Findings Of Fact Joseph L. Hiland, at all times here relevant, was licensed by Petitioner as an ordinary life, including disability, insurance agent. He has been a licensed insurance agent for 17 years and is presently a general agent for Philadelphia Life Insurance Company (Philadelphia) , National Reserve Life Insurance Company, and Century Life Insurance Company. He is not a general agent for but is licensed by Connecticut Mutual Insurance Company. In early 1980 the Philadelphia agent who served William Earl Tucker's policies, before moving out of the area, called Tucker to say he was leaving and that Hiland would be servicing his policies in the future. In April, 1980 Hiland sent Tucker an annual review letter and, after receiving Tucker's response, telephoned Tucker who asked Hiland to stop by. On or about May 24, 1980 Hiland visited Tucker's home and spoke with Tucker and his wife. At this time Tucker had Philadelphia policies which Hiland was reviewing and Hiland was unaware that Tucker had policies with Beneficial. A review of Tucker's Philadelphia policies had convinced Hiland Tucker did not need additional insurance; but Philadelphia had recently come out with a new policy, railed Avant Guarde, which appeared better suited for Tucker's situation than his existing policies. Hiland explained this policy to Tucker and Tucker concluded that he wanted to replace his existing Philadelphia policies. Tucker also wanted to take out an insurance policy on his youngest child. He already had policies on his other children. After the applications had been filled out Tucker asked Hiland to review his other policies and he presented four policies he had with beneficial. After reviewing these policies Hiland advised Tucker that he could get better coverage with Philadelphia policies for less money than he was paying for his Beneficial policies. Tucker then told Hiland he wanted to replace the Beneficial policies with Philadelphia policies and asked Hiland to take care of it for him. Tucker's application for the Avant Guarde policy and the new child's policy had been filled out before Hiland realized Tucker intended to replace the Beneficial policies and the block in Section 3 had been marked "no" on those forms and was not changed after Hiland learned of Tucker's desire to replace the Beneficial policies. Hiland explained the disclosure statement to Tucker and told him he should be presented with the forms if he was replacing insurance Tucker replied he didn't have time for Hiland to fill out those forms and for Hiland to take care of the necessary paper work. Because of the late hour and the need to fill out four disclosure statements for the four policies Tucker wanted to replace, Hiland did not fill out these forms. Completion of the disclosure statements would not have affected Tucker's determination to replace his Beneficial policies. Then Hiland left Tucker's home he had applications for Philadelphia policies on William E. Tucker and Tucker's four minor children Jess, Kelly, Doug and April. He also had Tucker's check in the amount of $295 for the initial premium on these policies. When Hiland realized Tucker intended to cancel his Beneficial policies he told Tucker that Carter George (the Beneficial agent) would be very upset. Tucker's response was to the effect that's too bad. Hiland prepared a letter (Exhibit 5) for Tucker to send to Beneficial to cancel the policies Tucker wanted to cancel. By mistake this letter was forwarded to Beneficial without being signed by Tucker and without the policies to be cancelled. Upon receipt of this letter Beneficial advised Agent George and sent Exhibit 6 to Tucker with enclosed forms for Tucker to complete. Upon receipt of the information that Tucker was cancelling his Beneficial policies George called Tucker, told him that Hiland was a crook and should be in jail. George also presented the Department of Insurance with his version of Hiland's transgressions. At this time Tucker knew little of Hiland and agreed to help George put Hiland in jail if he was a crook. The following morning an investigator from the Department of Insurance came by Tucker's home around 6 or 7 a.m. to discuss the case with Tucker. Upon receipt of the application Philadelphia prepared the policies Tucker had applied for and sent them to Hiland. When Hiland called Tucker to advise him he had the policies he was told by Tucker that the insurance department was investigating and that Tucker didn't want the policies. Hiland arranged for the cancellation of the Philadelphia policies and refunded the premiums advanced by Tucker. The Beneficial policies were never cancelled. While this investigation was proceeding Tucker talked with other people who had dealings with Hiland and George and concluded that perhaps George was the crook and Hiland the straight man. When he testified in these proceedings Tucker was quite positive that Hiland had fully explained to him the policies he was offering, the procedures to be followed in replacing insurance policies, and that he was in no wise misled nor did Hiland make any misrepresentations to him regarding the insurance policies in issue. He requested Hiland to take care of cancelling the Beneficial policies and discouraged completion of the disclosure statements.
