12-001225 Office Of Financial Regulation vs. Marine Bank And Trust Company, A State-Chartered Bank In Vero Beach, Florida Status: Closed Recommended Order on Tuesday, November 20, 2012.

Summary: Petitioner demonstrated that Respondent had engaged in unsafe and unsound practices and had violated laws relating to the operation of a financial institution. Recommended the issuance of a cease and desist order by Petitioner against Respondent.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

OFFICE OF FINANCIAL REGULATION, )

)

Petitioner, )

)

vs. ) Case No. 12-1225

)

MARINE BANK AND TRUST COMPANY, )

A STATE-CHARTERED BANK IN VERO )

BEACH, FLORIDA, )

)

Respondent. )

_______________________________ )

RECOMMENDED ORDER

Pursuant to notice, a final hearing was held in this case

on August 10, 13, and 14, 2012, by video teleconference with

connecting sites in Port St. Lucie and Tallahassee, Florida,

before Errol H. Powell, an Administrative Law Judge of the

Division of Administrative Hearings.

APPEARANCES

For Petitioner: Jeffrey D. Jones, Esquire

C. Michael Marschall, Esquire

Office of Financial Regulation

200 East Gaines Street, Suite 624

Tallahassee, Florida 32399-0371

For Respondent: Paul M. Phillips, Esquire

Adams and Reese, LLP

Bank of America Building

101 East Kennedy Boulevard, Suite 4000

Tampa, Florida 33602

Edward W. Dougherty, Esquire

Robert J. Angerer, Jr., Esquire

Igler & Dougherty, P.A.

2457 Care Drive

Tallahassee, Florida 32308

STATEMENT OF THE ISSUE

The issue for determination is whether Respondent committed

the offenses set forth in the Amended Administrative Complaint

dated February 29, 2012, and, if so, what action should be

taken.

PRELIMINARY STATEMENT

The Office of Financial Regulation (OFR) issued an Amended

Administrative Complaint and Notice of Rights against Marine

Bank and Trust Company, a State-Chartered Bank in Vero Beach,

Florida (Marine Bank) dated February 29, 2012. OFR charged

Marine Bank with engaging in unsafe and unsound practices within

the meaning of section 655.005(1)(y), Florida Statutes, for

which an order to cease and desist from engaging in the unsafe

and unsound practices and to take the necessary corrective

action is authorized and appropriate pursuant to section

655.033(1)(a); with violating laws relating to the operation of

a financial institution for which an order to cease and desist

and to take the necessary corrective action is authorized and

appropriate pursuant to section 655.033(1)(b); and with

breaching the written agreement between it and OFR for which an

order to cease and desist from operating in violation of the

written agreement and to take the necessary corrective action is

authorized and appropriate pursuant to section 655.0331(1)(e).

Marine Bank disputed the material allegations of fact and

requested a hearing. On April 6, 2012, this matter was referred

to the Division of Administrative Hearings.

Prior to hearing, a Protective Order Governing

Confidentiality of Production of Documents was issued.

Additionally, the parties filed unilateral prehearing

statements.

At hearing, OFR presented the testimony of three witnesses

and entered 18 exhibits (Petitioner's Exhibits C, D, E-1, E-2,

F-1, F-2, G, H, I-1, I-2, J-1, J-2, K, L-1, L-2, M, N, and O)

into evidence. Marine Bank presented the testimony of five

witnesses and recalled three witnesses whose testimony had been

presented by OFR and entered 38 exhibits (Respondent's Exhibits

numbered 1 through 33, and 55 through 59) into evidence. The

parties entered two joint exhibits (Joint Exhibits A (OFR's A

and Marine Bank's 8) and B (OFR's B) into evidence.

A transcript of the hearing was ordered. At the request of

the parties, the time for filing post-hearing submissions was

set for more than ten days following the filing of the

transcript. The transcript, consisting of three volumes, was

filed on September 21, 2012. The parties timely filed their

post-hearing submissions, which were considered in the

preparation of this Recommended Order.

FINDINGS OF FACT

1. No dispute exists that OFR is the state agency

authorized and charged with licensure and regulation of Florida

state-chartered financial institutions pursuant to section

20.121(3) and chapters 655 and 658, Florida Statutes, and the

rules promulgated pursuant thereto contained in Florida

Administrative Code chapter 69U.

