Findings Of Fact On May 30, 2008, FEC entered an Order of Probable Cause charging Respondent with the following violations: Count 1: On or about January 10, 2007, Respondent violated Section 106.07(1), Florida Statutes, when he failed to file with the filing office his 2006 Q4 CTR due on that date, listing all contributions received and all expenditures made, by or on behalf of the candidate. Count 2: On or about May 7, 2007, Respondent violated Section 106.141(1), Florida Statutes, by failing to properly dispose of surplus campaign funds within 90 days after he was eliminated and to file a report reflecting the disposition of those funds, when Respondent failed to qualify between January 30, 2007 and February 6, 2007, and failed to dispose of funds in his campaign account and file a report reflecting the disposition of the funds on or before May 7, 2007. On or about December 16, 2008, Respondent was personally served with the Order of Probable Cause by process server. Because Respondent neither elected to have a formal or informal hearing conducted before FEC nor elected to resolve the complaint by consent order within 30 days after the date of the filing of FEC's allegations, on January 30, 2009, FEC referred the case to the Division of Administrative Hearings (DOAH), pursuant to Section 106.25(5), Florida Statutes (2007). The case was filed at DOAH on February 2, 2009. On February 6, 2009, Petitioner filed and served its First Requests for Admission upon Respondent. Respondent had 35 days, including time for mailing, to either admit or deny each of the Requests for Admission. Rule 1.370(a), Florida Rules of Civil Procedure provides: Each matter of which an admission is requested shall be separately set forth. The matter is admitted unless the party to whom the request is directed serves upon the party requesting the admission a written answer or objection addressed to the matter within 30 days after service of the request . . Thirty-five days from February 6, 2009, was March 13, 2009. Respondent failed to file a response to FEC's Requests for Admission by March 13, 2009. Additionally, Rule 1.370(b), Florida Rules of Civil Procedure, provides: Any matter admitted under this rule is conclusively established unless the court on motion permits withdrawal or amendment of the admission. On March 17, 2009, Petitioner filed its Motion for Summary Final Order, based on the unanswered Requests for Admission, and, therefore, based upon the conclusively established admissions of fact. Respondent filed no response in opposition to the Motion for Summary Final Order, as permitted by Florida Administrative Code Rule 28-106.204. On April 3, 2009, an Order to Show Cause was entered, requiring Respondent to show cause by April 10, 2009, why a Summary Final Order should not be entered against Respondent. Respondent did not file any response. The April 3, 2009, Order to Show Cause gave Respondent a final opportunity to dispute any or all facts, to set aside the Requests for Admission, or to otherwise show cause why the Motion for Summary Final Order should not be granted. Respondent has not shown good cause. Respondent's failure to provide a written answer or objection to FEC's Requests for Admission conclusively establishes the following determinative facts, which prove the charges herein:1/ Respondent signed a Statement of Candidate form for Jacksonville City Council, District 7, on June 8, 2005. Respondent filed an Appointment of Campaign Treasurer and Designation of Campaign Depository for Candidates (DS-DE-9) on or about June 8, 2005, designating himself as the treasurer of his campaign. Respondent did not file his 2006 Q4 Campaign Treasurer's report by January 10, 2007. Respondent received a Memorandum from Beth Fleet, Director of Candidate Administration, dated January 12, 2007, notifying him that he failed to file his 2006 Q4 Campaign Treasurer's Report that was due on January 10, 2007. Respondent received an April 27, 2007, Memorandum from Jerry Holland, Duval County Supervisor of Elections, notifying Respondent that he failed to file his 2006 Q4 Campaign Treasurer's Report that was due on January 10, 2007. Respondent's failure to file his 2006 Q4 Campaign Treasurer's Report is a violation of Section 106.07(1), Florida Statutes. Respondent's Termination Report (TR) was due on May 7, 2007. Respondent received a letter dated April 27, 2007, from Jerry Holland, Duval County Supervisor of Elections, notifying him that his TR was due on May 7, 2007. Respondent did not file his TR with the Duval County Supervisor of Elections by May 7, 2007. Respondent's failure to file his TR by May 7, 2007, is a violation of Section 106.141(1), Florida Statutes.
The Issue Whether the Respondent committed the violations alleged in the Order of Probable Cause entered August 26, 2009, and, if so, the penalty that should be imposed.
Findings Of Fact Because Ms. Fresen failed to respond to the Petitioner's First Request for Admissions, the matters of which admissions were requested are deemed conclusively established for purposes of this administrative proceeding. See Fla. R. Civ. P. 1.370. The Petitioner's First Request for Admissions is attached to this Final Order, and the matters of which admissions were requested are adopted herein as findings of fact.
The Issue The issues to be resolved in this proceeding concern whether the Petitioner's Decedent, Joanne Eddy, validly effected a transfer from the pension plan to the Investment Plan of the Florida Retirement System (FRS), and whether the Respondent agency is estopped from invalidating that transfer. It must also be determined whether the Petitioner is entitled to an award of reasonable attorney's fees and costs.
Findings Of Fact The following facts have been stipulated by the parties in the Joint Pre-hearing Statement or Stipulation: Joanne Eddy was employed as a Paramedic by Hillsborough County, Florida, from 1989 until 2004. Hillsborough County is now and for all periods relevant to this case has been a participating employer in the Florida Retirement System (FRS). As a Hillsborough County employee, Ms. Eddy participated in the FRS pension plan from her date of hire in September of 1989 until April of 2004. Ms. Eddy was fully vested in the FRS pension plan. Ms. Eddy was diagnosed with cancer (metastatic melanoma) in August 2003. In that month Ms. Eddy was placed on approved medical leave. Ms. Eddy remained on approved medical leave of absence until her resignation in April 2004 (April 8, 2004). In March 2004, Ms. Eddy submitted a "Second Election Retirement Plan Enrollment Form" to the FRS Plan Choice Administrator (Citi-Street). Ms. Eddy indicated on this form that she wished to change from the FRS pension plan to the FRS Investment Plan. The second election retirement plan enrollment form was signed by Ms. Eddy on March 1, 2004, and received by the FRS Plan Choice Administrator, Citi-Street on March 8, 2004. Citi-Street is a private entity which is an agent of the FRS, Division of Retirement (DOR) and the SBA. On April 1, 2004, Joanne Eddy participated in a grievance hearing involving another Hillsborough County employee. Hillsborough County paid Ms. Eddy for the time that she attended the grievance hearing on April 1, 2004. Ms. Eddy resigned from her FRS employment with Hillsborough County on April 8, 2004. Ms. Eddy called the FRS financial guidance line on April 29, 2004, to inquire about the status of her transfer to the FRS Investment Plan. In May 2004, Ms. Eddy received a written statement from FRS confirming an opening balance of her FRS Investment Plan account, in the amount of $60,345.86. The transaction date on the statement is April 29, 2004. Ms. Eddy died of cancer on June 20, 2004. Prior to her death, Ms. Eddy designated her two sisters, Petitioner Julie Lambrou and Lynda Wood, as beneficiaries on her FRS Investment Plan account. Ms. Eddy's beneficiary designation form allocates 60 percent to Ms. Lambrou and 40 percent to Ms. Wood. As beneficiaries, Ms. Lambrou and Ms. Wood are entitled to the value of Ms. Eddy's FRS Investment Plan assets, if a transfer to the FRS Investment Plan is determined to be valid. On September 3, 2004, an employee of the Division of Retirement within the Department of Management Services wrote a letter to Joanne Eddy's mother, Kathleen Dickey. In part, the September 3, 2004, letter states: Ms. Eddy elected to transfer to the Investment Plan effective April 1, 2004. However, since she did not work in the month of April and therefore did not receive a salary payment under the Investment Plan, her election is null and void. Ms. Lambrou followed all legally required procedures to contest the denial of her sister's election to transfer to the FRS Investment Plan. On September 30, 2005, SBA Director of Policy, Risk Management and Compliance wrote a "Final Action" letter to Ms. Lambrou advising her that SBA had concluded that Ms. Eddy's election to transfer to the FRS Investment Plan was invalid. Petitioner, Julie Lambrou, filed a Petition for Hearing in this matter on November 1, 2005, after receiving an extension from the SBA. Ms. Lambrou's attorney sent SBA a letter on February 22, 2006, enclosing a copy of the Hillsborough County payroll check for the work performed by Ms. Eddy on April 1, 2004. As of the date of the Joint Pre-hearing Statement, th[e] Division of Retirement ha[d] made no determination as to whether the information contained in the February 22, 2006, letter constitutes creditable service. Ms. Eddy was very positive and very active regarding her chances for recovery from the effects of melanoma and embarked on an active treatment, surgery and therapy program to try to effect a cure. This included chemical therapy as well as brain surgery, which was apparently successful. She even participated in the trial of a new therapy, interleukin therapy and a new and aggressive type of chemical therapy. She was initially optimistic about her chances for recovery. In early 2004, however, she begin to decline in health. She thus began to focus very strongly on setting her personal affairs, including her financial affairs, in order. She then learned that, because she was not married and had no children, under the FRS pension plan (defined contribution) there would be no beneficiary eligible to receive her retirement benefits upon her death. She learned at the same time, however, that if she transferred to the Investment Plan, that she could designate beneficiaries to receive the full value of her Investment Plan account upon her death. Consequently, she decided to do so and submitted the necessary forms to make an election (her "second election") to transfer from the pension plan to the Investment Plan with the FRS, in March 2004. She named her two sisters as beneficiaries in a 60 percent, 40 percent proportion because she really wished the money to be for the use of her nephews and nieces. One sister had three children, the other two children. Eligibility to Transfer to Investment Plan Members of the pension plan who did not elect to transfer to the FRS Investment Plan when the plan was established in 2002, as of March of 2004, were permitted to make a one-time election known as the "second election" to transfer to the Investment Plan