Findings Of Fact For the purposes of these proceedings, Jager Industries, Inc. and Castle Realty Ltd. are synonymous as Petitioner. Through name changes, Castle Realty Ltd. became Jager Industries, Inc. Under the provisions of the Mortgage Brokerage Act, Chapter 494, Florida Statutes, the Office of the Comptroller, Department of Banking and Finance (Department), is charged with the responsibility and duty of administering the Mortgage Brokerage Guaranty Fund (Fund) which includes the duty to approve or deny applications for payment from the Fund, as set forth in Section 494.042, Florida Statutes. At all times material hereto, 1st Federated Realty Mortgage, Inc. (1st Federated) was licensed as a mortgage broker in this state pursuant to Chapter 494, Florida Statutes, having license number HE 7896. On or about January 8, 1981, 1st Federated filed for bankruptcy in the United States Bankruptcy Court for the Middle District of Florida, Tampa, Division. Thereafter, on or about December 16, 1981, 1st Federated was dissolved. On January 29, 1985, the Department received a letter dated January 25, 1985, by regular mail, requesting payment from the Fund on behalf of Castle Realty Ltd. Attached to the letter was a final judgment entered on April 21, 1982, in the Circuit Court for Pinellas County against 1st Federated in the principal amount of $50,000 based upon a violation of Section 494.042(2)(d), Florida Statutes, a Writ of Execution returned unsatisfied and an Affidavit of Reasonable Search. Thereafter on May 17, 1987, the Department received by certified mail a copy of the Complaint filed against 1st Federated and supporting documents including a copy of the Master Loan Commitment, Affidavit and Acceptance of Service. Pursuant to the Master Loan Commitment, Castle Realty paid $50,000 to 1st Federated as a Master Commitment Fee in exchange for a promise by 1st Federated to fund up to $4,000,000 for individual condominium loans. The individual commitments and closing of loans were subject to the lender approving the borrower's credit; however, approvals could not be unreasonable withheld. Timely notice of the institution of the action by Petitioner against 1st Federated as required by s. 494.043(5), Florida Statutes (1985), was waived by Respondent. No evidence was submitted regarding the number of claims involving 1st Federated and the amount of those claims that have been paid by Respondent from the Fund. Accordingly, no recommendation is made regarding the amount of Petitioner's claim that may be paid from the Fund pursuant to the limitations contained in s. 494.044, Florida Statutes (1985). By Notice of Intent to Deny Payment from the Mortgage Brokerage Guaranty Fund dated May 22, 1987, Respondent entered findings of fact, conclusions of law and denied Petitioner's claim. As grounds therefor, Respondent concluded that the 1985 and 1986 amendments to Chapter 494 were applicable in this case as those amendments were remedial or procedural in nature and should be given retrospective application. Thereafter, Petitioner requested formal proceedings by petition filed June 16, 1987, and this request was forwarded to the Division of Administrative Hearings by the Comptroller's letter dated July 23, 1987.
The Issue The issues for determination in this proceeding are whether Respondent, by and through his employees: (a) sold unregistered securities in the secondary market which were marked up in excess of 10 percent of the prevailing market price and which were not exempt from registration; (b) permitted an agent to service accounts prior to the agent's effective date of registration in the State and concealed such action; and (c) failed to maintain minimum net capital requirements for his corporation; and (d) failed to properly supervise the activities of his employees and agents.
Findings Of Fact Respondent owned the stock of a holding company and was an officer in a wholly owned subsidiary of the holding company. Respondent and another individual owned the stock of Dean, Johnson and Burke Holding Company ("Holding"). Holding owned the stock of Dean, Johnson and Burke Securities, Inc. ("Securities"). Respondent was the Secretary of Securities. Respondent had ultimate responsibility for disbursements and profits for Holding and Securities. Respondent monitored the checkbooks and daily expenses for Securities. Respondent's accountant provided financial information to Respondent concerning the daily operations of both companies. The information was provided on forms supplied by Respondent. Respondent kept a daily record of how much each company made or lost, how much was owed, and other accounting information. Respondent made sure that the bills were paid and that the credit of each company remained good. Respondent also controlled the hiring of key personnel. Brent A. Peterson was a manager and principal for Securities. 2/ Mr. Peterson set prices for the firm. Mr. Peterson engaged in transactions in which prices were set for securities to be sold to customers in excess of 10 percent above and below the prevailing market price. Out of 457 trades, approximately 38 were sold at prices that exceeded a 10 percent markup (the "marked up securities"). The marked up securities were sold at prices in excess of 10 percent of the prevailing market rate. The National Association of Securities Dealers, Inc., ("NASD") determined that the securities were marked up in excess of 10 percent of the prevailing market price based upon Securities' contemporaneous costs. When a dealer is simultaneously making a market in a security (a "market maker"), the NASD looks to the prevailing market price for the purpose of determining if a markup exceeds 10 percent. The prevailing market price is the price at which dealers trade with one another, i.e., the "current inter-dealer market." 3/ When a dealer is not simultaneously making a market in a security (a "non-market maker"), the contemporaneous costs of the dealer are used for the purpose of determining if the securities have been marked up in excess of 10 percent. The contemporaneous costs reflect the prices paid for a security by a dealer in actual transactions closely related in time to the dealer's retail sales of that security. Such a standard is normally a reliable indication of prevailing market price in the absence of evidence to the contrary. Securities was not a market maker in the marked up securities. Even though securities may be sold at the same market price by one firm that is a market maker and one that is not a market maker, the latter may be deemed by the NASD to have marked up the security by more than 10 percent depending on the firm's contemporaneous costs. Many of the marked up securities were sold to customers at the same market price as that the customers would have paid other brokerage houses. 4/ Since Securities was not a market maker in the marked up securities, the standard used by the NASD to determine the amount of markup was the contemporaneous costs paid by Securities. The securities involved in the 38 trades were marked up more than 10 percent over Securities' contemporaneous costs. Respondent sold unregistered securities that were not exempt from registration. Unregistered securities may be sold if they are reasonably related to the current market price. The marked up securities were not reasonably related to the prevailing market price because they were marked up more than 10 percent over Securities' contemporaneous costs. Robert M. Long sold securities to customers as an employee of Securities prior to the effective date of his registration with Petitioner. Mr. Long was registered with Petitioner as a registered representative on May 18, 1988. Mr. Long was employed by Securities, from April 19, 1988, through September 20, 1989. Mr. Peterson advised Mr. Long that Mr. Long was authorized to trade securities. Pursuant to Mr. Paterson's advice, Mr. Long sold securities in Tel-optics prior to the effective date of his registration with Petitioner on May 18, 1988. Respondent concealed the sale of securities by Mr. Long prior to the effective date of his registration with Petitioner. Mr. Long's registered representative number was 34. Relevant order tickets showed Mr. Long as the person engaged in the sale of securities prior to May 18, 1988. Registered representative number 30 had been used on the order tickets at the time of the trades. After Mr. Long was registered with Petitioner, Mr. Long's number 34 was added to the order tickets and number 30 was crossed out. Securities operated with a net capital deficiency of approximately $30,000. The net capital deficiency resulted from the failure to accrue liabilities. The net capital deficiency was discovered by Mr. Long and Jeff Clark, an examiner for the NASD. The invoices for bills for the unaccrued liabilities were not filed where bills and invoices were normally filed and were found by Mr. Long concealed in drawers and other remote locations in the office. The net capital deficiency was discovered by Mr. Long on August 28, 1989, but not reported to Petitioner until September 19, 1989. Mr. Long did not notify Petitioner of the net capital deficiency at Securities until the deficiency could be verified by Mr. Clark.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner enter a final order finding that Respondent is guilty of committing the acts alleged in the Administrative Complaint, requiring Respondent to cease and desist from all violations of Florida statutes and rules, and imposing a fine in the aggregate amount of $9,000. The fine should be imposed in the amount of $2,000 for selling securities in excess of a 10 percent markup and $3,500 for each of the other two acts that constituted violations of applicable statutes and rules. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 25th day of July, 1991. DANIEL MANRY 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 25th day of July, 1991.
