The Issue This cause concerns a dispute as to whether the petitioner was properly denied application for examination as a general lines insurance agent by his exclusion from the examination because of alleged cheating thereon.
Findings Of Fact The Petitioner is an applicant for Licensure by examination as a general lines, property, casualty and miscellaneous lines insurance agent in Florida. The Petitioner sat for the general lines examination, which was held at Pensacola Catholic High School in Pensacola, Florida on January 7, 1989. Mary Chadwick and Marilyn Archer were employed by the examination administrator, the Educational Testing Services, as test proctors. Both were present at Pensacola Catholic High School on January 7, 1989, at the examination site and administered the general lines examination. Prior to the start of the examination, candidates for the examination were verbally advised by Mary Chadwick, the test proctor, not to consult any course materials or other written materials during the taking of the examination. Miss Chadwick then read a prepared statement, prior to the start of the examination, warning the candidates that any incidents of cheating, including giving or receiving help, copying or retaining test questions, would result in disqualification and dismissal from the examination. The test candidates were admonished not to use dictionaries, books, pamphlets, slide rules, calculators, calculator watches, compasses, rulers or papers of any kind during the test. Anyone found using these items would be disqualified from licensure and dismissed from the examination. The examinees were then admonished that if any such materials were in their possession that they should place them under their chair and that only the test booklet and a pencil should be on their desks. During the course of the examination, an examination candidate, Mr. Francis Kelly, observed that the Petitioner was referring to certain 3" X 5" note cards on top of his desk, concealed beneath his hand. The Petitioner was observed by Mr. Kelly to look at the note cards and then write in his examination booklet. Mr. Kelly observed this happening on repetitive occasions during a period of several minutes. Having formed the opinion that the Petitioner was cheating on the examination, Mr. Kelly left the examination room and reported the incident, and his observations, to the "hall proctor" outside the examination room. The hall proctor informed Marilyn Archer, the test supervisor, that a gentleman had told her that another candidate was cheating on the examination. The hall monitor and Ms. Archer then walked into the examination room and, together with Ms. Chadwick, they observed, through a window in the door, the Petitioner surreptitiously referring to the note cards. After observing the Petitioner for 2 or 3 minutes, Ms. Chadwick went into the room and confronted him. The Petitioner denied having any materials or cards in his possession. Ms. Archer then entered the room and asked the Petitioner for the note cards. The Petitioner denied having any cards, but ultimately relinquished them to Ms. Archer. He relinquished two note cards with information handwritten on them. The two note cards surrendered contained information pertaining to the 240 hour property and casualty insurance course, which was relevant to the insurance subject matter of the examination. They would definitely be of assistance to a candidate taking the general lines examination, which the Petitioner was then taking when he had the cards in his possession and was observed by Mr. Kelly and the other witnesses. The Petitioner was then dismissed from the examination and his test materials and the two note cards were collected. Ms. Chadwick and Ms. Archer then reported this incident involving the Petitioner to the Educational Testing Services by telephone and followed up with a written "irregularity report." Mr. Kelly, Ms. Chadwick, Ms. Archer all testified to the above-referenced effect. None of them had ever met the Petitioner before January 7, 1989. There has been no demonstration they have any bias or that any other reason exists for finding their testimony to be of dubious credibility. The Department thereafter denied the application of the Petitioner for admission to the examination and licensure, by its letter of denial dated January 13, 1989. The Petitioner requested a formal proceeding to contest that denial and in due course this proceeding ensued.
Recommendation Having considered the foregoing findings of fact and conclusions of law the evidence of record, the candor and demeanor of the witnesses, and the pleadings and arguments of the parties, it is therefore RECOMMENDED, that the Department deny the Petitioner, Paul John Roberto's, application for licensure as a general lines - property, casualty, and miscellaneous lines agent. DONE AND ENTERED this 19th day of September, 1989, in Tallahassee, Leon County, Florida. P. MICHAEL RUFF Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 19th day of September, 1989. APPENDIX Case NO. 89-0788 PETITIONER'S PROPOSED FINDINGS: The Petitioner did not actually propose any findings of fact, but rather sought to discuss the testimony of the three witnesses presented against him by the Department. In essence, the Petitioner contends that witness Kelly could not have seen the evidence of cheating from his seating position and that the other witnesses based their testimony concerning his possession of the incriminating note cards during the taking of the examination, and his use of them for that purpose, on hearsay. If this could be deemed to constitute a finding of fact, it is rejected because it does not comport with the preponderant weight of the evidence, which establishes that the report of Mr. Kelly merely prompted the examination supervisors, who testified, to go and observe Mr. Roberto in the act of cheating themselves. Their testimony is certainly not hearsay, and in any event, Mr. Kelly also testified, thus the hearsay contention by the Petitioner is groundless. The Petitioner proposed no actual findings of fact so there are none to rule upon in addition to this. RESPONDENT'S PROPOSED FINDINGS: The Respondent's proposed findings of fact 1 through 15 are accepted. COPIES FURNISHED: Paul J. Roberto, Pro Se 22 Country Club Road Shalimar, Florida 32579 James A. Bossart, Esquire Office of Legal Services 412 Larson Building Tallahassee, Florida 32399-0300 Hon. Tom Gallagher State Treasurer and Insurance Commissioner The Capitol, Plaza Level Tallahassee, Florida 32399-0300
The Issue Whether Respondent committed the offenses described in the administrative complaint? If so, what punishment should he receive?
Findings Of Fact Based on the record evidence the Hearing Officer makes the following Findings of Fact: Respondent is now, and has been for approximately the past 20 years, licensed by Petitioner as a general lines insurance agent. On July 3, 1986, Petitioner received a complaint concerning Respondent from Elsa Garcia. Garcia reported that she had purchased automobile insurance through Dixie Insurance Brokers and had been given a temporary insurance binder bearing the signature of a "Paul J. Lovelace" reflecting that her coverage was to be effective March 11, 1985. According to Garcia, however, she had subsequently discovered, after having been involved in an automobile accident on March 23, 1985, that her insurance coverage had not taken effect until after the accident. Garcia's complaint was assigned to one of Petitioner's employees, Burton Powell, to review and investigate. As part of his investigation, Powell contacted Alan D. Kruger, Garcia's attorney. Kruger supplied Powell with Garcia's affidavit and other pertinent documents, including a copy of Garcia's automobile insurance application and the temporary insurance binder she had been given by Dixie Insurance Brokers. The application reflects that Garcia was seeking coverage for the period from April 2, 1985, to October 2, 1985. The binder, on the other hand, indicates that it was to be effective for one month commencing, not April 2, 1985, but March 11, 1985. Someone other than Respondent signed his name to both the application and the binder. 1/ On various occasions prior to December 18, 1987, Respondent was the general lines insurance agent of record for Dixie Insurance Brokers. 2/ On these occasions he never personally signed any insurance applications, nor did he otherwise play any role in the operation and control of the agency. By his own admission, he simply allowed the agency to use his license, without any restrictions imposed by him, in exchange for monetary consideration. In so doing, he willfully engaged in a scheme designed to circumvent the licensing requirements of the Florida Insurance Code.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that Petitioner enter a final order (1) dismissing Count I of the administrative complaint; (2) finding Respondent guilty of Count II of the administrative complaint; and (3) revoking Respondent's general lines insurance agent license for his having engaged in the conduct specified in Count II of the administrative complaint. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 2nd day of November, 1989. STUART M. LERNER 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 2nd day of November, 1989.
The Issue Should discipline be imposed by Petitioner against Respondent's insurance agent licenses, life including variable annuity (2-14), and general lines (2-20), pursuant to Chapters 624 and 626, Florida Statutes (2004)?
