Findings Of Fact The Applicant, Protestant, and Department submitted Proposed Findings of Fact pursuant to Rule 3C-9.11, Florida Administrative Code. The Applicant's Proposed Findings of Fact are accepted except where they might specifically conflict with the Findings stated in the Hearing Officer's Report or where they may constitute conclusions of law, with the following exceptions: The last sentence of Proposed Finding Number 8 is rejected to the extent that it constitutes a legal argument as opposed to a finding of ultimate fact. Proposed Finding Number 11 is rejected in that it constitutes legal argument as opposed to a finding of ultimate fact. Proposed Finding Number 15 is rejected in that it constitutes a conclusion of law. The Protestant's Proposed Findings of Fact are accepted except where they might specifically conflict with the Findings stated in the Hearing Officer's Report or where they may constitute conclusions of law, with the following exceptions: The first sentence of Proposed Finding Number 6 is rejected in that it is speculative, constitutes legal argument, and is not supported by competent substantial evidence. The last sentence of Proposed Finding Number 6 is rejected in that it constitutes a conclusion of law as to the reason why the Protestant's bank charter was granted. The first, third, fourth and fifth sentences of Proposed Finding Number 10 are rejected, as they constitute legal arguments based upon restatement of testimony, as opposed to findings of ultimate fact. The second sentence of Proposed Finding Number 11 is rejected in that it constitutes a conclusion of law. Proposed Finding Number 14 is rejected in that it consists of argumentative references to testimony and not findings of ultimate fact. Proposed Finding Number 24 is rejected in that it constitutes legal argument and conclusions of law rather than findings of ultimate fact. The first sentence of Proposed Finding Number 26 is rejected in that it constitutes a conclusion of law. The second sentence of Proposed Finding Number 26 is rejected in that it is repetitious and constitutes a conclusion of law. The Fourth sentence of Proposed Finding Number 26 is rejected in that it constitutes a conclusion of law. Proposed Finding Number 27 is rejected in that it constitutes a conclusion of law. Proposed Finding Number 28 is rejected in that it constitutes legal argument rather than a finding of ultimate fact. The last sentence of Proposed Finding Number 31 is rejected in that it constitutes legal argument and a conclusion of law. The Department's Proposed Findings of Fact are accepted except where they might specifically conflict with the Findings of the Hearing Officer's Report or where they may constitute conclusions of law.
Findings Of Fact First Bank of Hollywood Beach is a state-chartered bank duly authorized and empowered under the laws of the State of Florida and of the United States to conduct a general banking business in and from offices in the State of Florida. First Bank's main office is located in Broward County, and it has three authorized branch offices in Broward County. (Hearing Officer's Exhibit 1) American Bank of Hollywood is a state-chartered bank duly authorized and empowered under the laws of the State of Florida and of the United States to conduct a general banking business in and from offices in the State of Florida. (Hearing Officer's Exhibit 1) It conducts business in its main office in Broward County, has a branch office in Broward County, and has applied for a second branch office in Broward County. Gerald A. Lewis is the Comptroller of the State of Florida and, as such, is the head of the Department of Banking and Finance. On August 1, 1980, the Department received request from the First Bank of Hollywood Beach for approval of an amendment to its charter changing its name to First American Bank of Broward County. On August 22, 1980, the department received an objection to the requested name change from American Bank of Hollywood. (Hearing Officer's Exhibit 1) Both banks have engaged in the banking business in Broward County, Florida, for more than eight years using their current corporate names. (Hearing Officer's Exhibit 1) Some of the principals of First Bank of Hollywood Beach, either as directors, officers, or shareholders, are and have been directors, officers, or shareholders of the First American Bank of Palm Beach County, which bank conducts a business through a main office and ten branch offices in Palm Beach County, Florida. Said principals desire to change the name of First Bank of Hollywood Beach to reflect its affiliation with the First American Bank of Palm Beach County. Additionally, substantially the same group of individuals has pending with the Department an application to organize a new bank to be named First American Bank of Broward County, which bank will also conduct its business through its main office in Broward County, Florida. If the de novo charter is approved, the new bank would also function as part of the "group" comprised of the First American Bank of Palm Beach County and the First Bank of Hollywood Beach. (Hearing Officer's Exhibit 1) As of the date of hearing in this cause, banks with the word "American" in their names were located in thirteen different counties within the State of Florida. At that time, within Broward County, the following commercial banks and savings and loan associations used the word "American" in their titles: American Bank of Hollywood + 1 branch (+ 1 branch applied for) Transamerica Bank of Florida + 1 branch Pan American Bank of Broward + 3 branches Great American Bank of Davie Great American Bank of Broward County Gulfstream American Bank & Trust Company + 5 branches AmeriFirst Federal Savings & Loan Associa- tion + 5 branches American Savings & Loon Association + 14 branches The proposed First American Bank of Broward County, together with First Bank's group if its requested name change is approved, would produce five additional locations of banks with "American" in their titles in Broward County. The sole basis for American Bank's objection to First Bank's requested name change is confusion based upon name similarity. No confusion exists between the First American Bank of Palm Beach County and the Pan American Bank of Palm Beach County or between the First American Bank of Palm Beach County and any bank in Broward County with "American" in its name, although the First American Bank of Palm Beach County has a branch within one mile of the Palm Beach/Broward County line. David Starke, an economist who specializes in consulting work with financial institutions, was not tendered as an expert witness and, accordingly, was not accepted as one. However, the surveys of banks with similar names in the State of Florida prepared by him reveal that all banks using the word "American" in their names also use either a first-word adjective and/or a geographic designation to distinguish one from the other. According to those surveys, both the banks and the savings and loam associations in Broward County with "American" in their titles use these two methods of distinguishing themselves. Both methods of distinction would be utilized by the requested one change in this cause. Other than uncorroborated hearsay evidence, American Bank introduced four items of correspondence which David L. Cory personally obtained from mail erroneously received by American Bank on one Saturday. All of the items of correspondence originated from persons outside of Broward County, with two of them originating from outside of the State of Florida. None of the items was addressed to the American Bank of Hollywood; however, three of the four items specifically carried American Bank's mailing address. The 1980 Hollywood (Broward County, Florida) telephone directory contains a listing for a First American Bank of Broward County, a bank formerly known as Executive Bank of Fort Lauderdale and now known as Great American Bank of Broward County. 10 . In March, 1979 the American Bank of Hollywood reserved with the Secretary of State's office the corporate name of American Bank of Broward. Other than reserving the name, American Bank has taken no steps toward using that name. The Department takes no position on the requested name change herein and recommends neither approval nor disapproval.
Recommendation Based upon the foregoing findings of fact and conclusions of law, it is, therefore, RECOMMENDED: That a final order be entered approving the request of First Bank of Hollywood Beach to change its name to First American Bank of Broward County. RECOMMENDED this 13th day of May, 1981, in Tallahassee, Florida. LINDA M. RIGOT, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 13th day of May, 1981. COPIES FURNISHED: Leonard L. Levenstein, Esquire 1500 South Dixie Highway Coral Gables, Florida 33146 Walter W. Wood, Esquire Assistant General Counsel Office of the Comptroller Suite 1302, The Capitol Tallahassee, Florida 32301 Robert B. Butler, Esquire Ellis, Spencer, Butler & Kisslan 1909 Tyler Street Post Office Box 6 Hollywood, Florida 33022 The Honorable Gerald A. Lewis Comptroller, State of Florida The Capitol Tallahassee, Florida 32301 =================================================================
The Issue Whether the application to organize Plus International Bank should be approved.
