control of Money Laundering in Money Transmitters Act Section 560.310 was created by the 1994 Legislature as part of the omnibus “Money Transmitters Code” (the Code), providing for initial regulation of payment instrument sellers, foreign currency exchangers, check-cashers, and funds transmitters. The Code was enacted following publication of a report of Florida’s Eleventh Statewide Grand Jury titled “Check Cashing Stores: A Call for Regulation.” See Interim Report Number One of the Eleventh Statewide Grand Jury, “Check Cashing Stores: A Call For Regulation,” (Feb. 9, 1994)(“1994 Grand Jury Report” or “1994 Report”). The 1994 Report recognized the important role of check-cashing services for a significant number of people who are economically disadvantaged and cannot, or do not, maintain traditional bank accounts. However, the 1994 Report also documented abuse of unregulated check-cashing services by con artists, money launderers, and other criminals. The report found that the unregulated industry attracted criminals because the industry was under no obligation to keep records of the identity of those for whom they move money. Specifically, the report found that check-cashers did not have to: (1) verify that their business customers were legally registered; (2) verify that the person presenting the payment instrument is authorized to cash the instrument; or (3) keep records of the identity of the person who cashed the payment instrument. Id. The 1994 Report found check-cashing services were “not legally obligated to maintain transaction records of any kind that would be useful to law enforcement in the exercise of their investigatory duties.” Id. The 1994 Report recommended statewide regulation of check-cashing services to include the following relevant requirements: Id. Maintain for a period of five years all records of transmittals, currency exchanges, checks cashed, payment instruments issued, and other related financial records. Obtain identification from customers when cashing checks or money orders. Obtain, and maintain for five years, documentation regarding the identity of the payees of checks and money orders. Part I of the Code applied generally to all money transmitters, which was specifically defined to include check cashers. See ch. 94-354, § 1, Laws of Fla. (1994). The Code created section 560.123 “Florida Control of Money Laundering in Money Transmitters Act” requiring money transmitters to comply with the money laundering, enforcement, and reporting provisions of section 655.50, Florida Statutes. Id. Section 655.50, Florida Statutes (1993),3/ provided in pertinent part, “[e]ach financial institution shall maintain for a minimum of 5 calendar years full and complete records of all financial transactions, including all records required by 31 C.F.R. parts 103.33 and 103.34.” § 655.50(8)(b), Fla. Stat. (1993). Part III of the Code created sections 560.301, et seq., titled the “Check Cashing and Foreign Currency Exchange Act” (the Act). See ch. 94-354, § 3, Laws of Fla. (1994). Section 560.310, titled “Records of check cashers and foreign currency exchangers,” contained no requirements for particular types of records to be kept, but provided for the length of time check cashers must maintain “books, accounts, records and documents,” and provided for the location and destruction of said records. See § 560.310, Fla. Stat. (Supp. 1994). The Act did not directly require personal identification of persons presenting payment instruments for cash, but rather incentivized the presentation of personal identification by correlating the amount of fees charged with presentation of personal identification. Check cashers could charge a higher transaction fee when the customer did not present identification.4/ In 2008, the Attorney General’s Office published a Report of the Eighteenth Statewide Grand Jury titled, “Check Cashers: A Call for Enforcement” (2008 Report). See Second Interim Report of the Eighteenth Statewide Grand Jury, “Check Cashers: A Call for Enforcement” (March 2008). The 2008 Report was highly critical of the Money Transmitter Regulatory Unit (MTRU), the arm of Respondent with regulatory authority over check cashers and other money transmitters. The 2008 Report documented systematic fraud involving the check-cashing industry perpetrated particularly by construction contractors, in the arena of workers’ compensation, and the health care sector, in the arena of Medicaid and Medicaid prescription drug fraud. Id. at 7. According to the 2008 Report, both issues involved the establishment of shell corporations to launder money obtained by fraudulent means. Id. at 9, 11. The 2008 Report described the following elaborate scheme of workers’ compensation fraud: A contractor, who is required to purchase workers’ compensation insurance based on the amount of his or her payroll, hides the payroll by establishing a shell corporation in the name of a nominee owner, often a temporary resident of the United States. The shell company buys a bare minimum workers’ compensation policy, and