The Issue The issue to be resolved in this proceeding concerns whether the Respondent violated various provisions of the Florida Insurance Code, as alleged in the Amended Administrative Complaint, and if so, what penalty, if any, is warranted.
Findings Of Fact The Petitioner is an agency of the State of Florida charged with regulating and licensing the entry of insurance agents into the profession of insurance and with regulating the practice of agents and other insurance professionals already licensed by the State of Florida. The Respondent, at all times pertinent hereto, was and is licensed by the State of Florida as a non-resident life and health insurance agent. The Respondent procured applications for life insurance to be issued from Pacific to the 30 named individuals and entities set forth in the Amended Administrative Complaint in its 25 counts. Pacific was not authorized to transact insurance business in the State of Florida because the company was not yet licensed. However, it was in the process of becoming licensed and licensure was imminent. The company Regional Director, C. Manley Denton, and other company officials, when they recruited the Respondent to sell insurance policies in Florida, assured him that licensure was imminent, that there was no impediment to finalization of the licensure procedures in the very near future, and that the Respondent could legally obtain life insurance policy applications and sell policies in Florida if he took the applications and dated them in and from his Tulsa, Oklahoma, office. He was assured that this procedure would render his activities legal. In reliance on these representations by officials of Pacific, the Respondent undertook to and did obtain the applications for, and sell the insurance policies, referenced above and in the Amended Administrative Complaint. The Respondent, for many years, has transacted insurance business as a general agent of life and health insurance in Oklahoma and in Florida. He is a resident of both states, spending part of each year in each state. Many of the policyholders referenced above and in the Amended Administrative Complaint were clients of the Respondent, who had already had other insurance policies issued by him through companies he represents. In the particular instances involved in this proceeding, many of these clients had been policyholders of the First Capital Life Insurance Company, which had experienced financial difficulties and gone into receivership. Because of his policyholders' concern and his own concern about the possibility of the future inability to pay claims by the company in receivership, the affected clients and the Respondent were desirous of replacing those policies with policies in a different and sounder insurance company. This desire dovetailed neatly with the desire by the executives at Pacific to obtain a large block of insurance policy business in Florida and in other states in the mainland United States. This desire by Pacific executives was due to a recent merger of that company with the Hawaiian Life Insurance Company, a company which was owned by Meiji Mutual Life of Tokyo Japan (Meiji). The resulting merged company, Pacific, was owned by Meiji. The executives at Pacific, which had historically been headquartered in San Jose, California, desired to continue to maintain the company domicile and their own personal residences in California and avoid having to relocate to Hawaii. This was the reason they desired to secure a large block of insurance business very rapidly in order to enhance the sales record of the "stateside branch" of the company. They believed that this would insure that their relocation would not have to be accomplished. With this interest in the forefront of their plans, the executives of Pacific began to search for the best insurance agents in the nation who have a record of successfully writing large volumes of life insurance policy business. The Respondent is such an insurance agent. He had recently achieved a nationally-recognized ranking as one of the highest volume life insurance producer agents in the country. Because the Respondent was desirous of placing a high-dollar volume of life insurance policies for the clients referenced above, who had had policies in the financially-troubled First Capital Life Insurance Company, the Respondent agreed, at the behest of the officials of Pacific, to attempt to write a large block of life insurance business in the State of Florida. The Respondent is a well-respected general life insurance and health insurance agent. He is widely known throughout the insurance profession and industry, throughout the United States, as an ethical, competent and successful life insurance policy producer. He has no blemish on his licensure and practice record as an agent, throughout the approximate 40 years he has engaged in the profession. When the Respondent obtained the insurance policy applications and policies at issue in this proceeding, he