Findings Of Fact On March 24, 2000, the Department received an application (Application) from foreign nationals (Applicants) to organize a new bank, Plus International Bank (New Bank), to be located in Miami-Dade County, Florida. The Department published notice of its receipt of the Application in the April 7, 2000, edition of the Florida Administrative Weekly. The notice complied with the requirements Section 120.80(3)(a)1.a., Florida Statutes, and Rule 3C-105.103(1), Florida Administrative Code.5 By letter dated April 11, 2000, the Department requested the Applicants to supplement their Application with additional information, including information concerning their "promise of successful operation" and the New Bank's "capital structure," its "directors and officers," and its "banking quarters." It was not until November 3, 2000, that the Department received all of the additional information it had requested from the Applicants. The Application identifies four individuals associated with the New Bank who are foreign nationals: Manuel Sacal, Harry Sacal, Alex Sacal, and Roberto Barroso. Manuel Sacal (M. Sacal) is a proposed director of the New Bank and holder of 28% of the bank's outstanding shares of common stock. He is currently the Chief Executive Officer and General Director of Casa De Cambio Plus, S.A. de C.V. (Cambio Plus), a foreign exchange house based in Mexico City, Mexico, and the Chief Executive Officer and General Director of Plusder, S.A. de C.V., a futures brokerage house located in Mexico City, Mexico. As the Chief Executive Officer and General Director of Cambio Plus, a position he has held since 1987, M. Sacal has helped Cambio Plus become one of the largest exchange houses in Mexico. Harry Sacal (H. Sacal), like M. Sacal, is a proposed holder of 28% of the New Bank's outstanding shares of common stock. Alex Sacal (A. Sacal) is a proposed holder of 14% of the New Bank's outstanding shares of common stock. M. Sacal, H. Sacal, and A. Sacal are brothers. They each are citizens of Mexico. Roberto Barroso is a proposed director of the New Bank and holder of 0.1% of the New Bank's outstanding shares of common stock. He is a citizen of Brazil. Mr. Barroso has 30 years of banking experience, primarily in the area of international banking. He has, among other things, managed financial institutions and been involved in making trade financing arrangements. From approximately 1998, until his retirement in June of 2000, he was a Vice-President of Citibank. The other proposed directors of the New Bank identified in the Application -- Enrique Cabanilla, Barry Deutsch, Jaime Medina, Ira Weindruch, Deborah Jacobson, and Patrick Fournie -- are all United States citizens. These individuals, along with Mr. Barroso, have sufficient business experience, ability, standing, and reputation to enable them to perform their duties as the New Bank's directors in a manner that can reasonably be expected to result in the successful operation of the bank. Mr. Cabanilla, who is also identified as the proposed chief executive officer of the New Bank, has had over 30 years of banking experience, with particular emphasis in the areas of international banking and trade finance. He has held banking positions which have required him to be directly involved in credit analysis and approval, bank and personnel administration, direction and control of operations, and the application of routine control and audit functions. In addition, he has been responsible for the management of multi- branch banking operations and all phases of commercial lending. Although Mr. Cabanilla has not had at least one year of direct experience as an executive officer, director, or regulator of a financial institution within the last three years, it appears that he possesses sufficient financial institution experience, ability, standing, and reputation to enable him to perform his duties as the New Bank's chief executive officer in a manner that can reasonably be expected to result in the successful operation of the bank. Mr. Deutsch has had over 30 years of banking/bank consulting experience. He has been an employee of, and consultant to, a number of large United States financial institutions, such as Mellon National Bank, Bank One, and Bank of America. In addition, as a consultant, he has assisted a number of community banks in the South Florida area with strategic planning, marketing, and investor relations. He has also served as a consultant to several Latin American financial institutions, including Banco Popular de Puerto Rico and Grupo Financiero BAC, and to Bank Polska Kasa Opieki in Warsaw, Poland. While Mr. Deutsch has had at least one year of direct experience as an executive officer or director of a financial institution, he last served in such a capacity in 1988. Mr. Medina has had almost 20 years of banking experience, primarily in the area of international banking, and has had a least one year of direct experience as an executive officer of a financial institution within three years of the date the Application was filed with the Department. Mr. Weindruch was an owner and director of RockIsland Bank, an Illinois-state chartered bank, from 1985 until 1991. In addition, he served on the bank's loan, facilities, and personnel committees. He has not served as an executive officer or director of a financial institution since his departure from RockIsland Bank. Ms. Jacobson has extensive experience in the exporting and importing business. She has never been an executive officer or director of a financial institution. Mr. Fournie is the Chief Financial Officer for Surfin, Ltd., the Latin American arm of Direct TV. Prior to assuming his current position, he was employed by Citibank, where he gained considerable experience in international banking. Mr. Fournie has never been an executive officer or director of a financial institution. None of the proposed officers, directors, or major shareholders6 of the New Bank has been convicted of, or pled guilty or nolo contendere to, any violation of Section 655.50, Florida Statutes (which is known as the "Florida Control of Money Laundering in Financial Institutions Act"), any offense described Chapter 896, Florida Statutes, or any other crime. At present, the New Bank does not have a proposed president. The New Bank's business plan reflects that the bank will offer trade financing and commercial loans to small and medium-sized United States exporters and importers located primarily in Florida; commercial loans and small business loans to small and medium-sized businesses in the Miami-Dade County community; and private banking services to high net worth individuals, particularly those who are foreign nationals and permanent or part-time residents of the United States. The Application indicates that, at the time of the opening of the New Bank, 5,000,000 shares of common stock will have been sold at $2.00 per share, producing $10,000,000.00 in start-up capital. (According to the Application, the total number of shares of common stock that the New Bank will be authorized to issue is 7,500,000.) Of the $10,000,000.00 in start-up capital that the New Bank will have at opening, $7,000,000.00 will have been contributed by the Sacal brothers (M. Sacal, H. Sacal, and A. Sacal). Approximately $2,500,000.00 of the remaining $3,000,000.00 in start-up capital has already been raised. The Sacal brothers have committed to increasing their investment in the New Bank after its opening, as circumstances warrant. The Application estimates that net organizational expenses will be $446,642.00. Of the amount ($9,553,358.00) of capital remaining following payment of these expenses, $5,000,000 will be allocated as paid-in capital (5,000,000 shares at $1.00 par value). The New Bank's proposed capital structure will also have paid-in surplus in an amount greater than 20 percent of paid-in capital and a fund designated as undivided profits in an amount greater than five percent of paid-in capital. The initial capitalization of the New Bank appears to be adequate in relation to its proposed business activities. Local conditions in Miami-Dade County indicate reasonable promise of successful operation of the New Bank. The bank's financial plan appears to be reasonable and attainable. The parties have stipulated that the corporate name, "Plus International," is not, and cannot, be reserved with the Department of State inasmuch as the Department of State no longer reserves corporate names. The New Bank, which will be located at 200 South Biscayne Boulevard, Miami, Florida, will have suitable quarters. The Applicants have applied to have the New Bank insured by the Bank Insurance Fund (BIF) of the Federal Deposit Insurance Corporation (FDIC). The application was received by the FDIC on July 11, 2000. DONE AND ENTERED this 9th day of February, 2001, in Tallahassee, Leon County, Florida. ___________________________________ STUART M. LERNER 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 9th day of February, 2001.
The Issue The ultimate issue in this case is whether an application to organize Petitioner, BBU Bank, should be approved by Respondent, the Office of Financial Regulation, Division of Financial Institutions.
Findings Of Fact On March 12, 2004, the Office of Financial Regulation (hereinafter referred to as the "Office") received an Application for Authority to Organize a Bank, a Savings Bank or Association Pursuant to Chapters 658 and 665, Florida Statutes (hereinafter referred to as the "Application"). The new bank is to be known as BBU Bank and is to be located at 150 Alhambra Circle, Coral Gables, Miami-Dade County, Florida. The Application listed three individuals who would own an interest in BBU Bank who were nationals of a country other than the United States: Juan Carlos Escotet, Luis Xavier Lujan, and Jorge Carraballo Rodriguez. Mr. Escotet and Mr. Jujan, but not Mr. Rodriguez, were determined to be proposed "major shareholders" of BBU Bank. A major shareholder is defined in Florida Administrative Code Rule 3C-105.001(7) as "any person subscribing to 10 percent or more of the voting stock or nonvoting stock which is convertible into voting stock of the proposed state financial institution." Mr. Rodriguez will not own ten percent of the stock of BBU Bank nor will he be a director or executive officer of BBU Bank. The Office caused notice of its receipt of the Application to be published in the March 26, 2004, edition of the Florida Administrative Weekly. That notice was made consistent with the requirements of Section 120.80(3)(a)1.a., Florida Statutes, and Florida Administrative Code Rule 3C- 105.103(1). By letter dated March 22, 2004, the Office acknowledged receipt of the Application and deposit of the filing fee, reported that notice of receipt of the Application had been published in the Florida Administrative Weekly, and requested additional information, including documentation of BBU Bank's source of cash and/or a copy of a loan commitment to fund the purchase of bank stock by each of the proposed directors, the qualifications of the proposed directors, and information concerning whether an application had been filed with the Federal Deposit Insurance Corporation (hereinafter referred to as the "FDIC"). By letter dated July 2, 2004, the Office notified the applicants that documents addressing the information requested in previous correspondence had been received and reviewed. The Office, therefore, informed the applicants that it had "now [found] your application substantially complete." The Office also notified the applicants that a public hearing was required, due to the proposed role of Mr. Escotet and Mr. Lujan in BBU Bank. On August 5, 2004, Don Saxon, Commissioner of the Office, issued an Order Granting Office's Petition for Public Hearing, ordering the public hearing on the Application required by Section 120.80(3)(a)4, Florida Statutes. The Order was filed with the Division of Administrative Hearings on August 10, 2004, with a letter requesting the assignment of an administrative law judge to conduct the public hearing. The public hearing was scheduled to commence at 1:00 p.m., on September 21, 2004. Notice of the hearing was caused to be published in The Miami Herald on August 31, 2004, in compliance with Florida Administrative Code Rule 3C-105.105(1). The public hearing was conducted as scheduled. No member of the public appeared at the hearing. No opposition to the Application was expressed by anyone appearing at the hearing. Mr. Escotet, a proposed director and holder of 62 percent of the common stock of BBU Bank, appeared and testified at the public hearing. Based upon that testimony, it is found that Mr. Escotet: Is a citizen of Venezuela; Is currently President of Banesco Banco Universal, Caracas, Venezuela; Has extensive banking experience and serves on the board for several other banks in Venezuela; and Possess sufficient financial institution experience, ability, standing, and reputation to enable him to perform his duties as a director for BBU Bank in a manner that can reasonably be expected to result in the successful operation of the bank. Mr. Lujan, a proposed director and holder of 31 percent of the common stock of BBU Bank, appeared and testified at the public hearing. Based upon that testimony, it is found that Mr. Escotet: Is a citizen of Venezuela; Is currently the Executive President of Banesco Bank Universal, Caracas, Venezuela; Has more than 20 years of educational, managerial, and executive experience in the banking business; and Possess sufficient financial institution experience, ability, standing, and reputation to enable him to perform his duties as a director for BBU Bank in a manner that can reasonably be expected to result in the successful operation of the bank. The other proposed directors, Jose R. Gutierrez, Martha S. Pantin, Raul Robau, Santiago D. Morales, and Raul J. Valdes-Fauli, are all citizens of the United States. They have sufficient business institution experience, ability, standing, and reputation to enable them to perform their duties as a director for BBU Bank in a manner that can reasonably be expected to result in the successful operation of the bank. Mr. Gutierrez is the proposed President and Chief Executive Office for BBU Bank. Mr. Gutierrez is currently a director for, and chairman of the Audit Committee of, Eastern National Bank, Miami, Florida. Mr. Gutierrez has 24 years of banking experience, including serving as president of three banks, in Miami-Dade County. Mr. Gutierrez has sufficient financial institution experience, ability, standing, and reputation to enable him to perform his duties as BBU Bank's President and Chief Executive Officer in a manner that can reasonably be expected to result in the successful operation of the bank. Neither Mr. Escotet or Mr. Lujan has been convicted of, or pled guilty or nolo contendere to, any violation of Section 655.50, Florida Statutes, any offense described in Chapter 896, Florida Statutes, or any other crime. The other proposed officers and directors of BBU Bank reported to the Office that they had not been convicted of, or pled guilty or nolo contendere to, any violation of Section 655.50, Florida Statutes, any offense described in Chapter 896, Florida Statutes, or any other crime and no evidence to the contrary was presented at the public hearing. The Office conducted a background investigation of all of the directors and executive officers of BBU and reported no information to preclude them from serving in their proposed capacities for the bank. Respondent's Exhibit 2 at 337-371. Consistent with Section 658.21(4), Florida Statutes, three of the proposed directors, Mr. Escotet, Mr. Lujan, and Mr. Valdes-Fauli, have direct financial institution experience within three years of the date of the Application. The business plan for BBU Bank represents that the bank will offer full-service banking to individuals and businesses located primarily in Miami-Dade County. BBU Bank will seek international businesses originating from Venezuela and other countries in Latin America, relying upon the contacts and experience of its directors and executive officers. BBU Bank will issue 2,000,000 shares of common stock at a price of $7.50 per share. Stock sales will produce $15,000,000.00 in capital. After payment of $350,000.00 of organization expenses, BBU Bank will allocate the remaining $14,650,000.00 capital funds as follows: Paid-in Capital (2,000,000 shares of $5.00 par value): $10,000,000.00 Paid-in Surplus (at least 20% of Paid-in Common Stock): 4,650,000.00 Total Capital Account $14,650,000.00 The initial capitalization of BBU Bank is adequate for its proposed business activities. BBU Bank will have quarters suitable to carry out its business. Conditions in Miami-Dade County indicate reasonable prospects for the successful operation of BBU Bank. The bank's financial plan is reasonable and attainable.