in accordance with Section 121.4501(4)(e), Florida Statutes (2003). This is distinguished from the first election period which ended in August of 2003. § 121.4501(4)(a), Fla. Stat. (2003). No rules had been enacted in March 2004 governing the second election to transfer to the Investment Plan. In the absence of rules, the official policy statement concerning transfer eligibility to the Investment Plan is the official "Summary Plan Description" of the FRS Investment Plan, promulgated by the DOR, which was in effect in March and April of 2004. It is to this document to which employees, intent on transferring to the Investment Plan, are referred by a notation or instruction on the face of the enrollment form those employees must use to enroll in the Investment Plan. The Summary Plan Description contains the following guidance for employees considering a second election: If you wish to use your Second Election, note that the plan change is effective the first day of the month following the receipt and processing of your second Election Retirement Plan Enrollment Form by the FRS Plan Choice Administrator. To finalize the plan change you must work or be covered by approved leave for at least one day in the month of your effective date. If you submit your Second Election Retirement Plan Enrollment Form in December and it is received and processed by the Plan Choice Administrator on December 15, your plan change will be effective on January 1. To finalize the change you must work or be covered by approved leave for at least one day in the month of January. If you do not work or are not on approved leave in January, your plan change will be reversed and you will remain in your original plan. (emphasis supplied) (See Exhibit O in evidence.) Applying the foregoing provision in the Summary Plan Description, Ms. Eddy's election thus became effective on April 1, 2004. She was on approved leave in April through the date of her resignation which was April 8, 2004. Moreover, she was paid for work performed on April 1, 2004, for attending a grievance hearing as a union representative. This was a regular, compensable part of her employment duties because she was a designated union representative and her duties required her to attend such grievance hearings and related meetings. Indeed, she attended a formal meeting on March 11, 2004, concerning the same grievance claim proceeding, in which the grievance claim of Linda Wood was discussed with Ms. Joni Taylor. This was done through her official duties as an employee union representative designated by her employer to attend such meetings by her employer's adherence to the collective bargaining agreement with the union. If Ms. Eddy was entitled to payment for the April 1, 2004, attendance at the grievance hearing, as indeed she was, then she also should have been paid for the meeting on March 11, 2004, on the same basis or theory as she was paid for the April 1, 2004, grievance hearing by her employer, Hillsborough County. Ms. Eddy was aware in March 2004 that changing retirement plans was the only effective means of passing her vested retirement benefits on to other members of her family. She thus filled out the Second Election Retirement Plan Enrollment Form supplied by the FRS in March 2004. That form indicates that enrollment is effective on the first day of the month following the month in which the election form is received by FRS. It is undisputed that her election form was received by the FRS administrator on March 8, 2004. The information provided Ms. Eddy in the Summary Plan Description indicated that she was eligible to elect the FRS Investment Plan if she worked or was on approved leave in the month of April 2004. As a union representative Ms. Eddy knew that her presence at the grievance hearing on April 1, 2004, was compensable under the terms of the Collective Bargaining Agreement between the county, her employer, and her union. The March 11, 2004, meeting should have been compensable as well on the same basis, and Ms. Eddy, no doubt, could have called that to her employer's attention and to the attention of the DOR, if she had known of any requirement, intent or position by the DOR or the SBA that she had to have been paid for employment during the month of March, in order for her March 2004 election to be valid. Ms. Eddy also was aware that she was on approved leave during all of 2004 until her resignation on April 8, 2004. Ms. Eddy received an initial written confirmation from the DOR of her election to transfer to the Investment Plan in March 2004, in the form of a "Second Election Plan Choice Confirmation." The confirmation, which bears a transaction date of March 8, 2004, states in relevant part: This statement confirms your recent FRS Plan Choice utilizing your one time, second election. You have elected to change to the FRS Investment Plan effective 04/01/2004 and transfer the present value of your FRS Pension Plan benefit. Ms. Eddy called the FRS Financial Guidance Line on April 29, 2004, and in a lengthy conversation with persons responsible for fielding inquiries and giving financial planning information (Ernst and Young and Citi-Street), she discussed her account and various options that might be available to beneficiaries, including tax ramifications. During this phone conversation, a Citisreet representative confirmed that her transfer to the Investment Plan became effective in April 2004, and her investment account balance would be transferred to the FRS Investment Plan by the end of April 2004. Before her death, Ms. Eddy received a second written confirmation from FRS that her transfer to the FRS Investment Plan was effective, in the form of an "Investment Plan Opening Balance Confirmation Statement." This confirmation, which bears a transaction date of April 29, 2004, the date of her phone conversation, states: This statement confirms the opening balance of your FRS Investment Plan account. On 04/29/2004, the amount of $60,345.86, which represents the present value of your FRS Pension Plan benefit will be allocated to the investment options listed below. Ms. Eddy died on June 20, 2004. At the time of her death she had 2.44 hours of unused sick leave and 6.52 hours of unused annual leave or vacation leave, for which payment was made following her death. On June 9, 2004, Dan Beard, a Benefits Administrator with the DOR, in an e-mail with the subject "Election Reversals," noted the following with respect to Ms. Eddy's election: "Per agency, member was on some type of leave and finally resigned. Second election to IP is not valid since member did not work in IP effective month." Ms. Lambrou first learned that the DOR had determined Ms. Eddy's election to be "null and void" from a letter sent to Kathleen Dickey, her mother, dated September 3, 2005, which was in response to an inquiry made by Ms. Dickey. She learned also of this position by the DOR in conversations with Paul Dane, an employee of the DOR. The September 3, 2005, letter states that Ms. Eddy's election was void because "she did not work in the month of April and therefore did not receive a salary payment under the Investment Plan . . . ." (See Exhibit H in evidence.) Ms. Lambrou thereafter made many inquiries into the reasons for the reversal, chronicled in Attachment 1 of the SBA final decision letter. (Exhibit J in evidence.) The SBA conducted a review in response to Ms. Lambrou's Request for Intervention, which was submitted on November 4, 2004. In every written communication from and between SBA and the DOR, from June 2004 through April 2005, the asserted reason for reversing Ms. Eddy's election was that she did not work or earn salary in the month following the month of her election which was therefore her effective month of April 2004. In its final decision letter of September 30, 2005, the SBA repeated the position that Ms. Eddy's election was invalid because she was not actively employed and did not earn a salary during April 2004. In response to the final decision letter, Ms. Lambrou filed a request for formal hearing and hired counsel to represent her. A later examination of Ms. Eddy's work record revealed that Ms. Eddy had in fact worked on April 1, 2004, for which her employer, Hillsborough County, issued a delayed salary paycheck. This information was revealed in a letter of February 22, 2006, from Ms. Lambrou's attorney to the SBA, to the effect that Hillsborough County had issued a paycheck for Ms. Eddy's work on April 1, 2004. Despite the policy position communicated to members of the retirement system in the official Summary Plan Description, that an effective election required working or being on approved leave in the month the election became effective, following receipt of the information concerning Ms. Eddy's work on April 1, 2004, the SBA took the additional position that not only must the employee seeking to transfer from the pension plan to the Investment Plan receive a salary payment in the effective month (April 2004), but must also have been working and getting paid on the day the election form was submitted. Moreover, at the hearing, Dan Beard, the Benefits Administrator for the DOR, testified that in order to be eligible to transfer to the Investment Plan, a member must be on paid status on the day the FRS administrator receives the member's election form. When asked how a member would be able to know that they had to be on paid status on the day the election form is received in order to be eligible to transfer to the FRS Investment Plan, Mr. Beard could only respond that member education was "not part of his job." If Ms. Eddy's election to transfer to the Investment Plan were determined to be valid her beneficiaries would be entitled to receive her full investment account balance. If her election is determined to be invalid then no benefits will be paid to any beneficiary, relative or to her estate, and the funds accrued in her retirement account or accounts through her working life will be forfeited to the state. The SBA was aware in June 2004 that Ms. Eddy was on approved leave when she submitted her election to transfer to the FRS Investment Plan, and was on approved leave through the date of her resignation on April 8, 2004. Notwithstanding the clear language in the Summary Plan Description, the SBA took the position after Ms. Eddy's death that her election was invalid because she had not worked and had not received a salary in April 2004. This was the position the SBA communicated on a number of occasions in writing thereafter, until a formal proceeding was initiated by Ms. Lambrou on November 1, 2005. After the formal proceeding was initiated and after counsel for the Petitioner informed the SBA in February 2006 that Ms. Eddy had in fact worked and been paid by Hillsborough County for work performed in April 2004, the SBA altered its position so that it also contended that the transfer to the Investment Plan was invalid because Ms. Eddy had allegedly not worked and not received a salary on the day the election to enroll in the Investment Plan and the enrollment form was filed (March 1, 2004) or, alternatively, that she had not worked or been paid on the date the Investment Plan election enrollment form was received by the FRS plan administrator.