Findings Of Fact Stipulated Facts Respondent is licensed by Petitioner as a life including variable annuity (2-14) and a general lines (2-20) insurance agent and has been issued license D029506. During the time referenced in the Administrative Complaint, Respondent was licensed as a customer representative (4-40) and a life including variable annuity (2-14) agent. The Department has jurisdiction over Respondent's insurance licenses and appointments. At all times relevant to the dates and occurrences referenced in the Administrative Complaint, Respondent was employed or affiliated with Direct General Insurance Agency, Inc., a Tennessee corporation, doing business in Florida as Florida No-Fault Insurance Agency (Cash Register). Additional Facts: At times relevant to the case Respondent held his life including variable annuity license (2-14) under an appointment with Direct Life Insurance Company. At times relevant to the case Respondent had a customer representative license (4-40) under appointment with Direct General Insurance Agency, Inc. At present Respondent continues to hold the life including variable annuity license (2-14) under an appointment with Direct General Life Insurance Company. At present he has a general lines license property and casualty license (2-20) under appointments with Direct General Insurance Company and American Bankers Insurance Company of Florida. On February 8, 2005, Brandi Dean called Cash Register to receive a quote for the purchase of basic automobile insurance coverage. She was provided a quote at that time. On February 8, 2005, Brandi Dean, went to the Cash Register to purchase basic automobile insurance coverage. She had done business with the insurance agency before. Her policy with Direct General Insurance Company was Policy No. FLCR162714439, as reflected in Petitioner's Exhibit numbered 15, with a scan cover sheet entitled "Renewal Auto." On February 8, 2005, Ms. Dean purchased automobile insurance coverage that would be effective from February 10, 2005 through February 10, 2006. She was charged $316 for property damage liability (PD) and $216 for basic injury protection (PIP) for a total of $532, with a $25 policy fee. The application information within the exhibit reflects the customer's name, signature, and initials in various places. On February 8, 2005, Ms. Dean was provided another form referred to as an Explanation of Policies, Coverages and Cost Breakdown (including non-insurance products). Petitioner's Exhibit numbered 16. She signed that document. It reflected the auto policy coverage information. It also set forth under a category referred to as optional policies, the purchase of Lloyd's Accident Medical Protection Plan for $110. Petitioner's Exhibit numbered 17 is additional information concerning the Accident Medical Protection Plan application by the customer signed by her. It details a $110 annual premium for individual coverage of $1,000 medical expense, and 125/day-365 day hospital coverage. Within that same exhibit there is a form signed by the customer titled 100% certain underwriters @ Lloyd's/London (DB/33) Accident Medical Protection Plan. This reflects $110 cost, $125 daily coverage and the total annual benefit of $45,625. Petitioner's Exhibit numbered 18 is a scan cover sheet entitled Renewal Finance with Premium Finance Agreement Information in association with Direct General Financial Services, Inc., in which the customer Ms. Dean paid $69.63 down, financed $599.82, with a total price of $748.61 when considering the annual percentage rate for financing. This document in totality was initialed and signed by Ms. Dean. Ms. Dean was provided a receipt for her cash down-payment on the purchase. Petitioner's Exhibit numbered 14. Petitioner's Exhibit numbered 19 is an Insurance Premium Financing Disclosure Form signed by the customer, reflecting the cost of the automobile insurance and the hospital indemnity plan, the amount of total cost and includes the policy fee for the automobile insurance, document stamp tax, the down payment, and the total amount financed $599.82. Ms. Dean was left with the impression that she had only purchased automobile insurance. She believed that the monthly payments for the financing were only in relation to automobile insurance. Ms. Dean does not recall having the accidental medical protection plan explained to her as to its terms. She does not recall anyone explaining that it was an optional plan unassociated with automobile insurance. She told the agent that she dealt with that she was only interested in purchasing the state-required automobile insurance coverage. Had she realized that she was purchasing optional accident medical protection, not part of the automobile insurance purchase, she would have declined the optional policy. Ms. Dean does recall that the agent she dealt with made some brief explanation about the documents involved in the transaction but not every page was explained. Ms. Dean recalls explanations about the automobile policy but nothing about optional coverage. Ms. Dean glanced over the documents but did not read every word included in the documents. Ms. Dean does not recall whom she dealt with on February 8, 2005. Otherwise, the record does not reflect the person who sold the automobile insurance and accidental medical protection plan to her at that time. At times relevant, Denise Daley Turnbull worked at Cash Register. She was a customer representative license (4- 40), appointed by Direct General Insurance Agency, Inc. On March 24, 2005, William L. Green, Jr., came to Cash Register to purchase automobile insurance. He dealt with Ms. Turnbull. He made a $170.02 down payment for his purchases, as reflected in Petitioner's Exhibit numbered 4, which is a receipt provided to Mr. Green. A scan cover sheet related to an auto policy purchased, together with the application information for the automobile insurance purchased through Direct General Insurance Company is found within Petitioner's Exhibit numbered Mr. Green purchased automobile insurance for property damage liability (PD) in the amount of $590 and basic personal injury protection (PIP) for $370, with a $25 policy fee, totaling $985. He signed and initialed parts of the forms in association with the automobile insurance. Ms. Turnbull also signed forms in association with the automobile insurance. Petitioner's Exhibit numbered 6 is an explanation of policies, coverages and cost breakdown (including non-insurance products) reflecting the overall purchases by Mr. Green. He signed that form. It relates the automobile insurance purchase. It also relates the purchase of an American Bankers Travel Protection Plan for $60, a Lloyd's Accidental Medical Protection Plan for $110 and life insurance of $98. With fees and other costs the total purchase was $1270.99. Of relevance here, Petitioner's Exhibit numbered 9 is a scan cover sheet in relation to the life policy signed by Ms. Turnbull. It also includes application information to Direct Life Insurance Company with certain questions reflected that were initialed by the purchaser. Mr. Green signed the application. Respondent also signed the application, as well as printing his name and insurance license number on the form. Petitioner's Exhibit numbered 10 is a scan cover sheet for a New Finance with Direct General Financial Services, Inc., which reflects a $162.03 down-payment, $1105.17 in amount financed, with a $129 finance charge. The total sales price for all purchases was $1396.20, to include the life insurance with Direct Life Insurance Company. Mr. Green signed the premium finance agreement. Petitioner's Exhibit numbered 11 is a copy of the Insurance Premium Finance Disclosure Form signed by Mr. Green. Ms. Turnbull has no recollection of the Respondent's participation in the sale of the life insurance policy to Mr. Green. She does recall that Respondent was in the insurance agency office when the life insurance was purchased. She recognizes Respondent's signature in association with the life insurance application and purchase. Mr. Green had no intention of purchasing life insurance when he went to Cash Register on March 24, 2005. He recalls dealing with Ms. Turnbull. No one else sat with Mr. Green and explained policy information to him. Specifically, Respondent did not sit with Mr. Green and offer explanations about the policy. Mr. Green did not see Respondent sit with Ms. Turnbull and Respondent remained silent while she sold the life policy. Had Mr. Green realized that he was purchasing life insurance he would have declined the opportunity.
Recommendation Upon consideration of the facts found and the conclusions of law reached, it is RECOMMENDED: That Petitioner enter a final order finding a violation under Count I as set forth in the conclusions of law, dismissing Count II and suspending Respondent's license for six months for the violation. DONE AND ENTERED this 7th day of May, 2007, in Tallahassee, Leon County, Florida. S CHARLES C. ADAMS 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 7th day of May, 2007. COPIES FURNISHED: William Gautier Kitchen, Esquire Gregg Marr, Esquire Department of Financial Services Division of Legal Services 200 East Gaines Street Tallahassee, Florida 32399-0333 L. Michael Billmeier, Jr., Esquire Galloway, Brennan and Billmeier, P.A. 240 East Fifth Avenue Tallahassee, Florida 32303 Michael L. Rothschild, Esquire Larry S. Davis, P.A. 1926 Harrison Street Hollywood, Florida 33020 Honorable Alex Sink Chief Financial Officer Department of Financial Services The Capitol, Level 11 Tallahassee, Florida 32399-0300 Daniel Sumner, General Counsel Department of Financial Services The Capitol, Level 11 Tallahassee, Florida 32399-0307