Findings Of Fact Based upon consideration of the oral testimony and documentary evidence introduced at the hearing, the following relevant facts are found. In October, 1978, the Applicant filed with the Department of Banking and Finance an application for authority to open a branch bank at the northwest corner of Gunn Highway and Hudson Lane in the northwest section of unincorporated Hillsborough County, Florida. The Applicant presently does not have any branch bank facilities and, by way of this application, seeks the establishment of its first branch bank. The applicant bank was established April 11, 1975, as the Citrus Park Bank and is located at Gunn Highway and Hixon Road in the northwest section of unincorporated Hillsborough County, Florida. The site of the proposed branch is approximately 4.5 miles southeast of the main office. As stated, the site for the proposed branch is the northwest corner of Gunn Highway and Hudson Lane, which provides good access to both roads. The proposed branch office will offer the full extent of customer facilities. The branch bank building will contain approximately 1,500 square feet, housing four interior teller windows and two auto tellers. The seller of the land on which the proposed branch facility will be situated, has no connection with the Applicant. The primary service area for the proposed branch bank is bounded on the north by Erlich Read, on the south by railroad tracks, on the east by a direct line running north from Gunn Highway, Linebaugh Avenue intersection, and on the west by Henderson Road extended to Bellamy Road. Witnesses Bobier and Noto, of Site Selection Consultants, Inc., testified that the primary service area boundaries are realistic, in that they comply with regulatory criteria of being the smallest area within which the proposed bank will garner 75 percent of its deposits. Exhibit 5 of the Applicant's application reveals that there are eight deposit customers within the primary service area with total deposits of $178,783, and eight loan customers with total loans of $13,735. Since the date of its initial application with FDIC 1/, October 15, 1978, from that date to April 18, 1979, Citrus Park Bank has acquired eighty-one new deposit customers for total additional deposits of $186,548. (See Applicant's Exhibit No. 5) There are presently no existing banks within the primary service area for this proposed branch. Within the proposed site for this branch bank, it appears that the population of the primary service area is approximately 6,900 persons. It is projected that by 1985, the population will reach at least 15,000. The people living within the primary service area are of the highest strata when using traditional factors such as income, wealth, housing and occupation. The average population per banking office for the United States as a whole is 4,561, whereas this population figure for-the State of Florida is 8,086 per banking office. The Applicant anticipates total deposits at the end of the first year's operation of the proposed branch to be $1.5 million; at the end of the second year, $3.0 million and at the end of the third year, $4.5 million. At the end of the first year of operating, the Applicant anticipates a net loss of approximately $25,900. At the end of the second year, the Applicant projects a net profit of $41,300; and at the end of the third year, a net profit projection of $85,000 is expected. There are a significant number of new or recently developed subdivisions in the primary service area. There appears to be approximately nine large residential communities within the service area. While there appears to be no large commercial activity and development in the primary service area, current plans for such development appear imminent. According to the applicant bank, it is entitled to have 50 percent of its unimpaired capital and surplus in direct ownership or leasehold improvements of land and building, which eqnals $545,000. As of December 31, 1978, the bank had invested in such assets a total of $285,000. Thus, the Applicant figures that it has available to invest in bank promises an amount of $260,000. The applicant bank has a net investment in land of $20,000 and anticipates spending $150,000 on buildings, which make a total of $170,000 invested in land and buildings. The applicant bank's president, Robert D. Sellas, testified that the Applicant has sufficient capital accounts to support the bank's deposit base and the additional fixed asset proposal for the branch and its operations. Based on the main facility's record of growth, Mr. Sellas testified that the applicant bank has sufficient earnings and earnings prospects to support the anticipated expenses of the proposed branch. The bank's net profit to asset ratio is being maintained at 1.04 percent for the calendar year or better. It has good established earnings and is presently retaining most of its earnings for the branch expansion. As of December 31, 1978, the Applicant's adjusted capital to asset ratio was 13.97 percent. This figure is expected to increase over the following few months. An examination of the bank's economic figures indicate that the Applicant is enjoying good liquidity. (See Applicant's Exhibit No. 4) This chart which commences in the month of May, 1976, and continues through March, 1979, indicates that at the end of March, 1979, the bank had a ratio of approximately 76 percent of loans to loanable funds. In determining the bank's liquidity, a figure is utilized to determine the amount of funds it is willing to commit to loans. According to this formula, 80 percent of total deposits excluding public funds plus capital funds exists in excess of the amount invested in fixed assets and is considered available to fund the loan account. According to this formula, President Sellas testified that the bank has sufficient liquidity to support the branch bank expansion. The Applicant's main office is staffed with the intention of establishing an additional branch. The Applicant's managerial capacity, asset condition and past performance are good. President Sellas testified that the Applicant has sufficient depth and quality of management to operate the proposed branch without reducing its current level of services or over-extending its managerial or operational capacity. (See Respondent's Exhibit No. 3) The Applicant has six officers excluding its Chairman of the Board. The average banking experience for the Applicant's officer' is 10.5 years and their average age is 36 years. The individual designated to be the manager for the proposed branch is Dana Chwan. Ms. Chwan has a Bachelor of Science degree from the University of Tampa, has been associated with the Citrus Park Bank since its inception four years ago, and is presently in a loan officers training program. Prior to this program, Ms. Chwan served as the bank's marketing officer. (See Respondent / Applicant's Exhibit No. 3 for personnel data concerning the officers) Mr. Keith White, an expert for the Petitioner, Carrollwood State Dank, testified that there was total available deposits within the primary service area of approximately $104,200,000. He (White) further testified that it is possible that Citrus Park Bank, through its proposed branch, could garner $1.5 million in deposits during its first year in operation. Additionally, President Sellas testified that in his judgment, the prospect for the viability of the proposed branch is good. The applicant bank recently underwent an FDIC examination and at that time the financial-asset condition of the bank was in excellent shape, although the bank wrote off a minor amount of loans. Expert witnesses Bobier and Noto, of Site Selection Consultants, Inc., testified that the public convenience and need would be better served by the establishment of the Citrus Park branch bank at the proposed location and both were optimistic about the future growth in and around the proposed location of this branch bank. The Citrus Park Bank started with an initial capitalization of $1,201,500. The bank has had an excellent past performance record and has been profitable. Over the years the bank has taken a conservative approach toward dividends and has paid five cents per share to its stock-holders per quarter, retaining a substantial sum of its earnings for expansion. The bank's president, Robert D. Sellas, testified that the bank projects a continued increase in earnings and feels that the establishment of this branch will not adversely affect the bank's earnings. The name of the proposed branch is to be "Citrus Park Bank-Gunn Highway Branch Office." In accordance with provisions of Florida Statutes, Subsection 120.57(1)(a)(12), conclusions of law and recommendations are not included in this Report. RESPECTFULLY SUBMITTED AND ENTERED this 21st day of May, 1979, in Tallahassee, Florida. JAMES E. BRADWELL Hearing Officer Division of Administrative Hearings Room 101, Collins Building Tallahassee, Florida 32301 (904) 488-9675 COPIES FURNISHED: Richard B. Collins, Esquire Michaels, Sheffield, Perkins, Collins and Vickers 2007 Apalachee Parkway Post Office Box 10069 Tallahassee, Florida 32302 J. Riley Davis, Esquire Taylor, Brion, Buker and Greene 32G Barnett Bank Building Post Office Pox 1796 Tallahassee, Florida 32302 Gerald A. Lewis, Comptroller Office of the Comptroller The Capitol Tallahassee, Florida 32301 William S. Lyman, Esquire Assistant General Counsel Office of the Comptroller The Capitol Tallahassee, Florida 32301
Findings Of Fact Petitioner is an agency of the State of Florida charged with the responsibility and duty to prosecute violations of the statutes and rules regulating the practice of real estate in the State of Florida. Respondent, Benjamin C. Rolfe, is now and was at all times material hereto a licensed real estate broker in the State of Florida, having been issued license number 0318091 in accordance with Chapter 475, Florida Statutes. The last license issued to Mr. Rolfe was as a broker with Squires Realty of the Palm Beaches, Inc., 721 U.S. 1, #217, North Palm Beach, Florida. Respondent, Duane C. Heiser, is now and was at all times material hereto a licensed real estate broker in the State of Florida having been issued license number 0038233 in accordance with Chapter 475, Florida Statutes. The last license issued to Mr. Heiser was as a broker effective February 8, 1991, at Duane C. Heiser Realty Co., 1312 Commerce Lane A1, Jupiter, Florida. On or about December 12, 1998, a Final Order was issued by the Florida Real Estate Commission and received by Mr. Heiser whereby his real estate broker's license was suspended for two (2) years from January 12, 1989, through January 10, 1991. During the month of October 1989, Mr. Heiser violated the lawful suspension order of the Commission by personally delivering rental checks to and ordering the disbursement of escrow funds from the Property Management-Operating Account, which is an escrow account, of Squire's Realty Company of the Palm Beaches, Inc. Between March 22 and March 26, 1990, the escrow account records of Mr. Rolfe, who was the qualifying broker for Squire's Realty of the Palm Beaches, Inc., were audited by Petitioner's authorized representatives. The Escrow/Trust Account Audit revealed that Respondent Rolfe failed to properly document and reconcile the Property Management-Operating Account, which is an escrow account. Mr. Rolfe was responsible for this account. Mr. Rolfe was negligent regarding the management of this escrow account by allowing a suspended