09-003052PL Department Of Financial Services vs. Robert Gordon Dewald Status: Closed Recommended Order on Thursday, December 10, 2009.

Summary: Petitioner proved by clear and convincing evidence that Respondent violated certain provisions of the Florida Insurance Code; Respondent failed to do due dilligence prior to selling the 12 victims the unauthorized annuity. Recommend revocation.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF FINANCIAL )

SERVICES, )

)

Petitioner, )

)

vs. ) Case No. 09-3052PL

)

ROBERT GORDON DEWALD, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was held before

Daniel M. Kilbride, a duly-designated Administrative Law Judge

of the Division of Administrative Hearings, on September 29,

2009, in Sarasota, Florida.

APPEARANCES

For Petitioner: Philip M. Payne, Esquire

Department of Financial Services

624 Larson Building

200 East Gaines Street

Tallahassee, Florida 32399

For Respondent: Robert G. DeWald

3730 Eagle Hammock Drive

Sarasota, Florida 34240

STATEMENT OF ISSUE

Whether Respondent committed the acts alleged in

Petitioner’s ten-count Second Amended Administrative Complaint,

and, if so, what penalty, if any, should be imposed upon Robert

Gordon DeWald’s (Respondent) insurance agent licenses.

PRELIMINARY STATEMENT

In a ten-count Second Amended Administrative Complaint,

filed June 8, 2009, the Department of Financial Regulation

(Petitioner) charged Respondent with having violated certain

provisions of the Florida Insurance Code, including that:

Respondent directly or indirectly represented or aided an

unauthorized insurer; Respondent knew or reasonably should have

known that the annuity contracts with the unauthorized insurer

violated Section 626.901, Florida Statutes (2008), and that

Respondent is therefore liable for the losses; Respondent

knowingly placed before the public a statement, assertion, or

representation with respect to the business of insurance that

was untrue, deceptive, or misleading; Respondent knowingly

caused to be made, published, disseminated, circulated,

delivered, or placed before the public any false material

statement; Respondent demonstrated a lack of fitness and

trustworthiness to engage in the business of insurance;

Respondent engaged in unfair or deceptive practices or otherwise

showed himself to be a source of injury or loss to the public;

and Respondent otherwise acted in violation of Florida Insurance

Code provisions as specifically detailed in Petitioner’s Second

Amended Administrative Complaint.

Pursuant to his completed Election of Proceedings form,

Respondent requested a formal administrative hearing before the

Division of Administrative Hearings (DOAH). This matter was

referred to DOAH on June 9, 2009, and discovery ensued.

Petitioner deposed Respondent on September 3, 2009,

consumer Louis Blevens on September 3, 2009, and consumers

Audrey Piel and Edna Bishop on September 10, 2009.

Pursuant to the Notice(s) of Taking Deposition and on the

record at Respondent’s deposition, which was taken prior to any

of the consumers’ depositions, Respondent was informed that the

consumers’ depositions would likely be entered as Petitioner’s

exhibits at hearing, in lieu of the consumers’ live testimony,

because of the consumers’ age, infirmity, and travel

limitations. Respondent declined to be present at any of the

depositions of the consumers.

An Order Granting Continuance and Re-Scheduling Hearing was

issued on July 8, 2009, and a Notice of Transfer was issued on

September 23, 2009, transferring this matter to the undersigned

Administrative Law Judge.

At the hearing, Petitioner called two witnesses, Rock Roque

and Ronald Lovejoy, to testify. Due to age, infirmity, and

travel restrictions, Respondent introduced into evidence the

testimony of Louis Blevins, Audrey Piel, and Edna Bishop by way

of deposition transcripts without objection.

Petitioner, at hearing and without objection by Respondent,

filed the following exhibits, which were admitted into evidence.

Exhibit 1: Respondent’s DFS Agent License

Printouts and License Application.

Composite Exhibit 2:

A. Tennessee Secretary of State filing for

National Foundation of America (NFOA).

B. NFOA corporate resolution dated April 18,

2006.

Exhibit 3: State of Washington Office of

Insurance Commissioner Cease and Desist Order

against NFOA, Richard Olive, and Susan Olive,

dated September 18, 2006.

Composite Exhibit 4:

A. Office of Insurance Regulation IFO against

NFOA, Richard Olive, and Susan Olive.

B. 1st DCA dismissal of NFOA appeal dated

July 24, 2007.

Composite Exhibit 5:

A. Florida Office of Insurance Regulation

certification that NFOA has no Certificate of

Authority (COA).

B. Secretary of State Certification that NFOA

was not registered with the Division of

Corporations.

Composite Exhibit 6:

A. Internal Revenue Service (IRS) letter, dated

May 17, 2007, to Texas Department of Insurance

that NFOA is not classified as exempt under

501(c)(3) of the Internal Revenue Code (IRC).

B. IRS letter, dated February 6, 2008, to

Tennessee Receiver/Paul Eggers that NFOA does not

qualify as exempt under 501(c)(3) of the IRC.

Exhibit 7: Verified Petition for Appointment of

Receiver for NFOA, from the Tennessee Department

of Commerce and Insurance (DCI), dated May 23,

2007, with exhibits.

Exhibit 8: Verified Petition to Convert

Rehabilitation to Liquidation for NFOA, from the

DCI, dated August 2, 2007.

Exhibit 9: Final order of Liquidation for NFOA

from DCI, dated September 11, 2007.

Composite Exhibit 10:

A. As to Florida consumer Yvette Potvin – NFOA

contract and related documents.

B. The Tennessee Receiver’s first distribution

refund of money to Ms. Potvin.

C. The Tennessee Receiver’s second distribution

refund of money to Ms. Potvin.

D. Ms. Potvin’s surrender charges.

E. Respondent’s commission check.

Composite Exhibit 11:

A. As to Florida consumer Edna Bishop – NFOA

contract and related documents.

B. Respondent’s commission check.

Composite Exhibit 12:

A. As to Florida consumer Genevieve McCann –

NFOA contract and related documents.

B. The Tennessee Receiver’s first distribution

refund of money to Ms. McCann.

C. The Tennessee Receiver’s second distribution

refund of money to Ms. McCann.

D. Ms. McCann’s surrender charges.

E. Respondent’s commission check.

Composite Exhibit 13:

A. As to Florida consumer Lenora Bricker – NFOA

contract and related documents.

B. Respondent’s commission check.

Composite Exhibit 14:

A. As to Florida consumer Louise Blevins – NFOA

contract and related documents.