Findings Of Fact Based upon all of the evidence, the following findings of fact are determined: At all times relevant hereto, respondent, Ralph Edward Carter, was licensed and eligible for licensure as a life and health insurance agent and general lines agent - property, casualty, surety and miscellaneous lines by petitioner, Department of Insurance and Treasurer (Department). When the events herein occurred, respondent was licensed as a property and casualty insurance agent for Bankers Insurance Company (BIC) and Underwriters Guarantee Insurance Company (UGIC). In March 1987 respondent purchased an insurance franchise and began operating an insurance firm under the corporate name of Mr. Auto of South St. Petersburg, Inc. Records on file with the Department of State reflect that effective June 25, 1988 the name of the corporation was changed to Reliable Insurance of South St. Petersburg, Inc. Since February 1989 the business has been located at 3135 18th Avenue, South, No. C- 3, St. Petersburg, Florida. The corporation was primarily engaged in doing business as a general lines insurance agency. Respondent has been licensed as an agent since 1968, and during his tenure as an agent, has worked in sales with several large insurance companies. In January 1988 Betty Andrews purchased from respondent liability and property damage coverage on her two automobiles, a 979 Ford station wagon and a 1980 Chrysler. The insurance was written through UGIC and was effective for the year beginning January 8, 1988. Shortly after May 16, 1988 Andrews received a notice from UGIC reflecting that she owed an additional $38.90 on her policy. For some undisclosed reason, Andrews did not pay the additional premium owed. On July 6, 1988 Andrews visited respondent's office for the purpose of adding comprehensive and collision coverage on her two automobiles. After respondent quoted a rate, she agreed to purchase the additional coverage, filled out an application, and gave respondent two checks totaling $166. These monies were deposited into respondent's business account. The balance was to be paid in three monthly payments of approximately $55 each month through a finance company. Respondent gave Andrews a document entitled "Receipt and Binder Certificate" reflecting she had comprehensive and collision coverage with "Bankers" effective from July 6, 1988 to January 6, 1989. "Bankers" was in fact Bankers Insurance Company. When Andrews did not receive a policy from BIC, she attempted to contact respondent on several occasions to ascertain its whereabouts. Andrews could not recall when or how many times she telephoned respondent's office but indicated she was never able to reach him. This was probably because respondent operated a one-man office with no clerical help and was frequently absent from his office. In late August 1988 Andrews received a notice from UGIC advising that UGIC intended to cancel her policy effective September 7, 1988 because she failed to pay the $38.90 premium still due. At about this same time Andrews' husband sold the station wagon and purchased a truck. Accordingly, Andrews needed to transfer her insurance to the new vehicle. She went to respondent's office in early September 1988 and asked him why she had never received the new policy. She also asked him to find out why her existing policy was being cancel led and requested him to transfer coverage from the station wagon to the new truck. In Andrews' presence, respondent made a telephone call to UGIC and learned that Andrews' husband had failed to disclose on the insurance application that he had received a traffic ticket. This in turn caused a $38.90 increase in the annual premium, and because that amount had not been paid, the policy was being cancelled. Respondent attempted to persuade UGIC to reinstate the policy but was unsuccessful. Dissatisfied, Andrews told respondent she intended to file a complaint with the Department of Insurance. Respondent then wrote her a check for $166 which represented a full refund of her monies. There is no evidence to establish that respondent intended to defraud Andrews or to evade the requirements of the insurance code. Despite the fact that Andrews did not receive a policy, she was covered until September 1988 by her original policy and respondent's errors and omissions policy. Through testimony by an underwriting manager for BIC, David R. Wardlow, it was established that respondent had entered into a correspondent agreement with an agent of BIC. Wardlow's review of BIC's records reflected that BIC had never received Andrews' application and premium nor was a policy written on her behalf. However, there was no evidence to establish how promptly respondent was required to remit a new application and premium to BIC or whether respondent violated BIC policy by retaining the application and monies for some sixty days until he learned that the existing policy had been cancel led. Respondent readily conceded that he never forwarded the application and premium monies to BIC. He explained his actions by pointing out that after Andrews left his office he decided to secure the coverage from UGIC rather than BIC in order to have the entire coverage with one company at a cheaper rate. When he later learned that UGIC intended to cancel Andrews' policy for nonpayment of premium, he thought he might be able to persuade UGIC to reinstate the policy but was unsuccessful. He offered no excuse except inadvertence as to why he had not promptly followed up on Andrews' application. Petitioner also presented the testimony of Johnnie Ruth Bell who purchased automobile insurance from respondent in October 1988. Although Bell's testimony was often vague and confusing, the following facts were established. On or about October 1, 1988 Bell went to respondent's office to purchase full insurance coverage on her 1987 Toyota Corolla. After discussing various options with respondent, Bell agreed to purchase a policy issued through Redmond-Adams, a Sarasota underwriter for UGIC. Bell gave respondent a check in the amount of $227 as a down payment and agreed to finance the balance through a finance company at a rate of $78 per month for eight months. These monies were deposited into respondent's bank account. Respondent issued a "Receipt and Binder Certificate" reflecting coverage with "Underwriter - Redmond Adams". Because Bell had financed the car with a local bank, it was necessary for respondent to furnish the bank with evidence of insurance. Through inadvertence, but not intentionally or willfully, respondent misplaced the application and never forwarded the application and premium to the insurance company nor did he notify the bank of Bell's insurance coverage. However, Bell was covered during this period of time by respondent's errors and omissions policy. After Bell did not receive a copy of her policy from Redmond-Adams, but received a number of telephone calls and notices from her bank, she met with respondent around December 2, 1988. Respondent accepted an additional $156 in cash from Bell and issued her a new binder effective that date which was identical to the first binder except for the date. It is unknown why the additional money was collected. He then tore up the first binder. When Bell had still not received her policy by April 1989, she filed a complaint with petitioner. After respondent learned that Bell had filed a complaint, he contacted her in May 1989 and refunded all of her monies. There was no evidence to establish how promptly respondent was required to submit applications and premiums to UGIC or how that company construed the term "in the regular course of business" in the context of agents remitting applications and premiums. Respondent blamed his problems on the fact that he is the sole employee of his office and, according to his estimate, services some 500 active clients per year and more than 1,500 accounts. He desires to continue in the insurance profession and points to the fact that, of the many insurance transactions handled by him over the last twenty-two years, the Andrews and Bell transactions are the only two that have spawned any significant problems. Moreover, he has never been disciplined by petitioner during his tenure as an agent. Respondent asks that any penalty be limited to a period of probation during which time he can have the opportunity to improve his management and bookkeeping skills. There was no evidence to establish whether respondent's conduct demonstrated a lack of fitness or trustworthiness to engage in the insurance profession. As to respondent's knowledge and technical competence to engage in the transactions authorized by his licenses, he conceded he lacks training in bookkeeping and management skills, both needed for a general lines agent, but denied that he lacks the necessary skills in the sales part of the business. This was not contradicted. Finally, respondent has taken curative steps to insure that applications are not misplaced and the customer receives the requested insurance.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that respondent be found guilty of violating sections 626.611(8) and 626.734 and that his general lines license be suspended for thirty days. All other charges should be dismissed with prejudice. DONE AND ORDERED this 13 day of March, 1990, in Tallahassee, Leon County, Florida. DONALD R. ALEXANDER 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 13 day of March, 1990. APPENDIX Petitioner: 1-4. Partially adopted in finding of fact 1. 5-7. Partially adopted in finding of fact 3. 8-11. Partially adopted in finding of fact 6. Note - Where a finding has been partially adopted, the remainder has been rejected as being irrelevant, unnecessary, cumulative, subordinate, not supported by the evidence, or a conclusion of law. Respondent: A Partially adopted in findings of fact 5 and 6. Rejected as being irrelevant. Partially adopted in finding of fact 3. Partially adopted in finding of fact 5. Partially adopted in finding of fact 6. Rejected since respondent did not move his office until February 1989. Partially adopted in finding of fact 4. Partially adopted in finding of fact 6. I. Partially adopted in findings of fact 3 and 8. Partially adopted in findings of' fact 7 and 8. Partially adopted in findings of fact 6 and 7. Partially adopted in finding of fact 10. Partially adopted in finding of fact l. Partially adopted in finding of fact 10. Partially adopted in finding of fact 1. Note - Where a finding has been partially used, the remainder has been rejected as being irrelevant, cumulative, unnecessary, subordinate, not supported by the evidence or a conclusion of law. COPIES FURNISHED: Honorable Tom Gallagher Insurance Commissioner Plaza Level, The Capital Tallahassee, FL 32399-0300 Willis F. Melvin, Jr., Esquire 412 Larson Building Tallahassee, FL 32399-0300 Richard J. DaFonte, Esquire O. Box 41750 St. Petersburg, FL 33743-1750 Donald A. Dowdell, Esquire General Counsel Department of Insurance The Capitol, Plaza Level Tallahassee, FL 32399-0300 =================================================================
The Issue Does Petitioner, Department of Financial Services (DFS), have authority to determine if Respondent, Alberto Luis Sotero (Mr. Sotero) and Respondent, FalconTrust Group, Inc. (FalconTrust), wrongfully took or witheld premium funds owed an insurance company while a civil action between the insurance company and Mr. Sotero and FalconTrust pends in Circuit Court presenting the same issues? Should the insurance agent license of Mr. Sotero be disciplined for alleged violations of Sections 626.561(1), 626.611(7), 626.611(10), 626.611(13), and 626.621(4), Florida Statutes (2007)?1. Should the insurance agency license of FalconTrust be disciplined for alleged violations of Section 626.561(1), 626.6215(5)(a), 626.6215(5)(d). 626.6215(5)(f), and 626.6215(5)(k), Florida Statutes?
