95-004048 Department Of Insurance vs. Tara Jeanne Smith Status: Closed Recommended Order on Friday, July 12, 1996.

Summary: Petitioner did not show that Respondent failed to provide informed consent to customers prior to selling them auto club memberships; administrative complaint should be dismissed.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF INSURANCE )

AND TREASURER, )

)

Petitioner, )

)

vs. ) CASE NO. 95-4048

)

TARA JEANNE SMITH, )

)

Respondent. )

____________________________)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was held in this case on February 8,

1996, in Tallahassee, Florida, before the Division of Administrative Hearings,

by its designated Hearing Officer, Diane Cleavinger.

APPEARANCES

For Petitioner: Michael K. McCormick, Esquire

Division of Legal Services

612 Larson Building

Tallahassee, Florida 32399-0300

For Respondent: Charles J. Grimsley, Esquire

Charles J. Grimsley and Associates

1880 Brickell Avenue

Miami, Florida 33129

STATEMENT OF ISSUES

The issue in this proceeding is whether Respondent's insurance agent's

license should be suspended, revoked or otherwise disciplined for violations of

Chapter 626, Florida Statutes.

PRELIMINARY STATEMENT

On July 27, 1995, the Petitioner, Department of Insurance, filed an

Administrative Complaint against Respondent, Tara Jeanne Smith, alleging that

Respondent's insurance licenses should be disciplined for violating various

provisions of Chapter 626, Florida Statutes. Specifically, the Administrative

Complaint alleged, in three separate counts, that the Respondent unlawfully sold

insureds motor club memberships without their informed consent, made false and

misleading statements regarding the coverages provided and falsely represented

and illegally required insureds to purchase motor club membership as part of

their purchase of automobile insurance. The Administrative Complaint, in all

county, alleged that Respondent engaged in the prohibited practice of "sliding"

additional coverages or products into the purchase of the insured without the

informed consent of the insured.

Respondent denied the allegations of the Administrative Complaint and

requested a formal administrative hearing. The case was forwarded to the

Division of Administrative Hearings.

At the hearing, the Department offered the testimony of three witnesses and

submitted one composite exhibit into evidence. The Respondent testified in her

own behalf and offered three exhibits into evidence.

After the hearing, the Petitioner and Respondent filed Proposed Recommended

Orders on May 21, 1996, and May 17, 1996, respectively. The parties' Proposed

Findings of Fact have been considered and utilized in the preparation of this

Recommended Order, except where those facts were cumulative, subordinate,

irrelevant, immaterial or were not shown by the evidence. Specific rulings on

the parties' Proposed Findings of Fact are contained in the Appendix to the

Recommended Order.

FINDINGS OF FACT

1. Respondent is currently and at all times relevant to this proceeding

was licensed as a life and health insurance agent and as a general lines agent.

2. Respondent was the primary agent of Emerald Coast Insurance Agency

(Emerald Coast) located at Pensacola Street in Tallahassee, Florida. Respondent

did not work on commission, but received a fixed salary for her employment.

3. Emerald Coast was a general lines insurance agency in Florida and

specializes in nonstandard automobile insurance, insuring high risk drivers who

normally have a difficult time procuring insurance.

4. On June 30, 1993, Hulan Mitchell called Emerald Coast and requested a

quote for automobile insurance on his truck. His truck insurance was about to

expire.

5. Mr. Mitchell received a quote over the phone. Later that same day,

during his lunch hour, Mr. Mitchell went to Emerald Coast's office where

Respondent worked to purchase insurance. Because he was on his lunch hour, Mr.

Mitchell was in a hurry to complete the insurance transaction.

6. Mr. Mitchell initially met with a gentlemen at the counter, but was

turned over to Respondent. Mr. Mitchell advised Respondent that he wanted to

purchase the bare minimum of coverage for his truck.

7. The Respondent made a printout of a quote for automobile insurance from

the agency's quick quote computer system. The printout did not reflect a charge

for membership in an automobile club. Mr. Mitchell was surprised to discover

that the quote he obtained from Respondent was about $48.00 higher than the

quote he had received over the phone. However, Mr. Mitchell decided to purchase

the insurance anyway.