Recommendation Having considered the foregoing findings of fact, 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 a final order be entered by the State Board of Administration finding that the election of Ms. Eddy, the Petitioner's decedent and testatrix, to transfer her retirement benefits and credits to the FRS Investment Plan was valid and that the benefits thereof be paid over, in the proportions designated by Ms. Eddy, to Ms. Eddy's designated beneficiaries, the Petitioner, Julie Lambrou, and her sister, Lynda Wood. The request for attorney's fees and costs is denied. DONE AND ENTERED this 28th day of September, 2006 Tallahassee, Leon County, Florida. S P. MICHAEL RUFF 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 September, 2006. COPIES FURNISHED: James W. Linn, Esquire Lewis, Longman & Walker, P.A. Post Office Box 10788 Tallahassee, Florida 32302 Ruth L. Gokel, Esquire Office of the General Counsel State Board of Administration 1801 Hermitage Boulevard Tallahassee, Florida 32308 Brian A. Newman, Esquire Pennington, Moore, Wilkinson, Bell & Dunbar, P.A. Post Office Box 10095 Tallahassee, Florida 32302-2095 Coleman Stipanovich Executive Director State Board of Administration of Florida Post Office Box 13300 Tallahassee, Florida 32317-3300 Bruce Meeks Inspector General State Board of Administration of Florida Post Office Box 13300 Tallahassee, Florida 32317-3300
The Issue The issues presented for determination are whether Respondent violated Subsections 106.11(3) and 106.19(1)(d), Florida Statutes, as alleged in the Order of Probable Cause dated May 22, 2001, and the Statement of Findings dated April 3, 2001.
Recommendation It is recommended that the Florida Elections Commission enter a final order dismissing all charges against Petitioner, Bruce Grady. DONE AND ENTERED this 26th day of November, 2001, in Tallahassee, Leon County, Florida. JEFF B. CLARK 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 26th day of November, 2001. COPIES FURNISHED: Mark Herron, Esquire Mark Herron, P.A. 215 South Monroe Street, Suite 701 Tallahassee, Florida 32301 Eric M. Lipman, Esquire Florida Elections Commission The Capitol, Room 2002 Tallahassee, Florida 32399-1050 Barbara M. Linthicum, Executive Director Florida Elections Commission The Capitol, Room 2002 Tallahassee, Florida 32399-1050 Patsy Rushing, Clerk Florida Elections Commission The Capitol, Room 2002 Tallahassee, Florida 32399-1050
The Issue Whether Respondent, Jean M. Hovey, willfully violated Subsection 106.143(1)(a), Florida Statutes (2008), as alleged in the Order of Probable Cause dated August 26, 2009, and, if so, what is the appropriate penalty.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing, the following Findings of Facts are made: Respondent was a candidate for Winter Springs, Florida, city commission in 2008. Respondent was a first-time candidate for public office. She evidenced her decision to enter the city commission race by qualifying on August 28, 2008, one day prior to the deadline to qualify. A component of qualifying is the candidate's assertion that they have read and understand the requirements of Chapter 106, Florida Statutes. As a result of her late filing, Respondent had only five or six weeks to actively campaign. Responding to the advice of volunteer advisors, on September 4, 2009, Respondent hired Denise Ryser to manage her campaign. Ms. Ryser had previously managed a successful city commission race and was managing two other Winter Springs city commission races. Ms. Ryser was qualified to manage a city commission campaign. Ms. Ryser's initial focus was to prepare a campaign mailer. It was important that the mailer be presented to the voters as quickly as possible. Respondent provided the biographical information for the mailer; Ms. Ryser did the graphics, layout, color selection, and the "marketing" of the mailer. Several layouts/mock-ups of the mailer were prepared by Ms. Ryser and submitted to Respondent for approval. Each layout/mock-up submitted to Respondent contained the statutorily-mandated disclaimer. Subsection 106.143(1)(a), Florida Statutes, requires that: Any political advertisement that is paid for by a candidate and that is published, displayed, or circulated prior to, or on the day of, any election must prominently state: "Political advertisement paid for and approved by (name of candidate), (party affiliation), for (office sought)." After Respondent finally approved what she believed to be the final layout/mock-up, Ms. Ryser, on September 19, 2008, electronically forwarded a layout/mock-up to a printer in Miami. Inexplicably, the layout/mock-up forwarded by Ms. Ryser did not contain the statutorily-mandated disclaimer. This failure was attributed to a transmission error. Because Ms. Ryser perceived a need for "handouts" to be distributed by Respondent at personal appearances, Ms. Ryser, on the same day, September 19, 2008, ordered 100 additional mailers from a local printer. These mailers contained the statutorily- mandated disclaimer. When the Miami printer returned the mailers to Ms. Ryser, without further examining the mailers, she took them directly to a "mail-house" in Winter Park, Florida, to be mailed to 11,000 registered Winter Springs, Florida, voters. They were mailed on October 2, 2008. Respondent did not receive a mailer, as she was not on the mailing list. Ms. Ryser received a mailer at her home on Saturday, October 3, 2008. It was not until Sunday, October 4, 2008, that she noticed the absence of the statutorily-mandated disclaimer. Ms. Ryser immediately called Michael Ertel, Seminole County, Florida, supervisor of elections, and advised him of the error. Mr. Ertel did not testify. However, the parties stipulated that he would have testified that he advised Ms. Ryser to remail the mailer with the proper disclaimer and destroy the remaining mailers without the disclaimer. On Monday, October 6, 2008, Ms. Ryser discarded the mailers in her possession. At Ms. Ryser's direction and paid for by her, the mail-house printed the appropriate disclaimer on the remaining 3,000 mailers in its possession and mailed them to voters. On Tuesday, October 7, 2008, Respondent attended a candidates' night at Highland's in Winter Springs, and mailers were available to the public at this event. Unrefuted testimony indicates that Respondent's mailers, without the statutorily- mandated disclaimer, were available to the public at this meeting. Respondent did not learn that the mailers did not have the statutorily-mandated disclaimer until October 8, 2008, when she and her volunteer campaign advisors confronted Ms. Ryser about the error. Ms. Ryser acknowledged that the failure to include the statutorily-mandated disclaimer was her error and that Respondent was unaware of the error until October 8, 2008.