Findings Of Fact Based on the testimony and other evidence presented at the final hearing and on the entire record of this proceeding, the following findings of fact are made: Mr. Sotero is licensed by DFS as an insurance agent in Florida and has been at all times material to this matter. He holds license number A249545. FalconTrust is licensed by DFS as an insurance agency in this state and has been at all times material to this matter. It holds license number L014424. Mr. Sotero is an officer and director of FalconTrust and held these positions at all times material to this proceeding. Mr. Sotero also controlled and directed all actions of FalconTrust described in these Findings of Fact. Zurich American Insurance Company is a commercial property and casualty insurance company. FalconTrust Commercial Risk Specialists, Inc., and Zurich-American Insurance Group entered into an "Agency-Company Agreement" (Agency Agreement) that was effective January 1, 1999. The Agency Agreement bound the following Zurich entities, referred to collectively as Zurich: Zurich Insurance Company, U.S. Branch; Zurich American Insurance Company of Illinois; American Guarantee and Liability Insurance Company; American Zurich Insurance Company; and Steadfast Insurance Company. The Agreement specified that FalconTrust was an "independent Agent and not an employee of the Company [Zurich.]". . .. The Agency Agreement also stated: All premiums collected by you [Falcontrust] are our [Zurich's] property and are held by you as trust funds. You have no interest in such premiums and shall make no deduction therefrom before paying same to us [Zurich] except for the commission if any authorized by us in writing to be deducted by you and you shall not under any circumstances make personal use of such funds either in paying expense or otherwise. If the laws or regulations of the above state listed in your address require you to handle premiums in a fiduciary capacity or as trust funds you agree that all premiums of any kind received by or paid to you shall be segregated held apart by you in a premium trust fund account opened by you with a bank insured at all times by the Federal Deposit Insurance Corporation and chargeable to you in a fiduciary capacity as trustee for our benefit and on our behalf and you shall pay such premiums as provided in this agreement. (emphasis supplied. The Agency Agreement commits Zurich to pay FalconTrust commissions "on terms to be negotiated . . . ." It requires FalconTrust to pay "any sub agent or sub producer fees or commissions required." The Agency Agreement also provides: Suspension or termination of this Agreement does not relieve you of the duty to account for and pay us all premiums for which you are responsible in accordance with Section 2 and return commissions for which you are responsible in accordance with Section 3 [the Commission section.] The Agency Agreement was for Mr. Sotero and Falcontrust to submit insurance applications for the Zurich companies to underwrite property and casualty insurance, primarily for long- haul trucking. The Agency Agreement and all the parties contemplated that Mr. Sotero and FalconTrust would deduct agreed-upon commissions from premiums and remit the remaining funds to Zurich. On September 14, 2000, Zurich and Mr. Sotero amended the Agency Agreement to change the due date for premium payments and to replace FalconTrust Group, Inc. (FalconTrust) for FalconTrust Commercial Risk Specialists, Inc., and to replace Zurich-American Insurance Group and Zurich Insurance Company, U.S. Branch, with Zurich U.S. Mr. Sotero and Zurich's authorized agent, Account Executive Sue Marcello, negotiated the terms of the commission agreement as contemplated in the Agency Agreement. Mr. Sotero confirmed the terms in a July 20, 1999, letter to Ms. Marcello. The parties agreed on a two-part commission. One part was to be paid from the premiums upon collection of the premiums. The second part, contingent upon the program continuing for five years, was to be paid by Zurich to Mr. Sotero and FalconTrust. The total commission was 20 percent. FalconTrust and Mr. Sotero were authorized to deduct 13 percent of the commission from premiums before forwarding them to Zurich. The remaining seven percent Zurich was to pay to Mr. Sotero and FalconTrust at the end of the program or after the fifth year anniversary date. The letter spelled out clearly that Zurich would hold the money constituting the seven percent and was entitled to all investment income earned on the money. The passage describing the arrangement reads as follows: Our total commission is 20 percent however Zurich will hold and retain the first 7 percent commission where they are entitle [sic] to earn investment income. I understand that FalconTrust will not benefit from this compounded investment income. However you mentioned you would increase our initial commission that is set at 13 percent currently from time to time depending on FalconTrust reaching their goals, but it will never exceed a total commission of 20 percent. It is to our understanding that the difference will be paid at the end of the program or after the fifth year anniversary date being 12/31/2005, but not earlier than five years. I do understand that if Zurich and/or FalconTrust cancels the program on or before the fourth year being 12/31/2004 that we are not entitle [sic] to our remaining commission that you will be holding. If the program is cancelled after 12/31/2004 by FalconTrust and/or Zurich it is understood that all commission being held will be considered earned. (emphasis added.) Until the program ended, the parties conducted themselves under the Agency Agreement as described in the letter. At some point the parties agreed to decrease the percentage retained by Zurich to five percent and increase the percentage initially paid to and kept by FalconTrust to 15 percent. During the course of the relationship FalconTrust produced approximately $146,000,000 in premiums for Zurich. At all times relevant to this matter, all premium payments, except for the portion deducted by sub-agents and producers before forwarding the payments to Mr. Sotero and FalconTrust were deposited into a trust account. The various sub-agents of FalconTrust collected premiums and forwarded them to FalconTrust, after deducting their commissions, which were a subpart of the FalconTrust 13 percent commission. FalconTrust in turn forwarded the remaining premium funds after deducting the portion of its 13 percent left after the sub-agent deduction. This was consistent with the Agency Agreement and accepted as proper by Zurich at all times. All parties realized that the held-back seven percent, later five percent, was money that Zurich would owe and pay if the conditions for payment were met. The parties conducted themselves in keeping with that understanding. Mr. Sotero and FalconTrust described the practice this way in their Third Amended Complaint in a court proceeding about this dispute: "In accordance with the Commission Agreement, Zurich held the contingency/holdback commission and received investment income thereon." (Emphasis supplied.) In 2006 Zurich decided to end the program. In a letter dated December 8, 2006, Tim Anders, Vice President of Zurich, notified Mr. Sotero that Zurich was terminating the Agency-Company Agreement of January 1, 1999. The letter was specific. It said Zurich was providing "notification of termination of that certain Agency-Company Agreement between Zurich American Insurance Company, Zurich American Insurance Co. of Illinois, American Guarantee and Liability Insurance Co., American Zurich Insurance Company, Steadfast Insurance Company . . . and FalconTrust Grup, Inc. . . ., dated January 1, 1999, . . .." Mr. Sotero wrote asking Zurich to reconsider or at least extend the termination date past the March 15, 2007, date provided in the letter. Zurich agreed to extend the termination date to April 30, 2007. At the time of termination FalconTrust had fulfilled all of the requirements under the Agency-Agreement for receipt of the held-back portion of the commissions. Mr. Sotero asked Zurich to pay the held-back commission amounts. He calculated the amount to exceed $7,000,000. Zurich did not pay the held- back commission amounts. As the program was winding down and the termination date approached, FalconTrust continued to receive premiums. As the Agency Agreement and negotiated commission structure provided, FalconTrust deducted its initial commission from the premium payments. But, reacting to Zurich's failure to begin paying the held back commission amounts, Mr. Sotero engaged in "self help." He deducted at least $6,000,000 from the premium payments from customers, received and deposited in the trust account. He took the money as payment from Zurich of earned and held back commissions.3 Nothing in the Agency Agreement or negotiated commission agreement authorized this action. In March of 2007, Mr. Sotero and FalconTrust also brought suit against Zurich in the Circuit Court for the Eleventh Judicial Circuit, Miami, Florida. The issues in that proceeding include whether Mr. Sotero and FalconTrust wrongfully took premiums and how much Zurich owes them for commissions. As of the final hearing, that cause (Case Number 07-6199-CA-01) remained pending before the court and set for jury trial in August 2010. There is no evidence of a final disposition. But the court has entered a partial Summary Judgment determining that FalconTrust wrongfully took premium funds for the commissions that it maintained Zurich owed. The court's Order concludes that the issue is not whether Zurich owed money to FalconTrust, but whether FalconTrust was entitled to take the funds when it did. Like the undersigned, the court determines that it was not. Between December 8, 2006, the date of the cancelation letter, and April 30, 2007, the program termination date, Mr. Sotero and FalconTrust did not remit to Zurich any of the approximately $6,000,000 in premium payments received. Despite not receiving premiums, Zurich did not cancel or refuse to issue the policies for which the premiums taken by Mr. Sotero and FalconTrust were payment. The policies remained in effect.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Financial Services suspend the license of Adalberto L. Sotero for nine months and suspend the license of FalconTrust Group, Inc. for nine months. DONE AND ENTERED this 15th day of October, 2010, in Tallahassee, Leon County, Florida. S JOHN D. C. NEWTON, II Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 15th day of October, 2010.
The Issue Whether Petitioner's application for licensure as a Resident General Lines Insurance Agent was properly denied by the Department of Financial Services.
Findings Of Fact Petitioner owns two insurance agencies, All Florida Insurance and Tax Services ("All Florida") and One Florida Insurance Agency, Inc. ("One Florida"). On or about January 5, 2010, Gardonal Marcellot ("Marcellot") filled out an application and interviewed with Petitioner for an insurance agent position. The same day, Petitioner offered Marcellot a job at All Florida as an insurance agent.1/ Marcellot accepted the job and provided Pierre a copy of his 2-20 General Lines Insurance Agent license and Social Security card. Pierre informed Marcellot that his start date for employment with All Florida would be January 15, 2010. Soon thereafter, there was a major earthquake in Haiti, and Petitioner informed Marcellot by email that she had to go out of the country to help her family and she was pushing back his start date with the company. Marcellot never reported to work or started his employment with All Florida after Pierre left the country.2/ On or about February 12, 2010, Petitioner applied for agency licensure with the Department for All Florida and named Christopher Jeremie as the Agent in Charge. Pierre also named Marcellot as the secretary and treasurer of All Florida on the application. Marcellot never held a corporate officer position at All Florida. While operating All Florida, Pierre engaged in all the activities that require an insurance agent license. She admitted during the hearing that she ran the office, met with customers by phone and in person, responded to fax and email insurance requests, provided insurance quotes for customers, completed forms for customers, input the insurance information in the computer to get quotes for customers to review, input the information online, and processed numerous insurance applications. On February 26, 2010, Petitioner filled out an application for a Change of Agent in Charge for All Florida and named Marcellot Agent in Charge without his permission. 3/ Pierre continued to utilize Marcellot's licensure information and name him Agent in Charge without his permission to obtain Agency appointments with companies4/ for at least five insurance applications. On May 22, 2010, Pierre next utilized Otto Latimer's ("Latimer") licensure information without his permission and changed the Agent in Charge for All Florida by naming Latimer to the position.5/ On June 22, 2010, Petitioner submitted an Application for Agency Licensure online to the Department on behalf of One Florida and also named Latimer as the Agent in Charge without his permission. Latimer never worked at or served as Agent in Charge for All Florida or One Florida. Latimer owns his own business, Service Ace Corporation, where he works full time. He has been licensed since 1983 as a General Lines Insurance agent. At some point, Latimer discovered that Pierre was having problems getting a 2-20 license agent. He offered to help her by allowing her to rent space at his agency location and for her to work under his license. He never gave her permission or allowed her to use his license or name him as Agent in Charge for appointments. Pierre utilized Latimer's licensure information without his permission for her insurance companies and named him Agent in Charge for both Universal Property and Casualty Insurance Company and Citizens Property Insurance Corporation ("Citizens") insurance appointments for a total of about 19 insurance applications. On August 11, 2010, Citizens terminated All Florida's Agent Appointment Agreement after determining that Pierre had committed forgery and larceny based on false personification because Pierre signed Marcellot's name to the agent appointment application and named him as agent of record. On December 13, 2010, Pierre filed an application with the Department for a Resident General Lines Agent license. On December 21, 2010, Petitioner signed and issued All Florida check number 1003 to Del Rio Discount Corporation, in the amount of $1,000.00. Pierre cut check number 1003 as the gross down payment on a premium finance agreement dated October 1, 2010, for the homeowner policy purchased by Bernard and Eleanor Woodside. The check was returned for insufficient funds. Del Rio Finance filed a complaint with the Department against Petitioner for Pierre issuing check 1003 on behalf of All Florida because the check bounced for insufficient funds. Wendi Cameron ("Cameron"), the Department's investigator in this matter, started investigating the complaint in January 2011. She went to Pierre's office location to see Latimer, whom she believed was the Agent in Charge based on the paperwork Pierre had falsely completed and filed. Latimer was not present and so Cameron spoke to Pierre, who told Cameron that Latimer was out of the office. On May 29, 2011, while Pierre's insufficient funds investigation was still pending, Cameron received another complaint about Pierre namely that Citizens Insurance Company had terminated Pierre's appointment after being advised by Marcellot that Pierre had used his identity without his knowledge and forged his name on applications. Cameron visited Petitioner's office three times during Petitioner's investigations and an Agent in Charge was never present. Pierre was managing the office on each visit. On the fourth visit to the office, it was closed with a note on the door. Cameron was never able to speak to an Agent in Charge and was always informed that one was not available each time she called or visited. The Department concluded its investigation of Pierre and denied her application for licensure based on the Department's sections 626.112(1)(a), (b)4, 626.112(9), 626.172(2), (3), 626.611(7), (8), 626.621(2),(3), and (6).