licensee, Mr. Heiser, access to this account. Mr. Rolfe and Petitioner stipulated that the appropriate penalty for Mr. Rolfe's violation of Section 475.25(1)(b), Florida Statutes, would be the imposition of an administrative fine in the amount of $300.00 and the placement of his licensure on probation for a period of one year. They further stipulated that the administrative fine was to be paid within thirty days of the filing of the final order. They also stipulated that during his term of probation Mr. Rolfe would be required to complete sixty hours of continuing education with thirty of those sixty hours being the thirty hour management course for brokers. They further stipulated that Mr. Rolfe would be required to provide to Petitioner satisfactory evidence of his completion of those sixty hours of continuing education and that those sixty hours of continuing education are to be in addition to any other continuing education required of Mr. Rolfe to remain active and current as a real estate broker in the State of Florida. Mr. Heiser and Petitioner stipulated that the appropriate penalty for Mr. Heiser's violation of Section 475.25(1)(b), Florida Statutes, would be the imposition of an administrative fine in the amount of $300.00 and the placement of his licensure on probation for a period of one year. They further stipulated that the administrative fine was to be paid within thirty days of the filing of the final order. They also stipulated that during his term of probation, Mr. Heiser would be required to complete sixty hours of continuing education with thirty of those sixty hours being the thirty hour management course for brokers. They further stipulated that Mr. Heiser would be required to provide to Petitioner satisfactory evidence of his completion of those sixty hours of continuing education and that those sixty hours of continuing education are to be in addition to any other continuing education required of Mr. Heiser to remain active and current as a real estate broker in the State of Florida.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered which: Dismisses Counts I, III, and V of the Administrative Complaint; Finds Mr. Heiser guilty of having violated a lawful order of the Florida Real Estate Commission in violation of Section 475.25(1)(e), Florida Statutes, as alleged in Count II of the Administrative Complaint. It is further recommended that the Final Order impose an administrative fine in the amount of $300.00 upon Mr. Heiser and place his licensure on probation for a period of one year. It is also recommended that the conditions of probation require that Respondent Heiser pay the said administrative fine within thirty days of the filing of the final order and that he be required to complete sixty hours of continuing education during his term of probation. It is further recommended that as part of the sixty hours of continuing education, Mr. Heiser be required to successfully complete the thirty hour management course for brokers, that he be required to provide satisfactory evidence of completion of such continuing education to Petitioner, and that these sixty hours of continuing education be in addition to any other continuing education required of Respondent Heiser to remain active and current as a real estate broker in the State of Florida. Finds Mr. Rolfe guilty of culpable negligience in a business transaction in violation of Section 475.25(1)(b), Florida Statutes, as alleged in Count IV of the Administrative Complaint. It is further recommended that the Final Order impose an administrative fine in the amount of $300.00 upon Mr. Rolfe and place his licensure on probation for a period of one year. It is also recommended that the conditions of probation require that Respondent Rolfe pay the said administrative fine within thirty days of the filing of the final order and that he be required to complete sixty hours of continuing education during his term of probation. It is further recommended that as part of the sixty hours of continuing education, Mr. Rolfe be required to successfully complete the thirty hour management course for brokers, that he be required to provide satisfactory evidence of completion of such continuing education to Petitioner, and that these sixty hours of continuing education be in addition to any other continuing education required of Respondent Rolfe to remain active and current as a real estate broker in the State of Florida. DONE AND ORDERED in Tallahassee, Leon County, Florida, this 30th day of December, 1991. CLAUDE B. ARRINGTON 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 30th day of December, 1991. COPIES FURNISHED: James H. Gillis, Esquire Department of Professional Regulation 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801 Neil F. Garfield, Esquire Garfied & Associates, P.A. World Executive Building Suite 333 3500 North State Road 7 Fort Lauderdale, Florida 33319 Jack McRay General Counsel Department of Professional Regulation 1940 North Monroe Street Suite 60 Tallahassee, Florida 32399-0792 Darlene F. Keller Division Director Division of Real Estate Department of Professional Regulation 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801
The Issue The purpose of the public hearing was to review the application to consolidate New River Bank, Oakland Park, Florida, and 1st United Bank, Boca Raton, Florida, in accordance with Florida law.
Findings Of Fact 1st United Bancorp (Bancorp) is a Florida bank holding company which maintains its principal place of business at 980 North Federal Highway, Boca Raton, Florida. 1st United is a Florida chartered bank and is a wholly-owned subsidiary of Bancorp and operates full service banking facilities at seven locations in Palm Beach and Martin Counties. New River is a Florida chartered bank which maintains its executive offices at 2901 West Oakland Park Boulevard, Oakland Park, Florida, and operates two banking facilities in Broward County, Florida. The Department is the duly designated state agency vested with the responsibility of processing and approving or disapproving a plan of any financial entity to acquire the assets and assume the liabilities of another financial entity pursuant to Section 655.414, Florida Statutes. On July 13, 1993, Bancorp and New River entered into a Sale and Purchase Agreement which provides that Bancorp will cause 1st United to purchase substantially all of the assets and to assume substantially all of the liabilities of New River, after which New River will be liquidated and dissolved. The agreement noted above was duly adopted by majority vote of the respective Boards of Directors of Bancorp, 1st United and New River. In addition, the respective Boards of Directors of Bancorp, 1st United and New River duly adopted by majority vote a Plan of Acquisition of Assets and Assumption of Liabilities which summarized pertinent portions of the agreement and which includes all of the terms and conditions required by Section 655.414 (1), Florida Statutes. On September 7, 1993, 1st United and New River submitted an application to the Department seeking the Department's approval for the purchase of New River's assets and assumption of its liabilities as set forth in the agreement and as summarized by the plan. Submitted with the application were the requisite filing fee and all of the required documents including copies of the agreement, the plan and certified copies of the authorizing resolutions of the respective boards of directors. On September 17, 1993, the Department caused notice of the receipt of the application to be published in the Florida Administrative Weekly. This published notice met the requirements of Rule 3C-9.003(1), Florida Administrative Code. On September 7, 1993, Warren Orlando, in his capacity as president of 1st United, filed a petition for public hearing and notice of intention to appear on behalf of 1st United. On October 27, 1993, the Department referred the matter to the Division of Administrative Hearings for the purpose of conducting a public hearing pursuant to Section 120.60(5), Florida Statutes, and Rule 3C-9.004, Florida Administrative Code. Notice that a public hearing would be held on the application on December 13, 1993, was duly published in conformity with Rule 3C-9.005, Florida Administrative Code, in the Fort Lauderdale Sun-Sentinel, Palm Beach Post, and Stuart News, newspapers of general circulation in the communities in which 1st United and New River do business. The agreement provides that New River will receive a combination of cash and Bancorp common stock equal to the net asset value, as defined in the plan, of the assets and liabilities of New River being purchased or assumed. The agreement further provides that after the closing of the asset acquisition, New River shall cease operations and commence dissolution and liquidation proceedings. Substantially all of the Bancorp common stock and available cash received by New River from Bancorp will be distributed to New River shareholders, other than dissenting shareholders. New River stockholders will receive a pro rata portion of the Bancorp common stock and cash available for distribution. After the acquisition of the assets and assumption of liabilities as set forth in the agreement and as summarized in the plan, 1st United will have adequate capital structure in relation to its activities and its deposit liabilities. The acquisition of the assets and assumption of liabilities as set forth in the agreement and as summarized in the plan, if consummated, are not contrary to the public interest. The respective boards of directors of Bancorp and New River requested the opinion of Alex Sheshunoff & Co. Investment Banking with regard to the fairness to the respective shareholders of each corporation, from a financial point of view, of the terms and conditions of the agreement. Alex Sheshunoff & Co. Investment Banking is regularly engaged in and is an expert authority in the valuation of bank and bank holding company securities in connection with bank mergers and acquisitions. Thomas Mecredy is an expert in the valuation of bank and bank holding companies in connection with bank mergers and acquisitions. On December 8, 1993, Alex Sheshunoff & Co. Investment Banking through Thomas Mecredy issued its opinion to the respective Boards of Directors of Bancorp and New River that the terms and conditions of the agreement were fair and equitable to the shareholders of each corporation. Pursuant to the agreement, New River's Board of Directors duly adopted a plan of dissolution and complete liquidation for New River. The plan of dissolution provides that after the sale of assets and assumption of liabilities the Board of Directors will reserve a sufficient amount of Bancorp stock and cash for payment of liquidation expenses and payment of liabilities not assumed by 1st United, including contingent liabilities (general reserves). In addition to the general reserves, New River will create a special reserve (special reserve) in an amount which it considers sufficient to defend and satisfy certain potential claims which may be asserted against New River by shareholders of New River in conjunction with the organization and initial offering of common stock of New River. In determining the amounts necessary to establish the general reserves and special reserve, New River's board of directors consulted with the national law firm of Proskauer Rose Goetz and Mendelsohn with respect to both reserves and the Florida law firm of Shutts & Bowen with respect