Findings Of Fact The Petitioner is University General Hospital, Inc. (hereinafter "UGHI"), the present license holder of University General Hospital (hereinafter "University Hospital"), a 140-bed general acute-care hospital located in Seminole, Florida. During calendar years 1989 and 1990 and until July 30, 1991, University Hospital operated as a division of Community Health Investment Corporation f/k/a/ CHS Management Corporation (hereinafter "CHIC"). On July 30, 1991, UGHI was incorporated as a wholly-owned subsidiary of CHIC and became the license holder of University Hospital. University Hospital's change in licensure on that date did not change its ownership, control, management, reporting, or operation. On or about December 2, 1991, UGHI timely filed Certificate of Need (hereinafter "CON") Application No. 6851 to convert 12 general acute-care beds to hospital-based skilled nursing beds. As of the date of filing its CON application, UGHI was the license holder of University Hospital and complied with the definition of "Applicant" set forth in Rule 10-5.002(3), Florida Administrative Code. Prior to submission of CON Application No. 6851, UGHI retained John Gilroy of the law firm Haben, Culpepper, Dunbar & French to serve as legal counsel for the CON project. In his initial dealings with UGHI regarding compliance with the requirements of Section 381.707(3), Florida Statutes, Gilroy learned that audited financial statements previously prepared for University Hospital while it was a division of CHIC could be reissued for UGHI. Gilroy then contacted Elizabeth Dudek, Director of the Department of Health and Rehabilitative Services (hereinafter "HRS") Office of Community Health Services and Facilities, to inquire whether the proposed audited financial statements (i.e., the reissued statements) would comply with the applicable statutory requirements. Dudek suggested that Gilroy direct his inquiry to Roger Bell, an Audit Evaluation and Review Analyst with the HRS Office of Community Health Services and Facilities. In conducting her responsibilities, Dudek relies upon the opinions of experts, and Bell is the most qualified person in the HRS Office of Community Health Services and Facilities to render an opinion regarding hospital audited financial statements. Among Bell's responsibilities is advising Dudek whether CON applicants' financial statements should be accepted or rejected. At that time or soon thereafter, Gilroy had at least one telephone conversation with Bell wherein he informed Bell that UGHI had been in existence for less than one year and inquired whether the proposed reissued audited financial statements would be acceptable to HRS. Bell's response to Gilroy was that he was not aware that audited financial statements could be reissued in the manner proposed by UGHI, but if Arthur Andersen & Co. could prepare such a document, he expected that it would be acceptable. Additionally, Bell indicated to Gilroy that a balance sheet audit would not give HRS sufficient financial information and that it would be beneficial if he could look at reissued audited financial statements to conduct a more in-depth analysis. Bell did not inform Gilroy of any HRS policy regarding the types of audited financial statements HRS would accept from applicants in existence for less than one year. Following his discussion with Bell, Gilroy sent a letter to his client dated November 20, 1991, indicating that Bell agreed that the reissued statements would be acceptable and that Arthur Andersen & Co. should prepare such statements prior to January 17, 1992. In a letter dated December 12, 1991, Gilroy asked Bell to confirm HRS' position regarding reissued audited financial statements in writing, consistent with their prior conversation. In a letter dated December 16, 1991, Bell reiterated to Gilroy that "if Arthur Andersen is assuming the liability for this assertion, then it is probably in order," and also stated that "[u]nless a concern appears in the auditor's reports or notes, I do not foresee any problem." The letter did not refer to any HRS policy regarding the types of audited financial statements HRS would or would not accept from corporations in existence for less than one year. After receipt and review of Bell's December 16 letter, Gilroy remained under the impression that reissued audited financial statements would be acceptable to HRS provided they were properly executed and signed and had appropriate notes. In a letter dated December 19, 1991, HRS identified certain items of information omitted from UGHI's initial application (commonly referred to as an "Omissions Letter"), including, among other items, audited financial statements of the applicant. On that same date, HRS also sent an Omissions Letter to Edward White Hospital, Inc., an applicant in the same application review batch as UGHI. The Omissions Letter sent to Edward White Hospital, Inc., included a section as follows: If an applicant, due to non-existence as an entity, has not completed a fiscal year of operation, the applicant will submit an audited financial statement in which the balance sheet date falls within the period which begins on the first day of its existence as a legal entity and ends on the date of the applicant's choosing, provided the audited financial statement is available and included with the application during or before the end of the omissions process. Had a similar statement been contained in the UGHI Omissions Letter, Gilroy would have approached HRS to determine whether UGHI's proposed audited financial statements were acceptable notwithstanding this policy. After his review of the UGHI Omissions Letter, Gilroy remained under the impression that reissued statements would be acceptable to HRS if prepared in accordance with accounting and auditing standards. According to Dudek, HRS did not reveal its policy regarding entities in existence for less than one year in the UGHI Omissions Letter because HRS had not been provided with information prior to the issuance of the letter that UGHI was an entity that had been in existence for less than one year. Prior to the Omissions Letter, HRS was, however, informed both orally and in writing that UGHI had been in existence for less than one year. On or about January 15, 1992, UGHI timely filed its response to the Omissions Letter and included a document entitled "UNIVERSITY GENERAL HOSPITAL, INC. (A WHOLLY-OWNED SUBSIDIARY OF COMMUNITY HEALTH INVESTMENT CORPORATION) FINANCIAL STATEMENTS AS OF DECEMBER 31, 1990 AND 1989 TOGETHER WITH REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS." In a letter dated January 28, 1992, HRS notified UGHI that its CON application was being administratively withdrawn from consideration for the sole reason that it did not contain audited financial statements of the applicant, University General Hospital, Inc. The purpose of audited financial statements from the standpoint of HRS' review of CON applications is that they provide HRS with a basis to determine the overall financial strength and financial position of the applicant and the applicant's ability to carry out the project being proposed. HRS requires that the financial statements be "of the applicant" because it looks to the source of funding and financial strength of the entity responsible for funding the project--the party submitting the CON application. The audited financial statements submitted by UGHI reflect the resources available to it for the CON project proposed in CON Application No. 6851 and are appropriate to demonstrate the financial strength of UGHI. The audited financial statements filed by UGHI contain financial documentation for years ending December 31, 1990 and 1989, as well as information through November 13, 1991. The issuance of audited financial statements for an entity incorporating a period of time before that entity's corporate existence (known as "reissuance") is a common practice in the accounting profession and, subject to the entity's ability to satisfy the specified prerequisites, is consistent with pronouncements and standards under generally accepted auditing standards (hereinafter "GAAS") and generally accepted accounting principles (hereinafter "GAAP"). The prerequisites for reissuance of an audited financial statement are adequate disclosure made in the notes of the financial statement and continuance of common ownership, control, management, reporting, and operation of the entity's activities. Prior to issuance of the audited financial statements for UGHI, Arthur Andersen & Co. conducted an extensive post-audit review of UGHI and concluded that the financial statements previously issued to University Hospital could be reissued as audited financial statements of UGHI. Had Arthur Andersen & Co. found that the previously-issued audited financial statements were misleading or that the requirements set forth in GAAS and GAAP were not satisfied, it would not have reissued the audited financial statements on behalf of UGHI. The audited financial statements submitted by UGHI to HRS constitute a valid document prepared in accordance with the pronouncements and standards under GAAS and GAAP. It is the policy of HRS that, if an entity has been in existence for less than one year, HRS will accept only a balance sheet audit as of the date of incorporation, or a short period audit from the date of incorporation through an undefined period of time. HRS' policy is not reflected in any of the statutes, rules, or HRS Manual provisions regarding audited financial statements, and HRS is not in the process of promulgating a rule regarding this policy. HRS' policy applies to all entities submitting CON applications that have been in existence for less than one year. Balance sheet and short period audits are not appropriate documents to assess an entity's financial condition. In many cases, HRS would