Recommendation Upon consideration of the foregoing Findings of Fact and Conclusions of Law reached, it is RECOMMENDED that the Department of Financial Services enter a final order denying Petitioner's application for licensure as a General Lines Insurance Agent in the State of Florida. DONE AND ENTERED this 26th day of March, 2012, in Tallahassee, Leon County, Florida. S JUNE C. McKINNEY Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 26th day of March, 2012.
The Issue The issue posed for decision herein is whether or not the Respondent's license and eligibility for licensure as an Ordinary Life, Disability and a General Lines agent should be revoked, suspended, or otherwise disciplined for reasons set forth hereinafter by the Administrative Complaint filed by the Petitioner on September 24, 1982. EXHIBITS The following exhibits were made part of the record: An Insurance Binder dated October 7, 1980, issued to Colon Aveiga by Center Insurance Agency, Inc., and signed by Jon Scott Robbins evidencing payment of $554 for an auto insurance policy issued by Dixie Insurance Company (Petitioner's Exhibit 53). An application for a Fireman's Fund auto insurance policy, dated October 10, 1980, signed by Colon Aveiga and Jon Scott Robbins evidencing payment of $514 (Petitioner's Exhibit 44). An Insurance Binder dated April 20, 1981, issued to Colon Aveiga and signed by Jon Scott Robbins evidencing payment of $767 credit for premiums paid and $299 for premiums due (Petitioner's Exhibit 56). A copy of a cancelled personal check (numbered 128) written by Colon Aveiga, dated April 20, 1981, made payable to Metro Insurance Agency in the amount of $299 for payment of premiums due (Petitioner's Exhibit 57). A Notice of Cancellation of a Fireman's Fund auto insurance policy dated March 25, 1981, and issued to Colon Aveiga for nonpayment of premiums due (Petitioner's Exhibit 52). An Amended Fireman's Fund Auto Insurance Policy dated February 6, 1981, issued to Colon Aveiga and showing a premium adjustment of $271 due (Petitioner's Exhibit 49). A Fireman's Fund Interoffice Memo dated March 23, 1981, written by Albert Sons, FJUA Underwriting Manager for Fireman's Fund Insurance Companies, discussing Colon Aveiga's insurance policy application (Petitioner's Exhibit 42). A Fireman's Fund FJUA Underwriters Request for Information from Metro Insurance Agency regarding Colon Aveiga, dated December 1, 1980 (Petitioner's Exhibit 46) A Fireman's Fund Underwriting memo dated January 14, 1981, requesting information about Colon Aveiga from Metro Insurance Agency and containing a new address for Colon Aveiga (Petitioner's Exhibit 47). A Florida Department of Highway Safety and Motor Vehicles' transcript of Gaston Aveiga's certified driving record, dated September 16, 1981 (Petitioner's Exhibit 43). An Insurance Binder dated October 2, 1980, issued to Marc Gavidia by Metro Insurance Agency and signed by Jon Scott Robbins, evidencing a payment of $140 for an auto insurance policy issued by Fireman's Fund (Petitioner's Exhibit 97). An Insurance Premium Finance Agreement dated October 23, 1980, issued to Marc Gavidia by the Metro Insurance Agency and signed by Jon Scott Robbins (Petitioner's Exhibit 98). A Florida Department of Highway Safety and Motor Vehicles' transcript of Marc Gavidia's certified driving record, dated September 16, 1981 (Petitioner's Exhibit 99). An application for a Fireman's Fund auto insurance policy, dated October 9, 1980, signed by Marc Gavidia and Jon Scott Robbins (Petitioner's Exhibit 101). A Policy Change Request for a Fireman's Fund auto insurance policy, dated February 10, 1981, issued by Metro Insurance Agency, signed by Jon Scott Robbins, concerning Marc Gavidia's policy and listing his address as 5361 S.E. 11th Street, Tallahassee, Florida (Petitioner's Exhibit 111). A Notice of Cancellation of Marc Gavidia's auto insurance policy, dated February 27, 1981, issued by Fireman's Fund and citing material misrepresentation as the grounds for the cancellation (Petitioner's Exhibit 112). A copy of a cancelled personal check (No. 1726) written by Juana Perez, dated March 12, 1981, made payable to Metro Insurance Agency in the amount of $299 for payment of premiums due (Petitioner's Exhibit 62). An Insurance Binder dated March 12, 1981, issued to Rogelio Perez by Metro Insurance Agency and signed by Jon Scott Robbins, evidencing auto insurance coverage by Utah Home Insurance Company (Petitioner's Exhibit 63). An Insurance Premium Finance Agreement dated March 12, 1981, issued to Rogelio Perez by Metro Insurance Agency, and signed by Jon Scott Robbins (Petitioner's Exhibit 78). An application for a Fireman's Fund auto insurance policy, dated March 12, 1981, signed by Rogelio Perez and Jon Scott Robbins (Petitioner's Exhibit 65). A Declarations Form for auto insurance coverage by Rogelio Perez by Fireman's Fund showing a premium due of $978 (Petitioner's Exhibit 75). A Declarations Form for auto insurance coverage by Rogelio Perez by Fireman's Fund showing a premium due of $881 (Petitioner's Exhibit 66). A receipt from Luby's Chevrolet of Miami, Florida, showing $1,084 received from Luis G. Capon (Petitioner's Exhibit 80). An Insurance Binder dated January 26, 1981, issued to Luis Capon by Metro Insurance Agency, signed by Jon Scott Robbins and evidencing auto insurance coverage provided by Utah Home Insurance Company (Petitioner's Exhibit 81). An application for a Fireman's Fund auto insurance policy dated January 28, 1981, signed by Jon Scott Robbins (Petitioner's Exhibit 84). A Policy Change Request for a Fireman's Fund auto insurance policy stating that Luis Capon's address had been changed to 2560 S.W. 34th Street, Gainesville, Florida, and signed by Jon Scott Robbins (Petitioner's Exhibit 86). A Florida Department of Highway Safety and Motor Vehicles' transcript of Luis Capon's certified driving record, dated September 12, 1981 (Petitioner's Exhibit 79). A cancelled policy advisal dated July 8, 1981, regarding Luis Capon's Fireman's Fund auto insurance policy (Petitioner's Exhibit 90). A letter from Albert M. Sons, dated September 22, 1981, in his capacity as FJUA Manager stating that an inspection by Fireman's Fund established that Luis Capon had not moved to Gainesville, Florida, and that in fact he lived in Miami and was therefore in a higher rating zone (Petitioner's Exhibit 89). An Interoffice Memo from the file of Fireman's Fund dated March 23, 1981, in reference to Luis Capon questioning certain inconsistencies in that individual's application for insurance (Petitioner's Exhibit 83). An application for a Fireman's Fund auto insurance policy, dated September 10, 1980, issued to Javier Alvarez, showing a signature of "Javier Alvarez" and signed by Jon Scott Robbins (Petitioner's Exhibits 3 and 4). A Declarations Form for auto insurance coverage of Javier Alvarez by Fireman's Fund showing a premium due of $737 (Petitioner's Exhibit 5). A Return to Sender letter from Fireman's Fund to Javier Alvarez bearing the address of 4902 S.W. 84th Street, Plantation, Florida (Petitioner's Exhibit 6). A Fireman's Fund FJUA Underwriters request for Javier Alvarez' correct address, issued to Metro Insurance Agency, dated November 14, 1980 (Petitioner's Exhibit 7). An Insurance Premium Finance Agreement allegedly signed by Javier Alvarez, issued by Metro Insurance Agency, and signed by Jon Scott Robbins (Petitioner's Exhibit 19). A letter from the National Insurance Finance Company to Javier Alvarez, 251 Crandon Boulevard, Miami, Florida, informing Alvarez of dates and terms of due payments (Petitioner's Exhibit 20). Deposition of A. M. Beverly, taken February 22, 1983 (Petitioner's Exhibit 1). FJUA Rating Manual (Petitioner's Exhibit 2). Fireman's Fund FJUA Rating Examination (Petitioner's Exhibit 3). The following witnesses testified on behalf of the Petitioner: Gaston Aveiga, Albert M. Sons, Peter Gavidia, Marc Gavidia, Juana Perez, Luis Capon, and Javier Alvarez. The Respondent testified on his own behalf. Based upon my observation of the witnesses and their demeanor while testifying, post-hearing memoranda, documentary evidence received, pre-hearing stipulations and the entire record compiled herein, I hereby make the following relevant:
Findings Of Fact The Respondent, Jon Scott Robbins, was, during times material herein, licensed as an Ordinary Life, Disability and General Lines agent. By its Administrative Complaint filed herein dated September 24, 1982, Petitioner, Department of Insurance, charged that the Respondent engaged in the following acts and/or conduct (in summary fashion) which amounts to conduct violative of Chapter 626, Florida Statutes, to wit: Respondent failed to account for or pay to the insurer, insured, or other persons entitled to premiums or other funds received belonging to insurers or others in transactions under his license in a fiduciary capacity, in violation of Section 626.561(1), Florida Statutes. Respondent diverted or appropriated such funds or portions thereof for his own use, in violation of Section 626.561(2), Florida Statutes. Respondent collected a sum as premium or charge for insurance in excess of or less than the premium or charge applicable to such insurance, in violation of Section 626.9541(15)(b), Florida Statutes. Respondent misappropriated, converted, or unlawfully withheld monies belonging to insurers, insureds, beneficiaries, or others received in the conduct of business under his license, in violation of Section 626.611(10), Florida Statutes. Respondent knowingly filed with a supervisor or other public official, or made, published, disseminated, circulated, delivered to any person, or placed before the public, or caused directly or indirectly to be filed with a supervisor, or other public official, or made, published, disseminated, circulated, delivered to any person, or placed before the public, any false material statement, in violation of Section 626.9541(d), Florida Statutes. Respondent knowingly made a false material statement, in violation of Section 626.9541(5)(a)2, Florida Statutes. Respondent knowingly made a false entry of material fact in a book, report, or statement of any person, or knowingly omitted to make a true entry of a material fact pertaining to the business of such person in a book, report, or statement of such person, in violation of Section 626.9541(5)(b), Florida Statutes. Respondent made false or fraudulent statements or representation on, or relative to, an application for an insurance policy for the purpose of obtaining a fee, commission, money, or other benefit from an insurer, agent, broker or individual, in violation of Section 626.9541(11)(a), Florida Statutes. Respondent knowingly made a false or fraudulent statement or representation in or with reference to an application or negotiation for