8. There were approximately five forms which were filled out by Respondent

in the presence of Mr. Mitchell. In fact, Mr. Mitchell supplied the information

included in some of the forms. No document was completed before his arrival at

the agency. As each document was completed, Respondent showed it to Mr.

Mitchell, explained the content of the forms, highlighting the areas she was

explaining with a mark and obtained his signature where it was required.

9. Mr. Mitchell admitted that he signed and initialed the forms presented

to him. However, because he was in a hurry he was not paying close attention to

the explanations of his purchase being given by Respondent. Nonetheless, in

fact, Mr. Mitchell actively made certain choices as to the type of coverage he

wanted and specifically rejected some of the products or benefits which were

offered to him.

10. The documents which were presented to Mr. Mitchell contained

information and warnings in regard to coverage or benefits not required by the

State of Florida that were optional add-ons to his purchase of insurance,

including an explanation that the price he was paying included a $50.00 charge

for membership in a travel club with $5,000.00 in benefits. All these areas,

including the membership in the automobile club were explained by Respondent to

Mr. Mitchell. Some of the explanations and rejections of benefits was recalled

by Mr. Mitchell at the hearing.

11. The entire transaction took approximately a half hour. Throughout the

process Respondent did not change the pace of her explanation, attempt to cover

or conceal documents or prevent Mr. Mitchell from asking any questions. Nor was

any of the optional non-insurance benefits requirement for the purchase of

insurance or a condition for a lower down payment or the availability of premium

financing on his insurance purchase.

12. Given these facts, the evidence did not clearly or convincingly

demonstrate that Respondent attempted to cause Mr. Mitchell to purchase non-

insurance products he did not want or was unaware that he was purchasing.

Likewise, the evidence did not demonstrate that Respondent had made any

misrepresentations to Mr. Mitchell during or after the conclusion of his

transaction with Emerald Coast. Therefore, Count I of the Administrative

Complaint should be dismissed.

13. On February 16, 1994, Jeanna Chester called Emerald Coast where

Respondent worked for a quote on automobile insurance. During the call she

provided some basic information to the agency.

14. Later that same day, Ms. Chester went to Emerald Coast to purchase

automobile insurance. She met with Respondent, who pulled up the earlier quote

on the agency's computer.

15. Again approximately five forms were filled out on Ms. Chester's

presence and were handed to her one at a time. Respondent did not attempt to

cover up or hide any form or portion of a form. Ms. Chester was not prevented

from asking any questions during the transaction and was permitted to examine

each form. Each form was explained to Ms. Chester, including the optional

automobile club membership and benefits with Respondent making her usual marks

on the forms as she explained each area.

16. Ms. Chester made active decisions regarding the extent of insurance

coverage she desired and the deductible she wanted under that coverage. She

also examined the forms to see if they were correct as to the coverage she

desired. Additionally she signed and initialed each form where required,

including the portions where the optional membership in the automobile club were

explained.

17. The entire transaction took approximately twenty minutes.

18. On May 23, 1994, Ms. Chester had to return to the agency to repurchase

her coverage. Ms. Chester was without insurance because her only payment on her

original purchase was by a check which had bounced. As a consequence her

insurance and club membership had been canceled. Ms. Chester went through the

process a second time which again took approximately 20 minutes.

19. Given these facts, the evidence did not clearly or convincingly

demonstrate that Respondent attempted to cause Ms. Chester to purchase non-

insurance products she did not want or was unaware that she was purchasing.

Likewise, the evidence did not demonstrate that Respondent had made any

misrepresentations to Ms. Chester during or after the conclusion or either or

her transactions with Emerald Coast. Therefore, Count II of the Administrative

Complaint should be dismissed.

20. On March 5, 1994, Michelle Humose purchased her first car, a 1993

Subaru. Because she needed insurance coverage to purchase the car, the car

dealer called Emerald Coast and obtained a quote for automobile insurance for

her. During the call the dealer had given Emerald Coast basic information on

the car and driver.