B. Respondent’s commission check.

Composite Exhibit 15:

A. As to Florida consumer Audrey Piel – NFOA

contract and related documents.

B. The Tennessee Receiver’s first distribution

refund of money to Ms. Piel.

C. The Tennessee Receiver’s second distribution

refund of money to Ms. Piel.

D. Ms. Piel’s surrender charges.

E. Respondent’s commission check.

Composite Exhibit 16:

A. As to Florida consumer John Bartlett – NFOA

contract and related documents.

B. Respondent’s commission check.

Composite Exhibit 17:

A. As to Florida consumer Lilla Dama – NFOA

contract and related documents.

B. Respondent’s commission check.

Composite Exhibit 18:

A. As to Florida consumer Agnes Burns – NFOA

contract and related documents.

B. The Tennessee Receiver’s first distribution

refund of money to Ms. Burns.

C. The Tennessee Receiver’s second distribution

refund of money to Ms. Burns.

D. Ms. Burns’s surrender charges.

E. Respondent’s commission check.

Composite Exhibit 19:

A. As to Florida consumer Elizabeth Buchanan –

NFOA contract and related documents. The

Tennessee Receiver’s first distribution refund of

money to Ms. Buchanan. The Tennessee Receiver’s

second distribution refund of money to

Ms. Buchanan. Ms. Buchanan’s surrender charges.

Respondent’s commission check.

B. As to Florida consumer Nancy Golus – NFOA

contract and related documents. The Tennessee

Receiver’s first distribution refund of money to

Ms. Golus. The Tennessee Receiver’s second

distribution refund of money to Ms. Golus.

Ms. Golus’s surrender charges. Respondent’s

commission check.

C. As to Florida consumer Herbert Owens – NFOA

contract and related documents. The Tennessee

Receiver’s first distribution refund of money to

Mr. Owens. The Tennessee Receiver’s second

distribution refund of money to Mr. Owens.

Mr. Owens’ surrender charges. Respondent’s

commission check.

Exhibit 20: Respondent’s April 17, 2007, and

March 20, 2007, response to Petitioner regarding

Florida consumers: Ms. Potvin, Ms. Bishop,

Ms. McCann, Ms. Bricker, Ms. Blevins, Ms. Piel,

Mr. Bartlett, and Ms. Dama.

Exhibit 21: DCI letter dated July 6, 2007,

demanding disgorgement of Respondent’s

commissions ($171,328.18).

Composite Exhibit 22:

A. Agent Licensee Profile Information printouts

for Rock Roque, Licensee ID# A225557.

B. Agent Licensee Profile Information printouts

for Ronald Lovejoy, Licensee ID# A159095.

Exhibit 23: Deposition of Respondent taken by

Petitioner with exhibits.

Composite Exhibit 24:

A. Deposition of Louise Blevins.

B. Deposition of Edna Bishop.

C. Deposition of Audrey Piel.

Composite Exhibit 25:

A. DOI Intercom agent newsletter July –

October 1996.

B. DOI Intercom agent newsletter September –

December 1997.

C. DOI Intercom agent newsletter January –

April 1998.

D. DOI Intercom agent newsletter May –

July 1998.

E. DOI Intercom agent newsletter January –

March 1999.

F. DOI Intercom agent newsletter February –

October 2000.

G. DFS Intercom agent newsletter August 2002 –

May 2003.

Respondent testified in his own behalf and filed the

following exhibits:

Exhibit 1: Respondent’s pre-hearing statement.

Exhibit 2: City of Hope’s web site document

titled “Charitable Gift Annuity”, page 1.

Exhibit 3: American Council of Gift Annuities

web site document titled “Welcome to the Donor’s

Corner”, pages 1-3.

Exhibit 4: American Council of Gift Annuities

web site document titled “Donor’s Corner –

Community Foundation”, page 1.

Petitioner raised objections as to the relevancy, lack of

foundation, and lack of completeness of Respondent’s Exhibits

1-4. The Administrative Law Judge admitted Respondent’s

Exhibits 1-3 as hearsay, subject to corroboration, but denied

Respondent’s Exhibit 4. However, none of Respondent’s exhibits

were corroborated by non-hearsay evidence and have not been

relied upon to support a finding of fact.

A Transcript of the final hearing was prepared and filed on

October 29, 2009. The parties were given 20 days from the

receipt of the hearing transcript in order to file their

respective proposed recommended orders. Petitioner timely filed

its Proposed Recommended Order. Respondent has not filed his

proposal as of the date of the Recommended Order.

FINDINGS OF FACT

1. Respondent is currently licensed in Florida as a

resident Life Including Variable Annuity (2-14), Life Including

Variable Annuity & Health (2-15), Life (2016), and Life & Health

(2-18) insurance agent.

2. At all times pertinent to the dates and occurrences

referred to herein, Respondent was licensed in this state as an

insurance agent and has been a licensed insurance agent in

Florida for over 21 years. Prior to being licensed in Florida,

Respondent was a licensed insurance agent in the state of New

York.

3. Petitioner has jurisdiction over Respondent’s insurance

agent licenses and appointments, pursuant to Chapter 626,

Florida Statutes (2008). 1

National Foundation of America

4. The National Foundation of America (NFOA) is a

registered Tennessee corporation that was formed on January 27,

2006, and headquartered in Franklin, Tennessee. NFOA Corporate

Resolution, dated April 19, 2006, provides for the corporate

authority to “liquidate stocks, bonds, and annuities . . . in

connection with charitable contributions or transactions. . . .”

This same resolution also provides for the corporate ability to

“enter into and execute planned giving or charitable

contribution transactions with donors, including executing any

and all documentation related to the acceptance or acquisition

of a donation, . . . given in exchange for a charitable gift

annuity. . . .”

5. On September 18, 2006, the State of Washington Office

of Insurance Commissioner issued an Order to Cease and Desist:

In the Matter of: National Foundation of America, Richard K.

Olive, and Susan L. Olive , Order No. D06-245. The Order, among

other things, was based on NFOA doing business in the state and

not having been granted a certificate of authority as an insurer

in the state of Washington and not having been granted tax

exempt status under Section 501(c)(3) of the IRC.