engaged in one course of conduct. That is, he contacted the clients and obtained their applications and arranged for the sale of the insurance policy contracts to them, as either new policies and clients, or as replacement policies for his existing clients, as the case might be. He engaged in this essentially-identical transaction with all 30 of these policyholders, in the genuine, good-faith belief that he was legally writing insurance policy business in the State of Florida based upon the circumstances related to him by officials of Pacific, upon which he relied. He candidly acknowledges, through counsel, that, in so relying, he knew that the company was not actually licensed in the State of Florida, but that that eventuality was imminent in the very near future, and that based upon the method the company assured him of writing the policies through the Tulsa, Oklahoma, office, he would be obtaining and transacting this business in a legally acceptable way. He also candidly acknowledges that, in fact, he understands, from his contact with the Department since that time, this was not the case and that he was writing the business for a company not legally authorized to do business in the State of Florida. The Respondent has freely admitted these above-found facts and does not dispute that he was in violation of the portion of the charges that do not depend on intent. He has established, however, through the exhibits admitted as explanatory hearsay and the agreed-upon proffer of his counsel, that the transactions at issue, all of which were the result of one essentially-identical course of conduct, were accomplished with no intent to defraud the policyholders, the company, or the Florida Department of Insurance. There was no willful, dishonest or deceitful intent by the Respondent during the course of his engagement in these transactions. There was no such willful wrongful intent in the course of his contact and relations with the company, those policyholders, or the Department of Insurance since that time. No policyholder or company suffered any financial detriment as a result of the Respondent's conduct, nor did any insurance coverage lapse at any time. Although there were some 30 policyholders who were sold insurance by the Respondent, as the agent for a company not actually licensed in the State of Florida, that circumstance had no effect on the validity of the policy coverages involved and there were no actual "victims" of the Respondent's conduct.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered by the Petitioner, Department of Insurance, finding the Respondent, Wayne Harland Creasy, guilty of a violation of Section 626.901(1), Florida Statutes, in the manner found and concluded above and that a penalty of $3,000.00 be imposed, together with the award of $500.00 in attorney's fees. DONE AND ENTERED this 1st day of April, 1996, in Tallahassee, Florida. P. MICHAEL RUFF, Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 1st day of April, 1996. APPENDIX TO RECOMMENDED ORDER Petitioner's Proposed Findings of Fact 1-32. Accepted. Rejected, as constituting a conclusion of law and not a finding of fact. Accepted, in part, but subordinate to the Hearing Officer's findings of fact on this subject matter. Accepted, in a technical sense, but not in the sense that any overt, intentional effort to circumvent Florida law was committed by the Respondent. Rather, it was a negligent failure to act in a legal way due to being misled by Pacific Guardian Life Insurance Company, Ltd. or its officers or employees. Accepted, as to the factual allegations of the Administrative Complaint, but not as to their legal import, and subordinate to the Hearing Officer's findings of fact on this subject matter. Respondent's Proposed Findings of Fact The Respondent's proposed findings of fact are not ruled upon or considered because they were not timely filed, being approximately one month out of time with no motion for extension of time, during the originally-set time period, being filed. Consequently, the Petitioner's motion to strike the Respondent's proposed findings of fact and conclusions of law is granted. COPIES FURNISHED: Willis F. Melvin, Jr., Esquire Department of Insurance and Treasurer Division of Legal Services 612 Larson Building Tallahassee, Florida 32399-0333 C. Rabon Martin, Esquire Martin and Associates 403 South Cheyenne Avenue Tulsa, Oklahoma 74103 Bill Nelson, State Treasurer and Insurance Commissioner Department of Insurance and Treasurer The Capitol, Plaza Level Tallahassee, Florida 32399-0300 Dan Sumner, Acting General Counsel Department of Insurance and Treasurer The Capitol, PL-11 Tallahassee, Florida 32399-0300
The Issue The issue in this case is whether, for the reasons alleged in the Administrative Complaint dated February 10, 1984, the Petitioner should revoke the Respondent's license and eligibility for licensure as an insurance agent or impose some lesser penalty authorized by statute.