2. No dispute exists that Marine Bank is a Florida state-

chartered bank operating under Charter Number 251-T, with its

principal place of business located at 571 Beachland Boulevard,

Vero Beach, Indian River County, Florida.

3. OFR began a full scope safety and soundness examination

of Marine Bank on August 23, 2010 (August Examination). The

August Examination was conducted concurrently with the Federal

Deposit Insurance Corporation (FDIC). In essence, both OFR and

FDIC determined that Marine Bank's financial condition had

deteriorated; that unsafe and unsound practices existed,

including operating with an excessive level of classified

assets, inadequate capital in relation to classified assets,

poor earnings, and ineffective management oversight; and that an

initiation of a corrective action plan was needed.

4. Additionally, among other things, the August

Examination revealed that Marine Bank had not obtained current

appraisal reports on two properties that were acquired by Marine

Bank through foreclosure, referred to as Other Real Estate Owned

(OREO). The last appraisal on the two properties was

December 4, 2008, and the properties were acquired on June 28,

2010. OFR determined that such failure by Marine Bank was a

violation of section 658.67(9)(a), Florida Statutes.

5. Marine Bank, through its Board of Directors, entered

into a Memorandum of Understanding (MOU) with the FDIC, through

the Regional Director of the FDIC's Atlanta Regional Office, and

OFR, through the Director, Division of Financial Institutions of

the Florida OFR. The effective date of the MOU was

September 17, 2010.

6. The MOU provided, among other things, that, as a result

of the FDIC Report of Examination of Marine Bank, dated

August 10, 2009, which showed that less than satisfactory

conditions existed at Marine Bank, which, if not corrected,

could result in a more severe situation, corrective action

needed to be taken; that the MOU was an agreement; and that

Marine Bank would, in good faith, comply with the requirements

of the MOU and eliminate the problems at Marine Bank.

7. The MOU required, among other things, Marine Bank to

maintain a Tier 1 Leverage Capital ratio of not less than 8

percent and a Tier 1 Risk Based Capital ratio of not less than

12 percent during the existence of the MOU. Further, the MOU

required that, if the capital ratios are less than required as

determined as of the date of any Report of Condition and Income

(Call Report) or any OFR examination, Marine Bank will, within

30 days, present a plan to OFR to increase the capital ratios or

bring them within compliance; that, after OFR provides comments

to Marine Bank regarding the plan, the board of directors of

Marine Bank will adopt the plan, including amendments or

modifications requested by OFR; and that, after adoption of the

plan, Marine Bank will implement the measures of the plan, which

have not been utilized previously, to increase the amount of

Tier 1 Capital sufficient to comply with the capital ratios.

8. Additionally, the MOU required, among other things,

Marine Bank to reduce the balance of assets classified

Substandard in the FDIC Report in relation to Tier 1 Capital and

the allowance for loan and lease losses (ALLL) through specific

methods within a certain time-period and a certain percentage.

9. OFR considers the MOU to be an agreement which is in

writing and is, therefore, a written agreement.

10. The MOU is a written agreement. 1/

11. When a memorandum of understanding is presented to the

board of directors of a financial institution, generally, the

board of directors is informed that a memorandum of

understanding is an informal enforcement or corrective action.

12. OFR considers the MOU to be enforceable through an

administrative complaint. OFR considered the MOU to be a

written agreement with it and that Marine Bank had breached the

written agreement. As a result, OFR considered the MOU to be

enforceable through a complaint pursuant to section

655.033(1)(e), which provides that OFR may file a complaint for

a breach of any written agreement with it.

13. During the discussions of the MOU and before it was

finalized, Marine Bank realized that it would fall short of

compliance with the capital levels presented. Before the

effective date of the MOU, in August 2010, Marine Bank presented

a capital plan to OFR and FDIC. OFR did not provide comments to

Marine Bank regarding its capital plan.

14. In November 2010, Marine Bank commenced an offering to

raise capital. The offering expired in June 2011, with

insufficient capital being raised.

15. Also, in April 2011, Marine Bank revised the capital

plan and provided it to OFR. Again, OFR did not provide

comments to Marine Bank regarding its revised capital plan.

16. Marine Bank agrees that it needs to raise capital. It

has made efforts to raise capital, and its efforts have been

ongoing. However, Marine Bank's efforts have been insufficient

to raise the capital needed.

