Volume 6, No. 4 - April 2017

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 Investigative and Forensic Services for criminal investigation.

Case: An investigation was opened based on a complaint alleging an unlicensed individual was transacting general lines insurance for a surplus lines agent. Department investigators attempted to conduct an agency audit and inspect records on two separate occasions. A subsequent subpoena was issued for the required documentation. When reviewed, the documentation provided by the agency was not responsive to the Department subpoena.

Investigators obtained documentation from insurers, witness interviews and consumer affidavits to establish the violation. The agency was steadfast in its refusal to cooperate with investigators, hired legal counsel and continued to contest the Department’s authority for eight months, without producing the documentation requested. Florida Statute s. 624.318(s) states in part “Every person being examined or investigated, and its officers, attorneys, employees, agents, and representatives, shall make freely available to the department or office or its examiners or investigators the accounts, records, documents, files, information, assets, and matters in their possession or control relating to the subject of the examination or investigation”.
Disposition: Fined $40,000 and placed on probation for two years.

Case: An investigation was originally opened on a public adjuster alleging a conflict of interest. The insurer that filed the complaint alleged the adjuster was working on the claim in conjunction with his wife, who owned a water remediation company. Two additional complaints were made to the Department while our investigation was active.

Evidence obtained by investigators proved the public adjuster was submitting paperwork for his adjusting services and for his wife’s company. One of the claim activity logs reviewed had no evidence the agent's wife had any direct contact with consumers, only the public adjuster. In each instance the public adjuster recommended his wife’s company to the homeowner for remediation of damages.
Disposition: Fined $1,500.

Case: A referral was received by investigators alleging the bail bond agent-owner of a bail bond agency had employed an unlicensed individual, who was a convicted felon, to perform bail bond functions on his behalf. Affidavits were obtained from consumers confirming the unlicensed individual had assisted in their transactions with the agency.
Disposition: Suspended for six months.

Case: An investigation was opened on a life, health and variable annuity agent based on an insurer's referral of a consumer complaint. The agent enrolled 23 applicants into products under the Affordable Care Act (ACA) with the intention of making fraudulent claims. Most of the people who signed up for the policies were homeless and did not live in Florida. The agent arranged for fraudulent claims to be submitted from an addiction recovery clinic based in California. The plan unraveled when Investigators discovered the agent used a vacant house as the address for all 23 applicants.
Disposition: License revoked.

Case: A complaint was filed with another government agency alleging misleading advertising by a automobile warranty firm, reported by a senior consumer. The advertising piece caused a great deal of stress to the senior, who believed his automobile warranty was expiring and immediately began to call the firm. Investigation determined the firm was also in violation of a Consent Order previously issued by the Department for the same violation.
Disposition: Fined $2,000.