Findings Of Fact In 1981, Barry Kandel, an employee of Allied Publishing Group, Inc., solicited Petitioners to purchase stock in Allied, a Florida Corporation. On May 1, 1981, Petitioners purchased one share of stock in Allied for $13,500. By mid-1982, Allied had gone out of business. Petitioners made unsuccessful demands for the return of their money on Brian E. Walker, the Secretary of Allied; on Thomas W. Kuncl, the President of Allied; and on Kandel. On November 19, 1984, Petitioners filed suit against Kandel, Kuncl, Walker, and Allied. The Civil Complaint filed in Case No. 84-6932 in the Circuit Court of the Fifteenth Judicial Circuit of Florida, in and for Palm Beach County, contained general allegations of fraud. On February 20, 1985, Petitioners obtained a default judgment against Allied only. No evidence was offered in this cause regarding the disposition of the litigation as to the individual defendants. The default judgment contains no factual determinations and does not specify a violation of either section 517.07 or section 517.301, Florida Statutes. Kandel currently resides in Fort Lauderdale, Florida, and Kuncl currently resides in the Gainesville, Florida, area. Kuncl was the last known person to have custody of and control over Allied's books and records. Petitioners filed a claim with Respondent, seeking reimbursement for $10,000 from the Securities Guaranty Fund, pursuant to sections 517.131 and 517.141, Florida Statutes. Their claim was denied by letter dated July 8, 1987, for failure to meet the statutory conditions. Neither Allied nor any individual associated with Allied who dealt with Petitioners was registered or licensed by the State of Florida pursuant to chapter 517, Florida Statutes, in any capacity. Petitioners did not cause a writ of execution to be issued against Allied nor the individuals associated with Allied. Petitioners did not attempt a reasonable search as to whether Allied possessed real or personal property or other assets which may be set off against a proposed claim to the Securities Guarantee Fund. Don Saxon, Director of the Division of Securities and Former Assistant Director, has been the only individual responsible for administering the Securities Guaranty Fund since 1983. The Department's interpretation of section 517.131(2), Florida Statutes, is that it requires a claimant to demonstrate findings of a violation of section 517.07 and/or section 517.301, Florida Statutes, by a licensed dealer, a licensed investment adviser or a licensed associated person. The Department's interpretation of section 517.131(3)(a), Florida Statutes, is that it requires a claimant to provide the Department with a certified copy of a judgment demonstrating a violation of section 517.07 and/or section 517.301, Florida Statutes. The Department's interpretation of section 517.131(3)(b), Florida Statutes, is that it requires a claimant to submit a copy of the writ of execution to the Department. During Saxon's tenure in administering the Securities Guaranty Fund, the Department has not waived any of the statutory requirements for claiming monies from the Fund. Section 517.131 and section 517.141, Florida Statutes, were enacted in 1978 and have remained virtually intact. The legislature did substitute the term "associated person" in place of the term "salesman" in section 517.131(2), Florida Statutes, without comment, although the order of licensed entities in that section was altered. The legislative intent behind the establishment of section 517.131, Florida Statutes, was to eliminate the bonding requirement for "individuals registered to be broker/dealers or investment advisers ... substituting therefor, a 'Security Guaranty Fund' to be funded through an assessment imposed upon them." The legislative intent behind section 517.141, Florida Statutes, was that disbursement from the Securities Guaranty Fund would be made to any person suffering monetary damages as a result of "some violation by a registrant."
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is, RECOMMENDED that a Final Order be entered denying Petitioners' claim for payment from the Securities Guaranty Fund. DONE and RECOMMENDED this 25th day of April, 1988, at 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 25th day of April, 1988. COPIES FURNISHED: Gerald Lewis, Comptroller Department of Banking and Finance The Capitol Tallahassee, Florida 32399-0350 Charles E. Scarlett, Esquire Office of the Comptroller Suite 1302, The Capitol Tallahassee, Florida 32399-0350 Richard O. Breithart, Esquire 818 U.S. Highway One, Suite 8 North Palm Beach, Florida 33408 Charles L. Stutts, Esquire Office of the Comptroller Department of Banking and Finance The Capitol, Plaza Level Tallahassee, Florida 32399-0350
The Issue The issue is whether Mr. Cavallo is subject to administrative sanctions for violation of the Florida Securities and Investor Protection Act for conduct while he was employed with three Florida firms which dealt in securities, Bond Management Corporation, Bond Administration Service Corporation and Bond Services International Corporation.