Findings Of Fact Based on the testimony of the witnesses and the exhibits admitted into evidence, I make the following Findings of Fact: 1/ On June 16, 1982, the Respondent, Shelby Dewey Blackman, executed an Application for Qualification as Nonresident Life Agent, which application he thereafter caused to be filed with the Petitioner, Department of Insurance and Treasurer. In that application Mr. Blackman stated that his residence address and his business address in his state of residence were both "2549 New York Avenue, Pascagoula, Miss. 39567." (Pet. Ex. 1; Tr. 12-13) The Department of Insurance and Treasurer does not issue Nonresident Life Agent licenses to people who are in fact residents of the State of Florida. Such licenses are only issued to people who are nonresidents of this state. Applicants for Resident Life Agent licenses are required to take an examination prior to licensure. Applicants for Nonresident Life Agent licenses are not required to take an examination prior to licensure. The Department would not have issued a Nonresident Life Agent license to Mr. Blackman if the Department had known that Mr. Blackman was a Florida resident. (Tr. 14) As a result of the filing of the application described above, the Department issued to Mr. Blackman a license as a Nonresident Life and Health Agent for the American Sun Life Insurance Company, which was the only company he was authorized to write insurance for in the State of Florida. When Mr. Blackman received his license, the license listed the name of the the only company he was authorized to write insurance for in this state. Licensees who are authorized to represent more than one insurance company in this state receive a separate license for each company they are authorized to represent. Mr. Blackman had only the one license to represent one company. (Pet. Ex. 1 and 2; Tr. 14-18) At all times material to this case, Mr. Blackman was a resident of Santa Rosa County, Florida. Specifically, Mr. Blackman was a resident of Santa Rosa County, Florida, at the time he applied for and was issued a Nonresident Life and Health Agent license and at the time of writing the four insurance applications which are described hereinafter. (Pet. Ex. 3; Tr. 20-21, 53) Continental Bankers Life Insurance Company of the South does not currently hold, and has never held, a Certificate of Authority to write insurance in the State of Florida. In November of 1982 Continental Bankers Life Insurance Company of the South was licensed to write insurance in the State of Alabama and Mr. Blackman was authorized by Continental to write insurance for Continental in the State of Alabama. (Pat. Ex. 8; Tr. 24-25) During November of 1982, Mr. Blackman wrote four applications for health insurance policies to be issued by the Continental Bankers Life Insurance Company of the South. One was an application dated November 2, 1982 from Mr. Thomas J. Barrow. Another was an application dated November 4, 1982, from Mr. Jimmie R. Williams. The last two were applications dated November 12, 1982, from Mr. Henry E. Marshall and Mr. Ercy L. Henderson, respectively. All four of the applications were written and signed in Jay, Florida. No part of the transactions which culminated in the writing of the four applications took place in the State of Alabama. On three of the applications Mr. Blackman wrote that the application was written and signed in Brewton, Alabama, and on one of the applications Mr. Blackman wrote that the application was written and signed in Flomaton, Alabama. The statements that the applications were written and signed in Alabama were false statements that Mr. Blackman knew to be false statements. (Pet. Ex. 4, 5, 6, 7; Tr. 37-38, 42, 49, 53-54) The false statements written on the four applications described above were relied upon by the Continental Bankers Life Insurance Company of the South and were, therefore, material misrepresentations. If Mr. Blackman had truthfully written on the applications that they were written and signed in the State of Florida, Continental would not have issued policies on the basis of those four applications because Continental was not licensed to write insurance in the State of Florida. The MM-6 policy is an insurance policy that Continental markets in Alabama and the false statements on the applications which indicated that the policies were applied for and completed in Alabama induced Continental to issue the policies. (Tr. 25-27, 32, 34-35)
Recommendation For all of the reasons set forth above, and particularly because of Mr. Blackman's demonstrated disregard for the truth, I RECOMMEND that the Department of Insurance and Treasurer enter a Final Order revoking Mr. Blackman's license and eligibility to hold a license. DONE AND ORDERED this 31st day of July, 1984, at Tallahassee, Florida. MICHAEL M. PARRISH Hearing Officer Division of Administrative Hearings Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 904/488-9575 Filed with the Clerk of the Division of Administrative Hearings this 31st day of July, 1984.