17. Marine Bank prepared and provided progress reports on

its compliance with the MOU. OFR reviewed and considered Marine

Bank's progress reports.

18. Also, among other things, Marine Bank was required, as

a federally insured bank, to file a quarterly Call Report, which

included Marine Bank's assets, liabilities, income, and the

interest rate risk. Call Reports are prepared and submitted by

the bank, and, therefore, Marine Bank's Call Reports were

prepared and submitted by it. The quarterly Call Reports formed

the basis for OFR's financial assessment of the financial health

of Marine Bank. Among other things, the quarterly Call Reports

reflected Marine Bank's Tier 1 Leverage Capital ratio and Tier 1

Risk Based Capital ratio.

19. The FDIC commenced another examination of Marine Bank

on September 19, 2011 (September Examination). The FDIC

provided a copy of its report to OFR. OFR is authorized to

accept an examination by an appropriate federal regulatory

agency. OFR considered the September Examination in evaluating

Marine Bank's condition.

20. Exam and visitation documents showed, among other

things, that Marine Bank's management oversight remained

ineffective and needed improvement; that Marine Bank's volume of

adversely affected assets was high and reflected additional

deterioration in its loan portfolio and Other Real Estate; that

Marine Bank's earnings remained weak; and that Marine Bank's

capital levels were deficient and below the minimum levels

required by the MOU.

21. Further, the exam and visitation results showed, among

other things, that Marine Bank's risk management processes were

not adequate in relation to economic conditions and Marine

Bank's asset concentrations; that Marine Bank's risk management

processes were not adequate in relation to and consistent with

Marine Bank's business plan, competitive conditions, and

proposed new activities or products; and that Marine Bank's

internal controls, audit procedures, and compliance with laws

and regulations were inadequate.

22. Also, the exam and visitation results noted, among

other things, that Marine Bank should amend its June 30, 2011,

Call Report due to significant errors that were identified

during the September Examination. Subsequently, Marine Bank

amended the June 30, 2011, Call Report, correcting some, but not

all, of the errors noted.

23. OFR began a visitation of Marine Bank on January 30,

2012, to determine Marine Bank's current financial condition and

to evaluate Marine Bank's compliance with the MOU.

24. The exam and visitation documents showed that,

overall, Marine Bank's financial condition remained weak.

Adversely classified assets remained high, totaling

$19,338,000.00 or 14.13 percent of total assets, and could

jeopardize Marine Bank's viability. Marine Bank's concentration

in non-owner occupied commercial real estate (CRE) loans and

land loans totaled $32,032,000.00 or 314 percent of the Total

Risk Based Capital. Marine Bank's earnings for the twelve

months ending December 31, 2011, were unsatisfactory with a pre-

tax net loss of $194,000.00 or a pre-tax return on average

assets of a negative 0.13 percent.

25. Further, the exam and visitation documents and Call

Report showed that, as of December 31, 2011, Marine Bank's Tier

1 Capital was $8,813,000.00 (Tier 1 Capital ratio of 6.52

percent) and Total Risk Based Capital was $10,224,000 (Total

Risk Based Capital ratio of 9.60 percent). Marine Bank failed

to meet the minimum ratio levels required in the MOU.

26. The exam and visitation documents showed that Marine

Bank had complied with all of the requirements of the MOU,

except for the Tier Capital ratios. Moreover, no dispute exists

that, since the effective date of the MOU, Marine Bank has

failed to meet or exceed the minimum ratio levels (Tier 1

Capital ratio of 8 percent and Total Risk Based Capital ratio of

12 percent), as required by the MOU, for any quarter period.

27. OFR examiners determined that, based on the results of

the visitation, the assessment of Marine Bank's financial

condition, risk management processes, operations, and management

during previous exams was justified.

28. No evidence was presented demonstrating that Marine

Bank was on the verge of insolvency or substantial dissipation

of assets or earnings.

CONCLUSIONS OF LAW

29. The Division of Administrative Hearings has

jurisdiction over the subject matter of this proceeding and the

parties thereto pursuant to sections 120.569 and 120.57(1),

Florida Statutes (2012).