the contractor makes payments to this shell “subcontractor,” who cashes the checks and returns the money to the contractor to pay his or her employees under the table. Id. at 10-12. Further, according to the 2008 Report, some check cashers actively participated in this scheme by setting up shell companies themselves, securing the certificate of insurance, and seeking out contractors with which to do business. Id. at 13. The 2008 Report documented an investigation by the Division of Insurance Fraud which revealed ten construction companies had funneled one billion dollars through check- cashing businesses in the prior three years. Id. at 13. The 2008 Report documented lack of enforcement by the MTRU, understaffing, and underutilized resources. Id. at 19-24. Further, the Report placed blame on the MTRU for failing to exercise rulemaking authority granted by the 1994 Legislature, especially with respect to collecting information related to corporate customers. Id. at 38. The 2008 Report also found the MTRU needed legislative authority to require check cashers to gather and report information in electronic format, which would make the investigation process more efficient and allow check-cashing businesses to detect structuring of transactions by customers to defraud workers’ compensation and other statutory requirements. Id. at 19. The 2008 Legislature incorporated many of the recommendations from the 2008 Report and significantly overhauled regulation of all money services businesses (formerly, “money transmitters”) including check cashers. The 2008 Legislation made the following changes-of- note to Part I of chapter 560: Prohibited licensees from accepting anything of value from a customer with intent to deceive or defraud. See ch. 08- 177, § 8, Laws of Fla. (2008) Prohibited the delivery to MTRU of any file known by it to be fraudulent or false. See Id. Increased the enforcement authority of MTRU. See ch. 08-177, § 9, Laws of Fla. Authorized immediate suspension of a license for failure to provide required records. See ch. 08-177, § 10, Laws of Fla. Required licensees to retain all required records for a minimum of five years. See ch. 08-177, § 1, Laws of Fla. The 2008 Legislature made the following changes to chapter 560, Part III: Prohibited a check casher from transacting business in any name other than the legal name under which it is licensed; Required disclosure of any fictitious name as part of initial licensing; Required a check casher to endorse all payment instruments received in the check- casher’s legal name under which it is licensed; and Prohibited check cashers from accepting multiple payment instruments from a person who is not the original payee, unless the person is a licensed check casher and the payment instruments are endorsed with the check casher’s legal name. Further, the 2008 Legislation required check cashers to maintain a customer file on all customers who cash “corporate or third-party payment instruments exceeding $1,000.” Ch. 08-177, § 42, Laws of Fla. The 2008 Legislature also added the requirement that, for any payment instrument accepted having a face value of $1,000 or more, the check casher must maintain personal identification from customers, a thumbprint of the customer, and a payment instrument log in an electronic format. See Id. Subsections 560.310(4), (5), and (6), relating to creation and maintenance of a statewide, real-time, online check-cashing database, were created by the 2013 Florida Legislature. See ch. 13-139, § 1, Laws of Fla. Prior to the 2013 amendments, section 560.310 required check cashers to maintain an electronic payment instrument log “as prescribed by rule.” § 560.310(1)(d), Fla. Stat. (2012). The 2013 amendment required check cashers to “submit the following information to the check-cashing database or electronic log, before entering into each check cashing transaction for each payment instrument being cashed, in such format as required by rule . . . .” Id. The Rule Florida Administrative Code Rule 69V-560.704(5)(a), reads as follows: (5)(a) In addition to the records required in subsections (1) and (2) for payment instruments $1,000.00 or more, the check casher shall create and maintain an electronic log of payment instruments accepted which includes, at a minimum, the following information: Transaction date; Payor name; Payee name; Conductor name, if other than the payee; Amount of payment instrument; Amount of currency provided; Type of payment instrument; Personal check; Payroll check; Government check; Corporate check; Third party check; or Other payment instrument; Fee charged for the cashing of the payment instrument; Branch/Location where instrument was accepted; Identification type presented by conductor; and Identification number presented by conductor. (b) Electronic logs shall be maintained in an electronic format that is readily retrievable and capable of being exported to most widely available software applications including Microsoft EXCEL. The 2013 Legislature incorporated into section 560.310, almost