Consumer eViews
FLORIDA CHIEF FINANCIAL OFFICER ALEX SINK'S WEEKLY NEWSLETTER

Volume 4, Number 16, April 20, 2007

Dear Floridian:

Today, the Florida Institute of Certified Public Accountants (FICPA) is holding their annual “Financial Fitness Friday” intended to provide Floridians with free access to financial guidance.  Through this event, the FICPA is providing Florida residents the opportunity to ask Certified Public Accountants general financial questions — FREE OF CHARGE. 

By calling the FICPA’s Financial Fitness Hotline at 1-800-342-3197, Ext. 554, between 9 a.m. and 5 p.m. Friday, April 20, 2007 or emailing financial questions at www.ficpa.org, Floridians can ask advice from volunteer Certified Public Accountants.  Floridians can also access additional financial resources, including check list on how to remain financially fit, from the FICPA Web site.  

I encourage all Floridians to call or write the hotline, to learn more about how they can better secure their families financial futures! 


Sincerely,

--Alex Sink


CFO SINK ON INSURANCE COMMISSIONER’S POLITICAL FUNDRAISING ACTIVITIES

 After learning that Insurance Commissioner Kevin McCarty was reportedly the sole host for a political fundraiser for the wife of one of his employees, Chief Financial Officer Alex Sink issued the following statement: 

“The Offices of Insurance Regulation and Financial Regulation were established to remove those offices and the Commissioners from direct political activity related to their regulated industries.  I am concerned that Mr. McCarty may have used his position as Insurance Commissioner to solicit political contributions from the insurance industry. 

“Upon learning that the Commissioner was to host a political fundraiser, I shared with him my concerns that his involvement was unsuitable and could cast Florida’s regulatory system in an unfavorable light.  While this may not be illegal, it is certainly not right.   

“Further, I am disturbed by the allegation that state computers may have been used for political purposes.  My department’s Inspector General will be investigating this matter.”  


CFO SINK JOINS U.S. ATTORNEY, FBI IN ANNOUNCING 25-COUNT INDICTMENT IN $100 MILLION FRAUD CASE

Florida Chief Financial Officer Alex Sink joined Acting U.S. Attorney James R. Klindt and Federal Bureau of Investigation (FBI) Special Agent in Charge Michael J. Folmar in announcing a 25-count indictment charging five suspects in a $100 million workers’ compensation fraud scam that left hundreds of workers in Florida and throughout the United States without urgently needed medical care.

“We found one victim homeless, living in her car, because of mounting medical bills, and five families left with no death benefits after fatal accidents,” said CFO Sink, who oversees the Department of Financial Services. “Floridians suffered greatly and did not receive needed medical care and workers’ compensation benefits because these individuals were interested only in enriching themselves.”

The indictments unsealed today named Jerry M. Brewer, 56, Capistrano Beach, Calif., currently residing in England; Donald E. Touchet, 53, El Cajon, Calif.; Dr. Richard E. Standridge, 58, Tempe, Ariz., Robert J. Jennings, 59, Danville, Ill.; and Joshua Poole, 33, Atlanta, Ga. Three of the men are facing 215 years or more in prison if convicted on the counts against them.

The joint investigation began in 2002 after the department’s Division of Workers’ Compensation issued a stop-work order for failure to secure workers’ compensation insurance against now-defunct Jacksonville-based MiraLink Group, Inc., a leasing company with 20,000 employees. Detective Tommy Clark with the department’s Division of Insurance Fraud determined that MiraLink was using an unauthorized entity, Regency Insurance of the West Indies, and that Regency was issuing bogus workers’ compensation policies throughout the United States. As the investigation broadened to include the Federal Bureau of Investigation and the U.S. Attorney’s Office, evidence mounted that various employee leasing organizations knowingly bought Regency’s bogus policies and knowingly put workers at risk.

Thomas King, owner and operator of MiraLink, is facing a possible 20-year prison sentence, and an order to pay $5.8 million in victim restitution, at his sentencing scheduled May 6. King was arrested in 2005 on 23 federal counts of wire fraud, mail fraud and money laundering and was found guilty on all 23 counts last September.

Michael Lee McCafferty, the former chief executive officer of TTC Illinois, was sentenced on Wednesday to 33 months in prison and was ordered to pay $7 million in restitution for his part in the scheme. Before filing for bankruptcy in 2001, TTC was one of the nation's largest employee leasing organizations with headquarters in Kankakee, Ill., branches in Tampa and Boca Raton, and clients in 40 states.