Findings Of Fact The Department of Banking and Finance, Division of Securities, administers the provision of the Florida Securities and Investor Protection Act, Chapter 517, Florida Statutes. The Department had investigated the activities of the several respondents named in the Cease and Desist Order filed in this case, including Bond Management Corporation, Bond Administration Services Corporation, Bond Services International Corporation, Bond Premium Corporation and Mr. Cavallo. The business plan of Bond Management Corporation. Bond Management Corporation and Bond Administration Services Corporation were principally operated by Thomas Whalen, who was assisted by Mr. Cavallo. These corporations had been founded by Robert DiStefano, who had sold them to Mr. Whalen in 1985. Mr. Cavallo began working for Mr. Whalen in approximately March of 1986. The offices of these corporations were first located on State Road 7 in Plantation, Florida, but later were moved to Hollywood, Florida. The business of Bond Management Corporation and Bond Administration Services Corporation consisted of issuing, selling and administering the registration and redemption of Certificates of Beneficial Interest in pools of bonds. The two companies actually operated as an integrated entity. Bond Management was to be the trustee for the bonds which comprised the trust corpus and issue the Certificates of Beneficial Interest. These were sold to telephone marketing companies and to time-share companies. These companies then used the certificates as premiums or incentives to attract people to travel to their developments or to listen to sales presentations. Bond Administration Services Corporation handled the sales and the registration of the certificates by the ultimate purchasers. The certificates were sold from offices in Broward County, Florida, to corporations in Florida and throughout the United States. Bond Management Corporation represented in its private placement memorandum that 68% of the funds it received from the time-share developers and telemarketing companies or others who bought the Certificates of Beneficial Interest would form the trust corpus, and this money would be used to buy zero-coupon government securities. Most of the certificates had face values of $1,000; a few were sold with face values of $500. The certificates would attain these values only if kept until the maturity of the underlying government bonds, which would be from 20-45 years. The actual value of the $1,000 certificates at the time delivered as premiums to those who attended sale presentations was between $17 to $18; the $500 certificates were worth between $8.50 to $9.00. The clients of Bond Administration Services Corporation, the time-share developers or other entities which bought the certificates as premiums for consumers attending their sales presentations, would pay about $30 per $14000 certificate. Bond Management Corporation and Bond Administration Services Corporation assisted the time-share developers and telemarketing companies which purchased the Certificates of Beneficial Interest in the redistribution of those certificates to consumers. Bond Administration Service Corporation sent letters to the purchasing companies to be given as handouts to the sales prospects (members of the public) who ultimately received the certificates instructing the recipient about how to register the Certificates of Beneficial Interest with Bond Administration Services Corporation. Regulation of the Certificates of Beneficial Interest The Certificates of Beneficial Interest issued by Bond Management Corporation constitute securities under Federal law and Florida law. Bond Management Corporation made filings with the Securities and Exchange Commission of the United States under regulation D, which indicated that the securities were exempt from registration under the Federal Act. The Certificates of Beneficial Interest were not registered with the State of Florida Department of Banking and Finance, Division of Securities. Neither Bond Management Corporation, which issued the Certificates of Beneficial Interest, or the individuals in the corporation who offered them for sale or actually sold them (including Mr. Whalen and Mr. Cavallo), were registered with the State of Florida, Department of Banking and Finance, Division of Securities. In May of 1986, the owner of Bond Management Corporation, Mr. Whalen, was visited by representatives of the Florida Division of Securities. Mr. Cavallo attended that meeting. The Division's representative told Mr. Whalen and Mr. Cavallo that the enterprise being operated would require the registration of the issuer of the securities, Bond Management, that the staff members at Bond Management Corporation and Bond Administration Services Corporation who sold the securities to their customers (the time-share developers and telemarketing companies) would have to be registered, and that the persons at the time-share developer or other entrepreneurs who were "giving" the certificates to prospective clients would have to be registered. Prospective clients of the time-share developers and telemarketing companies were required to attend sales presentations in order to receive a Certificate of Beneficial Interest; consequently, the Division of Securities maintained that the consumers were providing consideration for the receipt of the certificates, and were purchasing them from the clients of Bond Management Corporation. Mr. Cava1lo's role at Bond Management Corporation Mr. Cavallo had a business card which represented that he was the Vice President of Marketing and Sales for Bond Management Corporation. In his capacity as Vice President of Sales and Marketing, Mr. Cavallo managed the day- to-day operation of Bond Management Corporation and Bond Administration Corporation. He offered to sell or actually sold Certificates of Beneficial Interest to many companies throughout the United States, at least five of which were located in Florida. Mr. Cavallo sent packages to time-share companies and other potential purchasers of blocks of Certificates of Beneficial Interest, which contained sample Certificates of Beneficial Interest, a private offering memorandum describing the securities, and instruction letters which would accompany the Certificates of Beneficial Interest when delivered to the purchasing corporation's prospective clients. The clients were told how to register those certificates with Bond Administration Services Corporation. When Mr. Cavallo first came to work at Bond Management Corporation, the registration coupons sent to the company by many consumers had not been processed, and Mr. Cavallo spent a good deal of his time in the first two months processing those registrations. The private offering memorandum which Mr. Cavallo distributed as part of the business plan of Bond Management Corporation and Bond Administration Services Corporation contained false representations about the securities, including the amount of the compensation which the trustee, Bond Management Corporation, was to receive; the use of 68% of the proceeds of the sale of the certificates to purchase the bonds which were to be the trust estate; the promise to deposit the bonds comprising the trust estate with the Federal bank or similar financial institution, and the underlying value of the certificates. No government bonds were ever purchased, so the Certificates of Beneficial Interest which Bond Management Corporation issued were worthless. Bond Management Corporation and Bond Administration Services Corporation, dealt with the money paid for the Certificates of Beneficial Interest as their own. In addition, the private offering memorandum Mr. Cavallo distributed did not disclose important facts, including the participation of Mr. Cavallo in the management of the issuer, and the identity of the founder of the