21. The car dealer followed her to Emerald Coast and escorted her inside

to introduce her to an agent, who was Respondent. The dealer then left.

22. Respondent went outside and took pictures of Ms. Humose's car and came

back inside to complete the transaction with Ms. Humose.

23. In this instance, most of the paperwork had been filled out prior to

Ms. Humose's arrival at the agency. However, some of the forms which required

personal information from Ms. Humose were filled out in her presence. Although,

Ms. Humose does not recall, Respondent followed her usual process of handing the

forms to Ms. Humose, simultaneously explaining and marking the documents as she

explained them, including the areas which covered the optional auto club

membership. After, each area was explained Ms. Humose signed and initialed the

forms as it was required.

24. Respondent did not change the pace of her presentation and did not

cover or hide any documents or portion of any document.

25. Ms. Humose also asked questions about the purchase she was making.

The entire transaction took approximately 15 minutes with Respondent also

helping another customer during the initial stages of Ms. Humose's transaction.

26. Ms. Humose did not make the full down payment required by her

contract. On Monday, May 8, 1994, Ms. Humose had obtained a better deal on

automobile insurance and called to cancel the insurance she had purchased with

Emerald Coast. Eventually, Ms. Humose received a full refund of the money she

had paid to the insurer.

27. Given these facts, the evidence did not clearly or convincingly

demonstrate that Respondent attempted to cause Ms. Humose to purchase non-

insurance products she did not want or was unaware that she was purchasing.

Likewise, the evidence did not demonstrate that Respondent, had made any

misrepresentations to Ms. Humose during or after the conclusion of her

transactions with Emerald Coast. Therefore, Count III of the Administrative

Complaint should be dismissed.

CONCLUSIONS OF LAW

28. The Division of Administrative Hearings has jurisdiction over this

subject matter of and the parties to this proceeding. Section 120.57(1),

Florida Statutes.

29. In license discipline cases the agency has the burden to establish by

clear and convincing evidence that the Respondent had violated the statutes or

rules which govern the license. Ferris v. Turlington. 510 So. 2d 292 (Fla.

1987).

30. In this case, the Respondent was charged with violating Sections

626.611(4), 626.611(5), 626.611(7), 626.611(9), 626.611(13), 626.621(2),

626.621(6), 626.9541(1)(k)1., and 626.9541(1)(z), Florida Statutes. Boiled down

to the essentials the Department alleged that Respondent violated the provisions

listed above by unlawfully selling insureds motor club memberships without their

informed consent, made false and misleading statements regarding the coverages

provided and falsely represented and illegally required insureds to purchase

motor club membership as part of their purchase of automobile insurance and that

Respondent engaged in the prohibited practice of "sliding" additional coverages

or products into the purchase of the insured without the informed consent of the

insured.

31. However, the Department failed to establish by clear and convincing

evidence that Respondent attempted to "slide" coverage or ancillary products or

mislead any of the customers involved in this case. Likewise, the evidence did

not clearly or convincingly demonstrate that Respondent did not obtain the

informed consent of her customers prior to selling them the auto club

memberships involved here. Therefore, the Administrative Complaint should be

dismissed.

RECOMMENDATION

Based upon the findings of fact and the conclusions of law, it is,

RECOMMENDED:

That the Department of Insurance enter a Final Order finding Respondent not

guilty of violating Chapter 626, Florida Statues and dismissing the

Administrative Complaint.

DONE and ENTERED this 12th day of July, 1996, in Tallahassee, Leon County,

Florida.

___________________________________

DIANE CLEAVINGER, Hearing Officer

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

[phone] SunCom 278-9675

Filed with the Clerk of the

Division of Administrative Hearings

this 12th day of July, 1996.

APPENDIX

1. The facts contained in paragraphs 1, 2, 3, 4, 7, 8 and 16 of

Petitioner's Proposed Findings of Fact are adopted.

2. The facts contained in paragraphs 5, 6 and 9 of Petitioner's Proposed

Findings of Fact are subordinate.