insurance, in violation of Section 626.9541(11)(b), Florida Statutes. Respondent willfully violated a provision or provisions of the Insurance Code, in violation of Section 626.611(13), Florida Statutes. Respondent demonstrated a lack of fitness or trustworthiness to engage in the business of insurance, in violation of Section 626.611(7), Florida Statutes. Respondent engaged in fraudulent or dishonest practices, in violation of Section 626.611(9), Florida Statutes. Respondent engaged in unfair methods of competition or in unfair or deceptive acts as prohibited under Part VII of Chapter 626, Florida Statutes, in violation of Section 626.621(6), Florida Statutes. Respondent violated a provision of the Insurance Code, in violation of Section 626.611(10), Florida Statutes. Respondent has shown himself to be a source of injury or loss to the public, or detrimental to the public interest, in violation of Section 626.621(6), Florida Statutes. During times material herein, Respondent served as a General Lines agent and represented Fireman's Fund Insurance (Fireman's Fund). The complaint allegations, in summary fashion, may be grouped in two classifications; (1) that Respondent knowingly filed false statements of material facts concerning insureds in an attempt to attract more insureds by offering lower rates and (2) Respondent received premiums from insureds in excess of the actual premiums he submitted to Fireman's Fund and thereby unlawfully appropriated the excess monies to his own use. Albert Sons is the underwriting manager for the Florida Joint Underwriters Association (FJUA) in his capacity for Fireman's Fund and is a direct contact for Fireman's Fund with the Respondent. All FJUA premium rates are identical given the same variables such as age, type of vehicle, use and territory. Any variation of these factors changes the rate in a uniform manner and that change is uniform throughout the industry. As an example, Miami is a substantially higher rated territory than Gainesville (TR 31-32). An insured who cancels his insurance coverage is charged the amount of premium based on the amount of time that the coverage remained in effect plus a service charge exacted by the company for processing the application. Pursuant to negotiations for the purchase of auto insurance, Gaston Aveiga, speaking on behalf of his father Colon Aveiga, informed Respondent of his Florida driver's license number and date of birth. The same information was provided to the Respondent on behalf of Colon Aveiga. Gaston advised the Respondent that he would be the principal driver of the car to be insured. Colon Aveiga purchased an auto insurance policy from the Respondent on October 7, 1980 and was quoted a premium of $544. Colon received an insurance binder from Respondent reflecting his correct address: 1215 NE 110th Street, Miami, Florida (Petitioner's Exhibit No. 53). Approximately three days later, an application was made to Fireman's Fund on October 10, 1980, reflecting that Colon Aveiga's address is 1534 SW 34th Street, Gainesville, Florida. The Aveigas have never lived in Gainesville nor have they indicated any intention of moving to Gainesville (TR 15). The insurance application further provides that Colon Aveiga is the only driver of the car and that he had an international drivers license whereas the Aveigas only have Florida driver's licenses; they specifically informed the Respondent of the same and that Gaston would be the principal driver of the insured car. The application submitted to Fireman's Fund on behalf of the Aveigas reflects a total premium of $514 which is, of course, $30 less than the premium quoted and collected from Colon Aveiga. On October 2, 1980, Marc Gavidia, and his father, Peter, purchased an auto insurance policy from the Respondent, doing business as Metro Insurance Agency. 2/ Respondent provided the Gavidias an insurance binder containing their correct address: 10441 SW 50th Street, Miami, Florida and evidencing a payment of $140 towards the balance due (Petitioner's Exhibit No. 97). The insurance was purchased to insure Marc Gavidia's Dodge van of which he was the principal driver. Marc Gavidia purchased the auto insurance from Respondent because of the cheaper rate (TR pp. 41-45). On October 4, 1980, an auto insurance application was tendered to Fireman's Fund on behalf of Marc Gavidia reflecting that he was self-employed (Petitioner's Exhibit No. 101). Marc Gavidia did not list himself as self- employed on the application (TR 49). Marc Gavidia gave Respondent his Florida driver's license which reflected a birth date of February 7, 1960 whereas the application submitted by Respondent on behalf of Marc Gavidia reflects a birth date of February 14, 1950 with a different driver's license number (Petitioner's Exhibit No. 101). On February 14, 1981 Respondent sent a policy change request for Florida auto insurance stating that the insured, Marc Gavidia, transferred schools to Tallahassee and now lives at 5361 SE 11th Street, Tallahassee, Florida (petitioner's Exhibit No. 111). Marc Gavidia has never lived in Tallahassee nor has he communicated to the Respondent any intent of moving to Tallahassee. (TR pp. 49-50). Juana Perez and her husband, Rogelio Perez purchased auto insurance from the Respondent based on the low rate quoted by Respondent. Ms. Perez wrote a check in the amount of $275 payable to Metro Insurance and received an insurance binder (TR pp. 53-54). Ms. Perez gave David Einhorn (a salesman of a local automobile dealership who was representing Respondent) Mr. Perez's Florida driver's license and Mr. Einhorn made a copy of the license (TR p. 56). An application for insurance was submitted to Fireman's Fund on behalf of the Perezes and reflects a total premium of $893. The application states further that the applicant has an international drivers license whereas Mr. Perez has never had an international drivers license (TR p. 59). The application reflects further that Mr. Perez was unemployed whereas he was employed at the time of his application for insurance (TR pp. 59, 63 and 65). An insurance premium finance agreement dated December 30, 1981, entered into by Mr. Perez shows $978 as a total amount of premiums minus the $275 downpayment leaving $704.20 as the amount to be financed (Petitioner's Exhibit No. 78). This represents approximately eighty-five ($85.00) dollars more than the premium sent to Fireman's Fund. On January 28, 1981, Luis Capon, purchased auto insurance from the Respondent and an application was submitted to Fireman's Fund reflecting a total premium of $789. At that time, Luis Capon paid $1,084 in cash to the Metro Insurance Company (TR p. 68). The application submitted by Respondent reflected further that Luis Capon had an international drivers license No. 1581934 and was born on January 15, 1944. At the time Luis Capon made application with the Respondent for auto insurance, he provided his Florida Drivers license which reflected his correct address: 419 NW 15th Avenue, Miami, Florida and his birth date, November 28, 1956 (TR p. 71). A policy change request for Fireman's Fund issued to Luis Capon states that Capon changed his address to 2560 SW 34th Street, Gainesville, Florida. The policy change request form was signed by Respondent. Luis Capon has never lived in Gainesville nor has he evidenced to Respondent any intent of living in Gainesville. Further, Luis Capon has never received any refund from Respondent and in fact had to pay additional premiums (TR p. 73). The additional premium seems to have stemmed from additional violations as reflected by a DMV Driving Report. Javier Alvarez purchased an auto insurance policy from Respondent and was advised that the total cash premium for the policy was $830. Javier Alvarez paid $250 and financed the remaining $580 (Petitioner's Exhibit No. 19). An application submitted on behalf of Mr. Alvarez reflects a total premium of $730 which was submitted with the application. Mr. Alvarez has not received a refund of the difference in the amount quoted i.e. $830 and the amount $730 actually paid to Fireman's Fund by Respondent. When negotiating for the purchase of the auto insurance policy from the Respondent, Javier Alvarez gave the Respondent his Florida driver's license which contained his license number, birth date and address. The application submitted on behalf of Mr. Alvarez shows a Plantation, Florida address and reflects that Javier Alvarez has a Massachusetts driver's license and a birth date of August 16, 1940 whereas his correct birth date is February 22, 1961 and his address is 251 Crandon Boulevard, Apartment 342, Key Biscayne, Florida (TR p. 106). Mr. Alvarez has never had any address other than the Key Biscayne, Florida address and has never possessed a Massachusetts driver's license. On April 2, 1981, Respondent sent an endorsement request to Fireman's Fund advising that Javier Alvarez had transferred schools and was living in Gainesville, Florida (Petitioner's Exhibit No. 2). Javier Alvarez has never attended any school in Gainesville, Florida nor has he indicated to Respondent any intent to do so (TR p. 110). THE RESPONDENT'S POSITION The Respondent testified on his own behalf and has been licensed since 1978. Respondent was first employed as a managing agent and as an underwriter for several years with another agency. During that employment, Respondent did not have the guidance and/or the assistance of a tutor. Respondent acknowledged that there were indeed numerous errors in addresses but he attributes same to the fact that he was a new agent without proper checks and balances in his office at the time, and that he, more than anyone else, was the victim of such mistakes. Respondent points to the fact that he earns commissions based on the amount of premiums and that the lower premiums quoted result in lower commissions to him. Finally, Respondent points to the fact that other agencies such as the chief complaining party in this case, Fireman's Fund, had a greater error ratio than the Respondent in the conduct of its insurance agency and that these errors were the result of sloppy clerical work and language barriers more than any intentional act on Respondent's part. 3/
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that the Respondent's insurance license as referred to herein be suspended for a period of two (2) years. It is further RECOMMENDED that eighteen (18) months of the subject suspension be suspended during which time the Respondent's license shall be placed on probation. RECOMMENDED this 2nd day of September, 1983 in Tallahassee, Florida. JAMES E. BRADWELL, 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 2nd day of September, 1983
The Issue Whether the Petitioner's application of January 11, 1991, for examination as a general lines agent should be granted.