The Issue Whether the Respondent committed the offenses alleged in the Administrative Complaint dated October 1, 2002, and, if so, the penalty that should be imposed.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing and on the entire record of this proceeding, the following findings of fact are made: The Department is the state agency charged with the administration of the Insurance Code of the State of Florida, including Chapter 626, Florida Statutes. See Section 20.121, Florida Statutes (2002). At the times material to this proceeding, Mr. Klein was licensed in Florida as an insurance agent for several lines of insurance. Mr. Klein was an authorized agent for Freedom Life. On or about February 6, 2002, the Department received a Termination of Appointment Form from Freedom Life, in which Freedom Life notified the Department that Mr. Klein's appointment as its agent had been terminated. Documentation attached to the form included four applications for health insurance and four checks for premium submitted with the applications. After receiving the Termination of Appointment Form, the Department initiated an investigation into the matter. Applicants Steven and Nancy Schwinn. The first questionable application for health insurance provided to the Department by Freedom Life named Steven and Nancy Schwinn as applicants, carried a signature purporting to be that of Mr. Klein, and was dated November 23, 2001. In the application, Mr. Schwinn's address was listed as Post Office Box 256 in Fort Lauderdale; his employer was identified as M.L.K. Inc. Investments; and Blue Cross/Blue Shield was identified as his current health insurance carrier. The Department's investigation revealed the following: The telephone number given for Steven and Nancy Schwinn is disconnected and neither Bellsouth nor AT&T has any record of having ever assigned a telephone number to Steven and/or Nancy Schwinn. A computer search failed to turn up a telephone number in Florida for Steven and/or Nancy Schwinn. The United States Postal Service reported that Post Office Box 256 in Fort Lauderdale is not assigned to Steven and/or Nancy Schwinn, but is, and has been, assigned to another individual unaffiliated with the transaction at issue herein. A search of property records in Miami-Dade, Broward, and Palm Beach counties failed to show any real property listed in the names of Steven and/or Nancy Schwinn. The Social Security Administration reported that the Social Security numbers listed on the application for Steven and Nancy Schwinn are invalid; that is, the Social Security numbers do not exist. The Florida Department of Revenue reported that a search of its records did not reveal any wage information for Steven or Nancy Schwinn under the Social Security numbers provided on the application. Blue Cross/Blue Shield reported that it could find no evidence that it had ever provided health insurance coverage to Steven Schwinn. Applicants Cary and Bonnie Washington. The second questionable application for health insurance provided to the Department by Freedom Life named Cary and Bonnie Washington as applicants, carried a signature purporting to be that of Mr. Klein, and was dated November 23, 2001. In the application, Mr. Washington's address was listed as Post Office Box 256 in Fort Lauderdale; his employer was identified as M.L.K. Investments; and Blue Cross/Blue Shield was identified as his current health insurance carrier. The Department's investigation revealed the following: The telephone number given for Cary and Bonnie Washington is disconnected and neither Bellsouth nor AT&T has any record of having ever assigned a telephone number to Cary and/or Bonnie Washington. A computer search failed to turn up a telephone number in Florida for Cary and/or Bonnie Washington. The United States Postal Service reported that Post Office Box 256 in Fort Lauderdale is not assigned to Cary and/or Bonnie Washington, but was, and has been, assigned to another individual unaffiliated with the transaction at issue herein. A search of property records in Miami-Dade, Broward, and Palm Beach counties failed to show any real property listed in the names of Cary and/or Bonnie Washington. The Social Security Administration reported that, although the Social Security numbers listed on the application for Cary and Bonnie Washington are valid, they are not issued to persons named Cary and Bonnie Washington. The Florida Department of Revenue reported that a search of its records did not reveal any wage information for Cary or Bonnie Washington under the Social Security numbers provided on the application. Blue Cross/Blue Shield reported that it could find no evidence that it had ever provided health insurance coverage to Cary Washington. Applicants Robert and Kathy Antetomer. The third questionable application for health insurance provided to the Department by Freedom Life named Robert and Kathy Antetomer as applicants, carried a signature purporting to be that of Mr. Klein, and was dated November 23, 2001. In the application, Mr. Antetomer's address was listed as Post Office Box 256 in Fort Lauderdale; his employer was