30. Section 655.033, Florida Statutes (2011), provides in

pertinent part:

(1) The office [OFR] may issue and serve

upon any state financial institution,

subsidiary, or service corporation, or upon

any financial institution-affiliated party,

a complaint stating charges whenever the

office has reason to believe that such state

financial institution, subsidiary, service

corporation, financial institution-

affiliated party, or individual named

therein is engaging in or has engaged in

conduct that is:

(a) An unsafe or unsound practice;

(b) A violation of any law relating to the

operation of a financial institution;

* * *

(e) A breach of any written agreement with

the office;

(f) A prohibited act or practice pursuant

to s. 655.0322 . . . .

* * *

(6) Whenever the office finds that conduct

described in subsection (1) is likely to

cause insolvency, substantial dissipation of

assets or earnings of the state financial

institution, subsidiary, or service

corporation or substantial prejudice to the

depositors, members, or shareholders, it may

issue an emergency cease and desist order

requiring the state financial institution,

subsidiary, service corporation, or

financial institution-affiliated party to

immediately cease and desist from engaging

in the conduct complained of and to take

corrective action. . . .

31. No dispute exists that the burden of proof is upon OFR

to prove the allegations in the Amended Administrative

Complaint. However, the parties disagree as to whether the

evidence standard is a preponderance of the evidence or clear

and convincing evidence.

32. "Findings of fact shall be based upon a preponderance

of the evidence, except in penal or licensure disciplinary

proceedings or except as provided by statute . . . ."

§ 120.57(1)(j), Fla. Stat.

33. "In a case where the proceedings implicate the loss of

livelihood, an elevated standard is necessary to protect the

rights and interests of the accused." Ferris v. Turlington

, 510

So. 2d 292, 295 (Fla. 1987). Consequently, the clear and

convincing standard is applicable in proceedings involving the

revocation of a professional license. Id.

34. The examination of the "nature of the proceedings and

their consequences" is required to "determine the degree of

proof required." Dep't. of Banking & Fin., Div. of Sec. &

Investor Prot. v. Osborne Stern & Co. , 670 So. 2d 932, 935 (Fla.

1996).

35. "The denial of registration . . . is not a sanction

for the applicant's violation of the statute, but rather the

application of a regulatory measure." Osborne Stern , at 934.

The preponderance of evidence standard is applicable in

proceedings involving an application for licensure. Osborne

Stern , at935.

36. However, "an administrative fine deprives the person

fined of substantial rights in property" and is "generally

punitive in nature." Osborne Stern , at 935.

37. In the instant case, OFR is seeking a cease and desist

order against Marine Bank based upon alleged violations of

statutory provisions. Marine Bank is a Florida state-chartered

bank. This proceeding is not penal in nature; whereas, a

proceeding involving the violation of a cease and desist order

would be. This proceeding does not implicate the loss of

livelihood or implicate significant property rights; whereas, a

proceeding involving the violation of a cease and desist order

would.

38. Consequently, the standard of proof is a preponderance

of the evidence.

39. Hence, the burden is on OFR to prove by a

preponderance of the evidence that Marine Bank committed the

offenses alleged in the Amended Administrative Complaint.

40. The Amended Administrative Complaint charges Marine

Bank with unsafe and unsound practices, violating laws

regulating the operation of a financial institution, and breach

of a written agreement, i.e., breach of the MOU.

41. Section 655.005, Florida Statutes (2010), provides in

pertinent part:

(1) As used in the financial institutions

codes, unless the context otherwise

requires, the term:

* * *

(r) "Unsafe or unsound practice" means any

practice or conduct found by the office to

be contrary to generally accepted standards

applicable to the specific financial

institution , or a violation of any prior

order of a state or federal regulatory

agency, which practice, conduct, or

violation creates the likelihood of loss,

insolvency, or dissipation of assets or

otherwise prejudices the interest of the

specific financial institution or its

depositors or members. In making this

determination, the office must consider the

size and condition of the financial

institution, the gravity of the violation,

and the prior conduct of the person or

institution involved.

(emphasis added).

42. Section 655.005, Florida Statutes (2011), provides in

pertinent part:

(1) As used in the financial institutions

codes, unless the context otherwise

requires, the term:

* * *

(y) "Unsafe or unsound practice" means any

practice or conduct found by the office to

be contrary to generally accepted standards

applicable to a financial institution , or a

violation of any prior agreement in writing

or order of a state or federal regulatory

agency, which practice, conduct, or

violation creates the likelihood of loss,

insolvency, or dissipation of assets or

otherwise prejudices the interest of the

financial institution or its depositors or

members. In making this determination, the

office must consider the size and condition

of the financial institution, the gravity of

the violation, and the prior conduct of the

person or institution involved.