to the special reserve for advice concerning the potential liability on the part of New River in connection with both known claims and potential claims and the amounts, if any, for which New River could be held liable. Shareholder E.D. Hittson noted that the book value of the New River stock is approximately $11.00 per share versus the $4.50 per share value of the 1st United stock. In response, bank officials noted that 1st United has dividend and strong growth potential not available to New River. Shareholder James Weck questioned provisions being made to satisfy outstanding lawsuit liabilities, the future location of the facility, and the effect on New River employees. In response, bank officials stated that the potential lawsuit liability is included in the reserve amounts, that no decision has been made as to the future location of the banking facility but that the needs of the service area will be met, and that it is their intention to draw talent from the New River staff. Shareholder Amine Semaan questioned whether New River would be represented on the Board of Directors at 1st United, whether minority areas would be a priority for the future location of the facility, and whether another buyer would have paid $10.50 per share. In response, bank officials maintained that New River will have one member on the Board of Directors at 1st United, that the needs of the service area will be met, and that no other, more attractive, buyer is available. On January 11, 1994, MaryAnn Cassel, a shareholder who reportedly attended the public hearing on December 13, 1993, filed a motion for leave to become a party. Such motion alleged that the movant, a minority shareholder, will be forced to accept Bancorp common stock in exchange for her New River shares or be forced to accept appraisal rights in lieu of her shares. Further, movant claimed that the plan is not fair to all parties because the shares of New River have been undervalued. Having deemed such motion untimely, and having determined such request does not allege circumstances unknown to movant prior to the December 13, 1993 public hearing, it is denied. DONE AND ENTERED this 24th day of January, 1994, in Tallahassee, Leon County, Florida. Joyous D. Parrish 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 24th day of January, 1994. COPIES FURNISHED: Honorable Gerald Lewis Comptroller, State of Florida The Capitol, Plaza Level Tallahassee, Florida 32399-0350 William G. Reeves General Counsel Department of Banking and Finance Room 1302, The Capitol Tallahassee, Florida 32399-0350 Donald E. Thompson, II Proskauer Rose Goetz and Mendelsohn One Boca Place, Suite 340 2155 Glades Road Boca Raton, Florida 37431 Michael W. Ford Phillip T. Ridolfo, Jr. Mershon, Sawyer, Johnston, Dunwody & Cole Phillips Point East Tower 777 South Flagler Drive, Suite 900 West Palm Beach, Florida 33401 Jeffrey D. Jones Department of Banking and Finance Division of Banking The Capitol, Suite 1302 Tallahassee, Florida 32399-0350 David S. Zimble Zimble Formoso-Murias, P.A. 1401 Brickell Avenue, Suite 730 Miami, Florida 33131
Findings Of Fact Based on the oral and documentary evidence presented at the hearing and on the entire record of this proceeding, the following findings of fact are made: On October 20, 1998, the Department received an application to acquire control of the First Bank of Miami by Rene de Picciotto, who is a citizen of Italy residing in Switzerland. Mr. de Picciotto currently owns approximately twenty-three percent of the outstanding common stock of the First Bank of Miami and proposes to increase his percentage of ownership to thirty-five percent of the bank's outstanding common stock. The First Bank of Miami is a state-chartered financial institution located in Miami, Dade County, Florida. The bank is insured by the Federal Deposit Insurance Corporation ("FDIC"), and Mr. de Picciotto filed a Notice of Change in Control with the FDIC. The FDIC conveyed its intent not to disapprove the acquisition in a letter dated April 8, 1999. In a notice published in the October 30, 1998, edition of the Florida Administrative Weekly, the Department complied with the requirements of Section 120.80(3)(a)1.a., Florida Statutes (Supp. 1998), by providing notice that Mr. de Picciotto's application had been filed, by advising the public that it could submit comments for inclusion in the record, and by advising that any person could request a public hearing by filing a request with the Clerk of the Department of Banking and Finance within twenty-one days of the date the notice was published. No request for a hearing was received from a member of the public. However, since the application at issue involves the acquisition of the First Bank of Miami by a foreign national, the Department requested a public hearing and forwarded the matter to the Division of Administrative Hearings as required by Section 120.80(3)(a)4. On May 27, 1999, Mr. de Picciotto complied with the requirements of Section 120.80(3)(a)4. by causing a notice to be published in The Miami Herald advising that a public hearing on his application to acquire control of the First Bank of Miami would be held on June 10, 1999, at the Division of Administrative Hearings in Tallahassee, Florida, and via telephone from the offices of the First Bank of Miami. The Miami Herald is a newspaper of general circulation in Dade County, Florida, which is the community served by the First Bank of Miami. The hearing was held as scheduled, but no member of the public appeared at either the Division of Administrative Hearings in Tallahassee or via the telephone conference connection with the First Bank of Miami. Mr. de Picciotto appeared in person at the public hearing in Tallahassee, Florida, as required by Section 120.80(3)(a)4. Mr. de Picciotto has extensive experience in banking. After receiving a baccalaureat degree from the French Ecole des Hautes Etudes Commerciales in 1964, Mr. de Picciotto worked from 1965 until 1973 for the Banque Indosuez, a leading European merchant bank. He has been involved in banking continuously since that time. From 1973 until 1978, Mr. de Picciotto managed the offices of the affiliates of the Trade Development Bank located in Switzerland, Paris, Luxembourg, and Belgium. From 1978 until 1981, Mr. de Picciotto was manager of the Financiere Indosuez, the Swiss unit of the Banque Indosuez, and was involved in portfolio management for individuals with a high net worth. In 1981, Mr. Picciotto purchased Progespar, an affiliate of the Banque Indosuez located in Switzerland, and he ultimately acquired thirty-three percent of the bank's stock. The bank was renamed Financiere Fransad in 1981, and it operated independently as a private bank until 1991, with its deposits growing during that time to 1.5 billion Swiss francs. Meanwhile, in 1986, Mr. de Picciotto obtained a license to open a bank in Lausanne, Switzerland, with initial equity of ten million Swiss francs. Mr. de Picciotto owned fifteen percent of the stock of this bank, which operated under the name of Cantrade Banque Lausanne and operated as a private bank involved in international finance. In 1987, Cantrade Banque Lausanne acquired a local Swiss bank named Banque Intercommerciale de Gestion, which had a representative located in Miami, Florida. In 1991, Financiere Fransad and Cantrade Banque Lausanne merged, and the resulting bank was named Cantrade Private Banque Lausanne. Mr. de Picciotto owned forty percent of the equity in this bank, and was vice chairman of the board. The bank managed deposits of 2.5 billion Swiss francs and employed 90 people. It continued to maintain a representative in Miami. In 1994, Mr. de Picciotto purchased one-hundred percent of the equity in Cantrade Private Banque Lausanne. In 1995, Banque Centonale de Geneve, which is a state bank organized under the Republic of Geneva, Switzerland, and owned by local governments in and around Geneva, purchased forty percent of the equity in Cantrade Private Banque Lausanne, which was renamed Compaginiv Bancarede Geneve. The bank currently employs 250 people and manages deposits of 10.5 billion Swiss francs, an increase from deposits of three billion Swiss francs in 1995. Mr. de Picciotto has been chairman of the bank since June 1995. During the approximately thirty years he has been in banking, Mr. de Picciotto has never been disciplined by any governmental authority in connection with any financial institution with which he has been affiliated or in connection with any financial transaction, and he has not been denied regulatory approval for the acquisition, merger, or creation of any financial institution. Except with respect to the application under consideration, Mr. de Picciotto is not aware of any pending or potential government investigation into his background, finances, or ownership of any financial institution, and he has never had a lawsuit filed against him. Mr. de Picciotto is well-regarded in the international banking community, and he enjoys a reputation of honesty and integrity in international banking circles. He has never been convicted of, or pled guilty or no contest to, any violation of Section 655.50, Florida Statutes; of Chapter 880, Florida Statutes; or of any similar federal or state law. Mr. de Picciotto has extensive experience in launching new banking operations and in developing and expanding small existing banks similar to the First Bank of Miami. He does not intend to implement any immediate significant changes in the management of the First Bank of Miami, and he intends to operate the bank in a manner that will benefit the interests of the general public, the depositors, the creditors, and the other shareholders of the bank. Mr. de Picciotto intends to use his personal funds to acquire the additional equity in the First Bank of Miami, and the purchase will cause no strain on his financial resources. Mr. de Picciotto's personal funds are sufficient to allow him to contribute to the bank any additional capital that may be required by state or federal regulatory agencies. The evidence presented is sufficient to establish that Mr. de Picciotto enjoys an impeccable reputation and possesses the experience and financial responsibility necessary to participate in controlling and managing the affairs of the First Bank of Miami in a legal and proper manner. The proof also is sufficient to establish that the interests of other shareholders, depositors, and creditors of the bank and of the public generally will not be jeopardized by the proposed acquisition by Mr. de Picciotto of thirty-five percent of the outstanding common stock of the First Bank of Miami. DONE AND ENTERED this 20th day of July, 1999, 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 20th day of July, 1999. COPIES FURNISHED: Saturnino Lucio, Esquire Lucio, Mandler, Bronstein, Garbett Stiphany & Martinez, P.A. 701 Brickell Avenue, Suite 2000 Miami, Florida 33131 Robert Alan Fox Assistant General Counsel Department of Banking and Finance Suite 526, The Fletcher Building 101 East Gaines Street Tallahassee, Florida 32399 Harry Hooper, General Counsel Department of Banking and Finance Suite 526, The Fletcher Building 101 East Gaines Street Tallahassee, Florida 32399-0350 Honorable Robert F. Milligan Comptroller, State of Florida Department of Banking and Finance The Capitol, Plaza Level Tallahassee, Florida 32399-0350
The Issue Whether Respondent properly denied Petitioner's application for licensure as a Life and Variable Annuity and Health Insurance Agent.