company, John DiStefano, who had previously been convicted of securities violations. Shortly after Mr. Cavallo went to work for Bond Management and Bond Administration Services Corporation, he came to doubt that Thomas Whalen was competent to act as a trustee to run the business, due to Mr. Whalen's apparent addiction to cocaine. Mr. Cavallo consulted with an attorney because of his concerns, who advised him that he should say nothing unless he could actually prove that Mr. Whalen was engaged in wrongdoing. Otherwise, Mr. Cavallo would expose himself to potential liability for slander or libel. Although Mr. Cavallo was aware that bonds were not being purchased to create the trust estate that the Certificates of Beneficial Interest represented, he continued to engage in sales of the Certificates of Beneficial Interest until he left the companies in July of 1986. Bond Services Corporation and Bond Administration Services Corporation sold at least 10,000 Certificates of Beneficial Interest, which produced approximately $320,000 in revenue. By May 1986 approximately 3,500 of those worthless certificates had been distributed to individuals, approximately 1,100 of whom were Florida residents. Bond Services International Corporation After Mr. Cavallo resigned from working with Bond Management Corporation and Bond Administration Services Corporation, he went to work for Bond Service International Corporation (Bond International). Bond International had the same business plan as Bond Management Corporation and Bond Administration Services Corporation, and even did business at what had been the location of Bond Management Corporation. The owner of Bond International was John Wallace. He invited Mr. Cavallo to work for him because he knew Cavallo was unhappy at Bond Management Corporation because of the improper business practices of Mr. Whalen. Mr. Whalen had been involved in a previous business enterprise with Mr. Wallace. When Mr. Cavallo came to work at Bond International, Bond International had few clients. Many of Mr. Cavallo's clients from Bond Management Corporation followed him to Bond International. Sales were carried out by Bond International in a manner essentially identical to that used at Bond Management Corporation and Bond Services Administration Corporation. The Certificates of Beneficial Interest issued by Bon Services were essentially identical to that Bond Management Corporation. As with Bond Management Corporation, Mr. Whalen also failed to purchase the bonds which were to make up the trust estate represented by the Certificates of Beneficial Interest. The operation was a little better than at Bond Management Corporation because Bond International bought $225,000 worth of bonds, but that was only about 2-1/2% of the amount required to give the stated face value to the Certificates of Beneficial Interest. Ultimately, when Mr. Wallace was arrested for violation of Florida securities laws, those bonds were surrendered to Wallace's bail bondsman rather than maintained in trust. As with the program at Bond Management Corporation, neither the Certificates of Beneficial Interest issued by Bond International, nor the individuals selling the certificates, including Mr. Cavallo, were registered with the State of Florida, Division of Securities. Sales of Bond International's certificates were made to at least 40 companies. Offers of sale were made to additional businesses. Mr. Cavallo, himself, sent Certificates of Beneficial Interest in conjunction with sales or offers to sell those securities at least 54 times to 41 separate companies, four of which were located in Florida. Bond International received at least $270,000 in revenue from the sale of approximately 10,000 Certificates of Interest. When Mr. Cavallo left the company in December of 1986 about 2,800 consumers had received the Certificates of Beneficial Interest. The private offering memorandum of Bond International was essentially identical to that of Bond Management Corporation. It contained essentially the same false statements regarding the use of proceeds from the sale of certificates to purchase bonds which were to be held in trust by a financial institution, and the compensation of the trustee. The persons actually described as the company's managers, Mitchell Rymar and Janet Himmelheber did not manage the company, John Wallace and Mr. Cavallo did. The private placement memorandum also failed to disclose ongoing state and federal prosecutions of Mr. Wallace for securities fraud and credit card fraud. Mr. Cavallo drafted and mailed letters to be used by the companies purchasing the Certificates of Beneficial Interest when distributing them to consumers. These letters from Bond International to the certificate holders misrepresented that the certificates were guaranteed by the United States Government, when they were not, and that bonds were held in escrow to support the Certificates of Beneficial Interest when they were not. Mr. Cavallo represented himself as the person in charge of Bond International, represented himself as a vice president, was a signatory on Bond International's bank accounts and established a securities account as the vice president of Bond International. He ran the day-to-day affairs of the company and had access to the books and records of the company from the time he began working there. Mr. Wallace considered Mr. Cavallo as a partner in the business. In connection with his duties at Bond International, Mr. Cavallo offered and made sales of Certificates of Beneficial Interest issued by Bond International, by Federal Express delivery, by telephone, and by hand delivery of certificates to, local companies in Broward County. When Mr. Wallace was jailed in November of 1986, Mr. Cavallo continued to operate Bond Services throughout that month. Mr. Cavallo knew that bonds were not being purchased as stated on the Certificates of Beneficial Interest and in the private placement memorandum, and that John Wallace was irresponsible and wasted funds of the company from the time Mr. Cavallo began working there. Nonetheless, Mr. Cavallo continued with the company and continued to sell Certificates of Beneficial Interest. Mr. Cavallo signed numerous checks drawn on the accounts of Bond International, which included $2,500 to pay the criminal defense attorney Mr. Wallace retained to handle the Federal credit card fraud charges filed against him in Chicago, $349 for Wallace to travel to Chicago in connection with those charges, $1,000 to Robert Trachman, the local lawyer retained by Mr. Wallace to defend him with respect to securities fraud charges in Broward County, and $8,500 paid to John Gilbert Bailbonds, Inc., for Mr. Wallace's bail in connection with the Florida securities charges. Mr. Cavallo also wrote a large number of checks to "cash" on accounts of Bond International beginning in August 1986, and ending in November 1986. These checks aggregated $34,093.66. It is by no means clear what the checks to "cash" were used for, but there is no proof that they were ever used to purchase the securities which Bond International should have purchased to back, the Certificates of Beneficial Interest. Mr. Cavallo received direct payments by check made to him of at least $3,155. Mr. Cavallo is sophisticated in financial matters. He holds a bachelors and masters degree from the University of Miami in Coral Gables, as well as a masters of foreign trade from the American Institute of Foreign Trade in Glendale, Arizona. After Mr. Cavallo severed his connection with Bond International, he took steps to establish Bond Premium Corporation, which would have followed a business plan similar to those of Bond Management Corporation and Bond International, although Mr. Cavallo maintains he would have purchased bonds to support his Certificates of Beneficial Interest. That company never did any business.