(emphasis added).

43. Effective July 1, 2011, section 655.005 was amended,

pertinent to the instant case, as to the definition of unsafe

and unsound practice: the definition was re-alphabetized; the

wording "specific financial institution" was replaced with "a

financial institution"; and the wording regarding a violation

was expanded beyond "any prior order" to "any prior agreement in

writing or order."

44. At the time that the MOU was entered into, section

655.005 had not been amended as indicated, and a violation of a

prior agreement in writing was not defined as an unsafe and

unsound practice. Only the 2010 version of section 655.005 is

applicable to the MOU.

45. The evidence demonstrates that the MOU is an agreement

in writing of corrective action and entered into to attempt to

address and correct the less than satisfactory financial

condition of Marine Bank.

46. Therefore, determinations regarding unsafe and unsound

practices are made without considering any alleged breach of the

MOU by Marine Bank.

47. The evidence demonstrates that Marine Bank engaged in

unsafe and unsound practice within the meaning of section

655.005(1)(y) by failing to diversify and prevent excessive

concentrations in its loan portfolio. Such unsafe and unsound

practice has resulted in Marine Bank having an excessive volume

of adversely classified loans which has created the likelihood

of loss, insolvency, or dissipation of assets or otherwise

prejudices the interest of Marine Bank or its depositors or

members.

48. The evidence demonstrates that Marine Bank engaged in

unsafe and unsound practice within the meaning of section

655.005(1)(y) by failing to ensure that its methodology for ALLL

consistently complied with regulatory guidance and adequately

accounted for the level of credit risk in Marine Bank's

portfolio; and that its ALLL policy fully documented the

processes that management utilized in developing the quarterly

ALLL methodology. Such unsafe and unsound practices have

created the likelihood of loss, insolvency, or dissipation of

assets or otherwise prejudiced the interest of Marine Bank or

its depositors or members.

49. The evidence demonstrates that Marine Bank engaged in

unsafe and unsound practice within the meaning of section

655.005(1)(y) by operating with inadequate capital levels in

relation to the risks associated with its lending practices and

loan portfolio; and by operating with earnings that are

insufficient to increase capital and fund an adequate ALLL.

Such unsafe and unsound practices have created the likelihood of

loss, insolvency, or dissipation of assets or otherwise

prejudiced the interest of Marine Bank or its depositors or

members.

50. The evidence demonstrates that Marine Bank engaged in

unsafe and unsound practice within the meaning of section

655.005(1)(y) by its Board of Directors providing ineffective

oversight, supervision, and guidance to Marine Bank's

management; and by its Board of Directors and management not

improving Marine Bank's deficient and deteriorating financial

condition and failing to correct deficiencies noted at

examinations and visitations. Such unsafe and unsound practices

have created the likelihood of loss, insolvency, or dissipation

of assets or otherwise prejudiced the interest of Marine Bank or

its depositors or members.

51. Section 658.67, Florida Statutes (2009) and (2010),

provides in pertinent part:

A bank may invest its funds, and a trust

company may invest its corporate funds,

subject to the following definitions,

restrictions, and limitations:

* * *

(9) Acquisitions of property as security.--

A bank or trust company may acquire property

of any kind to secure, protect, or satisfy a

loan or investment previously made in good

faith, and such property shall be entered on

the books of the bank or trust company and

held and disposed of subject to the

following conditions and limitations:

(a) The book entry shall be the lesser of

the balance of the loan or investment plus

acquisition costs and accrued interest or

the appraisal value or market value of the

property acquired which shall be determined

and dated within 1 year prior to or 90 days

after the date of acquisition and in

compliance with s. 655.60.

52. The evidence demonstrates that Marine Bank violated

the laws regarding the operation of a financial institution by

failing to obtain appraisals on OREO as required by section

658.67(9)(a).

53. Regarding the MOU, section 655.033(1)(e) provides that

OFR may issue a complaint for a breach of any written agreement

with OFR.

54. The evidence demonstrates that the MOU is a written

agreement 2/ and the written agreement is between OFR, Marine

Bank, and FDIC.