prefer a reissued audited financial statement to a balance sheet audit in analyzing a CON application. In determining whether an applicant complies with Section 381.707(3), Florida Statutes, HRS will, with certain exceptions, look at whether the definition of "Audited Financial Statement" set forth in Rule 10-5.002(5), Florida Administrative Code, is met. HRS does not apply the definition of "Audited Financial Statement" set forth in Section 10-5.002(5), Florida Administrative Code, to applicants in existence for less than one year. The definition it applies to these entities is not set forth in any rule, statute, or HRS Manual provision. A balance sheet audit does not comply with the definition of "Audited Financial Statement" set forth in Rule 10-5.002(5), Florida Administrative Code. The audited financial statements filed by UGHI comply with the definition of "Audited Financial Statement" set forth in Rule 10-5.002(5), Florida Administrative Code. Rule 10-5.008(5)(g), Florida Administrative Code, identifies those audited financial statements satisfying the rule definition of "Audited Financial Statement" that HRS will not accept. HRS explains the exceptions set forth within Rule 10-5.008(5)(g), Florida Administrative Code, on the basis that these audited financial statements reflect financial documentation of an affiliate entity. The audited financial statements submitted by UGHI are not a combined audit, a consolidated audit, or an audit of a division, as prohibited under Rule 10-5.008(5)(g). From an accounting standpoint, the audited financial statements submitted by UGHI are those of UGHI. An accounting firm typically identifies the entity being audited on the title page of the audited financial statements and in the audit report and financial statements contained therein. The title page of, and audit report and financial statements in, the audited financial statements prepared by Arthur Andersen & Co. for UGHI all reflect that the entity being audited is UGHI. An accounting firm faces significant liability if the audited financial statements it prepares are found to be inaccurate or misleading. HRS does not dispute, and in fact agrees, that the audited financial statements prepared by Arthur Andersen & Co. for UGHI were correctly issued and are consistent with GAAS and GAAP.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that a Final Order be entered accepting Certificate of Need Application No. 6851 filed by University General Hospital, Inc. for review in the nursing home batching cycle in which it was filed. RECOMMENDED this 20th day of July, 1992, at Tallahassee, Leon County, Florida. LINDA M. RIGOT Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 SC 278-9675 Filed with the Clerk of the Division of Administrative Hearings this day of July, 1992. APPENDIX TO RECOMMENDED ORDER, CASE NO. 92-1838 Petitioner's proposed findings of fact numbered 1-54 have been adopted either verbatim or in substance in this Recommended Order. Respondent's proposed findings of fact numbered 1-3 have been adopted either verbatim or in substance in this Recommended Order. Respondent's proposed findings of fact numbered 4-6 have been rejected as not being supported by the weight of the competent evidence in this cause. COPIES FURNISHED: Gerald M. Cohen, Esquire Steel Hector & Davis 4000 Southeast Financial Center Miami, Florida 33131-2398 Richard Patterson Assistant General Counsel Department of Health and Rehabilitative Services 2727 Mahan Drive Tallahassee, Florida 32308 Sam Power, Clerk Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700 John Slye, General Counsel Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700
The Issue The issue to be resolved in this proceeding concerns whether the Respondent willfully violated Section 106.141(1), Florida Statutes, by failing to properly account for and report the expenditure of certain campaign funds.
Findings Of Fact The Respondent was elected as State Attorney for the Seventh Judicial Circuit in 1988. He defeated the incumbent at that time, Stephen Boyles. Thereafter, in 1992, the Respondent was a republican candidate for re-election as State Attorney in that circuit. The Respondent was challenged in that republican primary in 1992 by Steve Alexander, a former Assistant State Attorney, under both Mr. Boyles and the Respondent. The campaign was a nasty and personal one, focusing on the Respondent's religious beliefs, including his prison ministry. The Respondent was defeated by 57 votes of more than 40,000 votes cast. Upon being defeated in the primary, the Respondent elected to support the democratic candidate in the general election, Ted Doran. The Respondent sent letters on his campaign stationery through the law office of Kermit Coble, a partner with the firm of Coble, Woods, Seps, Clayton and Teal. Two groups of letters were sent out: one to supporters of the Respondent in the primary and another to all members of the Florida Bar for the Seventh Judicial Circuit. The postage on these letters was provided through Mr. Coble's postage meter at his law firm and totaled $260.00. There came a time when Mr. Coble and representatives of his law firm called the Respondent to request reimbursement for the postage funds expended, the $260.00. The Respondent, therefore, wrote a check to reimburse Mr. Coble for the postage early on the morning of October 1, 1992. He used a check drawn on the campaign account. Typically, Mrs. Tanner wrote the check, both on the campaign checkbook and on their personal checkbook. The Respondent did not normally write checks. However, on this occasion, the Respondent did not want to bother Mrs. Tanner with the issuance of the reimbursement check. She was a student at the time, in graduate school, in addition to having to care for two daughters, the youngest of which was causing her parents considerable difficulty. Although the Respondent had read Chapter 106, Florida Statutes, in connection with embarking on his political campaign, he did not recall a specific prohibition which barred the use of campaign funds for the purpose involved in this proceeding. The use of the campaign checkbook did not trigger any awareness, at the time the Respondent issued the check, of any inappropriateness of using campaign funds in that manner. He did not give his action the thoughtfulness and attention that he should have, by his own admission. He conceded that he was pre-occupied with other duties and responsibilities at the time and failed to adequately consider the legal ramifications and consequences of his actions. At about this time, he was heavily involved in the preparation of a "double murder case", one of several significant cases in his office that he was attempting to complete prior to the end of his term of office. In fact, he had just recently completed the trial of serial killer, Aileen Wuornos. He had been keeping very long hours, arising before dawn and working late at night in order to prepare for each day's work and complete it. Several weeks later, he realized he had made an error in using campaign funds to pay for the postage charge. He requested Mrs. Tanner to reimburse the campaign account from their personal funds. He then relied upon and trusted his wife, Mrs. Tanner, who was also his campaign treasurer, to accomplish the reimbursement payment. He did not actually follow up on his request to her and gave it no further thought, assuming that it had been done. The Respondent and his wife have been married for 25 years, and she served as his campaign treasurer for both of his political campaigns in 1988 and 1992. She collected and deposited contributions to the campaign, wrote checks for campaign expenses, and she was responsible for completing and timely filing campaign reports with the Division of Elections and with local elections officials in her capacity as campaign treasurer. Mrs. Tanner acknowledged that the Respondent had asked her to reimburse the campaign account from their personal funds and that she had simply forgotten to do it. This time in question was a difficult time for her and her family. She was a student in graduate school and working as the mother of teenage daughters. Their younger teenage daughter was having behavioral problems which made her difficult to manage. Additionally, at the same period of time, the Respondent's mother was ill and required medical attention, including emergency room visits. In summary, it was a stressful, difficult time for the Respondent and his wife. Mrs. Tanner was quite distracted from the orderly, normal performance of her duties as a mother and student, as well as a campaign manager. She simply forgot to make the reimbursement, after being requested to do so by the Respondent. The Respondent and his wife filed the campaign treasurer's report dated October 5, 1992, which covered the period of August 28, 1992 through October 5, 1992. This report did not include any reference to the expenses related to the letters sent on behalf of Ted Doran. A note attached to the report, however, indicated that an amended report would be filed. The final campaign treasurer's report, covering the period October 5, 1992 through December 12, 1992 did include an expense of $260.00 to reimburse the firm of Coble, Woods, Seps, Clayton and Teal for the postage in question. The report did not note any payment from the Tanners' personal funds to the campaign as reimbursement for that postage. The Respondent and his wife signed the campaign treasurer's reports, as required by law, certifying the correctness and completeness of the report, which the Respondent believed to be the case at the time he signed it. He testified that he reviewed the report for accuracy, completeness and legal compliance and did not note the lack of an entry showing a personal reimbursement to the campaign account. He stated that the report was