Recommendation It is recommended that a final order be entered by the Department of Banking and Finance, Division of Securities, finding Mr. Cavallo guilty of: The sale of unregistered securities in violation of Section 517.07, Florida Statutes, and that he be fined $5,000; The sale of unregistered securities by an unregistered person, in violation of Section 517.12(1), Florida Statutes, and that he be fined $5,000; and Employing schemes to defraud and making false or fraudulent statements or representations in connection with the sale of the securities of Bond Management Corporation and Bond International in violation of Sections 51- 7.301(1)(a) and (c), Florida Statutes, and that for these acts he be fined $15,000, so that a total fine of $25,000 be imposed, and requiring him to cease and desist from further participation in the sale of securities. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 20th day of January, 1989. WILLIAM R. DORSEY, JR. Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1050 (904) 488-9765 Filed with the Clerk of the Division of Administrative Hearings this 20th of January, 1989. APPENDIX The following are my rulings on the proposed findings of fact submitted by the petitioners pursuant to Section 120.59(2), Florida Statutes (1987). Rulings on Petitioner's Findings of Fact Covered in finding of fact 1. Rejected as unnecessary. Covered in finding of fact 2. Covered in finding of fact 3. Covered in finding of fact 3. Covered in finding of fact 3. Covered in finding of fact 11. Covered in findings of fact 2 and 15. Covered in finding of fact 7. Covered in finding of fact 8. Covered in finding of fact 9. Covered in finding of fact 10. Covered in finding of fact 15. Covered in finding of fact 11. Covered in finding of fact 11. Covered in finding of fact 11. Covered in finding of fact 11. Covered in finding of fact 11. Covered in findings of fact 11 and 12. Covered in finding of fact 12. Covered in finding of fact 13. Covered in finding of fact 15. Rejected as cumulative. Covered in finding of fact 14. To the extent appropriate, covered in finding of fact 15. 26 To the extent appropriate, covered in finding of fact 15. Covered in finding of fact 16. Covered in finding of fact 18. Covered in finding of fact 18. Covered in finding of fact 19. Covered in finding of fact 19. Covered in findings of fact 7 and 20. Covered in finding of fact 21. Covered in finding of fact 22. Covered in findings of fact 17, 18 and 24. Covered in finding of fact 23. Covered in finding of fact 23. Covered in finding of fact 23. Covered in finding of fact 23. Rejected as unnecessary. To the extent appropriate, covered in finding of fact 25. Rejected as cumulative. Covered in finding of fact 26. Covered in finding of fact 17. Covered in finding of fact 5. It is not clear that Mr. Cavallo actually shared the profits equally with Mr. Wallace, however. Covered in finding of fact 23. Covered in finding of fact 26. Covered in finding of fact 27. Covered in finding of fact 28. Covered in finding of fact 29. Although my calculations of the amounts involved are somewhat different. Rejected as unnecessary. Covered in finding of fact 29. Covered in finding of fact 31. Covered in finding of fact 31. COPIES FURNISHED: Lawrence S. Krieger, Esquire 111 Georgia Avenue Suite 211 West Palm Beach, Florida 33401 Vincent R. Cavallo, pro se 405 S, Pine Island Road Plantation, Florida The Honorable Gerald Lewis Comptroller, State of Florida The Capitol Tallahassee, Florida 32399-0350 Charles L. Stutts, Esquire General Counsel Comptroller, State of Florida The Capitol Tallahassee, Florida 32399-0350
The Issue The issues in this case are whether Respondent violated sections 648.442(1), 648.442(2), 648.442(4), 648.571(1), 648.45(2)(e), 648.45(2)(h), 648.45(2)(j), 648.571(3)(b)1., and 648.571(3)(b)2., Florida Statutes (2007),1/ and Florida Administrative Code Rules 69B-221.145(4)(a) and 69B- 221.145(4)(b), and, if so, what discipline should be imposed.
Findings Of Fact The Department is the state agency responsible for regulating insurance and insurance-related activities, including limited surety (bail bond) licensees in Florida. At all times relevant to this proceeding, Mr. Wilson has been licensed in this state as a limited surety (bail bond) (2-34) agent, license number D012026. Mr. Wilson is the owner of Against All Odds Bail Bonds (Against All Odds), which is located in Tampa, Florida. As a bail bond agent, Mr. Wilson's duties include writing bail bonds for defendants who are incarcerated; ensuring the defendants appear for court dates; arresting defendants who fail to appear in court and returning them to jail; and returning collateral to defendants when requested. In 2007, Mr. Wilson was the only limited surety agent working at Against All Odds. In May 2007, Michael Wisher (Mr. Wisher) was arrested for driving under the influence, and his bond was set at $2,000. Mr. Wilson was contacted to post a surety bond on Mr. Wisher's behalf. On May 12 or 13, 2007, Mr. Wilson met Mr. Wisher at the Hillsborough County Jail, where Mr. Wisher was being held. Mr. Wilson advised Mr. Wisher that the premium for the bail bond was $200 and that an additional $1,800 for collateral was required. Mr. Wisher agreed to the arrangement and gave Mr. Wilson permission to use his credit card for the payment. Mr. Wilson used Mr. Wisher's credit card at the jail to pay for the premium and collateral for a total of $2,000. Mr. Wilson secured an appearance bond with United States Fire Insurance Company on May 13, 2007. Mr. Wilson was released and accompanied Mr. Wilson to the office of Against All Odds, where he executed an Indemnitor/Guarantor Check List dated May 12, 2007. Two of the provisions of the checklist provide: I understand that my collateral cannot be released until all bonds posted on my behalf for defendant have been exonerated and written notice form the court received by the bail agency. I understand that it is my [Mr. Wisher's] responsibility to request return of any collateral provided. There may be a delay of return of collateral until the bail agency has researched the exoneration date and verified the bail bond status with the appropriate courts. The process may be done faster if I obtain written verification of the bond exoneration from the court and provide it to the bail agency. Mr. Wilson did not issue a receipt to Mr. Wisher, showing that Mr. Wisher had paid $2,000. Based on Mr. Wilson's testimony, the Indemnitor/Guarantor Check List is not the receipt. Mr. Wilson claims that he did issue a collateral receipt, but that receipt did not show the credit card fee that was being imposed. According to Mr. Wilson, the copy of the receipt was destroyed in a fire. Mr. Wisher's testimony is credited that he did not receive a receipt. Computer records of the Clerk of Hillsborough Circuit Court show that on September 18, 2007, the bond was deactivated and a certificate of discharge of bond was issued in Mr. Wisher's case. Mr. Wilson claims not to have received the certificate of discharge, and no certificate of discharge was entered in evidence. Mr. Wisher contacted Mr. Wilson on December 17, 2007, requesting that his collateral be returned. Mr. Wisher advised Mr. Wilson that the bond had been discharged. Mr. Wilson was aware that the bond had been discharged because he had checked the computer records of the Clerk of the Hillsborough