Findings Of Fact Petitioner applied for licensure as a Life and Variable Annuity and Health Insurance Agent. Petitioner's application was signed and mailed to the Department of Insurance on or about January 27, 1998. Petitioner's application for licensure was denied by the Department on or about May 5, 1998. Two months later, on July 6, 1998, the Department issued an Amended Denial Letter that set forth the basis for the denial. According to the Amended Denial Letter, Petitioner's license was denied because she failed to meet the licensure requirements set forth in Sections 626.611(1) and (7) and 626.785(1), Florida Statutes. As a basis for the alleged violations, the Department stated: The Office of the Attorney General filed a civil action against you as vice-president and a director of the H.O.M.E. Program, and the H.O.M.E. Program along with other directors, alleging that the Program was formed as a not-for-profit corporation. . . to help people buy a house for themselves to live in. The complaint alleges that the Program offered a variety of services for a "Service Fee," has not provided any services, and that those fees were deposited into an account with NationsBank and the money was then misappropriated by one Jerome Ellington. The Attorney General still has a case pending against the H.O.M.E. Program and has stipulated to dismiss the cause of action against you with prejudice only at the conclusion of the lawsuit against the remaining defendants. You Charita Strode, were terminated from employment with NationsBank for wiring funds out of the H.O.M.E. Program's account in November 1997, after specifically being told by the Regional Service Support Manager that the funds needed to remain in the account until all items had cleared. The bank was placed in a loss situation of over $6,000 and due to your behavior you were terminated because you abused your authority in order to achieve the funds transfer, and did not follow supervisory instructions. That is evidence of lack fitness and trustworthiness. Further, it was determined by the Unemployment Compensation Appeals Bureau that you were discharged for misconduct and the Appeals referee resolved the conflicts in favor of your former employer. Petitioner was employed by NationsBank in January 1994, and, except for a six-month voluntary leave of absence, worked there continuously until she was terminated in January 1998. Prior to going on voluntary leave, Petitioner was manager of the NationsBank Gunn Highway Banking Center. During her first year with NationsBank, Petitioner was a management trainee associate. Thereafter, Petitioner became a manager, a position in which she served for the remainder of her tenure with NationsBank. As a manager, Petitioner was assigned to several NationsBank banking centers and was responsible for the operations, sales, and service of the centers to which she was assigned. Additionally, Petitioner's responsibilities included training and supervising more than fifty associates. In the spring of 1997, Petitioner was promoted from bank officer to an assistant or associate vice-president. While employed at NationsBank, Petitioner received at least two awards for her job performance. In 1997, Petitioner was recognized by NationsBank as a member of Florida Team One, a commendation that recognizes excellence in sales. One of the banking centers managed by Petitioner also received an award for service quality, an award received by only 20 to 30 percent of NationsBank banking centers. In May 1997, Petitioner first met and became acquainted with Jerome Ellington, the owner and founder of the H.O.M.E. Program. According to its literature, the H.O.M.E. Program was a "Christian Home Building Program" designed to assist individuals in building or remodeling their homes. Petitioner was particularly interested in the program because of her desire to become a homeowner. Based on her interest, Petitioner asked Mr. Ellington questions about the H.O.M.E. Program, how to become a member, and how to help other people who might be interested in the program. Petitioner became a client of the H.O.M.E. Program. As a client, Petitioner was required to pay to the program an initial fee of $1700 and a monthly maintenance fee of approximately $170 for three months. Based on her belief that the H.O.M.E. Program was a legitimate organization whose purpose was to assist individuals in purchasing homes, Petitioner told several family members and friends about the program. She told these individuals that the program would allow them to purchase homes for themselves and encouraged them to "look into it." Eventually, like Petitioner, between six and eight of these individuals paid the required fees and became clients of the H.O.M.E. Program. In late June or early July 1997, Petitioner became involved with the H.O.M.E. Program, serving on the program's Financial Advisory Board. The purpose of the Financial Advisory Board was to act as an agent to control the finances of the H.O.M.E. Program. During the time Petitioner was a named member of the advisory board, it met in July or August 1997, to organize that board. Other than this initial organizational meeting, the advisory board never met nor did it ever function in any official manner. In late July 1997, at about the time the H.O.M.E. Program was incorporated, Petitioner was selected by Mr. Ellington to serve as a member and elected as vice-president of the H.O.M.E. Program's Board of Directors (Board or Board of Directors). While Petitioner was on the Board, it seldom met. In July or August 1997, the H.O.M.E. Program set up three bank accounts at NationsBank. Each of the accounts had three signators, all of whom were officers of the H.O.M.E. Program: Bernadette Orsley, treasurer; Jerome Ellington, president; and Petitioner, vice-president. The address of record listed on the H.O.M.E. Program account was 7819 North Dale Mabry Highway, Suite 208, Tampa, Florida. From August 1997 through January 1998, Petitioner took a voluntary leave of absence from NationsBank to do work for the H.O.M.E. Program and to explore the possibility of going into business for herself. Petitioner's work with the H.O.M.E. Program involved setting up "outside services to clients once they got into their homes." Jerome Ellington was the chief executive officer and president of the H.O.M.E. Program. During the time that Petitioner was on the H.O.M.E. Program's Board and the Financial Advisory Board, Petitioner found that Mr. Ellington was not open about the expenditures he claimed to be making on behalf of the H.O.M.E. Program. Attempts were made by Petitioner and one other Board member to develop, initiate, and implement better accounting practices, operational procedures, and financial controls for the H.O.M.E. Program. For example, one recommendation was that two signatures be required on all checks written on the H.O.M.E. Program accounts. However, these efforts proved futile because Mr. Ellington was unwilling to implement any changes and relinquish financial control of the program's finances. By letter dated October 28, 1997, NationsBank advised the H.O.M.E. Program that due to the chargeback activity involving its three accounts, the bank was closing the accounts, effective ten days from the date of the letter. The letter acknowledged that the relationship between NationsBank and the H.O.M.E. Program was "a contractual one and under the terms of our Deposit Agreement either party can terminate the relationship at any time without cause." Chargeback activity occurs when items that are deposited or credited to the account are returned to the bank dishonored for a variety of reasons. NationsBank's concern with the H.O.M.E. Program accounts was that the excessive chargeback activity might possibly place the bank at risk of loss. In October 1997, Patricia McSweeney, then Regional Service Manager for NationsBank, spoke to Petitioner about the H.O.M.E. Program accounts and reiterated the contents of the October 28, 1997, letter from NationsBank. Upon learning from Ms. McSweeney that NationsBank was closing the H.O.M.E. Program's three accounts, Petitioner requested that the bank allow the three accounts to remain open to receive two electronic deposits that were scheduled to be made in November 1997. The electronic deposits were to be made on or about November 5 and 20, 1997. Ms. McSweeney agreed to leave the H.O.M.E. Program accounts open to receive the November electronic deposits and told Petitioner that there could be no check activity on the accounts. This agreement between Petitioner and Ms. McSweeney modified the terms of the October 28, 1997, letter and the accounts remained open beyond the time designated in that letter. However, the modification was not memorialized in writing and no date was established for closing the H.O.M.E. Program accounts once the November electronic deposits were made. With regard to the agreement between Petitioner and Ms. McSweeney, there was a material misunderstanding of how the H.O.M.E. Program accounts were to be handled during this extension. Ms. McSweeney's intent and understanding was that the account would remain open on a "credits-only" basis so that the credits could be received and posted to the account, and then allowed to age. Moreover, Ms. McSweeney believed there would be no check activity in the H.O.M.E. Program account, thereby eliminating or reducing the likelihood that the bank would be placed in a loss situation. On the other hand, Petitioner understood the agreement to mean that no checks could be written on the account or deposited into the H.O.M.E. Program account. However, Petitioner also believed that once the electronic deposits were made to the account, funds could be withdrawn from the account to cover the H.O.M.E. Program's expenses. The anticipated electronic deposits were made to the H.O.M.E. Program account as scheduled on or about November 5 and 20, 1997. After the November 5, 1997, electronic deposit of between $8,000 and $10,000, on November 10, 1997, Petitioner went to the NationsBank Carrollwood Banking Center and withdrew approximately $9,000 from one of the H.O.M.E. Program accounts to make a payment to the H.O.M.E. Program's line of credit. Petitioner believed that this withdrawal was permissible and not inconsistent with or in violation of the agreement with Ms. McSweeney. Furthermore, when Petitioner made the withdrawal, she was unaware of any flag on the account and no bank representative informed her that the account was so designated. At no time, either on November 10, 1997, or later, did any NationsBank representative notify Petitioner that the account was flagged and that the $9,000 withdrawal was improper and should not have been allowed. On or about November 20, 1998, the second electronic deposit was received and posted to the H.O.M.E. Program account. On the morning of November 20, 1997, Petitioner telephoned the NationsBank's Gunn Highway Banking Center and spoke with Michelle Shumate. Petitioner and Ms. Shumate knew each other because prior to Petitioner's going on leave, she was a bank officer and/or manager of the Gunn Highway Banking Center. During her telephone conversation with Ms. Shumate, Petitioner requested that two cashier's checks be drawn from the H.O.M.E. Program account and that the checks be made payable to the H.O.M.E. Program. The funds were to be used for operating expenses of the H.O.M.E. Program. When Petitioner requested the two cashier's checks, she did not perceive the requested transaction as being inconsistent with or in violation of the agreement she and Ms. McSweeney had made. Petitioner's interpretation of the agreement was that the H.O.M.E. Program was only precluded from writing checks to third parties on checks issued on the program's accounts. Because the cashier's checks were certified funds, Petitioner knew that there was no potential, at