Volume 3, No. 8 - September 2014

Compliance Corner

This section has been created to assist you in keeping your insurance business in compliance. The items are intended as reminders only and are not necessarily the exact text of the Florida Statutes or Florida Administrative Code. The legal cites have been provided for your further reference.

Reporting of Actions - Criminal, Administrative, and Other

Subsection 626.451(7), F.S., requires each licensee to advise the Department within 30 days after having been found guilty of or having pleaded guilty or nolo contendere to a felony or a crime punishable by imprisonment of one year or more under the laws of the United States, any state of the United States, or any other country, without regard to whether a judgment of conviction has been entered by the court having jurisdiction of such cases.

Section 626.536, F.S., requires each licensee (including insurance agencies) to submit to the Department a copy of the order, consent order, or other relevant legal documents within 30 days after the final disposition of any administrative action taken against the licensee by a governmental agency or other regulatory agency in this or any other state or jurisdiction relating to the business of insurance, the sale of securities, or activity involving fraud, dishonesty, trustworthiness, or breach of a fiduciary duty.

Subsection 626.6215(6), F.S., requires agencies and their officers to advise the Department within 30 days after an individual licensee's violation is known or should have been known by one or more of the partners, officers, or managers acting on behalf of the agency. An example would be an action taken against a license or registration for violations of state or federal securities or commodities law, such as an action taken by FINRA. Failure to do so could result in administrative action against the license(s) of the agency and/or majority owner, officer, partner, manager, director, or other person who manages or controls the insurance agency.

Actions may be reported via the NIPR's Attachment Warehouse, which may also satisfy reporting requirements for other states you are licensed in.

[See 626.451(7), 626.536, 626.621(13), and 626.6215(6), Florida Statutes]

Bail Bond Agents: Soliciting Business at the Jail

The Florida Statutes prohibit a bail bond agent from directly or indirectly soliciting business at the jail. The term "solicitation" is defined in paragraph 648.44(1)(b), Florida Statutes, as "the distribution of business cards, print advertising, or other written or oral information directed to prisoners or potential indemnitors." Another section in this statute also prohibits bail bond agents from conducting business with anyone other than the defendant at the jail, as well as prohibiting a bail bond agent from just loitering at the jail.

Recently we have learned of some county jails allowing bail bond agents to use the facilities at the jail to complete the paperwork required to post a bail bond. Regardless of any permission given by jail staff, this activity constitutes a violation of the Florida Insurance Code and the Department will look to take action against any bail bond agent found to be violating this prohibition. The penalty guidelines allow the Department to suspend a bail bond agent for three (3) months for the first violation and 12-24 months for subsequent violations.

The paperwork for a bail bond is to be completed somewhere other than the property of the jail, courthouse, or other area where prisoners are confined.

[See subsection 648.44(1), Florida Statutes, and Rule 69B-221.095, Florida Administrative Code]

Website with Compliance Information

There is a section on our website solely dedicated to compliance information. The section also provides consumers and licensees with an overview of the investigative process and many functions performed by our Bureau of Investigation. We encourage you to visit this section of our website and come back often as we update and add more information to it. You can visit the compliance site at www.MyFloridaCFO.com/Division/Agents/Compliance.