Circuit Court and saw the record showing the discharge of the bond. Mr. Wilson sent Mr. Wisher a money order for $500 on January 3, 2008. He sent Mr. Wisher another money order dated January 31, 2008, for another $500. Mr. Wisher did not agree to have his collateral returned in installments. By the end of January 2008, Mr. Wilson still owed Mr. Wisher $800. Mr. Wisher made numerous telephone calls to Mr. Wilson in an attempt to get the remaining amount of his collateral. In June 2008, Mr. Wisher wrote Mr. Wilson two times in an attempt to get his collateral returned. Both letters were returned by the United States Postal Service as unclaimed. Mr. Wisher did not receive any additional money from Mr. Wilson. Mr. Wilson claims that he mailed Mr. Wisher an additional $400, but the evidence does not support his claim. He submitted a copy of an envelope addressed to Mr. Wisher with a first class stamp on it. The envelope did not bear a post mark. The exhibit also had a portion of a customer receipt from the United States Postal Service, which states return of collateral in the section entitled "Pay To" and Michael Wisher in the section labeled "C.O.D. or Used For." The receipt contains no date and does not specify what service or goods for which the receipt was issued. Additionally, it appears that the receipt is not complete based on the wording at the bottom which states serial number; year, month, day; post office; and amount. Such wording would suggest that additional information would be part of the receipt, but the receipt provided by Mr. Wilson did not contain the additional information. In addition to the premium of $200, Mr. Wilson charged Mr. Wisher $400 for a credit card fee. This amount represented percent of the total bond amount, not just the collateral amount. The credit card fee which Mr. Wilson charged was more than the fee which the credit card company charged him for use of the credit card. Mr. Wilson claims that he was taught at the bail bond school held in Fort Lauderdale that up to 20 percent of the total bond amount could be charged to the client for the use of a credit card. The Department did not establish that Mr. Wilson failed to have a sign in his office posting the credit card fee schedule when Mr. Wisher visited his office. However, Mr. Wisher was not provided a copy of the credit card fee schedule.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered finding that Mr. Wilson did not violate sections 648.442(1), 648.442(4), and 648.571(3)(b)2.; finding that Mr. Wilson violated sections 648.442(2), 648.571(1), 648.571(3)(b)1., 648.45(2)(e), 648.45(2)(h), and 648.45(2)(j) and rules 69B-221.145(4)(a) and 69B-221.145(4)(b); suspending Mr. Wilson's license for six months; imposing an administrative fine of $5,000; and requiring Mr. Wilson to return the remainder of Mr. Wisher's collateral to him. DONE AND ENTERED this 29th day of November, 2011, in Tallahassee, Leon County, Florida. S SUSAN BELYEU KIRKLAND 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 29th day of November, 2011.
Findings Of Fact Based upon the oral and documentary evidence adduced at the final hearing and the entire record in this proceeding, the following findings of fact are made. At all times pertinent hereto, Respondent has been licensed in the State of Florida as a limited surety agent (bail bondsman), a life and health agent and a general lines agent. Respondent has been licensed as an insurance agent for more than eleven years. He has been a licensed limited surety agent for more than ten years. Pursuant to Section 648.442(3), Florida Statutes, all collateral received by Respondent or others acting under his supervision or control in transactions under his surety agent license constituted trust funds received in a fiduciary capacity. At all times pertinent to this proceeding, Respondent has been doing business as Protective Insurance Center, Jenkins Bail Bonds. Until early February of 1991, Respondent's general agent was Banker's Insurance Company. However, in early February, Respondent's relationship with that company was terminated. Respondent's current general agent is American Bankers Insurance Company of Florida. Russell Faibish, Respondent's general agent with American Bankers since February of 1991, has expressed via affidavit that Respondent is in good standing with that company and the company has been satisfied with his performance to date. On January 25, 1991, Respondent, while acting in his capacity as a limited surety agent for Banker's Insurance Company, posted a surety bond, No. 339658, (the "Bond") in the amount of $752.00 to obtain the release of Kim Reinhold Whitford from custody in Clay County, Florida. In connection with the posting of the Bond, Respondent received from Earnest R. Justice (the "Indemnitor") a $75.00 premium payment and a $350.00 cash collateral payment. At the time the Indemnitor arranged with Respondent for the issuance of the bond, the Indemnitor was advised that his collateral would be returned within twenty one days of the receipt of written notice of the discharge of the bond. Respondent was provided with a notice from the Clerk of Court that Ms. Whitford was scheduled for a court appearance on April 3, 1991 for a "plea." Respondent never made any inquiry as to the results of that April 3, 1991 hearing. On April 3, 1991, the Bond was discharged and the obligation of the surety, Banker's Insurance Company, was released in writing by the County Court of Clay County, Florida. Respondent contends that he never received notification of the discharge of the Bond. While the Court document indicates that a notice of the discharge of the Bond was sent to Respondent at the time the requirements for the discharge were satisfied on or about April 3, 1991, no conclusive evidence was presented to establish that the notice of discharge was actually sent to or received by Respondent. Respondent denies ever receiving that document. After Ms. Whitford was released from jail, the Indemnitor contacted Respondent's office several times in April and May of 1991 trying to arrange the return of his collateral. Respondent denies receiving any messages from the Indemnitor. The failure to receive the messages may have been due to office staff turnover. In any event, the evidence was sufficient to establish that the Indemnitor attempted to arrange for the return of his collateral on numerous occasions without success. On August 9, 1991, the Petitioner filed the Administrative Complaint which is the basis for this proceeding against Respondent alleging that he failed to return the Indemnitor's collateral. Upon receipt of the Administrative Complaint, Respondent contacted the Clerk of Court, in Clay County, Florida to determine the status of the bond. On August 30, 1991, the Clerk of Court, Clay County, Florida, sent Respondent a certified copy of the bond discharge. Respondent claims that he first became aware of the discharge of the Bond and the Indemnitor's right to the return of the collateral when he received the August 30 certification from Clay County. Because an Administrative Complaint had already been filed, Respondent did not immediately refund the collateral for fear that such action could be construed as an attempt to influence a witness in the case. In order to avoid the appearance of attempting to influence a witness, Respondent waited until the day of the hearing to