identified as M.L.K. Investments; and Blue Cross/Blue Shield was identified as his current health insurance carrier. The Department's investigation revealed the following: The telephone number given for Robert and Kathy Antetomer is disconnected and neither Bellsouth nor AT&T has any record of having ever assigned a telephone number to Robert and/or Kathy Antetomer. A computer search failed to turn up a telephone number in Florida for Robert and/or Kathy Antetomer. The United States Postal Service reported that Post Office Box 256 in Fort Lauderdale is not assigned to Robert and/or Kathy Antetomer, but is, and has been, assigned to another individual unaffiliated with the transaction at issue herein. A search of property records in Miami-Dade, Broward, and Palm Beach counties failed to show any real property listed in the names of Robert and/or Kathy Antetomer. The Social Security Administration reported that, although the Social Security number listed on the application for Kathy Antetomer is valid, it is not issued to a person named Kathy Antetomer. The Social Security Administration reported that the Social Security number listed on the application for Robert Antetomer is invalid; that is, the Social Security number does not exist. The Florida Department of Revenue reported that a search of its records did not reveal any wage information for Robert or Kathy Antetomer under the Social Security numbers provided on the application. Blue Cross/Blue Shield reported that it could find no evidence that it had ever provided health insurance coverage to Robert Antetomer. Applicants Karen and Paul Holock. The fourth questionable application for health insurance provided to the Department by Freedom Life named Karen and Paul Holock as applicants, carried a signature purporting to be that of Mr. Klein, and was dated November 29, 2001. In the application, Mrs. Holock's address was listed as Post Office Box 431 in Fort Lauderdale; her employer was identified as M.L.K. Investments; and Foundation Health was identified as her current health insurance carrier. The Department's investigation revealed the following: The telephone number given for Karen and Paul Holock is disconnected and neither Bellsouth nor AT&T has any record of having ever assigned a telephone number to Karen and/or Paul Holock. A computer search failed to turn up a telephone number in Florida for Karen and/or Paul Holock. The United States Postal Service reported that Post Office Box 431 in Fort Lauderdale is not assigned to Karen and/or Paul Holock, but is, and has been, assigned to another individual unaffiliated with the transaction at issue herein. A search of property records in Miami-Dade, Broward, and Palm Beach counties failed to show any real property listed in the names of Karen and/or Paul Holock. The Social Security Administration reported that, although the Social Security numbers listed on the application for Karen and Paul Holock are valid, they are not issued to persons named Karen and Paul Holock. The Florida Department of Revenue reported that a search of its records did not reveal any wage information for Karen or Paul Holock under the Social Security numbers provided on the application. Foundation Health reported that it could find no evidence that it had ever provided health insurance coverage to Karen Holock. According to the records of the Florida Division of Corporations, M.L.K. Inc. was administratively dissolved in September 1997; Mr. Klein is listed as the only director of the corporation. The four checks that accompanied the four health insurance applications were written on an account purportedly belonging to "M.L.K. Inc."; three of the checks were returned to Freedom Life with "Account Closed" stamped on the front; Freedom Life did not submit the fourth check for deposit. Mr. Klein admitted in the letter sent to the Department's counsel on or about April 11, 2003, that he had written "bad checks" for the four policies.4 The evidence presented by the Department is sufficient to establish with the requisite degree of certainty that Mr. Klein is not trustworthy or fit to engage in business as an insurance agent, and he has committed dishonest and fraudulent practices as an agent licensed by the State of Florida and appointed by Freedom Life: Mr. Klein completed and submitted four health insurance applications to Freedom Life when he knew that the persons named as applicants were fictitious and that the information contained in the applications was false; Mr. Klein knowingly and deliberately sent with the applications four checks for the policy premiums that were drawn on a bank account that he knew was closed and contained no funds.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Financial Services enter a final order finding that Matthew Lawrence Klein violated Section 626.611(7) and (9), Florida Statutes (2001), and suspending his license(s) to engage in the business of insurance for a period of 36 months. DONE AND ENTERED this 21st day of May, 2003, in Tallahassee, Leon County, Florida. PATRICIA HART MALONO 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 21st day of May, 2003.