that time, for a loss situation. After Ms. Shumate's telephone conversation with Petitioner, Ms. Shumate immediately called Ms. McSweeney, her supervisor, and advised her of Petitioner's request for two cashier's checks. At hearing, in explaining her reason for calling Ms. McSweeney, Ms. Shumate made no mention of the account being flagged. Rather, Ms. Shumate stated, "I had knowledge of chargeback activity of the account, and I made it a policy for myself that before doing anything for any H.O.M.E. Program accounts, I would call a supervisor." Based on Ms. Shumate's testimony and written statement concerning Petitioner's request for two cashier's checks, it appears that Ms. Shumate's decision to call Ms. McSweeney was not because the accounts were flagged, but rather because of her personal knowledge of the problems with the H.O.M.E. Program accounts. In response to Ms. Shumate's call, Ms. McSweeney told her that the H.O.M.E. Program accounts were "credit only" accounts and withdrawals or debits were not to be made on the account. Thirty minutes after Petitioner requested the cashier's checks, she came to the drive-through window of the NationsBank Gunn Highway Banking Center to pick up the checks. Ms. Shumate then told Petitioner that Ms. McSweeney had advised her that the H.O.M.E. Program account was a "credit only" account and that there could be no check activity on the account. Pursuant to Ms. McSweeney's directive, Ms. Shumate told Petitioner that if she had any questions, she should call Ms. McSweeney. Petitioner then immediately called Ms. McSweeney from her cellular telephone. However, when Petitioner was unable to reach Ms. McSweeney, she left a voice mail message for her. After leaving the Gunn Highway Banking Center, Petitioner then went to pick up a Ms. Barnes for a 9:00 a.m. meeting. When the meeting concluded, Petitioner took Ms. Barnes back to the H.O.M.E. Program Office located at 7819 North Dale Mabry Highway. Petitioner then went to the NationsBank Carrollwood Banking Center, the banking center closest to the H.O.M.E. Program Office. Petitioner signed in as a representative of the H.O.M.E. Program to request customer service. Petitioner then met with a consumer banker regarding having a wire transfer made from one of the NationsBank H.O.M.E. Program accounts to the program's new account at First Union. Petitioner gave the consumer banker the H.O.M.E. Program account number and the Petitioner and the consumer banker filled out the required forms necessary to effectuate the wire transfer. When the form was completed, the consumer banker initiated the wire transfer in the system and Petitioner left the Carrollwood Banking Center. Immediately prior to the wire transfer, the H.O.M.E. Program account from which the funds were taken had a balance of approximately $23,000. The amount that Petitioner had wire transferred from the NationsBank's H.O.M.E. Program account was $19,800. The purpose of the transfer was to put funds into the H.O.M.E. Program's account at First Union to meet the program's expenses. Petitioner was aware there had been a history of minimal chargebacks on the account, in the form of drafts. Based on this knowledge, when Petitioner initiated the wire transfer, she left a balance in the account that she believed would be sufficient to cover any potential chargebacks from the electronic drafts. Petitioner based the estimate on the past experience of the chargebacks from electronic drafts. When Petitioner requested that funds be removed from the H.O.M.E. Program account, she never anticipated that it would result in or contribute to a loss by NationsBank. When Petitioner requested the wire transfer, neither the consumer banker nor anyone else at the bank told her that the account was flagged and that funds could not be wired from the H.O.M.E. Program account. The transfer went smoothly and in accordance with NationsBank's routine business practices. On the afternoon of November 20, 1997, after the wire transfer was made, Petitioner spoke to Ms. McSweeney, who asked her why she had made the wire transfer. During that conversation, it became clear that there was a misunderstanding between Petitioner and Ms. McSweeney regarding how the H.O.M.E. Program's NationsBank accounts were to be handled in November 1997. Ms. McSweeney told Petitioner that she had told Petitioner "not to do that," apparently referring to their October agreement regarding Petitioner's request to allow the H.O.M.E. Program accounts to remain open in November. Petitioner then told Ms. McSweeney that she had never said that to her. Petitioner indicated to Ms. McSweeney that the H.O.M.E. Program needed funds from the account for its operating expenses and that she never would have asked that the accounts be allowed to remain open to receive the electronic deposits if the organization were absolutely prohibited from accessing the funds. In the days or weeks after the funds were wired from one of H.O.M.E. Program accounts at NationsBank, the chargebacks on the accounts were in excess of any amount that they had ever been. Between November 20, 1998, the date the wire transfer was made, and January 30, 1998, the date Petitioner's termination, NationsBank sustained a loss of approximately $6,000. This loss has not yet been recovered by the bank. Had the wire transfer not been made, NationsBank may not have sustained this loss. However, the approximate $6,000 loss by NationsBank may not be attributable to the November 20, 1997, wire transfer. Two other individuals on the H.O.M.E. Program accounts, including Jerome Ellington, were authorized signators on the H.O.M.E. Program accounts and could have made withdrawals. At the hearing, personnel of NationsBank did not state unequivocally that the other authorized persons on the H.O.M.E. Program accounts had not made withdrawals from the accounts between November 1997 and January 1998. NationsBank personnel did not rule out that such withdrawals had been made, but stated only that to confirm whether such withdrawals had been made, the bank records, which were unavailable, would have to be reviewed. If, in fact, such withdrawals were made, those withdrawals could have contributed to or been responsible for the bank's financial loss. In November 1997, the previously existing problems and disputes within the H.O.M.E. Program organization exacerbated. Mr. Ellington, president and founder of the H.O.M.E. Program, who had previously encouraged Petitioner's involvement in the program, both as a client and officer, now would no longer allow Petitioner to transact business on the H.O.M.E. Program accounts. Consequently, once the excessive chargebanks in the H.O.M.E. Programs account surfaced, Petitioner was unable to move funds back to NationsBank. Her requests to Mr. Ellington that he move funds to NationsBank were disregarded. When Petitioner was on the H.O.M.E. Program's Board of Directors, the Board not only failed to meet on a regular basis, but was also prohibited by Mr. Ellington from functioning as a governing body. Mr. Ellington controlled the H.O.M.E. Program, including the "purse strings" of the organization. Petitioner lost approximately $2,000, the total amount of the funds she invested as a client in the H.O.M.E. Program. Moreover, Petitioner also lost a substantial part of approximately $3,000 to $4,000 of her personal funds that she had used for the H.O.M.E. Program to cover some of its operating expenses. In one instance, during her early involvement with the H.O.M.E. Program, Petitioner co-signed a loan agreement for the organization to have a phone telephone system installed in the program's office. After the H.O.M.E. Program failed to make the payments, Petitioner paid off the loan and received no reimbursements. In the first week of December 1997, Petitioner received a copy of minutes from Special Meeting of the Board held on November 18, 1997. Petitioner received no notice of that meeting and, consequently, was not in attendance. The minutes of the meeting reflect that the only three Board members and/or officers present at the meeting were: Jerome Ellington, president; Jacqueline Garcia Ellington, secretary; and Bernadette Orsley, treasurer. Pursuant to the minutes of the November 18, 1997, Special Meeting of the Board, under the category of "New and Urgent Agenda Items," Mr. Ellington initiated a discussion regarding his dissatisfaction with Petitioner, one other Board member, and two staff members. The minutes reported that Mr. Ellington stated that the organization was facing "certain and immanent (sic) insurrection" by Petitioner and the other three individuals. Moreover, the minutes indicated that the labor force was "being manipulated into a confused state of loyalty and that this along with a confrontation of gross insubordination" by Petitioner and the other three individuals was "usurpatous (sic) to the general operations of the Firm and extremely deleterious to Client confidence." According to the minutes, following the discussion, Mr. Ellington moved to vote on the removal or termination of Petitioner and the other three individuals "in view of their attempted take over of the business and a number of other possible infractions of the law." Following Mr. Ellington's motion, by a unanimous vote of the three Board members/officers attending the Special Meeting, Petitioner and the other absent Board member were removed from the Board and the two staff members were terminated, effective immediately. Prior to Petitioner's receiving the minutes of the Special Meeting, she was unaware of her removal from the Board. On January 30, 1998, near the end of her voluntary leave, Petitioner met with officials of NationsBank. Petitioner was advised that her employment with NationsBank was being terminated, effective immediately, because she had failed to follow and had directly violated instructions of the service support manager, Ms. McSweeney. These charges stemmed from the incident involving the transfer of funds on November 20, 1997. Petitioner explained to NationsBank officials that she did not understand that the agreement with Ms. McSweeney prevented the removal of funds from the H.O.M.E. Program accounts. Petitioner also told the NationsBank officials that her behavior with regard to the accounts was consistent with her understanding of the agreement. In this regard, Petitioner informed NationsBank staff that prior to the wire transfer, in November 1997, she had made a withdrawal from the account to pay on the program's line of credit with no problem. Petitioner also told the bank officials that when that withdrawal was made, no one at the bank advised her that the withdrawal was improper or that the account was flagged. Notwithstanding Petitioner's explanation, NationsBank terminated Petitioner's employment, effective immediately. After Petitioner was terminated from NationsBank, she applied for unemployment benefits. The application was denied and Petitioner appealed. In the Notice of Decision issued on the matter, the appeals referee concluded that the Petitioner, claimant in that proceeding, "intentionally violated direct orders from her supervisor." Petitioner had fiduciary duties with regard to her position as vice-president and member of the Board and member of the Financial Advisory Board of the H.O.M.E. Program. However, for the reasons stated above, Petitioner's efforts to perform these duties were thwarted by tactics employed by Mr. Ellington. On January 10, 1998, Petitioner first learned that the Florida Attorney General's Office had been investigating the H.O.M.E. Program, when she was served with a civil action brought by the Attorney General. The Complaint, filed on December 13, 1997, named the H.O.M.E. Program, Inc., Jerome Ellington, and Board members, including Petitioner, as defendants. Among the allegations contained in the Complaint were that the funds collected