verbatim, the information required by the rule to be collected and maintained by check cashers in an electronic log.5/ The only significant difference between the statute and the rule is that the statute additionally requires check cashers to maintain, as part of the electronic log, the “payee’s workers’ compensation insurance policy number or exemption certificate number, if the payee is a business.” § 560.310(2)(d)11., Fla. Stat.6/ Respondent has not amended the rule subsequent to the 2013 amendments to section 560.310 requiring development and maintenance of a statewide, real-time, online check- cashing database. Respondent has not activated a statewide, real-time, online check-cashing database, but anticipates doing so in Fiscal Year 2015-2016. Referrals to Law Enforcement Pursuant to section 560.109(9), Respondent is required to annually report to the legislature the total number of examinations and investigations of its licensees that resulted in a referral to law enforcement, and the disposition of those referrals by agency. Respondent refers to the Florida Department of Law Enforcement (FDLE) results of its licensee investigations which may reveal criminal activity within the purview of the FDLE. For Fiscal Year 2012-2013, Respondent’s Bureau of Enforcement referred 78 examinations to FDLE. Respondent refers to the Division of Insurance Fraud (DIF) results of its licensee examinations which may reveal criminal activity related to workers’ compensation insurance. For Fiscal Year 2012-2013, Respondent referred 33 examinations to DIF. At the time of Respondent’s 2012-2013 annual report to the Legislature, FDLE had not opened any cases based on the 78 examinations referred. During that same time frame, DIF had opened 4 cases based on 33 referrals from Respondent. Threshold Amount for Recordkeeping Petitioner first challenges the rule as exceeding the scope of Respondent’s delegated legislative authority because it requires a log be kept “for payment instruments $1,000.00 or more” while the statute requires a log be kept on payment instruments “that exceed $1,000.” § 560.310(2)(a), Fla. Stat. Section 560.310(2) further reads, as follows: For purposes of this subsection, multiple payment instruments accepted from any one person on any given day which total $1,000 or more must be aggregated and reported in the check cashing database or on the log. (emphasis added). On the one hand, the statute requires a log be created and maintained on each payment instrument that exceeds $1,000, while on the other hand, acknowledges that payment instruments of lesser amounts, when presented by the same person, are “log worthy” when, together, they reach a threshold of $1,000. Petitioner argues that the 2012 Legislature repealed Respondent’s authority to require a log be kept on payment instrument amounts of $1,000. Section 560.310, Florida Statutes (2011), reads, in pertinent part, as follows: 560.310 Records of check cashers and foreign currency exchangers.— In addition to the record retention requirements specified in s. 560.1105, a licensee engaged in check cashing must maintain the following: Customer files, as prescribed by rule, on all customers who cash corporate or third- party payment instruments exceeding $1,000. For any payment instrument accepted having a face value of $1,000 or more: A copy of the personal identification that bears a photograph of the customer used as identification and presented by the customer. Acceptable personal identification is limited to a valid driver’s license; a state identification card issued by any state of the United States or its territories or the District of Columbia, and showing a photograph and signature; a United States Government Resident Alien Identification Card; a passport; or a United States Military identification card. A thumbprint of the customer taken by the licensee. A payment instrument log that must be maintained electronically as prescribed by rule. For purposes of this paragraph, multiple payment instruments accepted from any one person on any given day which total $1,000 or more must be aggregated and reported on the log. (emphasis added). The statute contained distinct recordkeeping requirements for payment instruments exceeding two different threshold amounts: (1) A customer file on all customers who cash corporate or third-party payment instruments exceeding $1,000, and (2) personal identification information of customers presenting payment instruments of $1,000 or more. The payment instrument log requirement was not associated with any minimum threshold amount. However, the language of subparagraph (c) did require aggregation of multiple payment instruments accepted from any one person on any given day which total $1,000 or more. As such, the log appeared to be required for all payment instruments of $1,000 or more. The 2012 Legislation struck the separate threshold of $1,000 or more which triggered the requirement to keep customer’s personal identification information. See ch. 12- 85, § 7, Laws of Fla. (2012). Further, the 2012 