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Volume 2, No. 3 - April 2013

Case Notes

Bureau of Investigation

The following are instances in which licensees or other persons violated the Florida Insurance Code and the administrative action the Department has taken against them. Note: All administrative investigations are subject to referral to the Division of Insurance Fraud for criminal investigation.

Case: An insurance company discovered that one of their licensed life and health agents had withdrawn $16,000 from the annuity of a senior citizen without her knowledge or consent. This agent worked in the branch office of a bank, and used his position of trust to change the mailing address of this consumer to his home address so that she would not know monies were being withdrawn. During the course of the investigation, two other senior consumers were discovered who had been victims of the agent.
Disposition: License revoked permanently. The agent was arrested and found guilty of charges of exploitation of the elderly and grand theft. He was sentenced to 13 months in state prison and eight years of probation. He was also ordered to pay restitution of $44,000 to the senior consumers.

Case: An investigation of a title agent and owner of a title agency. As part of a large scale mortgage fraud scheme, in addition to other acts, the title agent closed real estate transactions that involved inflated sales prices to falsely cause the mortgage lender to commit excess loan proceeds. She knowingly prepared closing documents necessary to close the fraudulent transactions, including disbursements and receipt of mortgage loan proceeds. She would prepare HUD-1 Settlement forms to indicate proceeds were received from a buyer, when in fact, they were received from the seller.
Disposition: License revoked. She was indicted for conspiracy to commit mortgage fraud, was convicted and sentenced to five months in federal prison, followed by a thirty-six month supervised release.

Case: An investigation of a life agent alleged that he received civil and administrative penalties, disgorgement, and an injunction by the Securities and Exchange Commission (SEC) for selling more than 750 customers risky types of collateralized mortgage obligations (CMO's). However, the agent failed to notify the Department of this action as required by law.
Disposition: License revoked.

Case: An investigation of a life and health agent determined that the Financial Industry Regulatory Authority (FINRA) entered into a Letter of Acceptance, Waiver and Consent barring him against associating with any FINRA member in all capacities for facilitating private securities transactions, fraudulent misrepresentation and omissions, conversion and misuse of consumer funds, and failure to provide complete responses.
Disposition: License revoked.

Case: An investigation of a life and health agent began as a result of a complaint from an insurance company. It was alleged that the agent submitted claim forms to the company which contained false signatures. During the course of the investigation the agent admitted submitting claim forms with false signatures.
Disposition: License suspended for six months.

Case: An investigation of an insurance agency alleged that an officer allowed a customer representative to transact insurance outside the agency location.
Disposition: Placed on probation for six months and fined $7,000.

Case: An investigation of a bail bond agent alleged that she failed to complete or correctly write an original application form, failed to keep in an individual file all documents defined in rule, and failed to attach a bond affidavit accepting collateral on a Department prescribed form.
Disposition: Fined $1,000.

Case: An investigation of a public adjuster alleged she overcharged for her services on a Citizen's claim by charging 20% of the claim instead of the statutorily mandated 10%.
Disposition: Placed on probation for one year and fined $1,500, which was to be paid within 30 calendar days. The fine was not paid and her license was suspended.