55. However, the evidence further demonstrates that a

memorandum of understanding is generally an informal enforcement

or corrective action; and that the board of directors of a

financial institution is generally informed that a memorandum of

understanding is an informal enforcement or corrective action.

56. In the instant case, the evidence demonstrates that

Marine Bank's Board of Directors was not informed that the MOU

was a formal enforcement or corrective action and that non-

compliance would lead to a complaint by OFR. Further, the

evidence demonstrates that no provision in the MOU contained

wording to put the Board of Directors on notice that non-

compliance would lead to a complaint. Moreover, the evidence

demonstrates that the MOU required the Board of Directors to

engage in good faith in complying with the MOU.

57. The undersigned is persuaded that the MOU was not the

type of written agreement that section 655.033(1)(e) was

intended to cover. The undersigned is not persuaded that OFR

was authorized to issue a complaint for Marine Bank's

noncompliance with the MOU. Consequently, the undersigned is

not persuaded that OFR was authorized to issue a complaint for

Marine Bank's noncompliance with the MOU pursuant to section

655.033(1)(e).

58. Hence, OFR has demonstrated that a cease and desist

order should be issued against Marine Bank for violating section

655.033(1)(a) and (b).

59. Even if the standard was clear and convincing, OFR met

its burden.

60. Also, Marine Bank argues that OFR filed the complaint

for an improper purpose. Section 120.569(2), Florida Statutes

(2011), provides in pertinent part:

(e) All pleadings, motions, or other papers

filed in the proceeding must be signed by

the party, the party's attorney, or the

party's qualified representative. The

signature constitutes a certificate that the

person has read the pleading, motion, or

other paper and that, based upon reasonable

inquiry, it is not interposed for any

improper purposes, such as to harass or to

cause unnecessary delay, or for frivolous

purpose or needless increase in the cost of

litigation. If a pleading, motion, or other

paper is signed in violation of these

requirements, the presiding officer shall

impose upon the person who signed it, the

represented party, or both, an appropriate

sanction, which may include an order to pay

the other party or parties the amount of

reasonable expenses incurred because of the

filing of the pleading, motion, or other

paper, including a reasonable attorney's

fee.

61. The evidence demonstrates that Marine Bank's financial

condition was not improving and remained weak and that OFR and

FDIC, individually, reached this determination. Further, the

evidence demonstrates grounds upon which filing a complaint was

proper. Additionally, the evidence failed to demonstrate

grounds upon which OFR should have delayed filing a complaint.

Under the circumstances of the instant case, it was not

unreasonable for OFR to file a complaint.

62. Also, the evidence demonstrates that OFR considered a

breach of the MOU, which was a written agreement with OFR, to be

actionable through the filing of a complaint against Marine

Bank. Even though OFR failed to persuade the undersigned that

its position is correct, the undersigned is also not persuaded

by Marine Bank that OFR filed the complaint for an improper

purpose. OFR's interpretation of section 655.033(1)(e),

although erroneous, was reasonable.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is

RECOMMENDED that the Office of Financial Regulation may

issue and is authorized to issue a cease and desist order

against Marine Bank for engaging in unsafe and unsound practices

and for violating laws relating to the operation of a financial

institution.

DONE AND ENTERED this 20th day of November, 2012, in

Tallahassee, Leon County, Florida.

__________________________________

ERROL H. POWELL

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 day 20th of November, 2012.

ENDNOTES

1/ Very little weight was placed upon Respondent's Exhibit 58.

2/ Id.

COPIES FURNISHED:

Drew J. Breakspear, Commissioner

Office of Financial Regulation

200 East Gaines Street

Tallahassee, Florida 32399-0371

Bruce Kuhse, General Counsel

Department of Financial Services

200 East Gaines Street, Suite 526

Tallahassee, Florida 32399-0371

Jeffrey D. Jones, Esquire

C. Michael Marschall, Esquire

Office of Financial Regulation

200 East Gaines Street, Suite 624

Tallahassee, Florida 32399-0371

Paul M. Phillips, Esquire

Adams and Reese, LLP

Bank of America Building

101 East Kennedy Boulevard, Suite 4000

Tampa, Florida 33602

Edward W. Dougherty, Esquire

Robert J. Angerer, Jr., Esquire

Igler & Dougherty, P.A.

2457 Care Drive

Tallahassee, Florida 32308

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.