changes collapsed the separate requirements of customer identification information, customer thumbprint, and a payment instrument log into one list of records required to be kept on customers who cash payment instruments exceeding $1,000. See Id. However, the law retained the requirement that multiple payment instruments totaling $1,000 or more accepted from any one person on any given day be aggregated and reported on the log. Electronic Log Requirement Next, Petitioner challenges the rule as an invalid exercise of Respondent’s delegated legislative authority because the governing statute was amended in 2013 to eliminate the requirement for check cashers to keep an electronic log of payment instruments. In 2013, the Legislature created the following new subsections of section 560.310: The office shall issue a competitive solicitation as provided in s. 287.057 for a statewide, real time, online check cashing database to combat fraudulent check cashing activity. After completing the competitive solicitation process, but before executing a contract, the office may request funds in its 2014-2015 fiscal year legislative budget request and submit necessary draft conforming legislation, if needed, to implement this act. The office shall ensure that the check cashing database: Provides an interface with the Secretary of State’s database for purposes of verifying corporate registration and articles of incorporation pursuant to this section. Provides an interface with the Department of Financial Services’ database for purposes of determining proof of coverage for workers’ compensation. The commission may adopt rules to administer this section, require that additional information be submitted to the check cashing database, and ensure that the database is used by the licensee in accordance with this section. Ch. 13-139, § 1, Laws of Fla. With regard to the payment instrument log, the statute was amended as follows:7/ Id. The office shall, at a minimum require licensees to submit the following information to the check cashing database or electronic log, before entering into each check cashing transaction for each A payment instrument being cashed, in such format as required log that must be maintained electronically as prescribed by rule: The law also made the following conforming changes to existing text of section 560.310: (2) If the payment instrument exceeds $1,000, the following additional information must be maintained or submitted: * * * For purposes of this subsection paragraph, multiple payment instruments accepted from any one person on any given day which total $1,000 or more must be aggregated and reported in on the check cashing database or on the log. Id. The statute authorizes Respondent to make a 2014- 2015 legislative budget request prior to executing the contract for a vendor to run the database. See § 560.310(4), Fla. Stat. Thus, the statute specifically anticipates lag time between enactment of the legislation requiring the statewide database and the rollout of the database. Contrary to Petitioner’s assertion, the statute does not eliminate licensed check cashers’ responsibility to maintain records in an electronic log. The statute recognizes the licensee’s duty to both maintain information on an electronic log and submit that information to the statewide real time database. Corporate Customer Next, Petitioner challenges Respondent’s authority to require check cashers to maintain records of corporate customers in addition to natural persons. The section of the rule at issue is 69V-560.704(4), which reads, in pertinent part, as follows: (4) In addition to the records required in subsections (1) and (2), for payment instruments exceeding $1,000.00, the check casher shall: * * * (d) Create and maintain a customer file for each entity listed as the payee on corporate payment instruments and third party payment instruments accepted by the licensee. Each customer file must include, at a minimum, the following information[.] (emphasis added). Florida Administrative Code Rule 69V-560.704 further defines the following relevant terms: For purposes of this rule the term: ‘Corporate payment instrument’, as referenced in Section 560.310(1), F.S., means a payment instrument on which the payee named on the face of the payment instrument is not a natural person. ‘Conductor’ means a natural person who presents a payment instrument to a check casher for the purpose of receiving currency. ‘Customer file’ in regard to a ‘corporate payment instrument’ means the corporate entity shown as payee. In regard to ‘third-party payment instruments’, the term ‘customer file’ means the individual negotiating the payment instrument. Petitioner complains that Respondent is without authority to construe the term “customer” as the payee on a corporate payment instrument rather than a natural person appearing before the licensee presenting a check to be cashed. Petitioner argues that section 560.310 defines customer as the person presenting a check for payment, while the rule impermissibly requires the licensee