by the H.O.M.E. Program had not been placed in an escrow account as had been represented to members and that the program had not initiated construction on any residence for any of its 140 clients. The Complaint also alleged that Mr. Ellington withdrew or transferred approximately $31,000 from a H.O.M.E. Program account and of that amount, $23,000 was transferred by Mr. Ellington from a H.O.M.E. Program's account at NationsBank to First Union on November 27, 1997. Moreover, the Complaint alleged that a substantial amount of those funds were used by Mr. Ellington for his personal expenses and approximately $17,000 of the program funds, at one time in Mr. Ellington's possession, remained unaccounted for. The Complaint contained no allegations that Petitioner or any other Board member had misappropriated H.O.M.E Program funds or, at any time, had organization funds in their possession which could not be accounted for. Pursuant to a Stipulated Settlement Agreement (Agreement) entered into on May 18, 1998, the Complaint was dismissed without prejudice against Petitioner "until the conclusion of the lawsuit against each of the remaining Defendants at which time the cause of action against [Petitioner] shall be dismissed with prejudice, provided that [Petitioner] has complied with the terms of the Agreement." In this regard, the Agreement requires the Petitioner to cooperate and assist the Attorney General's Office in the investigation and litigation relating to the Complaint. The Agreement acknowledged and expressly stated that Petitioner's acceptance of the Agreement did not constitute an admission that she violated the laws of Florida as alleged in the Complaint. To determine fitness and trustworthiness of applicants for insurance licenses, the Department looks at the applicant's history and activities in which the applicant participated. Also, the Department considers other issues, such as whether there were victims of the applicant's activities; whether someone was financially harmed; whether money and/or fiduciary duties were involved; and whether the actions were willful. In evaluating Petitioner's application, the Department had several concerns. First, the Department determined that Petitioner had willfully violated or refused to obey a supervisor's direct orders by moving funds out of the H.O.M.E. Program account and that as a consequence thereof, the bank lost several thousand dollars. In the Amended Denial Letter, the Department alleged that Petitioner accomplished this by "abusing" her position with the bank. From this uncorroborated information the Department received from NationsBank, the Department concluded that Petitioner's conduct demonstrated a lack of fitness and trustworthiness. Second, in making the final decision to deny Petitioner's application, the Department considered the fact that Petitioner had been a named defendant in the aforementioned Complaint filed by the Attorney General. Prior to the Department's issuing the Amended Denial Letter, it was aware that the Complaint had been dismissed as to Petitioner. Nonetheless, the Department found it significant that the Complaint had been dismissed without prejudice and that the Agreement had been reached in exchange for Petitioner's cooperation and testimony. The Department believed that the Agreement did not suggest that the underlying events that gave rise to the allegation in the Complaint did not occur. Finally, as a basis for its decision with regard to Petitioner's application, the Department relied on an Unemployment Appeals Bureau decision denying Petitioner unemployment benefits. The Department apparently found it significant that the referee in that proceeding found Petitioner's account of the events less credible than that of NationsBank and concluded that Petitioner "intentionally violated direct orders from her superior." Based on these considerations, the Department then concluded that the allegations raised in the Complaint demonstrated that Petitioner lacked the fitness to fulfill the fiduciary responsibilities required of an insurance agent. When the Department issued the Amended Denial Letter, it was unaware that Petitioner had been removed from the H.O.M.E Program Board in November 1997, because of her efforts to have the program implement financial controls for the funds it was collecting and expending. The Department was also unaware or failed to consider the short period of time Petitioner was associated with the Board, that Petitioner was a client of the H.O.M.E. Program, and that she lost money as a result of her involvement with the program.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department issue to Petitioner, Charita Michelle Strode, a license as a Life and Variable Annuity and Health Issuance Agreement. DONE AND ENTERED this 16th day of February, 1999, in Tallahassee, Leon County, Florida. CAROLYN S. HOLIFIELD 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 16th day of February, 1999. COPIES FURNISHED: Bill Nelson State Treasurer and Insurance Commissioner Department of Insurance The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300 Daniel Y. Sumner, General Counsel Department of Insurance The Capitol, Plaza Level 26 Tallahassee, Florida 32399-0300 Steve E. Baker, Esquire Delano Stewart, Esquire Stewart, Joyner, Jordan-Holmes, P.A. 1112 East Kennedy Boulevard Tampa, Florida 33672 Elenita Gomez, Esquire Mechelle R. McBride, Esquire Department of Insurance 612 Larson Building 200 East Gaines Street Tallahassee, Florida 32399-0333
Findings Of Fact On December 30, 1993, the Department received an application to organize a proposed new trust company to be located in Miami, Dade County, Florida, and to be called Columbus Trust Company (Columbus). Four individuals to be associated with Columbus are foreign nationals: Arturo Vinueza and Mario Yepes are proposed board of directors members; and Catalina Landes and Pedro Ycaza are major stockholders of Columbus. All other directors and stockholders of Columbus are citizens of the United States. They are: Charles C. Hardwick, III, Michael Hollihan, and Timothy S. Reed. All of the individuals listed in paragraphs 2 and 3 attended the public hearing. Mr. Vinueza is the proposed chief executive officer for Columbus. He is a graduate of the University of Miami and has more than thirteen years of banking and trust experience. Mr. Vinueza has served as manager or managing director of Citibank, N.A., Quito, Ecuador; Banco Popular International, Nassau; The Jersey Private Bank and Trust, Nassau; and Banco Popular del Ecuador, Miami Agency. Charles C. Hardwick, III, a proposed director, is a graduate of the University of Colorado, College of Law. He has more than twelve years of experience in international finance. Timothy S. Reed, a proposed director, is a graduate of Dartmouth College, and is a career banker, having retired from Citibank, N.A., New York, after more than thirty years of continuous service. He has served as general manager of Banco Popular del Ecuador, Miami Agency, for the past three years. Michael Hollihan, a proposed director who will serve as chief investment officer, has a degree in economics from the University of Wisconsin. He has completed graduate course work in economics at the University of South Carolina, and has been engaged in the business of international trade, finance and investments for more than twenty years. Mr. Hollihan was previously employed by Banco Central del Ecuador. For the past four years he has served as President of JPBT Advisors, Inc. in Miami. Mario Yepes, a proposed director, also has a degree in economics and was a teacher at the university of Colombia. He worked for a number of years for Bank of America, both in Miami and in Venezuela. Catalina Echevaria Landes, a major stockholder, is a business woman and interior designer. She has her own business located in Miami. Pedro Ycaza, a major stockholder, has a degree in business from a university in Ecuador. He worked for various banks in Ecuador for a number of years before joining Banco Popular in 1986. The Applicants seek to organize Columbus to provide trust services and investment management services to individuals having business or personal interests in the Miami area, and to JPBT Advisors, Inc. JPBT Advisors, Inc. advises certain mutual funds specializing in international investments. The Applicants propose to expand such services gradually to include private banking and investment management services to international investors residing or doing business in Miami and Dade County, Florida. The existing business of JPBT Advisors, Inc., which has annual revenues of approximately $3 million, will contribute to the income of Columbus during its initial period of operations as the bank develops its personal trust and investment management business. The proposed board of directors consists of individuals having many years of banking and business experience in the areas of international finance and asset management. Both Mr. Vinueza, the proposed chief executive officer, and Mr. Reed, a proposed outside director, have had direct experience as officers of financial institutions within the past three years and are presently employed in such capacities. The initial capital for Columbus will be $2 million. The initial capitalization of Columbus is adequate in relation to is proposed business activities. The corporate name of Columbus is reserved with the Department of State. Columbus will have suitable quarters in the Barnett Bank building located at 701 Brickell Avenue, Miami. Columbus' application was prepared by Richard Hunt, a financial consultant, who has been engaged in the business of providing such consulting services to organizing financial institutions for more than 25 years. The economic study and demographic analysis of the market for fiduciary services in Dade County, prepared by Mr. Hunt, concluded that the organization of Columbus will serve the convenience and advantage of its expected clients. The local conditions in Miami are favorable to Columbus' business plan. DONE AND ENTERED this 7th day of March, 1995, in Tallahassee, Leon County, Florida. JOYOUS D. PARRISH 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 7th day of March, 1995. APPENDIX TO REPORT OF PUBLIC HEARING, CASE NO. 94-6306 All proposed findings of fact were submitted by stipulation of the Department and Columbus. COPIES FURNISHED: Hon. Robert F. Milligan Comptroller, State of Florida The Capitol, Plaza Level Tallahassee, Florida 32399-0350 Harry Hooper, General Counsel Department of Banking and Finance The Capitol-Room 1302 Tallahassee, Florida 32399-0350 Rod Jones Shutts and Bowen 20 North Orange Avenue, Suite 1000 Orlando, Florida 32801 Albert T. Gimbel Chief Banking Counsel Office of the Comptroller The Capitol, Suite 1302 Tallahassee, Florida 32399-0350 Jeffrey D. Jones Assistant General Counsel Office of the Comptroller The Capitol, Suite 1302 Tallahassee, Florida 32399-0350 ================================================================= AGENCY FINAL ORDER ================================================================= STATE OF FLORIDA DEPARTMENT OF BANKING AND FINANCE DIVISION OF BANKING IN RE: Application for Authority to Organize a State Chartered Trust Administrative Proceeding Company to be located at Number: 3328-B-11/94 701 Brickell Avenue, Miami, DOAH Case Number: 94-6306 Dade County, Florida (Columbus Trust Company) / FINDINGS OF FACT, CONCLUSIONS OF LAW AND FINAL ORDER Having considered the facts and information contained in the application for authority to organize and operate Columbus Trust Company (Applicant), 1 have determined that the Applicant has met all six (6) statutory criteria set forth in Section 658.21, Florida Statutes, or can meet those criteria by complying with specific conditions. Accordingly, the application is approved, subject to the conditions specified herein.