accurate and complete and that it contained all financial activities of the campaign for that period in question. On January 12, 1993, however, a sworn complaint was filed by Shirley Bundy, former chairwoman of the Volusia County Republican Party Executive Committee, against the Respondent. She complained of the use of the Tanner republican campaign stationery to support a democratic candidate. The complaint also stated that a "reliable source" had informed Mrs. Bundy that Kermit Coble had paid the postage for the letters the Respondent sent in support of democratic candidate, Ted Doran. Thereafter, pursuant to statutory authority, the Division of Elections initiated an investigation in response to the Bundy complaint. Investigator, C.L. Ivey, was assigned to conduct the investigation. He is an experienced investigator, having over 31 years of experience with the Florida Department of Business Regulation and the Florida Department of Professional Regulation. On March 8, 1993, the Respondent filed an initial response to the complaint. He attributed the complaint to political retribution by Mrs. Bundy. He stated at that time that the postage cost had been reimbursed to Mr. Coble "with a personal check". He believed that that had, indeed, been done at the time he made that representation. The Respondent testified at hearing that he summarily put together his initial response to the complaint without reviewing his records or consulting his wife about the matter. He knew that she had been under a lot of stress at the time and did not even mention it to her. He was in the process of re- establishing his private law practice and was very pre-occupied with that and, therefore, relied exclusively on his memory of the facts involved in making the initial response to the complaint. Shortly thereafter, as part of his investigation, Mr. Ivey sought certain information and records from the 1992 campaign from Mrs. Tanner. She asked the Respondent about the request for information and, after further discussion and review of pertinent records, the Respondent and Mrs. Tanner learned that the Respondent's initial response, indeed, was incorrect. This was the first time that the Tanners had discussed the matter since the Respondent's original request for Mrs. Tanner to reimburse the campaign account from their personal account. On March 23, 1993, the Respondent filed a notarized, corrected response to the complaint, in which he explained the circumstances of his initial response, as well as explaining the circumstances surrounding the payment of the postage to Mr. Coble's law firm and the failure of Mrs. Tanner to reimburse the campaign funds from their personal funds, as he had requested her to do. The Respondent stated in this corrected response that in the last months of his term as State Attorney, he was pre-occupied with other matters and "was just too busy and did not give this matter my personal attention". Simultaneously with making this corrected response, the Respondent sought to reimburse the general revenue fund of the state for $260.00 with his personal check. He was informed that he needed to file an amended campaign report and to sent his reimbursement check with that report. He promptly did so and made his reimbursement to the general revenue fund at that time. Mr. Ivey completed his investigation and submitted his report on April 28, 1993. The report was based solely on documentary evidence. Mr. Ivey did not interview, depose, or otherwise interrogate the Respondent or Mrs. Tanner. Following the completion of his report, Mr. Ivey had no further contact with the case. Mr. Ivey had a case load at that time of 30 or 40 cases assigned to him. Mr. Ivey testified that he tries to complete investigations within a six-month period. He testified at hearing that because of the case load and limited resources available to him, many investigations had to be handled through correspondence, without an interview or a deposition. In this case, one of the reasons why an interview or deposition was not conducted, according to Mr. Ivey, was because the Respondent admitted all of the acts necessary to make out a violation of the statute, except for denying the element of willfulness. The investigative report stated that the Respondent had acknowledged the improper payment of the postage and had taken steps to correct it. The report also states that the Respondent did not acknowledge that the violation was willful. More than one year after Mr. Ivey completed his report, on May 19, 1994, the Division of Elections found probable cause to believe that a willful violation of Section 106.141(1), Florida Statutes, had occurred. A letter from Barbara Linthicum informing the Respondent of that finding was sent on May 19, 1994 to the Respondent. He testified, however, that he had never received that letter. The Florida Elections Commission issued its order of probable cause on June 28, 1994. It has not been established by sufficient, preponderant evidence of record that the Respondent willfully violated Section 106.141(1), Florida Statutes, as alleged. The probable cause finding was based only on an investigation which consisted of a review of documents and not upon consideration of any testimony or statements by either the Respondent or Mrs. Tanner. The weight of the evidence establishes that the Respondent acted in a careless manner but that his conduct was not "willful", as that term is employed and intended in Section 106.l41(1), Florida Statutes.
Recommendation Based on the foregoing Findings of Fact, Conclusions of Law, the evidence of record, the candor and demeanor of the witnesses, and the pleadings and arguments of the parties, it is RECOMMENDED that a Final Order be entered dismissing the complaint against John Tanner for the reasons found and concluded above. DONE AND ENTERED this 28th day of February, 1995, in Tallahassee, Florida. P. MICHAEL RUFF Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 28th day of February, 1995. APPENDIX TO RECOMMENDED ORDER, CASE NO. 94-4641 Petitioner's Proposed Findings of Fact 1-14. Accepted, but subordinate to the Hearing Officer's findings of fact on this subject matter. Rejected, as not entirely in accord with the weight and credibility of the preponderant evidence of record and subordinate to the Hearing Officer's findings of fact on this subject matter. The Hearing Officer has made the findings of fact on this subject matter after weighing, considering and determining the candor and credibility of the witnesses and evidence. Accepted, in the sense that the Respondent, if he had adequately reflected, would have known that the campaign check written was in violation of the law but not in terms of the violation being willful, intentional and conscious at the time he wrote the check. Consequently, this proposed finding of fact is subordinate to the Hearing Officer's findings of fact on this subject matter. Rejected, as contrary to the Hearing Officer's findings of fact made on this subject matter after determining the candor and credibility of the witnesses and the evidence. Accepted, only in terms of a mere recitation of the attempted proof of the Respondent concerning bias on the part of agency personnel. It has not been found that such bias, if any existed, had an effect on the prosecution of this case by the agency and the Respondent has candidly receded from that position in a post-hearing letter to the Hearing Officer and opposing counsel. Respondent's Proposed Findings of Fact The Respondent's proposed findings of fact are accepted, to the extent that they are in accord with the findings of fact made by the Hearing Officer. Proposed findings number 28 and numbers 30 through 39 are rejected as being immaterial and unnecessary to an adjudication of this dispute. COPIES FURNISHED: David R. Westcott, Esq. Florida Elections Commission The Capitol, Room 2002 Tallahassee, FL 32399-1007 Christopher R. Haughee, Esq. AKERMAN, SENTERFITT & EIDSON, P.A. 216 South Monroe Street, Suite 200 Tallahassee, FL 32301 Honorable Sandra B. Mortham Secretary of State The Capitol Tallahassee, FL 32399-0250 Don Bell, Esq. General Counsel Department of State The Capitol, PL-02 Tallahassee, FL 32399-0250
The Issue Whether Petitioner, as a candidate for the Leon County Commission, District 1, in the 1998 elections, willfully violated Subsection 106.07(5), Florida Statutes, which prohibits a candidate from certifying to the correctness of a campaign treasurer's report that is incorrect, false or incomplete, on 13 separate occasions; and Subsection 106.11(3), Florida Statutes, which prohibits a candidate from authorizing any expenses from the primary campaign account without sufficient funds on deposit in the primary campaign account to pay the full amount of the authorized expenses, to honor all outstanding checks, and to pay all previously authorized but unpaid expenses, on five separate occasions. Whether Petitioner, as a candidate for the Leon County Commission, District 1, in the 1998 elections, knowingly and willfully violated Subsection 106.19(1)(a), Florida Statutes, which prohibits a person from accepting a contribution in excess of $500 for each election, on one occasion; Subsection 106.19(1)(b), Florida Statutes, which prohibits a person or organization from failing to report a contribution required to be reported by Chapter 106, Florida Statutes, on 53 separate occasions; Subsection 106.19(1)(c), Florida Statutes, which prohibits a person or organization from falsely reporting or failing to report information required by Chapter 106, Florida Statutes, on 130 separate occasions; and Subsection 106.19(1)(d), Florida Statutes, which prohibits a person or organization from making or authorizing any expenditure prohibited by Chapter 106, Florida Statutes, on five separate occasions; and, if so, the appropriate penalty.