6. On April 13, 2007, the Florida Office of Insurance

Regulation (OIR) issued an Immediate Final Order (IFO) In the

Matter of: National Foundation of America, Richard K. Olive,

Susan L. Olive, Breanna McIntyre, and Robert G. DeWald ,

Case No. 89911-07, finding that the activities of NFOA, et al .,

constituted an immediate danger to the public health, safety or

welfare of Florida consumers. OIR further found that, in

concert, NFOA, et al ., were “soliciting, misleading, coercing

and enticing elderly Florida consumers to transfer and convey

legitimate income tax deferred annuities for the benefit of

themselves and their heirs to NFOA in exchange for charitable

term-certain annuities”; and that NFOA, et al ., had violated

provisions of the Florida Insurance Code, including Sections

624.401 and 626.901, Florida Statutes.

7. NFOA has never held a license or Certificate of

Authority to transact insurance or annuity contracts in Florida,

nor has NFOA ever been registered, pursuant to Section 627.481,

Florida Statutes, for purposes of donor annuity agreements.

NFOA was never a registered corporation with the Florida

Department of State, Division of Corporations.

8. On May 11, 2007, NFOA appealed OIR’s IFO to the First

District Court of Appeal of Florida (1st DCA). The 1st DCA

dismissed NFOA’s appeal on July 24, 2007. Therefore, NFOA

operated an as unauthorized insurer in Florida.

9. On May 17, 2007, the IRS sent a letter to the Texas

Department of Insurance stating that NFOA was not classified as

an organization exempt from Federal Income Tax as an

organization described in Section 501(c)(3) of the IRC.

10. On May 23, 2007, the DCI filed a Verified Petition for

Appointment of Receiver for Purposes of Liquidation of National

Foundation of America; Immediate and Permanent Injunctive

Relief; Request for Expedited Hearing, in the matter of Newman

v. National Foundation of America, Richard K. Olive, Susan L.

Olive, Breanna McIntyre, Kenny M. Marks, and Hunter Daniel ,

Chancery Court of the State of Tennessee (Chancery Court),

Twentieth Judicial District, Davidson County,

Case No. 07-1163-IV. The Verified Petition states, at paragraph

30:

NFOA’s contracts reflect an express written

term that is recognized by the IRS as a

charitable non-profit organization under

Section 501(c)(3) of the Internal Revenue

Code (Prosser, attachment 4), and the NFOA

represents in multiple statements and

materials that the contract will entitle the

customers to potential generous tax

deductions related to that status. The IRS

states that it has granted NFOA no such

designation. The deceptive underpinning

related to NFOA’s supposed tax favored

treatment of its contracts permeates its

entire business model and sales pitch. This

misrepresentation has materially and

irreparably harmed and has the potential to

harm financially all its customers and the

intended beneficiaries of the contracts.

These harms are as varied in nature and

degree as the circumstances of all those

individual’s tax conditions, the assets

turned into NFOA, and the extent to which

they have entrusted their money and keyed

their tax status and consequences to

reliance on such an organization.

11. On August 2, 2007, the Commissioner for the Tennessee

DCI, having determined that NFOA was insolvent with a financial

deficiency of at least $4,300,000, filed a Verified Petition to

Convert Rehabilitation by Entry of Final Order of Liquidation,

Finding of Insolvency, and Injunction, in the matter of Newman

v. National Foundation of America, et al.

12. On September 11, 2007, pursuant to a Final Order of

Liquidation and Injunction entered in the matter of Newman v.

National Foundation of America et al. , the Chancery Court placed

NFOA into receivership after finding that the continued

rehabilitation of NFOA would be hazardous, financially and

otherwise, and would present increased risk of loss to the

company’s creditors, policy holders, and the general public.

13. On February 6, 2008, the IRS sent a letter to the

court appointed Tennessee DCI Receiver (Receiver) for NFOA

stating that NFOA does not qualify for exemption from Federal

income tax as an organization described in Section 501(c)(3) of

the IRC. The IRS, in determining that NFOA did not qualify for

tax exempt status, stated that the sale of NFOA annuity plans

has a “distinctive commercial hue”, and concluded that NFOA was

primarily involved in the sale of annuity plans that “constitute

a trade or business without a charitable program commensurate in

scope with the business of selling these plans.” The IRS letter

also provides that consumers may not take deductions on their

income tax returns for contributions made to NFOA.

Insurance Agent’s Duties

14. An insurance agent has a fiduciary duty to his clients

to ensure that an insurer is authorized or otherwise approved as

an insurer in Florida by OIR prior to the insurance agent

selling the insurer’s product to his clients.

15. There are several methods by which an insurance agent

could verify whether or not an insurer was authorized or

Florida by OIR. It is insufficient for an insurance agent to

depend on the assurances of his insurance business peers as to

whether an insurer needs to be authorized in Florida.

16. Due to the importance of income tax considerations in

a consumer’s decision making process as to whether or not to

purchase an insurance product, an insurance agent has a

fiduciary duty to his clients to verify the validity of any

representations that an insurer’s product has an IRS 501(c)(3)

tax exempt status, prior to the insurance agent selling the

product to his clients.

17. There are several methods by which an insurance agent

could verify whether or not an insurer has an IRS 501(c)(3) tax

exempt status.

18. Respondent admitted, in his testimony, that he had

depended on the assurances of others and assumed that NFOA did

not need to be authorized as an insurer in Florida. Respondent

testified it was his understanding that only insurance companies

sell annuities; that NFOA was not an insurer; and therefore,

NFOA did not need to be licensed as a Florida insurer.

Respondent did not inquire of the Florida OIR whether or not

NFOA was authorized to do business in the State of Florida.

19. However, Respondent admitted that the NOFA product he

sold “mirrored” an annuity product.

20. Respondent testified that he had verified (by phone,

in writing, and the Internet) with the IRS that NFOA had applied

for 501(c)(3) tax exempt status. However, Respondent was aware

that the tax exempt status had not been granted to NFOA.

21. Respondent knew income tax considerations were

materially important to his clients. However, none of the NFOA

materials or any Florida consumer contracts signed by Respondent

and his clients contain any disclaimer language informing

consumers that the 501(c)(3) tax exempt status had been applied

for but had yet to be granted by the IRS.

22. Respondent testified that he made use of the Internet

to obtain information. However, Respondent failed to use the

Internet to find out that the State of Washington Office of

Insurance Commissioner entered an Order of Cease and Desist on

September 18, 2006, against NFOA based on NFOA not having a

certificate of authority as an insurer and because NFOA did not

have a 501(c)(3) tax exemption. As is noted below, the filing

date of the Washington Order to Cease and Desist, preceded in

time all but two of Respondent’s NFOA sales to Florida

consumers.

23. Respondent received commissions totaling $171,328.18

for selling NFOA annuities to Florida consumers. Respondent

failed to disgorge any of these commissions to the Receiver for

NFOA in the state of Tennessee.