The Issue The issue in this case is whether Respondent, Thomas Felix Diaz, has violated various provisions of the Florida Insurance Code as alleged in an Administrative Complaint dated March 26, 1992 and, if so, what disciplinary action should be imposed against his license as an insurance agent in Florida.
Findings Of Fact Based upon the oral and documentary evidence adduced at the final hearing and the entire record in this proceeding, the following findings of fact are made: At all times relevant to this proceeding, Respondent was licensed in this state as a life insurance agent. Respondent is currently licensed as a life insurance agent, as a life and health insurance agent, and as a health insurance agent. At all times pertinent to this proceeding, Respondent was appointed to sell life insurance with Mass Indemnity and Life Insurance Company (MILICO) which has recently changed its name to Primerica Financial Services. In that capacity, all funds received by, from or on behalf of consumers, representing premiums for insurance policies, were trust funds received in a fiduciary capacity and were to be paid over to an insurer, insured, or other persons entitled thereto in the regular course of business. Sometime around March of 1991, the president of Delta Picture Frame Company ("Delta" or the "Company") of Miami decided to change the health insurance for two of his employees. The insurance was being provided at company expense. The prior policy included a small life insurance component as part of the coverage. The president of the Company contacted the MILICO agency to inquire regarding their group health policy and asked to see an agent. On or about March 18, 1991, Respondent accompanied another agent for MILICO, Nelson Barrera, to Delta's office to meet with the president of the Company. At the time of the meeting, Respondent was only licensed as a life insurance agent. He did not obtain his health and life license until approximately April 15, 1991. At the meeting, Barrera explained the coverage and price for health insurance. The president of Delta agreed to purchase the health insurance policies but never verbally expressed any interest in purchasing life insurance for his employees. In fact, he specifically rejected a proposed life and health insurance package stating that the company would only pay for health insurance. Respondent spoke separately with the employees. Applications for both life and health insurance were filled out and signed by the employees. The evidence was inconclusive as to whether life insurance was actually discussed with either of the employees. Only one of the employees testified at the hearing. She verified her signature on the application for life insurance, but she claims that she only discussed health insurance with the agents and did not knowingly apply for life insurance. The president of Delta signed the last page of the life insurance applications which authorized automatic withdrawals to pay MILICO for the life insurance policies. The circumstances surrounding the execution of the life insurance applications was not clearly established by the evidence.. However, the evidence was clear that the president of the Company never intended to purchase life insurance and never knowingly agreed to authorize bank withdrawals for life insurance. The evidence established that the president of the Company clearly indicated that the Company would only pay for health insurance and he never knowingly assented to the issuance of life insurance policies for the employees at company expense. When the president of the Company noticed that the bank records reflected withdrawals payable to MILICO, he inquired further and learned that the deductions were for life insurance. He immediately called Respondent who agreed to cancel the life insurance policies and provide a refund. Respondent was entitled to receive a commission of 75 percent of the first year's premiums for the sale of the life insurance policies to the employees of Delta.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Insurance issue a Final Order finding Respondent guilty of violating Section 626.621(6) and that Respondent's licenses be suspended for a period of three months, or, in lieu of a suspension, Respondent should be required to pay to the Department a fine of $500 and be placed on probation for a period of two years subject to such terms and restrictions as the Department may apply. RECOMMENDED this 3rd day of June 1993, at Tallahassee, Florida. J. STEPHEN MENTON Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 3rd day of June 1993.