3. The facts contained in paragraphs 10, 11, 12, 13, 14, 15, 17, 18, 19,

20, 21, 22 and 23 of Petitioners' Proposed Findings of Fact were not shown by

the evidence.

4. The facts contained in paragraphs 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11,

12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 24, 25 and 26 of Respondent's

Proposed Findings of Fact are adopted.

5. The facts contained in paragraph 23 of Respondent's Proposed Findings

of Fact are subordinate.

COPIES FURNISHED:

Stephen C. Frederickson, Esquire

Division of Legal Services

645A Larson Building

Tallahassee, Florida 32399-0333

Charles J. Grimsley, Esquire

Charles J. Grimsley and Associates

1880 Brickell Avenue

Miami, Florida 33129

Bill Nelson

Commissioner

Department of Insurance

and Treasurer

The Capitol, Plaza Level

Tallahassee, Florida 32399-0300

Dan Sumner

Department of Insurance

and Treasurer

The Capitol, Plaza Level

Tallahassee, Florida 32399-0300

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions to this Recommended

Order. All agencies allow each party at least 10 days in which to submit

written exceptions. Some agencies allow a larger period within which to submit

written exceptions. You should contact the agency that will issue the final

order in this case concerning agency rules on the deadline for filing exceptions

to this Recommended Order. Any exceptions to this Recommended Order should be

filed with the agency that will issue the final order in this case.

=================================================================

AGENCY FINAL ORDER

=================================================================

THE TREASURER OF THE STATE OF FLORIDA

DEPARTMENT OF INSURANCE

BILL NELSON

IN THE MATTER OF: DOI CASE NO. 11200-94-A-MKM

TARA JEANNE SMITH DOAH CASE NO. 95-4048

_____________________/

FINAL ORDER

THIS CAUSE came on before me for the purposes of issuing a Final Agency

Order. The Hearing Officer assigned by the Division of Administrative Hearings

in the above-styled matter submitted a Recommended Order to the Department of

Insurance and Treasurer (hereinafter referred to as the "Department" or

"Petitioner"). The Recommended Order entered July 12, 1996, by Hearing Officer

Diane Cleavinger recommending dismissal of the Administrative Complaint, is

incorporated by reference. The Department filed numerous exceptions to the

Recommended Order. The Respondent did not file exceptions. Based upon the

complete review of the record, including the original charging document, the

transcript and evidence adduced at the formal hearing, the Recommended Order and

exceptions thereto, and relevant statutes, rules and case law, I find as

follows:

FINDINGS OF FACT AND CONCLUSIONS OF LAW

The Department of insurance and Treasurer hereby adopts and incorporates by

reference the findings of fact set forth in the Recommended Order except as

modified by rulings on exceptions, and adopts the conclusions of law except as

modified by the rulings on exceptions.

RULINGS ON EXCEPTIONS TO FINDINGS OF FACT

The Petitioner takes exception to the findings of fact contained in the

Recommended Order at paragraphs 12, 19, and 27, wherein the Hearing Officer

found that the evidence did not prove that the Respondent had committed the

violations charged as referenced in each finding. This conclusion is not

supported by competent and substantial evidence as required by section

120.57(1)(a) 10., Florida Statutes. The Hearing Officer was convinced that the

multitude of forms utilized by the Respondent in selling the non-insurance

products (motor clubs) to Hulan Mitchell, Jenna Chester and Michele Humose

demonstrated that they had given their informed consent. However, the Hearing

Officer overlooked the blatant misrepresentation and false statement contained

in the "premium" receipts issued to each of the insureds. Although the Hearing

Officer is free to determine the credibility of the witness' testimony, the

Hearing Officer cannot ignore or reject unrefuted competent and substantial

evidence in the record that clearly and convincingly demonstrates that the

premium receipts are a misrepresentation of fact or false statement. No witness

testimony is necessary to make this finding. The documents speak for themselves

and were not otherwise questioned or refuted. The record unequivocally

established the following:

Hulan Mitchell - The "premium" receipt (Pet. Ex. "1") issued to Mr.