Re: Count I: Consumer – Yvette Potvin

24. On November 30, 2006, Respondent solicited and induced

Yvette Potvin of Casselberry, Florida, then age 81, to transfer

or otherwise surrender ownership of her existing annuity

contract with Allianz Life Insurance Company in return for an

NFOA annuity. The NFOA agreement that the consumer entered

into, and which was signed by Respondent, is dated subsequent to

the State of Washington Order to Cease and Desist that was filed

against NFOA.

25. Respondent knew or reasonably should have known that

NFOA was not an authorized insurer in Florida.

26. Respondent, by use of the NFOA installment plan

agreement, knowingly misrepresented to Ms. Potvin that NFOA was

a charitable non-profit organization under Section 501(c)(3) of

the IRC, even though Respondent knew that NFOA had not been

approved for tax exempt status by the IRS.

27. Based upon Respondent’s transaction of insurance,

Ms. Potvin transferred to NFOA and is anticipated to lose

approximately $10,410.42. This amount includes a surrender

penalty incurred for transferring her original Allianz annuity

to NFOA, and after receiving partial refunds by the Receiver.

28. Based upon Respondent’s transaction of insurance with

Ms. Potvin, Respondent was paid a commission of $3,682.89 by

NFOA.

Re: Count II: Consumer – Edna Bishop

29. On January 18, 2007, Respondent solicited and induced

Edna Bishop of Orlando, Florida, then aged 89, to transfer or

otherwise surrender ownership of her existing annuity contract

with American Equity Investment Life Insurance Company in return

for an NFOA annuity. The NFOA agreement that the consumer

entered into, and which was signed by Respondent, is dated

subsequent to the State of Washington Order to Cease and Desist

that was filed against NFOA. Ultimately, this transaction did

not close.

30. Respondent knew or reasonably should have known that

NFOA was not an authorized insurer in Florida.

31. Respondent, by use of the NFOA installment plan

agreement, knowingly misrepresented to Ms. Bishop that NFOA was

a charitable non-profit organization under Section 501(c)(3) of

the IRC, even though Respondent knew or should have known that

NFOA was not a tax exempt corporation.

32. Based upon Respondent’s transaction of insurance with

Ms. Bishop, Respondent was paid a commission of $8,185.35 by

NFOA, even though the transaction was not completed.

Re: Count III: Consumer – Genevieve McCann

33. On December 14, 2006, Respondent solicited and induced

Genevieve McCann of Fern Park, Florida, then aged 85, to

transfer or otherwise surrender ownership of her existing

annuity contract with American Equity Investment Life Insurance

Company in return for an NFOA annuity. The NFOA agreement that

the consumer entered into, and which was signed by Respondent,

is dated subsequent to the State of Washington Order to Cease

and Desist that was filed against NFOA.

34. Respondent knew or reasonably should have known that

NFOA was not an authorized insurer in Florida.

35. Respondent, by use of the NFOA installment plan

agreement, knowingly misrepresented to Ms. McCann that NFOA was

a charitable non-profit organization under Section 501(c)(3) of

the IRC, even though Respondent knew or should have known that

NFOA was not a tax exempt corporation.

36. Based upon Respondent’s transaction of insurance,

Ms. McCann is anticipated to lose approximately $6,100.23.

The loss consists of $20,933.04, the amount transferred to

NFOA, less $1,742.85 (installment payments made by NFOA to

Ms. McCann); $12,473.62 (the first payment sent by Receiver);

and $2,686.63 (the second payment sent by Receiver). Ms. McCann

lost $2,070.29 through surrender charges incurred for

transferring her original American Equity annuity to NFOA. If

the surrender penalty is excluded from the calculation,

Ms. McCann’s loss is $4,029.94.

37. Based upon Respondent’s transaction of insurance with

Ms. McCann, Respondent was paid a commission of $1,879.52 by

NFOA.

Re: Count IV: Consumer – Lenora Bricker

38. On or about November 30, 2006, Respondent solicited

and induced Lenora Bricker of Winter Haven, Florida, then aged

87, to transfer or otherwise surrender ownership of her existing

annuity contract with American Equity Investment Life Insurance

Company in return for an NFOA annuity. The NFOA agreement that

the consumer entered into, and which was signed by Respondent,

is dated subsequent to the State of Washington Order to Cease

and Desist that was filed against NFOA. Ultimately, this

transaction did not close.

39. Respondent knew or reasonably should have known that

NFOA was not an authorized insurer in Florida.

40. Respondent, by use of the NFOA installment plan

agreement, knowingly misrepresented to Ms. Bricker that NFOA was

a charitable non-profit organization under Section 501(c)(3) of

the IRC, even though Respondent knew or should have known that

NFOA was not a tax exempt corporation.

41. Based upon Respondent’s transaction of insurance with

Ms. Bricker, Respondent was paid a commission of $1,085.17 by

NFOA, even though the transaction was not completed.

Re: Count V: Consumer – Louise Blevins

42. On or about November 30, 2006, Respondent solicited

and induced Louise Blevins of Longwood, Florida, then aged 81,

to transfer or otherwise surrender ownership of her existing

annuity contract with American Equity Investment Life Insurance

Company in return for an NFOA annuity. The NFOA agreement that

the consumer entered into, and which was signed by Respondent,

is dated subsequent to the State of Washington Order to Cease

and Desist that was filed against NFOA. Ultimately, this

transaction did not close.

43. Respondent knew or reasonably should have known that

NFOA was not an authorized insurer in Florida.

44. Respondent, by use of the NFOA installment plan

agreement, knowingly misrepresented to Ms. Blevins that NFOA was

a charitable non-profit organization under Section 501(c)(3) of

the IRC, even though Respondent knew or should have known that

NFOA was not a tax exempt corporation.

45. Based upon Respondent’s transaction of insurance with

Ms. Bricker, Respondent was paid a commission of $5,469.09 by

NFOA, even though the transaction did not close.

Re: Count VI: Consumer – Audrey Piel

46. On December 14, 2006, Respondent solicited and induced

Audrey Piel of Maitland, Florida, then aged 81, to transfer or

otherwise surrender ownership of her existing annuity contract

with American Equity Investment Life Insurance Company in return

for an NFOA annuity. The NFOA agreement that the consumer

entered into, and which was signed by Respondent, is dated

subsequent to the State of Washington Order to Cease and Desist

that was filed against NFOA.

47. Respondent knew or reasonably should have known that

NFOA was not an authorized insurer in Florida.