Findings Of Fact Petitioner Paul L. Kornya was licensed in 1974 as a general lines insurance agent in the State of Florida. Prior to 1984, Respondent Department of Insurance had taken no formal disciplinary action against the Petitioner. In 1983, while licensed as an insurance agent and employed in the capacity of office manager for the Milton Carpenter Insurance Agency, Petitioner established a demand deposit account in the name of "Atlantic Association Insurance" and listed himself as the sole signatory and beneficiary on the account. Petitioner thereafter wrote four unauthorized checks on the Milton Carpenter Agency Account totaling $47,132.14 made payable to Atlantic Association Insurance and deposited them into his demand deposit account. In order to conceal his activity, the Petitioner altered the payee of the checks. In a prior administrative case (Case No. 84-L-4085F), Petitioner admitted misappropriating and converting the funds. In 1983, while licensed as an insurance agent and employed in the capacity of office manager for the Milton Carpenter Insurance Agency, Petitioner wrote two unauthorized checks on the Milton Carpenter Agency Account totaling $3,455 made payable to Blinder, Robinson and Co., Inc., Investment Bankers. In order to conceal his activity, the Petitioner listed an agency account code designated for miscellaneous companies on said checks. In a prior administrative case (Case No. 84-L- 4085F), Petitioner admitted misappropriating and converting the funds which were used for Petitioner's personal stock purchases. In 1984, a judgement in the amount of $52,013.35 was entered against Petitioner in the case styled Milton Carpenter Insurance, Inc., a Florida Corporation, and Cincinnati Insurance Company vs. Paul L. Kornya, Case No. 84-3235 CA(L)A, Fifteenth Judicial Circuit Court, Palm Beach County, Florida. On October 31, 1985, the Department entered a Final Order revoking Petitioner's license qualifications and eligibility for licensure for a period of two years, based upon the misappropriation and conversion of said funds. By application signed December 16, 1987 and filed December 28, 1987, Petitioner submitted an application for examination as a general lines insurance agent. By Insurance Commissioner Bill Gunter's letter to the Petitioner of February 29, 1988, the Department requested that the Petitioner submit certain certificates of employment to verify his prior experience. The letter stated that, "[t]o qualify for this examination through experience you must have completed within the past 4 years, at least 1 year of substantially full-time responsible duties as the bona fide employee of an agent or insurer. Your duties during this time must have been in all lines of property, casualty, surety, health and marine insurance. ... One certificate should be completed by you and the other by your employer." The Petitioner claims to have submitted said employment certificates shortly following the Department's request. However, the Department's files do not contain the documents or any other response to the letter, and there is no evidence beyond Petitioner's testimony to support the claim. By letter of March 17, 1988, Department representative Franklin Thompson again requested the experience information cited in the February 29 letter or in the alternative, that Petitioner submit proof that a course of education had been completed. The letter further stated that "we will need a statement from Milton Carpenter Insurance Inc. Agency of Belle Glade, Florida stating that any and all indebtedness you may have had relative to their firm has been satisfied". Both the February 29 and March 17 letters provided that failure to file the information within 30 days from the date of each letter is grounds for denial of the application. Three months passed following the March 17 letter to the Petitioner. According to the records of the Department, no response to either letter was received. On June 17, 1988, the Petitioner's December 1987 application was closed by the Department based upon the failure of Petitioner to submit the previously requested information. By letter of June 23, 1988, the Petitioner advised the Department that the indebtedness was not to the Milton Carpenter Insurance Agency, but was to Cincinnati Insurance Company, which had insured the Carpenter agency against such losses. The letter further stated that approximately $5,000 had been repaid to the Cincinnati Insurance Company. By letter of August 3, 1988, Department representative Thompson wrote, "[t]he information you have furnished has been thoroughly reviewed. It appears that your indebtedness with Milton Carpenter Insurance has been assigned to Cincinnati Insurance Company. Please request that Cincinnati Insurance Company furnish us with a statement indicating that all of your indebtedness to their company has been satisfied". The letter stated that failure to respond within 30 days from the date of the letter was grounds for denial of the application. The evidence does not explain the reason for Mr. Thompson's letter of August 3, 1988. Given the June 17 closure of the pending application based upon the Petitioner's failure to supply additional information, the information furnished apparently consisted of the Petitioner's untimely filed letter of June 23. As of August 3, no pending application existed. In any event, the Petitioner did not respond to the August 3 request. By second application signed October 31, 1989, and filed November 3, 1989, Petitioner submitted an application for examination as a general lines insurance agent. By undated letter, Department representative Thompson again requested Petitioner to submit either certificates of employment to verify his prior experience or proof of completion of certain educational requirements, and further requested a reply to the letter of August 3, 1988 seeking statement from Cincinnati Insurance Company indicating that "all of your indebtedness to their company has been satisfied". Again the letter provides that failure to furnish the requested information within 30 days would result in the file being closed. 1/ The Petitioner, subsequent to the undated letter and prior to February 2, 1990, submitted said certificates of employment. Early in 1990, the Petitioner's application file was assigned to Department representative, Patricia Lehman. On February 2, 1990, Ms. Lehman informed that Petitioner that his certificates of employment were not acceptable, and that he would be required to complete a 240 hour educational requirement. Further, Ms. Lehman's letter provided that, "[i]n addition, you will need to furnish us with a certified letter from Cincinnati Insurance Company that you have made full restitution or a certified copy of the written agreement between you and the party(s) involved that you are making restitution satisfactory to all parties concerned. The information you sent to us is not certified and reflects no signatures". Beginning February 26, 1990, Mr. Kornya took and completed the 240 hour insurance course as identified in the Department's previous communications. The $595 course met for six weeks, five days each week, from 8:00 a.m. to 5:00 p.m. On September 17, 1990, the pending application was closed by the Respondent based upon the failure of Petitioner to submit the previously requested information. There is no evidence that Petitioner submitted evidence of completing the educational requirement. On or about January 8, 1991, Petitioner entered into an restitution agreement with Cincinnati Insurance Company setting forth a payment schedule which requires that Petitioner make a payment of $300 each month to the Cincinnati Insurance Company in order to eventually satisfy the entire $52,013.35 judgement against him. By application signed January 11, 1991, and filed January 16, 1991, Petitioner submitted an application for examination as a general lines agent. By memorandum of February 18, 1991, to her superior, Bob Stewart, Ms. Lehman recommended that the Petitioner's application be denied. Specifically, her memo provides as follows: Mr. Kornya's license qualification and eligibility for licensure were revoked by the Department in 1985 for the mishandling of funds in a fiduciary capacity. It does not appear Mr. Kornya attempted to make restitution until the signed Agreement in 1991. He has demonstrated lack of fitness and trustworthiness to engage in the business of insurance. Therefore pursuant to Sections 626.611(1) (7) , [sic] 626.641(2) and 626.731(1), I recommend his application be denied. Although Ms. Lehman's memo states that "[i]t does not appear Mr. Kornya attempted to make restitution until the signed Agreement in 1991", prior to the January 8, 1991 execution of the restitution agreement, the Petitioner had paid $12,237.94 to Cincinnati Insurance Company realized from the sale of vehicles and real estate. The executed copy of the restitution agreement reflects that such funds were paid, although the agreement fails to indicate when the payment was made. The payment was applied towards interest which had accumulated on the judgement, not towards the $52,013.35 principle judgement amount. At the time of the hearing, the restitution payments were current (although Petitioner did not make the $300 payment due in April, but paid $600 in May.) As of the date of hearing, approximately $49,913 remained to be paid to Cincinnati Insurance Company to satisfy the judgement. Although at the time of the hearing, a letter allegedly from Cincinnati Insurance Company indicated that they had not received documentation of Petitioner's compliance with paragraph five of the restitution agreement (a requirement that Petitioner purchase a life insurance policy naming the insurer as irrevocable beneficiary), said policy was purchased on January 9, 1991. By letter of March 1, 1991, the Department denied the application, based on an application of the statutory sections cited in Ms. Lehman's memo. On June 21, 1991, the Department issued an amended letter of denial. 2/ In the amended letter of denial, the Department cites the prior misappropriation of funds, the unsatisfied judgement, and the 1985 revocation of licensure and eligibility for licensure, which "circumstances surrounding that revocation still exist". The letter cites Sections 626.611(1), (4), (7), (9), (10) and (13), section 626.641(2), and section 626.731(1) Florida Statutes, as the statutory basis for the denial. The evidence fails to establish that any representative of the Department of Insurance, at any time, informed or assured the Petitioner that, upon his completion of the course of education and upon the execution of the restitution agreement between Cincinnati Insurance Company and the Petitioner, his application for examination for licensure as a general lines insurance agent would be approved. The Petitioner has been acquainted with his current employer, Samuel Jokich, for approximately six years. Mr. Jokich employs the Petitioner as a "Colorado Prime" freezer beef salesman. According to Mr. Jokich, the Petitioner is "extremely trustworthy" and of good character. The Petitioner had not disclosed to Mr. Jokich, and Mr. Jokich was not otherwise aware, that the Petitioner had taken approximately $52,000 from the Milton Carpenter Insurance Agency. Mr. Jeffrey Hooker, an independent insurance agent in Belle Glade and childhood friend of the Petitioner's, is aware of the Petitioner's misappropriation and conversion of approximately $52,000 from the Milton Carpenter Insurance Agency. However, Mr. Hooker stated that he would trust the Petitioner and "try to help him any way I could". Mr. Hooker desires to become partners with the Petitioner in a proposed insurance agency in Ft. Myers. Mr. Kenneth Snyder, a field representative for CNA Insurance Company, has known the Petitioner for approximately eight years. He believes the Petitioner to be of "good character" with "solid morals". Although Mr. Snyder was aware that the Petitioner had taken some funds from the Milton Carpenter Insurance Agency, he was unaware of the amount of said funds. Mr. Snyder stated that he would be willing to enter into a business relationship were the Petitioner to become licensed as a general lines agent.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that the Department of Insurance enter a Final Order denying the application of Paul L. Kornya to sit for examination for licensure as a general lines insurance agent. DONE and RECOMMENDED this 23rd day of January, 1992, in Tallahassee, Florida. WILLIAM F. QUATTLEBAUM Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 23rd day of January, 1992.