Mitchell indicates a total premium of $378. The actual cost of the "insurance"

was $328 with a downpayment of $98 required. See Premium Finance Agreement

(Pet. Ex. "1") This is absolutely unrefuted on the record. The premium receipt

includes $50 for the cost of the motor club, which is not a policy of insurance

and accordingly is not "premium". Also the downpayment required, purportedly

for insurance, included $50 for the motor club ($98 $50 = $148). Furthermore,

based on clear documentary evidence in the record, Mr. Mitchell was again

subject to a misrepresentation of fact (undisputed) wherein on July 9, 1993 he

received a letter (Pet. Ex. "1") threatening to cancel his "insurance" policy

because he did not pay a $48 balance due on the motor club. Accordingly the

record clearly indicates that the Respondent has made a false or misleading

statement with reference to the insurance transaction for Mr. Mitchell. The

fact that the Hearing Officer held that Mr. Mitchell knew (despite his testimony

otherwise) that he had purchased a motor club, does not negate the fact that the

Respondent made a false or misleading statement.

JENNA CHESTER - The deceptive premium receipt practice was visited upon Ms.

Chester on two occasions. First on February 1, 1994 a "premium" receipt (Pet.

Ex. "2") was issued in an amount of $670 for "total premium" due and a required

downpayment of $261. The actual cost of the "insurance" was $585 with a

required downpayment of $176. See Premium Finance Agreement (Pet. Ex. "2") The

"premium" receipt and downpayment included a non-insurance fee for a motor club

in the amount of $85. On May 23, 1994 Ms. Chester went to the Respondent to

repurchase coverage which had been cancelled. At that time, another "premium"

receipt was issued to her in the amount of a "total premium" of $719 and a

required downpayment of $286 (Pet. Ex. "2") The actual cost of the insurance was

$619 and a required downpayment of $186. See Premium Finance Agreement (Pet.

Ex. "2") The additional $100 was for the non-insurance motor club which was sold

to Ms. Chester. Although the Hearing Officer held that Ms. Chester knew she was

purchasing this motor club (despite Ms. Chester' s testimony otherwise) this

does not negate the fact that the Respondent has made false or misleading

statement in this insurance transaction with Ms. Chester.

Michelle Humose - The unrefuted documentary evidence indicates that on May

5, 1994, Ms. Humose was issued a "premium" receipt (Pet. Ex. "3") indicating a

"total premium" in the amount of $926 and a required downpayment of $348. The

actual cost of the "insurance" was $826 with a required downpayment of $248 See

Premium Finance Agreement (Pet. Ex. "3") The additional $100 included in the

"premium" receipt was for the non-insurance motor club sold to Ms. Humose.

Again despite the Hearing Officer's finding contrary to Ms. Humose's direct

testimony that she did not know she was purchasing a motor club, the Respondent

has clearly and convincingly made a false or misleading statement with respect

to this insurance transaction with Ms. Humose.

It is implicit in the Findings of Fact by the Hearing Officer that each

referenced transaction took place as described herein. The Hearing Officer

merely failed to explicitly state in the Recommended Order that the unrefuted

documentary evidence establishes a prima facie misrepresentation of fact.

Indeed, the exact factual scenario established herein was determined to

constitute a misrepresentation in In the Matter of: Kenneth Michael Whitaker,

Case Number 93-L-432DDH (Final Order dated July 3, 1995). It was specifically

determined "that the Respondent's standard business practice of combining the

costs of insurance coverages with the costs of the auto club memberships and

then calling such costs "total premium" on receipts issued to customers

constituted a misrepresentation and was deceptive." Also, it was further

determined "that the Respondent's standard business practice of deducting all or

part of the ancillary product fee up front resulted in false statements on other

documents that the full downpayment for premium or financing of premium had been

made, when in actuality it had not." Whitaker Final Order at pp's 9-10. The

Department determined that this activity was a violation of section 626.611(9),

Florida Statutes. This finding was also affirmed on appeal in Whitaker v.