48. Respondent, by use of the NFOA installment plan

agreement, knowingly misrepresented to Ms. Piel that NFOA was a

charitable non-profit organization under Section 501(c)(3) of

the IRC, even though Respondent knew or should have known that

NFOA was not a tax exempt corporation.

49. Based upon Respondent’s transaction of insurance,

Ms. Piel is anticipated to lose approximately $5,594.24. The

loss consists of $21,089.17, the amount transferred to NFOA;

less $996.35 (installment payments made by NFOA to Ms. Piel);

$13.645.33 (the first payment sent by Receiver); and $2,938.99,

(the second payment sent by Receiver). Ms. Piel lost $2,085.74

through surrender charges incurred for transferring her original

American Equity annuity to NFOA. If the surrender penalty is

excluded from the calculation, Ms. Piel’s loss is $3,508.50.

50. Based upon Respondent’s transaction of insurance with

Ms. Piel, Respondent was paid a commission of $1,839.54 by NFOA.

Re: Count VII: Consumer – John Bartlett

51. On February 13, 2007, Respondent solicited and induced

John Bartlett of Orlando, Florida, then age 75, to transfer or

otherwise surrender ownership of his existing annuity contract

with American Equity Investment Life Insurance Company in return

for an NFOA annuity. The NFOA agreement that the consumer

entered into, and which was signed by Respondent, is dated

subsequent to the State of Washington Order to Cease and Desist

that was filed against NFOA. Ultimately, this transaction did

not close.

52. Respondent knew or reasonably should have known that

NFOA was not an authorized insurer in Florida.

53. Respondent, by use of the NFOA installment plan

agreement, knowingly misrepresented to Mr. Bartlett that NFOA

was a charitable non-profit organization under Section 501(c)(3)

of the IRC, even though Respondent knew or should have known

that NFOA was not a tax exempt corporation.

54. Based upon Respondent’s transaction of insurance with

Mr. Bartlett, Respondent was paid a commission of approximately

$16,385.56 by NFOA, even though the transaction was not

completed.

Re: Count VIII: Consumer – Lilla Dama

55. On January 18, Respondent solicited and induced Lilla

Dama of Orlando, Florida, then aged 86, to transfer or otherwise

surrender ownership of her existing annuity contract with

American Equity Investment Life Insurance Company in return for

an NFOA annuity. The NFOA agreement that the consumer entered

into, and which was signed by Respondent, is dated subsequent to

the State of Washington Order to Cease and Desist that was filed

against NFOA. Ultimately, this transaction did not close.

56. Respondent knew or reasonably should have known that

NFOA was not an authorized insurer in Florida.

57. Respondent, by use of the NFOA installment plan

agreement, knowingly misrepresented to Ms. Dama that NFOA was a

charitable non-profit organization under Section 501(c)(3) of

the IRC, even though Respondent knew or should have known that

NFOA was not a tax exempt corporation.

58. Based upon Respondent’s transaction of insurance with

Ms. Dama, Respondent was paid a commission of approximately

$2,757.52 by NFOA, even though the transaction was not

completed.

Re: Count IX: Consumer – Agnes Burns

59. On February 28, 2007, and April 2, 2007, Respondent

solicited and induced Agnes Burns of Orlando, Florida, then aged

87, to transfer or otherwise surrender ownership of her existing

annuity contract with American Equity Investment Life Insurance

Company and New York Life Insurance and Annuity Company,

respectively, in return for an NFOA annuity. The NFOA agreement

that the consumer entered into, and which was signed by

Respondent, is dated subsequent to the State of Washington Order

to Cease and Desist that was filed against NFOA.

60. Respondent knew or reasonably should have known that

NFOA was not an authorized insurer in Florida.

61. Respondent, by use of the NFOA installment plan

agreement, knowingly misrepresented to Ms. Burns that NFOA was a

charitable non-profit organization under Section 501(c)(3) of

the IRC, even though Respondent knew or should have known that

NFOA was not a tax exempt corporation.

62. Based upon Respondent’s transaction of insurance,

Ms. Burns is anticipated to lose approximately $77,509.17.

The loss consists of $335,070.29, the amount transferred to

NFOA; less $18,363.66 (installment payments sent by NFOA to

Ms. Burns); $205,859.31 (the first payment sent by Receiver);

and $44,338.93 (the second payment sent by Receiver). A

surrender penalty of $11,000.78 was incurred by Ms Burns for

transferring her original annuities to NFOA. If the surrender

penalty is excluded from the calculation, Ms. Burns’ loss is

$66,508.39.

63. Based upon Respondent’s transaction of insurance with

Ms. Burns, Respondent was paid a commission of $30,080.00 by

NFOA.

Re: Count X: Consumers – Ms. Buchanan; Ms. Golus, and

Mr. Owens

64. Respondent solicited and induced Elizabeth Buchanan,

aged 42, of Bradenton, Florida; Nancy Golus, aged 59, of

Palmetto, Florida; and Herbert Owens, aged 86, of St.

Petersburg, Florida, to transfer or otherwise surrender

ownership of their existing annuity contracts in return for an

NFOA annuities. As to the the NFOA agreement that Mr. Owens

entered into, and which was signed by Respondent, the date of

the agreement is subsequent to the State of Washington Order to

Cease and Desist that was filed against NFOA. The NFOA

agreements that Ms. Buchanan and

Ms. Golus entered into were dated prior to the State of

Washington’s Order to Cease and Desist.

65. Respondent knew or reasonably should have known that

NFOA was not an authorized insurer in Florida.

66. Based upon Respondent’s transactions of insurance,

Ms. Buchanan is anticipated to lose approximately $89,031.12.

The loss consists of $162,445.60, the amount transferred to

NFOA; less $20,000.00 (installment payments sent by NFOA to

Ms. Buchanan); $92,589.64 (the first payment sent by Receiver);

and $19,942.38 (the second payment sent by Receiver).

Ms. Buchanan suffered $59,117.54 in losses from surrender

charges incurred. Even after partial refunds by the DCI

Receiver and the surrender penalty are excluded from the

calculation, Ms. Buchanan’s loss is still $29,913.58.

67. Ms. Golus is anticipated to lose approximately

$146,027.18, the amount transferred to NFOA. Ms. Golus received

$94,917.67 (the first payment by Receiver) and $20,443.81 (the

second payment by Receiver). However, Ms. Golus suffered

$53,152.47 in surrender charges incurred. Even after partial

refunds by the Receiver and the surrender penalty are excluded

from the calculation, Ms. Golus’ loss is $30,665.67.