arrange to make a refund of the collateral available to the Indemnitor. On January 14, 1992, Respondent sent a Western Union Money Transfer, control no. 7395574746, payable to the Indemnitor in the amount of $350.00 as return of the collateral. Although the Indemnitor did not receive the return of his collateral until approximately eight to nine months after it was due, the collateral was ultimately returned and there is no other evidence in this case of any other financial loss to any member of the public. On average, Respondent has between 100 to 150 active bond cases per month. Most of those bonds are written in Palm Beach County, where Respondent's business is located. In this case, Respondent arranged for a "teletype bond" whereby the arrangements for the bond were made in Palm Beach County and notification of the posting of the bond and authorization for the release of the prisoner were transmitted via teletype to Clay County. Respondent contends that he reviews his active cases on a quarterly basis to confirm the status of the bonds. Nevertheless, it took almost six months for Respondent to determine that the requirements of the Bond in this case had been fully satisfied. No justifiable excuse was given for this delay. However, in mitigation, it does appear that the long distance nature of the transaction, the change in Respondent's general agent and office staff turnover all contributed to the delay in refunding the Indemnitor's collateral. Respondent has had three Administrative Complaints filed against him since 1985. The first Administrative Complaint was filed on June 26, 1985 and alleged that Respondent failed to provide required documentation of his assets to the Department. Pursuant to a Consent Order entered on August 6, 1985, Respondent was fined $200 and placed on probation for one year as a result of this charge. The most serious and pertinent prior administrative proceeding against Respondent was commenced by an Administrative Complaint dated November 17, 1987. That complaint alleged, among other things, that Respondent failed to return collateral to at least two clients. In April of 1989, the parties entered into a settlement stipulation regarding these charges pursuant to which Respondent was suspended for one year and fined $1,000.00. He was also required to make resitution to several individuals who had not been identified in the Administrative Complaint in that case. No explanation has been provided regarding the "restitution" required to be made to those individuals. The third case involved an Emergency Suspension Order entered on March 16, 1988. That Order was dissolved on September 20, 1988 when the underlying criminal charges were nolle prosequi. Respondent has had several IRS liens filed against him and there is currently a foreclosure action pending against his house. However, no specific information was provided regarding the status of those cases. Respondent contends that he is vigorously contesting all of those matters and he believes they will be favorably resolved. The evidence in this case suggests that Respondent is currently involved in disputes with some other customers regarding the return of collateral. The evidence did not establish the exact number or the facts surrounding those disputes. Respondent contends that all of those disputes are related to problems with or caused by his prior General Agent. No conclusions as to the merits of those complaints can be drawn from the evidence presented in this case. Gerald Michael Sandy, a licensed bondsman in the State of Florida and the current president of the Florida Surety Agents Association, testified on behalf of the Respondent in this matter. He indicated that on approximately 40% of the bonds that are executed, the Courts do not provide written notice of the discharge. However, Mr. Sandy conceded that even if written notification from a court is not received, the bail bondsman is primarily responsible for determining whether a bond has been discharged and a bail bondsman must immediately respond to the inquiries of an indemnitor regarding the return of collateral.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that a Final Order be entered suspending Respondent's licenses for three months, placing him on probation for two years and assessing an administrative fine in the amount of $500. RECOMMENDED this 9th day of March, 1992, at Tallahassee, Florida. J. STEPHEN MENTON Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 9th day of March, 1992. APPENDIX TO RECOMMENDED ORDER, CASE NO. 91-6302 Both parties have submitted Proposed Recommended Orders. The following constitutes my rulings on the proposed findings of fact submitted by the parties. The Petitioner's Proposed Findings of Fact Proposed Finding Paragraph Number in the Findings of Fact of Fact Number in the Recommended Order Where Accepted or Reason for Rejection. 1. Adopted in substance in Findings of Fact 1. 2. Adopted in substance in Findings of Fact 1. 3. Adopted in substance in Findings of Fact 2. 4. Adopted in substance in Findings of Fact 3. Findings of Fact 5. 7. Adopted in substance in Findings of Fact 5. 8. Adopted in substance in Findings of Fact 7. Rejected as unnecessary. Adopted in substance in Subordinate to Findings of Fact 13 and 14 and addressed in the Preliminary Statement. Subordinate to Findings of Fact 6 and 10. Adopted in substance in Findings of Fact 8. Subordinate to Findings of Fact 18. Subordinate to Findings of Fact 19. Subordinate to Findings of Fact 20. The Respondents's Proposed Findings of Fact Proposed Finding Paragraph Number in the Findings of Fact of Fact Number in the Recommended Order Where Accepted or Reason for Rejection. 1. Adopted in substance in Findings of Fact 5. 2. Adopted in substance in Findings of Fact 5. 3. Adopted in substance in Findings of Fact 7. 4. Adopted in substance in Findings of Fact 10. 5. Adopted in substance in Findings of Fact 11. 6. Adopted in substance in Findings of Fact 11. 7. Adopted in substance in Findings of Fact 12. 8. Adopted in substance in Findings of Fact 14. 9. Addressed in the Preliminary Statement. 10a. Adopted in substance in Findings of Fact 10. 10b. Adopted in substance in Findings of Fact 9. 10c. Adopted in substance in Findings of Fact 10. 10d. Adopted in substance in Findings of Fact 10. 10e. Adopted in substance in Findings of Fact 13. 10f. Adopted in substance in Findings of Fact 13. 10e.[sic] Adopted in substance in Findings of Fact 17. 10f.[sic] Adopted in substance in Findings of Fact 16. 10g. Rejected as unnecesdsary. 11a. Adopted in substance in Findings of Fact 21. 11b. Adopted in substance in Findings of Fact 21. 11c. Adopted in substance in Findings of Fact 21. 12. Adopted in substance in Findings of Fact 4. COPIES FURNISHED: David D. Hershel, Esquire Department of Insurance and Treasury Larson Building, Room 412 Tallahassee, Florida 32399-0300 Franklin Prince, Esquire Northbridge Centre, Suite 300-P 515 N. Flagler Drive West Palm Beach, Florida 33401 Tom Gallagher State Treasurer and Insurance Commissioner Department of Insurance and Treasurer The Capitol, Plaza Level Tallahassee, Florida 32399-0300 Bill O'Neil Deputy General Counsel Department of Legal Affairs The Capitol, Plaza Level Tallahassee, Florida 32399-0300
The Issue Whether Respondent committed the offenses set forth in the Administrative Complaint and, if so, the penalty which should be imposed.