Department of Insurance and Treasurer, Case No. 95-2702, (21 FLW 1353, Slip

Opinion dated June 13, 1996). The court upheld this violation when it

summarized the practice in the opinion as follows:

Appellant took all or part of the ancillary

product from the required premium downpayment

and gave the consumer a receipt which listed

the full downpayment as "Total Premium". The

receipt did not reveal that part of the

"premium" went to purchase an ancillary

product. Whitaker Slip

Opinion at pp's 3-4.

This type of fraudulent and deceptive practice also constitutes a violation

of section 626.9541(1)(b), Florida Statutes, by placing before the public a

representation or statement which is untrue, deceptive or misleading.

The Hearing Officer has already considered the unrefuted facts on the

record and was clearly in error to make a finding otherwise. Accordingly,

pursuant to section 120.57(a)(a) 10., Florida Statutes, which reads in part:

The agency may not reject or modify the

findings of fact, including findings of

fact that form the basis for an agency

statement, unless the agency first

determines from a review of the complete

record, and states with particularity in the

order, that findings of fact were not based

upon competent substantial evidence or that

the proceedings on which the findings were

based did not comply with essential

requirements of law.

the Department may modify the findings of fact.

In this case there was no competent and substantial evidence to make a

finding that the Respondent did not make a false or misleading statement with

the premium receipts issued in this cause. A review of the entire record

demonstrates unrefuted documentary evidence which supports the modified findings

of fact contained herein. Therefore, Petitioner's exceptions to findings of

fact 12, 19 and 27 are hereby GRANTED.

RULINGS ON EXCEPTIONS TO CONCLUSIONS OF LAW

The Petitioner takes exception to conclusions of law at paragraphs 30 and 31,

based on the Hearing Officer's rejection of unrefuted facts established on the

record, i.e., deceptive and misleading premium receipts. Conclusions of Law 30

and 31 are revised to reflect that the premium receipts issued to insureds

constitute fraudulent and deceptive practices as well as placing before the

public a representation or statement which is untrue, deceptive, or misleading.

Conclusion of Law 30 is modified as follows:

30. In this case, the Respondent was charged

with violating sections 626.611(4), 626.611(5),

626.611(7), 626.611(9), 626.611(13), 626.621(2),

626.621(6), 626.9541(1)(b), 626.9541(1)(e),

626.9541(1)(k)1., and 626.9541(1)(z), Florida

Statutes. Boiled down to the essentials the

Department alleged that Respondent violated the

provisions listed above by unlawfully selling

insureds motor club memberships without their

informed consent, made false and misleading

statements regarding the coverage provided and

falsely represented and illegally required

insureds to purchase motor club membership as

part of their purchase of automobile insurance

and that Respondent engaged in the prohibited

practice of "sliding" additional coverages or

products into the purchase of the insured without

the informed consent of the insured.

This revision is necessary because the Hearing Officer failed to include

sections 626.9541(1)(b) and 62.9541(1)(e), Florida Statutes, as alleged

violations.

Conclusion of Law 31 is likewise revised as follows:

31. The Department failed to establish by clear

and convincing evidence that Respondent attempted

to "slide" coverage or ancillary products

involved in this case. Likewise, the evidence

did not clearly or convincingly demonstrate that

Respondent did not obtain the informed consent of

her customers prior to selling them the auto club

memberships involved here. However, based on the

unrefuted evidence in the record, the Respondent

has violated sections 626.611(9) and

626.9541(1)(b), Florida Statutes, by issuing

"premium receipts" which falsely and deceptively

represented "total premium" which included a fee

for a non-insurance product, ie. motor club

membership. Accordingly, the Respondent is

guilty of three counts of violating sections

626.611(9) and 626.9541(1)(b), Florida Statutes.

The Petitioner's exceptions to conclusions of law 30 and 31 are hereby GRANTED.

RULING ON EXCEPTIONS TO RECOMMENDATION

The Petitioner takes exception to the recommendation that the

Administrative Complaint be dismissed. The Penalty Guidelines contained in

Chapter 4-231, Florida Administrative Code, should be applied in this case.