68. Mr. Owens is anticipated to lose approximately

$10,976.33. The loss consists of $54,743.52, the amount

transferred to NFOA; less $5,108.40 (installment payments

sent by NFOA to Mr. Owens); $32,262.83 (the first payment by

Receiver); and, $6,948.92 (the second payment sent by Receiver).

Mr. Owens incurred $552.96 in surrender charges. Even after

partial refunds by the Receiver and the surrender penalty are

excluded from the calculation, Mr. Owens’ loss is still

$10,423.37.

69. In each and every count, Petitioner proved by clear

and convincing evidence that:

a. Respondent directly or indirectly

represented or aided an unauthorized insurer

to do business in Florida.

b. Respondent knew or reasonably should

have known that the annuity contracts he

contracted with clients were with an

unauthorized insurer.

c. Respondent knowingly placed before the

public a statement, assertion, or

representation with respect to the business

of insurance that was untrue, deceptive or

misleading.

d. Respondent knowingly caused to be made,

published, disseminated, circulated,

delivered, or placed before the public a

false material statement.

e. Respondent demonstrated a lack of

fitness and trustworthiness to engage in the

business of insurance.

f. Respondent engaged in unfair and

deceptive practices or showed himself to be

a source of injury or loss to the public.

CONCLUSIONS OF LAW

70. Respondent has held insurance licenses in the state of

Florida for over 20 years and has had no prior disciplinary

action filed against those licenses.

71. DOAH has jurisdiction over the subject matter of, and

Stat. (2009).

72. Because Petitioner seeks suspension or revocation of

Respondent’s licenses, Petitioner has the burden of proving by

clear and convincing evidence that Respondent committed the

violations alleged in its Second Amended Administrative

Complaint. Department of Banking and Finance v. Osborne Stern &

Company , 670 So. 2d 932 (Fla. 1996); Ferris v. Turlington , 510

So. 2d 292 (Fla. 1987).

73. “Clear and convincing evidence is an intermediate

standard of proof, more than the ‘preponderance of the evidence’

standard used in most civil cases, and less than the ‘beyond a

reasonable doubt’ standard used in criminal cases.” Smith v.

Department of Health and Rehabilitative Services , 522 So. 2d

956, 958 (Fla. 1st DCA 1988). Clear and convincing evidence

requires:

That the evidence must be found to be

credible; the fact to which the witnesses

testify must be precise and explicit and the

witnesses must be lacking in confusion as to

the fact in issue. The evidence must be of

such weight that it produces in the mind of

the trier of fact a firm belief or

conviction, without hesitancy, as to the

truth of the allegations sought to be

established.

Smith , 522 So. 2d at 958 (quoting S lomowitz v. Walker , 429 So.

2d 797, 800 (Fla. 4th DCA 1983).

74. At all times material to the instant case, Subsection

626.901(1), Florida Statutes, has provided as follows:

Representing or aiding unauthorized insurer

prohibited –

(1) No person shall, from offices or by

personnel or facilities located in this

state, or any other state or country,

directly or indirectly act as agent for, or

otherwise represent or aid on behalf of

another, any insurer not then authorized to

transact such insurance in this state in:

(a) The solicitation, negotiation,

procurement, or effectuation of

insurance or annuity contracts, or

renewals thereof;

(b) The discrimination of information

as to coverage or rates;

(c) The forwarding of applications;

(d) The delivery of policies or

contracts;

(e) The inspection of risks;

(f) The fixing of rates;

(g) The investigation or adjustment of

claims or losses; or

(h) The collection or forwarding of

premiums;

or in any other manner represent to assist

such an insurer in the transaction or

insurance with respect to subjects of

insurance resident, located, or to be

performed in this state.

75. At all times material to the instant case, Subsection

626.901(2), Florida Statutes, has provided as follows:

Representing or aiding unauthorized insurer

prohibited –

(2) If an unauthorized insurer fails to pay

in full or in part any claim or loss within

the provisions of any insurance contract

which is entered into in violation of this

section, any person who knew or reasonably

should have known that such contract was

entered into in violation of this section

and who solicited, negotiated, took

application for, or effectuated such

insurance contract is liable to the insured

for the full amount of the claim or loss not

paid.

Aon Risk Services, Inc. v. Quintec , 887 So. 2d 368, 371 (Fla.

3rd DCA 2004), provides, “the only fair reading of the statute

[Subsection 626.901(2), Florida Statutes] is that the

broker/agent’s liability is limited to coverage ‘within the

provisions of the insurance contract’.” Pursuant to Subsection

626.901(2), Florida Statutes, Respondent’s liability for

consumers’ losses should exclude any surrender penalties

incurred in transferring the consumers’ original annuities to

NFOA. Nevertheless, pursuant to Subsection 626.621(6), Florida

Statutes, Respondent is still responsible for the consumers’

total losses, which include the amounts of the surrender

penalties.

76. At all times material to the instant case, Subsection

626.9541(1)(b)4., Florida Statutes, has provided as follows:

(1) UNFAIR METHODS OF COMPETITION AND

UNFAIR OR DECEPTIVE ACTS. – The following

are defined as unfair methods of competition

and unfair or deceptive acts or practices:

* * *

(b) False information and advertising

generally. – Knowingly making, publishing,

disseminating, circulating, or placing

before the public, or causing, directly or

indirectly, to be made, published,

disseminated, circulated, or placed before

the public:

* * *

4. In any other way, an advertisement,

announcement, or statement containing any

assertion, representation, or statement with

respect to the business of insurance, which

is untrue, deceptive, or misleading.

* * *

(e) False statement and entries.

1. Knowingly:

* * *

e. Causing, directly, or indirectly, to be

made, published, disseminated, circulated,

delivered to any person, or placed before

the public, any false material statement.

77. At all times material to the instant case, Subsection

626.611(7), Florida Statutes, has provided in pertinent part, as

follows:

Grounds for compulsory refusal, suspension,

or revocation of agent’s, title agency’s,

adjuster’s, customer representative’s,

service representative’s, or managing

general agent’s license or appointment.

The department shall deny an application

for, suspend, revoke, or refuse to renew or

continue the license or appointment of any

applicant, agent, title agency, adjuster,

customer representative, service

representative, or managing general agent,

and it shall suspend or revoke the

eligibility to hold a license or appointment

of any such person, if it finds that as to

the applicant, licensee, or appointee any

one or more of the following applicable

grounds exist:

* * *

(7) Demonstrated lack of fitness or

trustworthiness to engage in the business of

insurance.