The Issue Whether the Petitioner application for licensure as a resident life, variable annuity and health agent should be granted or denied.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing and on the entire record of this proceeding, the following findings of fact are made: The Department is the state agency responsible for issuing licenses "authorizing a person to be appointed to transact insurance or adjust claims for the kind, line, or class of insurance identified in the document." §§ 626.015(9) and 626.112(1)(a), Fla. Stat. Prior to December 4, 2002, Mr. Porras was licensed in Florida as an insurance agent. He was also part-owner of The Garpo Group, Inc. ("Garpo Group"), an insurance agency. On October 18, 2002, the Department (formerly the Department of Insurance) and Mr. Porras entered into a Settlement Stipulation for Consent Order ("Settlement Stipulation") as a result of an investigation by the Department that resulted in allegations of wrongdoing on the part of Mr. Porras. In the Settlement Stipulation, Mr. Porras agreed to surrender his agent's licenses to the Department. Mr. Porras did not admit in the Settlement Stipulation that he committed the acts alleged by the Department. A Consent Order was entered on December 4, 2002. The Consent Order incorporated the terms of the Settlement Stipulation and provided that the surrender of Mr. Porras's licenses "shall have the same force and effect as a revocation pursuant to Section 626.641, Florida Statutes"; that Mr. Porras "shall not engage or attempt or profess to engage in any transaction or business for which a license or appointment is required under the insurance code or directly or indirectly own, control, or be employed in any manner by any insurance agent or agency . . . ."; and that Mr. Porras "shall not have the right to apply to the Department for another license under the Insurance Code within two (2) years of the effective date of revocation." Neither the Settlement Stipulation nor the Consent Order included a deadline by which Mr. Porras was required to divest himself of his ownership interest in the Garpo Group. On April 24, 2003, a Purchase and Sale Agreement ("Agreement") was executed whereby Mr. Porras, Eduardo Garcia, Mayda Garcia, and Luis Garcia, who were identified as the principals of the Garpo Group, agreed to sell the Garpo Group to Jose Peña and Peter Rivero. The Agreement included a purchase price of $50,000.00, payable in an initial deposit of $20,000.00, with the remaining balance to be paid "in monthly installments of no less than $500.00 (Five Hundred Dollars), and no more than $2,500.00 (Two Thousand Five Hundred Dollars)." A Special Condition of the Agreement provided that Mayda Garcia, "Shareholder/Registered Agent/General Agent/Director," and Luis Garcia, "Shareholder/Director," would "remain in Corporation in their current capacity until final payment for sale of business is paid." Mr. Porras retained an interest in the monthly payments to be made by Mr. Peña and Mr. Rivero for the purchase of the business. In accordance with the terms of the Consent Order, Mr. Porras surrendered his license and did not subsequently engage in the transaction or solicitation of insurance. Mr. Porras did not exercise any control over the Garpo Group after entry of the Consent Order. Mr. Porras worked for the Garpo Group as a bookkeeper from May 2004 through October 2004.3 He was paid $175.00 per week, and his duties included reconciling the Garpo Group's bank accounts, entering deposits in the system, and cutting checks on the Garpo Group accounts.4 It can be reasonably inferred from the evidence presented by Mr. Porras regarding his understanding of the terms of the Consent Order that Mr. Porras was aware when he accepted employment with the Garpo Group that the terms of the Settlement Stipulation and of the Consent Order prohibited him from any involvement in the business of the Garpo Group, including employment "in any manner."
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED the Department of Financial Services enter a final order finding that Lorenzo Alejandro Porras violated the terms of a Consent Order entered by the Department of Financial Services and denying his application for licensure as a resident life, variable annuity, and health agent, pursuant to Section 626.611(13), Florida Statutes. DONE AND ENTERED this 29th day of March, 2006, in Tallahassee, Leon County, Florida. S PATRICIA M. HART 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 29th day of March, 2006.