There are three documented violations (one for each count) of engaging in

fraudulent and dishonest practices as prohibited in section 626.611 (9), Florida

Statutes, and placing before the public a representation or statement which is

untrue, deceptive or misleading in violation of section 626.9541(1)(b), Florida

Statutes. Under the penalty guidelines, a violation of section 626.611(9),

Florida Statutes, requires a suspension of 9 months per count. Under the

penalty guidelines, a violation of section 626.9541(1)(b), Florida Statutes,

requires a suspension of 6 months per count. Based on Rule 4-231.040, Florida

Administrative Code, the highest penalty per count should be assessed, therefore

the appropriate penalty is three counts at 9 months for a total suspension

period of 27 months. Since the total required suspension exceeds 2 years, the

appropriate sanction is the revocation of the Respondent's licenses in

accordance with section 626.641(1), Florida Statutes.

The violation of section 626.9541(1)(b), Florida Statutes, permits the

assessment of an additional fine on top of any other administrative sanction,

pursuant to section 626.9521, Florida Statutes. This section permits fines for

wilful violations of up to $10,000 per violation not to exceed $100,000. The

Petitioner recommends that a fine of $3,000 be assessed against the Respondent.

However, insufficient grounds have been demonstrated to justify the

assessment of a $3,000 administrative fine. Therefore, Petitioner's exceptions

to the recommendation are hereby GRANTED, except for the Petitioner's argument

for an additional sanction in the form of a $3,000 administrative fine which is

hereby DENIED.

PENALTY

Rule 4-231.160, Florida Administrative Code, prescribes the aggravating and

mitigating factors which the Department shall consider and, if warranted, apply

to the total penalty in reaching the final penalty. Aggravating factors in this

matter, as delineated in Rule 4-231.160, Florida Administrative Code, are the

willfulness of the Respondent's conduct and the existence of secondary

violations established in Counts I-III of the Administrative Complaint. Only

minimal mitigating factors exist which are outweighed by the aggravating

factors. The existence of these aggravating factors would increase the

Respondent`s total penalty, thereby resulting in a higher final penalty.

Increasing the Respondent's total penalty would be pointless, however, for

section 626.641(1), Florida Statutes, limits a licensee's period of suspension

to a maximum of 2 years. The Respondent's 27-month total penalty already

exceeds the two-year statutory limit. Consequently, the Department has

determined that a revocation of the Respondent's insurance agent license is

warranted and appropriate in this matter, and is necessary to adequately protect

the insurance-buying pubic.

IT IS THEREBY ORDERED:

All licenses and eligibility for licensure held by TARA JEANNE SMITH, are

hereby REVOKED, pursuant to the provisions of sections 626.611, 626.621,

626.641(2) and 626.651(1), Florida Statutes, effective the date of this Final

Order. As of the date of this Final Order, the Respondent shall not engage in

or attempt or profess to engage in any transaction or business for which a

license or permit is required under the Florida Insurance Code, or directly or

indirectly own, control or be employed in any manner by an insurance agent or

agency.

Any party to these proceedings adversely affected by this Final Order is

entitled to seek review of this Final Order pursuant to section 120.68, Florida

Statutes, and Rule 9.110, Florida Rules of Appellate Procedure. Review

proceedings must be instituted by filing a Notice of Appeal with the General

Counsel, acting as the agency clerk, at 612 Larson Building, Tallahassee,

Florida 32399-0333, and a copy of the same and the filing fee with the

appropriate District Court of Appeal within thirty (30) days of rendition of

this Order.

DONE and ORDERED this 4th day of September, 1996, in Tallahassee, Florida.

__________________________

BILL NELSON

Treasurer and

Insurance Commissioner

COPIES FURNISHED:

Tara Jeanne Smith

2588 Panther Creek Road, Apt. A

Tallahassee, Florida 32308-5628

Charles J. Grimsley, Esquire

Charles J. Grimsley and Associates, P.A.

1880 Brickell Avenue

Miami, Florida 33129

Diane Cleavinger, Hearing Officer

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

Stephen C. Fredrickson, Esquire

Division of Legal Services

200 E. Gaines Street

Tallahassee, Florida 32399-0333