The Issue The issues are whether Respondent, by entering a plea of nolo contendere to a misdemeanor charge of conspiracy to commit workers' compensation fraud, demonstrated a lack of fitness and trustworthiness to sell insurance in violation of Section 626.611(7), Florida Statutes, and if so, what penalty should be imposed.
Findings Of Fact At all times relevant to this proceeding, Respondent was eligible for licensure and licensed in the following areas: (a) as a health insurance agent; (b) as a life insurance agent; (c) as a life and health insurance agent; (d) as a life, health, and variable annuity agent; (e) as a surplus lines insurance agent; and (f) as a general lines insurance agent. In June 1992, the insurance agency that Respondent worked for was purchased by another insurance agency. Ronald Palmerton was a client of the owner of Respondent's former employer. Mr. Palmerton held a workers' compensation policy issued by Liberty Mutual Insurance Company (Liberty Mutual). After the owner of Respondent's former employer left the new agency, Respondent handled Mr. Palmerton's requests for additional insurance with Liberty Mutual. Respondent was never paid a commission for any work performed on Mr. Palmerton's behalf. Even so, Respondent's testimony that Mr. Palmerton was not up front with information that he provided to Respondent and that Respondent never told Mr. Palmerton that he could avoid his workers' compensation experience modification if he started another company is not persuasive. In a Fourth Amended Information dated April 16, 2001, Respondent and Mr. Palmerton, were charged in the Circuit Court of the First Judicial District, in and for Escambia County, Florida, Case No. 99-2081 CF, with several felony and misdemeanor violations. Specifically, Respondent was charged as follows: (a) with racketeering, a first-degree felony in violation of Section 895.03, Florida Statutes; (b) with conspiracy to commit racketeering, a first-degree felony in violation of Sections 895.03(4) and 777.04(3), Florida Statutes; and (c) conspiracy to commit workers' compensation fraud, a misdemeanor in violation of Sections 440.37(4) and 777.04(3), Florida Statutes. The misdemeanor criminal charge was based on allegations that, beginning on April 4, 1993, Respondent and Mr. Palmerton did unlawfully and knowingly conspire to commit workers' compensation fraud by knowingly making false or misleading oral or written statements and representations and/or knowingly omitting or concealing material information required by Section 440.381, Florida Statutes. According to the Fourth Amended Information, the purpose of the conspiracy was to avoid or diminish the amount of payment of any workers' compensation premiums to be paid by Mr. Palmerton and/or his related companies to a carrier or self-insurance fund. The criminal trial was scheduled for April 16, 2001. On April 12, 2001, the State of Florida offered a plea agreement to Respondent. Respondent initially refused the offer but changed his mind after learning that Mr. Palmerton had agreed to plead guilty to felony charges for perjury and racketeering, with a sentence for 18 months' house arrest and 15 years of probation. Respondent understood that Mr. Palmerton would testify against Respondent if he elected to proceed to trial. On April 16, 2001, Respondent entered into a Plea Agreement in which he agreed to plead no contest to one count of conspiracy to commit workers' compensation fraud, a first-degree misdemeanor. The agreement included a provision for a sentence of one year of probation. Under the agreement, a sentence of nine months' incarceration in the Escambia County jail would be suspended pending Respondent's successful completion of all terms and conditions of probation. The agreement also provided that Respondent's probation would include the payment of any restitution ordered by the Court during a subsequent hearing. On April 16, 2001, the Court adjudicated Respondent guilty, withholding imposition of sentence and placing Respondent on one year of probation. The terms of Respondent's probation included, but are not limited to, the following: payment of a fine and court costs in the amount of $1,000; payment of the costs of prosecution in the amount of $5,000; and (c) payment of restitution as determined at a subsequent hearing. A few days after being adjudicated guilty, Respondent contacted Petitioner's staff to determine the effect of his nolo contendere plea to a misdemeanor offense on his licensure status. Petitioner's staff subsequently informed Respondent that a misdemeanor offense would not result in an automatic suspension of an insurance license. On April 11, 2002, the Court conducted a restitution hearing. During the hearing, the State of Florida and Respondent agreed and stipulated to the entry of a restitution order and judgment satisfactory to the victim, Liberty Mutual. On June 3, 2002, the Court entered a Restitution Order and Judgment against Respondent. The Order required Respondent to pay restitution in the amount of $225,000. Pursuant to the Order, Respondent and Mr. Palmerton are jointly and severally liable for payment of the restitution, with Respondent receiving credit toward the total obligation for $200,000 previously paid by Mr. Palmerton and $10,000 paid by Respondent on April 11, 2002. As such, the effective amount of the Restitution Order and Judgment was a $15,000 balance due from Respondent. In June 2002, Petitioner issued a renewal notice for Respondent's surplus lines insurance license. The notice requested the appointing insurance company or agency to certify that Respondent had not pled guilty, or nolo contendere to, or had not been found guilty of a felony since originally being appointed by the appointing entity. The notice did not inquire whether Respondent had pled guilty, or nolo contendere to, or found guilty of a misdemeanor. At the time of the formal hearing, Respondent and Mr. Palmerton were still jointly and severally obligated to pay $15,000 in unpaid restitution. Respondent had successfully completed his probation in all other respects. During the hearing, Petitioner denied any wrong doing in relation to the misdemeanor offense to which he pled no contest. Specifically, Respondent denied that he ever intended to assist Mr. Palmerton in any type of scheme to defraud or otherwise do harm to Liberty Mutual. Respondent's testimony in this regard in not persuasive. Respondent has been a licensed insurance agent for 32 years. Prior to the instant proceeding, Respondent's insurance licenses have not been the subject of a disciplinary proceeding or lawsuit. Liberty Mutual did not name Respondent as a party in its civil suit against Mr. Palmerton. Instead, Respondent cooperated with and testified on behalf of Liberty Mutual in that proceeding. Until Respondent committed the offense at issue here, his reputation in the insurance community indicates that he was an honest and trustworthy agent.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED: That Petitioner enter a final order imposing a six-month suspension of Respondent's insurance licenses. DONE AND ENTERED this 28th day of October, 2002, in Tallahassee, Leon County, Florida. SUZANNE F. HOOD 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 28th day of October, 2002. COPIES FURNISHED: James A. Bossart, Esquire Department of Insurance Division of Legal Services 200 East Gaines Street, Room 612 Tallahassee, Florida 32399-0333 Thomas E. Wheeler, Jr., Esquire Post Office Box 12564 Pensacola, Florida 32573-2564 Honorable Tom Gallagher State Treasurer/Insurance Commissioner Department of Insurance The Capitol, Plaza Level 02 Tallahassee, Florida 32399-0300 Mark Casteel, General Counsel Department of Insurance The Capitol, Lower Level 26 Tallahassee, Florida 32399-0307