Findings Of Fact Respondent was at all times relevant hereto licensed by Petitioner in the State of Florida as a Limited Surety Agent (Bail Bondsman) and as a Life and Health Insurance Agent. On January 1, 1988, Daniel Del Sardo was arrested and incarcerated in Broward County, Florida, on charges of forgery, uttering a forged instrument, grand theft of the second degree, and possession of a stolen credit card. His bail was set in the amount of $3,100.00. On March 29, 1988, Sabastian Del Sardo (Complainant), the father of Daniel Del Sardo, and Respondent entered into an agreement for Accredited Surety & Casualty Company, Inc., for whom Respondent acted as agent and attorney in fact, to post the bail bond for Daniel Del Sardo. Complainant paid Respondent the sum of $350.00 as the premium for the bail bond and agreed to indemnify Accredited Surety & Casualty Company, Inc., the surety on the bond, in the event the surety suffered a loss on the bail bond. In addition, Complainant tendered to Respondent, as additional security, a check in the amount of $1,000.00 and the title to a 1979 Cadillac. Complainant told Respondent to hold the check until April 3, 1988, the date Complainant was scheduled to receive his social security check. On April 4, 1988, Complainant gave to Respondent the sum of $750.00 in cash in exchange for the $1,000.00 check that Respondent had been holding since March 29, 1988. The collateral security was accepted by Respondent as attorney in fact and in trust for Accredited Surety & Casualty Company, Inc. By the terms of the agreement executed by Complainant and Respondent, Complainant was entitled to a return of the collateral security within 21 days after the bail bond was discharged in writing by the court. On or about April 7, 1988, Complainant asked Respondent to take Daniel Del Sardo back into custody because Daniel had gotten back on drugs and had been stealing from Complainant and Complainant's wife. Respondent had sufficient justification to return Daniel Del Sardo to custody. While there was a verbal agreement between Complainant and Respondent that Respondent would return Daniel to custody, there was no agreement as to how, or whether, Respondent was to be compensated for doing so. Respondent incurred expenses in locating Daniel Del Sardo and in returning him to custody. Respondent and one of his employees spent over twenty hours looking for Daniel Del Sardo. When he was located, Daniel Del Sardo was high on drugs and did not go to jail peaceably. While he was in the process of taking Daniel Del Sardo back into custody, Respondent's clothing was damaged. Respondent's employee transported Daniel Del Sardo from Miami, Florida, to the Broward County, Florida, jail on April 10, 1988. On April 20, 1988, Daniel Del Sardo changed his plea from not guilty to guilty on the four counts and was sentenced to a total of four years in prison. The bond posted on behalf of Daniel Del Sardo was discharged on April 26, 1988. On April 28, 1988, Complainant asked Respondent to return the car title and the $750.00 security deposit he had given Respondent. Respondent refused to return the entire deposit and told Complainant that he was going to keep the sum of $525.00 to reimburse himself for expenses he had incurred in taking Daniel Del Sardo back into custody. Complainant did not agree that Respondent was entitled to reimbursement of expenses. Further, Complainant did not agree that $525.00 was a reasonable figure for the expenses Respondent had incurred. In response to Complainant's demand that his entire deposit be refunded, Respondent, on April 28, 1988, returned the car title and the sum of $225.00 to Complainant. Respondent kept the sum of $525.00 to reimburse himself for the expenses he incurred in returning Daniel to custody. In charging Complainant for the expenses he incurred in returning Daniel Del Sardo to custody and in deducting those expenses from the collateral security, Respondent was following a practice that has developed among those engaged in the bail bond business in Dade County, Florida. Complainant filed a complaint with Petitioner on the grounds that his entire deposit of $750.00 had not been returned, asserting that there had been no agreement that he would pay Respondent's expenses for taking Daniel back into custody. On or about June 20, 1988, one of Petitioner's investigators contacted Respondent about the complaint. On June 21, 1988, Respondent paid to Complainant the sum of $525.00, representing the balance of the security deposit he had earlier received from Complainant. On January 26, 1989, Petitioner filed an administrative complaint against Respondent based on his dealings with Sabastian Del Sardo. The administrative complaint charged Respondent with violating the following: Section 648.44(1)(g), Florida Statutes, Section 648.442(1), Florida Statutes, Section 648.442(4), Florida Statutes, Section 648.45(2)(e), Florida Statutes, Section 648.45(2)(f), Florida Statutes, and Section 648.45(2)(j), Florida Statutes. Respondent denied the allegations of the Administrative Complaint and timely requested a formal hearing. There was no evidence that Respondent has been previously disciplined by Petitioner.
Recommendation Based on the foregoing findings of fact and conclusions of law it is RECOMMENDED that Petitioner, Florida Department of Insurance, enter a final order which finds that Respondent, Gerald Carpenter, violated the provisions of Sections 648.422(1) and (4), Florida Statutes, and Section 648.45(2)(j), Florida Statutes. It is further RECOMMENDED that an administrative fine in the amount of $500.00 be levied against Respondent. DONE AND ENTERED this 6th day of October, 1989, in Tallahassee, Leon County, Florida. 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 6th day of October, 1989. APPENDIX TO RECOMMENDED ORDER, CASE NO. 89-2356 The following rulings are made on the proposed findings of fact submitted by Respondent: The proposed findings of paragraph 1 are rejected as being unnecessary to the results reached. Whether Respondent was justified in returning Daniel Del Sardo to custody is not in issue. The proposed findings of paragraph 2 are rejected as being speculation. The proposed findings of paragraph 3 are rejected as being subordinate to the findings made. The proposed findings of paragraph 4 are rejected as being conclusions of law. COPIES FURNISHED: Brian Norton, Esquire Office of Legal Services 412 Larson Building Tallahassee, Florida 32399-0300 Randolph Q. Ferguson 1644 Northwest 17th Avenue Miami, Florida 33125 Honorable Tom Gallagher State Treasurer and Insurance Commissioner The Capitol, Plaza Level Tallahassee, Florida 32399-0300 Don Dowdell, General Counsel Department of Insurance and Treasurer The Capitol, Plaza Level Tallahassee, Florida 32399-0300