Findings Of Fact Based on the testimony, documentary evidence, entire record of this proceeding, the following Findings of Fact are made: At the time of the alleged violations, Petitioner was a candidate for re-election to the office for the Leon County Commission, District 1, for the general election in November 1998. Respondent had won the primary, run-off and general election in 1996. He had been a candidate for election to the office of Leon County Superintendent of Schools in 1992. Petitioner has a Bachelor of Arts degree from Howard University (1981), a Doctorate of Jurisprudence from Howard University (1984), and has done advanced studies in Theology and Ethics at Boston University School of Theology. He has been employed as a Legal Assistant and Training Specialist by the State of Florida. In addition, he has served as a Staff Assistant to a United States Senator and a Special Assistant to a Governor of Florida. He serves as an adjunct professor at a local university. Prior to the alleged violations, Petitioner signed a statement indicating that he had a copy of Chapter 106, Florida Statutes, and that he had read and understood same. Petitioner is a highly educated, sophisticated individual and an experienced candidate. The charging document in this case is the Order Of Probable Cause, which set out in unnumbered paragraphs, each statutory provision that Petitioner allegedly violated and the number of times of each alleged statutory violation. Attached to the Order of Probable Cause, and incorporated in the Order of Probable Cause by reference, is a Statement of Findings which lists with specificity each alleged violation. Specifically, it alleged: Probable cause to believe that the Respondent[²] violated Section 106.07(5), Florida Statutes, prohibiting a candidate from certifying to the correctness of a campaign treasurer's report that is incorrect, false, or incomplete, on 13 occasions; Probable cause to believe that the Respondent violated Section 106.11(3), Florida Statutes, prohibiting a candidate from authorizing any expenses from the primary campaign account without sufficient funds on deposit in the campaign account to pay the full amount of the authorized expenses, to honor all outstanding checks, and to pay all previously authorized but unpaid expenses, on six occasions; Probable cause to believe that the Respondent violated Section 106.19(1)(a), Florida Statutes, prohibiting a person or organization from accepting a contribution in excess of $500 for each election, on one occasion; Probable cause to believe that the Respondent violated Section 106.19(1)(b), Florida Statutes, failure of a person or organization to report a contribution required to be reported by this chapter, on 56 occasions; Probable cause to believe that the Respondent violated Section 106.19(1)(c), Florida Statutes, prohibiting a person or organization from falsely reporting or failing to report information required by this [sic], on 131 occasions. Probable cause to believe that the Respondent violated Section 106.19(1)(d), Florida Statutes, prohibiting a person or organization from making or authorizing any expenditure prohibited by this chapter, on seven occasions. Attached to the Order of Probable Cause, and incorporated in the Order of Probable Cause by reference, is a Statement of Findings which lists with specificity each alleged violation. As it relates to the 13 alleged violations of Subsection 106.07(5), Florida Statutes, paragraph 17 of the Statement of Findings lists each of the 13 Campaign Treasurer's Reports and each alleged unreported or incorrectly reported campaign contribution or expenditure. As it relates to the six alleged violations of Subsection 106.11(3), Florida Statutes, paragraphs 19-26 list each check returned for non-sufficient funds and other relevant information to the alleged violations. As it relates to the alleged violation of Subsection 106.19(1)(a), Florida Statutes, it is discussed with specificity in paragraph 34 of the Statement of Findings. As it relates to the 56 alleged violations of Subsection 106.19(1)(b), Florida Statutes, paragraphs 17 and 36 of the Statement of Findings specifically list each of the unreported contributions. As it relates to the 131 alleged violations of Subsection 106.19(1)(c), Florida Statutes, paragraphs 17, 38 and 39 of the Statement of Findings specifically list the 131 unreported or incorrectly reported expenditures. As it relates to the seven alleged violations of Subsection 106.19(1)(d), Florida Statutes, each of the prohibited expenditures is discussed with specificity in paragraphs 19-26 and 41 of the Statement of Findings. In his Petition for Formal Administrative Hearing, Petitioner "disputes issues of material fact" listed in paragraphs 3-6, 8-10, 13-20, 22-28, 30, and 33-43 of the Statement of Findings which is incorporated by reference into the Order Finding Probable Cause. In so doing, Petitioner specifically delineates his denial of each of the specifically alleged violations incorporated in the Order of Probable Cause by the Statement of Findings and demonstrates his awareness of the specific number of alleged violations and that the Commission intended to impose a fine for each violation. On June 17, 1996, Petitioner opened a campaign account at the Florida A & M University Credit Union which was given the account number 9174. This account was opened for Petitioner's 1996 campaign. The only bank signature card on file for the campaign account is the original card dated June 17, 1996. It designates two signatories: William Proctor and Fredrick T. Smith, campaign treasurer. Although account 9174 was inactive after the end of the 1996 campaign, it was activated for the 1998 campaign. On May 19, 1997, on opening his re-election campaign, Petitioner filed form DS-DE 9 designating himself Campaign Treasurer and the Florida A & M University Credit Union as campaign depository. On January 12, 1998, he filed a second form DS-DE 9 designating Thomas Rollins as Campaign Treasurer. None of the campaign checks or deposit slips offered into evidence were signed by Tom Rollins. An examination of records of the campaign account records produced by representatives of the Florida A & M University Credit Union indicate that Petitioner personally handled essentially all campaign banking activities. In his sworn responses to inquiries directed to unreported transfers of funds from the campaign account to Petitioner's personal accounts, unreported cash received by Petitioner at the time he deposited checks payable to the campaign account, cash withdrawals, unreported campaign contributions, and other financial irregularities, Petitioner typically gave the following answer: My campaign staff was instructed to record all expenditures [or contributions ] for reporting purposes. However, this expenditure was not reported because the campaign staff included inexperienced, non- professional clerical and bookkeeping personnel who did not always follow instructions to record the contributions and expenditures for reporting purposes. In addition, the campaign had a high turnover of staff, which further complicated efforts to insure that staff properly followed instructions. The Florida A & M University Credit Union will, at any time during business hours, print-out the last 30 days' account activity for a $3.00 fee. This allows an account holder to keep track of deposits, paid checks, issued checks that have not yet been paid, etc. Campaign account records show that this was done in August 1998. On July 27, 1998, prior to the first primary election, a $500 transfer was made from the account of William Proctor, Sr. and Patricia Proctor, account number 5016, to Petitioner's campaign account. This transfer is not reported in the campaign treasurer's report. Petitioner's campaign account records indicate that a transfer of $1,000 was made to Petitioner's campaign account from the account of William Proctor, Sr., and Patricia Proctor, account number 5016, which was maintained at the Florida A & M University Credit Union, on October 12, 1998, after the first primary and prior to the general election. This transfer is not reported in the campaign treasurer's report. In addition to the $1,500 in unreported contributions that were transferred from an individual account within the Florida A & M University Credit Union mentioned in paragraphs 17 and 18, an examination of the campaign account records reveals an additional $4,900 in unreported contributions was transferred into the campaign account from another account maintained by Petitioner within the Florida A & M University Credit