to maintain customer files of corporate entities. Section 560.310 does not define the term “customer.” The sections of the statute which predate the 2013 Legislation used the term customer as if it applied only to a natural person. For example, the statute required the check casher to maintain “[a] copy of the personal identification that bears the photograph of the customer used as identification and presented by the customer.” § 560.310(2)(b), Fla. Stat. (2012). Further, the statute required the licensee to maintain “[a] thumbprint of the customer taken by the licensee when the payment instrument is presented for negotiation or payment.” § 560.301(2)(c), Fla. Stat. (2012). However, the 2013 amendments to chapter 560, specifying the items to be documented in the check casher’s electronic log of payment instruments, employ the terms “payor name” and “payee name” as displayed on the payment instrument, and “conductor” if different from the name on the payment instrument. The list of items required by statute to be logged include “[t]he type of identification and identification number presented by the payee or conductor,” and “[p]ayee’s workers’ compensation insurance policy number or exemption certification number, if the payee is a business.” § 560.310(2)(d)10. and 11., Fla. Stat. (2013). Additionally, the legislation requires Respondent to ensure that the anticipated statewide check-cashing database will interface with the Secretary of State’s database for verifying corporate registration and articles of incorporation, as well as with the Department of Financial Services’ database for determining proof of coverage for workers’ compensation. If the payee’s corporate information is not maintained by check cashers, it cannot be reported to the statewide check-cashing database for verification. Furthermore, the statute prohibits a licensee from accepting or cashing a corporate payment instrument from a person who is not an authorized officer of the corporate payee named on the instrument. See s. 560.309(4), Fla. Stat. Without obtaining records of the corporate payee, the check casher would be unable to comply with this requirement. Corporate Documents Next, Petitioner complains that some of the information required by rule to be kept on corporate customers is beyond the Respondent’s statutory authority. Specifically, Petitioner objects to the obligation to maintain the following information on corporate customers, as required by rule 69V- 560.704(4)(d): Documentation from the Secretary of State verifying registration as a corporation or fictitious entity showing the listed officers and FEID registration number. If a sole proprietor uses a fictitious name or is a natural person, then the customer file shall include the social security number of the business owner and documentation of the fictitious name filing with the Secretary of State. Articles of Incorporation or other such documentation which establishes a legal entity in whatever form authorized by law. For purposes of this rule a sole proprietor operating under a fictitious name registered with the Secretary of State shall not have to present such documentation. Documentation of the occupational license from the county where the entity is located. A copy of the search results screen page from Compliance Proof of Coverage Query Page webpage from the Florida Department of Financial Services – Division of Workers’ Compensation website (http://www.fldfs.com/WCAPPS/Compliance _POC/wPages/query.asp). Documentation of individuals authorized to negotiate payment instruments on the corporation or fictitious entity’s behalf including corporate resolutions or powers of attorney. Payment instruments for insurance claims where there are multiple payees shall be exempt from this provision provided that the maker of the check is an insurance company and the licensee has obtained and retained documentation as to the identity of the natural person listed as the payee on such payment instrument. Section 560.310(2) provides for the following customer information to be kept on file: Customer files, as prescribed by rule, on all customers who cash corporate payment instruments that exceed $1,000. (emphasis added). Respondent clearly has statutory direction in determining which types of documentation should be kept in corporate customer files. As noted previously, licensed check cashers are required by statute to enter into their electronic log each corporate payees’ workers’ compensation insurance policy number or exemption certificate number before entering into each check-cashing transaction. See § 560.310(2)(d)11, Fla. Stat. Likewise, licensees are required to verify that the conductor presenting a corporate check is an authorized officer of the corporate payee. See § 560.309(4), Fla. Stat. Petitioner seems to suggest that Respondent cannot require any document to be kept on corporate payees unless that document is specifically mentioned in the authorizing statute. That suggestion is contrary to controlling law, as discussed more fully below.