78. At all times material to the instant case, Section

626.621, Florida Statutes, has provided as follows:

Grounds for discretionary refusal,

suspension or revocation of agent’s, title

agency’s, adjuster’s, customer

representative’s, service representative’s,

or managing general agent’s license or

appointment.

The department may, in its discretion, deny

an application for, suspend, revoke, or

refuse to renew or continue the license or

appointment of any applicant, agent, title

agency, adjuster, customer representative,

service representative, or managing general

agent, and it shall suspend or revoke the

eligibility to hold a license or appointment

of any such person, if it finds that as to

the applicant, licensee, or appointee any

one or more of the following applicable

grounds exist under circumstances for which

such denial, suspension, revocation, or

refusal is not mandatory under s.

616.611. . . .

* * *

(2) Violation of any provision of this code

or of any other law applicable to the

business of insurance in the course of

dealing under the license or appointment.

* * *

(6) In the conduct of business under the

license or appointment, engaging in unfair

methods of competition or in unfair or

deceptive acts or practices, as prohibited

under part IX of this chapter, or having

otherwise shown himself or herself to be

source of injury or loss to the public.

79. Florida Administration Code Rule 69B-231.110,

states, in pertinent part:

Penalties for Violation of Other Specific

Provisions of the Florida Insurance Code.

If the licensee is found to have violated

any of the following provisions of the

Insurance Code, the following stated penalty

shall apply:

* * *

(35) Section 626.901(1), F.S. – suspension

6 months.

* * *

(36) Section 626.901(2), F.S. – suspension

12 months.

80. Florida Administrative Code Rule 69B-231.100,

states in pertinent part:

Penalties for Violation of Section

626.9541(1).

If a licensee is found to have violated

Section 626.621(6), F.S., by engaging in

unfair methods of competition or in any

unfair or deceptive acts or practices as

defined in any of the following paragraphs

of Section 626.9541(1), F.S., the following

stated penalty shall apply:

(5) Section 626.9541(1)(e), F.S. –

suspension 6 months; except that the penalty

of a violation of Section 626.9541(1)(e)1.,

F.S., shall be a suspension of 12 months.

82. Florida Administrative Code Rule 69B-231.080,

states in pertinent part:

Penalties for Violation of Section 626.611.

If it is found that the licensee has

violated any of the following subsections of

Section 626.611, F.S., for which compulsory

suspension or revocation of license(s) and

appointment(s) is required, the following

stated penalty shall apply:

* * *

(7) Section 626.611(7), F.S., - suspension

6 months.

83. Florida Administrative Code Rule 69B-231.090, states,

in pertinent part:

Penalties for Violation of Section 626.621.

If it is found that the licensee has

violated any of the following subsections of

Section 626.621, F.S., for which compulsory

suspension or revocation of license(s) and

appointment(s) is required, the following

stated penalty shall apply:

* * *

(2) Section 626.621(2), F.S., - suspension

3 months.

* * *

(6) Section 626.621(6), F.S., - see Florida

Administrative Code Rule 69B-231.100.

84. Petitioner has proven by clear and convincing evidence

that Respondent violated Subsection 626.901(1), Florida

Statutes, as charged in Counts I - X of the Second Amended

Administrative Complaint. “The language of the statute

[Subsection 626.901(1), Florida Statutes] clearly imposes an

absolute bar against representing an unauthorized insurer.”

Beshore v. Department of Financial Services , 928 So. 2d 411, 412

(Fla. 1st DCA 2006).

85. In addition, Petitioner has proven by clear and

convincing evidence that Respondent has violated Subsections

626.621(2), and 626.621(6), Florida Statutes, respectively.

86. Respondent had a fiduciary duty to his clients and to

the insurer. See Natelson v. Department of Insurance , 454 So.

2d 31 (Fla. 1st DCA 1984). “Insurance agents enjoy the benefit

of public trust and stand in a fiduciary relationship with their

customers.” Department of Financial Services v. Carll and

Crain , Case Nos. 86221-06-AG and 86177-06-AG, Department’s Final

Order (2007) (DOAH January 31, 2007, paragraph 57), citing to

Natelson , 454 So. 2d at 31, 32. “Insurance agents enjoy the

benefit of public trust and stand in a fiduciary relationship

with their customers.” Department of Financial Services v.

Carll and Crain (DOAH January 31, 2007, paragraph 57) (citations

omitted). “A person acting in a fiduciary capacity generally

has a duty to make a full and fair disclosure of material facts

to the person reposing confidence in the fiduciary.” Department

of Financial Services v. Carll and Crain (DOAH January 31, 2007,

paragraph 57) (citations omitted).

87. As to each of his Florida clients, Respondent acted

“naively, if not irresponsibly” and worse when he aided NFOA,

both in NFOA’s unauthorized insurer context and in the

misrepresentation that NFOA was an IRS approved 501(c)(3) tax

exempt entity. See Department of Financial Services v. Keiffer ,

Case No. 61528-03-AG, Department’s Final Order (2004) (DOAH

April 2, 2004, paragraph 102). Respondent demonstrated a lack

of fitness or trustworthiness to engage in the continued

business of insurance in Florida.

88. Respondent knew or reasonably should have known that

NFOA was not an authorized insurer in Florida, for purposes of

Subsection 626.901(2), Florida Statutes. Respondent is an

experienced insurance agent of many years in both Florida and

New York. Respondent’s professed ignorance regarding how to

verify NFOA’s authority to conduct the business of insurance in

Florida and dependence upon the biased hearsay assurances of

others lacks credibility. Respondent owed a duty to his clients

to know that NFOA was an unauthorized insurer and to govern his

insurance agent activities accordingly. See Natelson , id.

“Ascertaining the existence or nonexistence of a certificate of

authority, constitutes ‘due diligence’ incumbent upon an agent

before engaging in the sale of insurance from a prospective

insurance company.” Department of Financial Services v.

Keiffer , Case No. 61528-03-AG, Department’s Final Order (2004)

insurance agent] is charged with knowledge of those facts he

could have discovered through ordinary diligence.” Department

of Financial Services v. Carll and Crain , (DOAH January 31,

2007, paragraph 60) citing to Cf. Ramel v. Chasebrook

Construction Company, Inc. , 135 So. 2d 876, 881 (Fla. 2d DCA

1961).

