Volume 5, No. 12 - December 2016

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: A follow-up investigation was conducted of a bail bond agent who had his license revoked by the Department. The revoked licensee had removed himself as an officer and owner of the bail bond agency with the Department of State, Division of Corporations. However, investigators found the agent advertising his services as a bail bond agent and as an agency owner on Facebook as well as on an active website. It was learned the revoked bail bond agent had recruited an unlicensed person to open and license a non-bail bond insurance agency. After it was licensed, the name was changed to reflect it was actually a bail bond agency.

It was discovered the revoked bail bond agent had recruited two licensed and appointed bail bond agents to act as the primary bail bond agent for the agency at different times. Bank records showed the revoked bail bond agent was the sole person authorized to transact on the agency’s bank account. This helped to prove he was operating the bail bond agency in violation of the Department’s Order of Revocation.

The revoked bail bond agent had taken possession of a vehicle used as collateral on the bond, although the bail bond had been discharged by the court. The revoked agent said the premium for the bail bond had not been paid, so he was taking the bail bond collateral, which is not permitted.

The information from the Bureau’s investigation was forwarded to the Department’s Division of Investigative and Forensic Services. The revoked bail bond agent was arrested and charged with acting as a bail bond agent with a revoked license(felony), grand theft of a motor vehicle (felony), petit theft (misdemeanor), and acting as a title loan officer without a license (charge dropped).
Disposition: The subject was adjudicated guilty of two felonies and a misdemeanor and sentenced to 14 months in prison, followed by 42 months of probation.

Case: A case was opened on a general lines agent and her insurance agency after a complaint was received stating the agency was charging unlawful fees to the purchasers of commercial property and general liability insurance policies.

To conceal the scheme, the agent would routinely fail to deliver a copy of the insurance contract to the purchaser. This prevented the policy owner from learning of the actual premium for the contract as issued by the insurance company. Investigators were able to secure affidavits from the victims, as well obtain records from the issuing insurance company and the agency’s bank. The agent further violated the Florida Insurance Code by attempting to interfere in the activities of the investigators during an inspection of the subject’s insurance agency.
Disposition: Agent and agency licenses were revoked and restitution was made to many of the victims.

Case: Investigators launched an investigation after receiving a complaint from an attorney representing a client. The client had paid an insurance agency more than $60,000 in premium for liability coverage over a three year period and never received a policy. The client contacted the agency and was told by the agent who "sold" the policies that she would look into it. When the client failed to receive a response from the agent, they visited the agency and found it had closed. The client called the insurer directly and learned that coverage was never issued.

The victim/client provided an affidavit to investigators with a time line of events, copies of the falsified certificates of insurance, proof of premium payment, and emails reflecting many fruitless attempts to obtain a copy of the policies from the agency.

Investigators visited the agency location to confirm the agency was closed. Underwriting documents obtained by investigators clarified that although the insurer did provide coverage for some time periods, it did not provide coverage for one six month policy period. Further, the insurer confirmed it did not produce or prepare the certificate of insurance for the uncovered time period. Bank records confirmed the premium check was deposited into an account in which the agent was authorized as a signatory.
Disposition: Permanently barred from the insurance industry in Florida.

Case: An investigation was opened when a title insurance agency failed to comply with the required annual data call. Every agency licensed to do business in the state is required to maintain and submit data information to the Office of Insurance Regulation (OIR) by May 31st each year. This information assists the OIR in the analysis of rates, title search costs, trends and the financial condition of the title insurance industry.

Case: The Bureau of Investigation received a complaint from a licensee that a provider gave her Continuing Education (CE) credits for courses she did not take. When she registered for classes, specific courses were automatically assigned to her. She completed the courses and received certificates of completion, but there was confusion about credits being applied to her Department record. She worked with the provider to get the issues resolved; however, after reviewing her records, she found she was given credit for five courses she did not complete. Investigators requested copies of the certificates of completion from the provider, but they looked different than the others, and a different version of the licensee’s name was used on the certificates.
Disposition: Provider fined $2,500 and ordered to pay $10,000 in investigative costs. The president of the provider licensee was fined $5,000.

Case: The Department issued an application denial and a permanent bar from applying for a license to an applicant for a general lines agent license due to his criminal history. The applicant had pled nolo contendere to ten (10) counts of possessing forged notes.

After the license was denied, the Department received a complaint from an American Legion Post alleging they had paid the unlicensed person a premium down payment of $5,100 for a general liability policy. The American Legion Post never received the policy.

A second complaint was lodged by a senior consumer who stated he had paid the unlicensed person a down payment of nearly $30,000 for a general liability, workers’ compensation, and automobile policies. The consumer realized there were no policies in force when one of his employees was injured and they tried to submit a workers’ compensation claim through the same person. The consumer was forced to pay another $30,000 to cover his employee’s medical expenses. It was discovered through our investigation that the unlicensed person had deposited the premium into his personal account.
Disposition: Investigative findings in this case were referred to the Division of Investigative and Forensic Services, which resulted in the subject's arrest and guilty plea to the charges of Theft from a Person 65 years or older, Grand Theft, and Transacting/Engaging in Insurance While Unlicensed, all felonies. The subject was sentenced to eight months in jail and ordered to pay $63,000 in restitution to the victims of his acts.

Case: A case was opened to perform a follow-up investigation after a bail bond agent had her license suspended by the Department. Investigators visited her bail bond agency and witnessed the suspended agent transacting bail bond business at the agency. The agency owner/primary bail bond agent knew of the suspension but allowed the suspended bail bond agent to continue working at the agency.
Disposition: The owner/primary bail bond agent was fined $5,000 and placed on probation for six (6) months. The suspended agent had been indefinitely suspended pending the outcome of criminal charges against her. She was revoked upon disposition of the criminal case and is permanently ineligible to apply for a bail bond agent's license.