Union. Petitioner's campaign account records indicated that the following 53 contributions totaling $8,075 were received by the campaign but were not reported in the campaign treasurer's reports: DATE CONTRIBUTOR AMOUNT 7-11-97 1996 Bill Proctor Campaign, Account No. 5016 $345.00 10-6-97 Eight Star Land Company $50.00 10-6-97 A. L. Buford, Jr. $50.00 10-9-97 Lewis Buford $100.00 10-19-97 Barbara Rouse $25.00 10-23-97 Charles Lockhart $150.00 10-28-97 Dr. Clinitia Ford $50.00 12-19-97 R & R Corporate Systems $200.00 2-10-98 Rudolf Maloy $100.00 4-13-98 Mitchell Asphalt $450.00 4-14-98 Hannah Plumbing $100.00 4-14-98 Suber & Weaver Equipment Repair $50.00 4-16-98 Tallahassee Mack Sales $250.00 4-16-98 Capital City Lawn Care $100.00 4-22-98 Eli Roberts & Sons, Inc. $100.00 4-27-98 Fort Knox Center $250.00 4-30-98 McKenzie Tank Lines $150.00 5-7-98 Gilbert Brown $50.00 6-5-98 Jimmy R. Jones Construction $250.00 7-17-98 Walter T. Mathis $100.00 7-20-98 Ron and/or Wanda Brafford $125.00 7-24-98 William and/or Deborah Grudice $100.00 7-27-98 Transfer from Patricia Proctor Account No. 1912 $500.00 7-27-98 Transfer from Patricia Proctor Account $400.00 7-27-98 No. 1912 Transfer from William Proctor Account $500.00 7-28-98 No. 5016 Jessie Dennis $100.00 7-29-98 Mary Middlebrooks $300.00 8-1-98 John and/or Phyllis Green $100.00 8-6-98 James H. Tookes $100.00 8-6-98 Charles Lockhart $100.00 8-7-98 Angela McNair $15.00 8-8-98 Marion Camps $100.00 8-9-98 Estate of Reginal Settles-Yolanda Foutz $100.00 8-11-98 Settles Ruby Seymour Bass $100.00 8-12-98 Martin and/or Susan Proctor $100.00 8-13-98 Cherry Bluff $200.00 8-13-98 Realtors PAC of Florida $500.00 8-18-98 Alfreda Blackshear $100.00 8-19-98 Davis Insurance Agency $25.00 8-19-98 John Haughabrook $50.00 8-19-98 Brown's Paint and Body Shop $100.00 8-20-98 Winnie Davis $100.00 8-24-98 Limm-Ann Griffin $50.00 9-4-98 Charles A. Francis $100.00 9-22-98 Allan Franklin $50.00 9-23-98 Marie Roy $50.00 9-24-98 Mitchell Asphalt $500.00 10-8-98 Marcus Robinson $25.00 10-9-98 Michael Moore $150.00 10-17-98 Sharon Durham $15.00 10-27-98 Catherine Gretsch $50.00 10-27-98 Catherine Gretsch $50.00 11-1-98 Rev. Jaycee Oliver $300.00 Petitioner's campaign account records indicated that the following 35 expenditures totaling $11,149.11 were made by campaign check but were not reported in the campaign treasurer's reports: DATE PAYEE AMOUNT 7-24-98 Lamar Advertising (Check No. 1003) $3,930.00 7-24-98 Sears (Check No. 1004) $26.92 8-5-98 Bill Doolin (Check No. 1003) $25.00 8-15-98 Petrandis Realty (Check No. 1004) $700.00 8-6-98 Morrison's (Check No. 1007) $12.38 8-12-98 Sprint (Check No. 514) $280.00 8-18-98 Bethel Family (Check No. 1012) $30.25 8-21-98 Feron Jones (Check No. 1030) $100.00 8-26-98 Gallery Graphics (Check No. 1076) $350.00 8-18-98 Payee Illegible (Check No. 516) $401.25 8-29-98 Jumbo Sports (Check No. 1077) $121.79 8-29-98 Knights of Pythias (Check No. 1078) $85.00 9-2-98 Sprint (Check No. 520) $269.78 9-2-98 Sprint (Check No. 521) $30.00 9-23-98 Zakiya Williams (Check No. 1079) $300.00 9-23-98 Arthur Gaines (Check No. 1080) $50.00 9-27-98 Angelo's Seafood (Check No. 1102) $68.81 9-28-98 Books-A-Million (Check No. 1103) $29.10 9-28-98 Morrison's (Check No. 1093) $10.93 10-2-98 Zakiya Williams (Check No. 1105) $150.00 10-7-98 All-World (Check No. 1106) $565.00 10-8-98 Comcast (Check No. 1107) $350.00 10-8-98 Comcast (Check No. 1108) $2,023.00 10-9-98 Danny Harris (Check No. 1081) $300.00 10-14-98 CUP, Inc. (Check No. 1109) $25.00 10-20-98 Ada Ibraahim (Check No. 1114) $70.00 10-2-98 Zakiya Williams (Check No. 1086) $125.00 10-26-98 Olive Garden (Check No. 1129) $13.67 10-27-98 Morrison's (Check No. 1091) $12.10 11-5-98 Aaron Rental (Check No. 1093) $310.92 11-5-98 Sprint (Check No. 1094) $245.80 11-9-98 Morrison's (Check No. 1115) $22.26 11-17-98 Ming-Tree (Check No. 1095) $20.80 11-24-98 Gene Sutton (Check No. 1116) $75.00 11-28-98 Soft-Touch (Check No. 1098) $20.00 Petitioner's campaign account records indicated that 56 cash withdrawals were made from the campaign account totaling $20,070.10. None of these cash withdrawals were listed on the campaign treasurer's reports. Sixteen "official checks" (i.e., guaranteed payment checks paid for by withdrawals from the campaign account for which his campaign account paid the amount of the check plus a fee of $2 per check, similar to a cashier's check issued by a bank), totaling $9,000.10 were issued by the Florida A & M University Credit Union, and apparently used to pay campaign debts. None of these official checks were reported in the campaign treasurer's reports. A listing of these "official checks" follows: DATE PAYEE AMOUNT 4-21-98 Eugene Stanton (Check No. 144650) $300.00 4-21-98 Ricky Coring (Check No. 144716) $1,750.00 6-28-98 Lamar Advertising $500.00 7-1-98 Gene Sutton (Check No. 145837) $100.00 7-1-98 Lamar Advertising (Check No. 145843) $530.00 7-1-98 Rugenia Speight (Check No. 145844) $200.00 7-7-98 Lamar Advertising (Check No. 146000) $130.00 7-20-98 Augustus Colston (Check No. 146159) $600.00 9-1-98 The Links, Inc. (Check No. 146837) $150.00 9-1-98 Aaron Roberts (Check No. 146838) $675.10 9-30-98 WHBX Radio (Check No. 147256) $1,700.00 10-1-98 M. Feron Jones (Check No. 147305) $210.00 10-1-98 WHBX Radio (Check No. 147306) $70.00 10-14-98 Zakiya Williams (Check No. 147507) $150.00 10-16-98 Zakiya Williams (Check No. 147528) $350.00 11-4-98 Petrandis Realty (Check No. 147835) $1,585.00 Although the evidence is inconclusive, it appears that all or most of the "official checks" were the result of cash withdrawals from the campaign account. Assuming that to be the case, approximately $11,000 in cash withdrawals remain unaccounted for. In connection with making 12 deposits to the campaign account, cash was deducted from each deposit. The amount of cash received totaled $1,460. The use of this cash was not shown in the campaign treasurer's reports. Four transfers totaling $2,900 were made from the campaign account to accounts numbered 9120-2 and 6038-2 which are Petitioner's personal accounts. These transfers were not listed in the campaign treasurer's reports. The records of Petitioner's campaign account indicate that the following checks in the total amount of $4,132.93 were presented and returned for insufficient funds: CHECK NO. PAYEE AMOUNT OF CHECK 1002 Unknown $319.93 1016 WHBX $1,170.00 1017 WHBX $600.00 1108 Comcast $2,023.00 1097 Unknown $20.00 An examination of campaign checking account records reveal that fees were charged by the campaign depository for returned checks and other special banking services, totaling $165.00, which were not listed in the campaign treasurer's reports. In sum, 123 expenditures (excluding bank fees), amounting to $44,579.31 were not listed in Petitioner's campaign treasurer's reports during the 1998 campaign. On March 2, 1999, Petitioner filed an amended campaign treasurer's report for the period October 10, 1998 to October 29, 1998, indicating that he had loaned his campaign $8,000 on October 12, 1998. The campaign account does not reflect such a loan. The original campaign treasurer's report for the period October 10, 1998 to October 29, 1998, reflects "loans $8,000” without further documentation. Petitioner certified the correctness of 13 campaign treasurer's reports each of which was incorrect, false, or incomplete. On October 8, 2001, Petitioner was convicted of 8 counts of violating Section 106.19(1)(a), Florida Statutes (failure to report campaign contributions during the 1998 campaign), adjudicated guilty, and sentenced to 12 months probation, to be served concurrently, and 100 hours of community service.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is Recommended that the Florida Elections Commission enter a final order: Imposing a civil penalty in the amount of $13,000 for 13 violations of Subsection 106.07(5), Florida Statutes. Imposing a civil penalty in the amount of $2,500 for five violation of Subsection 106.011(3), Florida Statutes. Imposing a civil penalty in the amount of $5,300 for 53 violations of Subsection 106.19(1)(b), Florida Statutes. Imposing a civil penalty in the amount of $59,000 for 130 violations of Subsection 106.19(1)(c), Florida Statutes. Not imposing an enhanced penalty, as provided in Subsection 106.19(2), Florida Statutes, for Petitioner's violation of Subsection 106.19(1)(d), Florida Statutes. Dismissing the alleged violations of Subsection 106.19(1)(a), Florida Statutes. DONE AND ENTERED this 25th day of January, 2002, in Tallahassee, Leon County, Florida. JEFF B. CLARK 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 25th day of January, 2002.