89. Respondent knew that NFOA had not been granted tax

exempt status by the IRS and nevertheless knowingly

misrepresented the 501(c)(3) tax exempt status of NFOA to his

clients, in violation of Subsections 616.9541(1)(b)4., and

626.9541(1)(e)1.e., Florida Statutes. Respondent owed a duty to

his clients to disclose that NFOA did not have a 501(c)(3) tax

exempt status, or to at least qualify his representations with a

disclosure that NFOA’s tax exempt status had been applied for

but that a determination by the IRS was pending. See Natelson ,

id.

90. The plain meaning of the word “knowingly” does not

require knowledge of the unlawfulness of the act, only knowledge

of the occurrence of the act. A person acts “with knowledge”

when there is an “awareness, as of a fact or circumstance.” See

Mogavero v. State , 744 So. 2d 1048, 1050 (Fla. 4th DCA 1999).

need only have knowledge of the facts; knowledge of the law

itself is not required nor is it an element of the offense.”

BT Professional Services, Inc. v. Dept. of Banking and Finance ,

Case No. 96-6136 (DOAH December 2, 1998), citing to United

States v. International Minerals and Chemical Corporation , 402

U.S. 558, 91 S.Ct. 1697, 29 L. Ed. 2d 178 (1971). Cf. Owens v.

Samkle Automotive, Inc. , 425 F.3d 1318, 1321 (11th Cir. 2005).

91. “Making a statement that is false when one does not

have sufficient information to know whether the statement is

either true or false amounts to a knowing misrepresentation that

rises to the level of fraudulent conduct. This is so because a

person is assumed to know whether he has insufficient knowledge

of the facts to assert the statement as true.” Jack Eckert

Corporation v. Smith , 558 So. 2d 1060 (Fla. 1st DCA 1990),

citing to Joiner v. McCullers , 158 Fla. 562, 28 So. 2d 823

(1947). Cf. Parker v. State of Florida Bd. of Regents ex rel.

Florida State University , 724 So. 2d 163, 168 (Fla. 1st DCA

1998).

92. Pursuant to the discussion of highest penalty per

count found in Florida Administrative Code Rule 69B-

231.040(1)(a), and having concluded that Respondent violated

Subsection 626.901(2), Florida Statutes, the stated penalty

authorized by Florida Administrative Code Rule 69B-231.110(36),

is a suspension of Respondent’s licensure for 12 months for each

separate violation of Subsection 626.901(2), Florida Statutes.

Therefore, Respondent’s total penalty calculates to a 120-month

suspension, even without further consideration of aggravating

factors, including the degree of financial injury to

Respondent’s clients, the elderly age of Respondent’s clients,

the financial commissions received by Respondent, and the

existence of secondary violations in Counts I-X. In the event

the final penalty exceeds a suspension of 24 months, the final

penalty shall be revocation. Fla. Admin. Code R. 69B-

231.040(3)(d).

93. Florida Administrative Code Rule 69B-231.160(1),

states:

Aggravating/Mitigating Factors.

The Department shall consider the following

aggravating and mitigating factors and apply

them to the total penalty in reaching the

final penalty assessed against a licensee

under this rule chapter. After

consideration, and application of these

factors, the Department shall, if warranted

by the Department’s consideration of the

factors, either decrease or increase the

penalty to any penalty authorized by law.

(1) For penalties other than those assessed

under Rule 69B-231.150 F.A.C.:

(a) Willfulness of licensee’s conduct;

(b) Degree of actual injury to victim;

(c) Degree of Potential injury to victim;

(d) Age or capacity of victim;

(e) Timely restitution;

(f) Motivation of licensee;

(g) Financial gain or loss to licensee;

(h) Cooperation with the Department;

(i) Vicarious or personal responsibility;

(j) Related criminal charge, disposition;

(k) Existence of secondary violations in

counts;

(l) Previous disciplinary order or prior

warning by the Department; and

(m) Other relevant factors.

94. Respondent’s mitigation testimony was composed of a

summary of his insurance career, his present financial and

personal situation, and a request for leniency, based on the

fact that he has no prior disciplinary action filed against his

licenses in Florida or New York.

95. The aggravating factors of the degree of financial

injury to Respondent’s clients, the elderly age of Respondent’s

clients, the financial commissions received by Respondent, and

the existence of secondary violations in Counts I-X, far

outweigh any mitigation of discipline. Revocation of all of

Respondent’s licenses is the only reasonable recommendation.

96. Having concluded that Respondent violated Subsections

626.901(1) and 626.901(2), Florida Statutes, if Respondent,

subsequent to revocation, makes application to Petitioner for

any licensure, Respondent bears the burden of proving that he

has otherwise satisfied the financial losses totaling

$283,439.68, if surrender penalties are included and $152,877.87

if surrender penalties are excluded, as found above, of his

clients.

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions

of Law, it is RECOMMENDED that the Chief Financial Officer enter

a final order finding that:

(1) Respondent violated Subsections 626.901(1),

626.621(2), and 626.621(6), Florida Statutes, as charged in

Counts I-X of the Second Amended Administrative Complaint;

(2) Revoking each and every one of Respondent’s licenses

and appointments issued or granted under or pursuant to the

Florida Insurance Code; and

(3) Providing that if Respondent, subsequent to

revocation, makes application to Petitioner for any licensure, a

new license will not be granted if Respondent fails to prove

that he has otherwise satisfied the financial losses of his NFOA

clients, or if Respondent otherwise fails to establish that he

is eligible for licensure.

DONE AND ENTERED this 10th day of December, 2009, in

Tallahassee, Leon County, Florida.

S

DANIEL M. KILBRIDE

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

[phone]

Fax Filing [phone]

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 10th day of December, 2009.

ENDNOTE

1/ All references to Florida Statutes are to Florida Statutes

(2008), unless otherwise indicated.

COPIES FURNISHED :

Robert G. DeWald

3730 Eagle Hammock Drive

Sarasota, Florida 34240

Philip M. Payne, Esquire

Department of Financial Services

624 Larson Building

200 East Gaines Street

Tallahassee, Florida 32399

Tracy Beal, Agency Clerk

Department of Financial Services

200 East Gaines Street

Tallahassee, Florida 32399-0390

Honorable Alex Sink

Chief Financial Officer

Department of Financial Services

The Capitol, Plaza Level 11

Tallahassee, Florida 32399-0300

Benjamin Diamond, General Counsel

Department of Financial Services

The Capitol, Plaza Level 11

Tallahassee, Florida 32399-0307

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

15 days from the date of this Recommended Order. Any exceptions

to this Recommended Order should be filed with the agency that

will issue the Final Order in this case.