In addition to the Division of Workers’ Compensation and the Division of Insurance Fraud, the department’s Division of Agent and Agency Services also played a key role in the investigation. The Office of Insurance Regulation also assisted.

After Detective Clark began to realize the scope of the alleged scam, he sought assistance from FBI Special Agent Doug Matthews and United States Attorney Mark Devereaux. Clark and Matthews conducted interviews of suspects in Arizona, Illinois, Alabama, Kentucky, and South Carolina in relation to the Florida victims. As a result of their collective work, the FBI designated the investigation as a “major case” in 2004, drawing in more resources.

“I want to thank every investigator, every attorney, and every crime analyst who helped bring these men in to justice,” said CFO Sink. “Providing workers’ compensation coverage is both a legal and a moral obligation, and we owe it to these injured workers and surviving families to make these individuals answer for what they did.”


CFO SINK ON PROTECTING FLORIDA’S MILITARY FROM DECEPTIVE INSURANCE PRACTICES

 Concerned about Florida’s servicemen and women falling victim to deceptive and improper insurance sales practices, Chief Financial Officer Alex Sink personally spoke before the Senate Banking and Insurance Committee Monday in favor of an amendment on Senate Bill 2702 that will increase protections for Florida’s military.  The amendment, sponsored by State Senator Ted Deutch (D-Delray Beach), directs the Department of Financial Services and the Financial Services Commission to adopt formal rules to protect Florida’s members of the United States Armed Forces.   

CFO Sink has been working to implement greater protections from dishonest insurance practices for our military after learning about the problem at several meetings of the National Association of Insurance Commissioners.  After unanimous passage by the committee, CFO Sink offered the following statement: 

“It is unthinkable that some unscrupulous insurance agents would sell bad investments, unnecessary life insurance policies, and misrepresent themselves and their products to members of our military.  Our soldiers are making the ultimate sacrifice to protect our freedoms, and they deserve protection from predatory or deceptive insurance sales practices.   

“In fact, Florida’s servicemen and women deserve to be offered first-rate financial products by trusted and responsible advisors so that they can provide for their families and save for retirement.  I look forward to continuing to work with the Legislature to ensure that we safeguard the financial futures of the members of Florida’s Armed Forces.”


Unlicensed agent snared in undercover operation

A South Florida man is facing charges of selling insurance without a license after he attempted to sell an annuity to an undercover Department of Financial Services’ investigator.

Eric Brown, 37, of Highland Beach, was arrested Tuesday on charges of three counts each of selling insurance without a license and violating a department order following an investigation by the department’s Division of Insurance Fraud (DIF).  If convicted on all of the charges, Brown faces up to 30 years in prison in addition to fines and restitution.  The department’s Division of Legal Services previously revoked Brown’s agent license in January 2006 for allegedly misleading senior citizens in the sale of annuities.  

“This man knowingly violated the law and put consumers at risk, and we will not tolerate that,” said Florida Chief Financial Officer Alex Sink, who oversees the department.  “We want consumers to know that we have made it easy for them to check the license of any insurance agent or company, and we strongly recommend that they do so before every transaction.”

To verify a license, consumers can call 1-800-342-2762 or log on to www.MyFloridaCFO.com and click on “Verify Before you Buy” to check various insurance and financial licenses, or click directly on “Check out your insurance agent” or “Look up your insurance company.”  Consumers can also file a complaint or report suspected fraud on the department’s web page or via the toll-free helpline at 1-800-342-2762. 

The arrest stems from a joint investigation between DIF and the Division of Agent and Agency Services’ Bureau of Investigations.  The investigation began when Bureau Investigator Sara Dwyer contacted DIF with suspicions that Brown was selling insurance without a license.  Working with DIF, Dwyer attended a seminar sponsored by Retirement Solutions, held March 21 at a Boynton Beach restaurant.  At the seminar, Brown identified himself as an accountant and office manager for Retirement Solutions, located at 1903 S. Congress Ave. #396, and, following a presentation on various products, offered Dwyer and other participants a free one-hour consultation in his office. 

Working with DIF Detective Stacey Spirn, Dwyer made a controlled call to Brown and set up a meeting for April 3, and Dwyer attended wearing a recording device.  Another meeting was scheduled for April 12 and, again wearing a recording device, Dwyer met with Brown and he allegedly recommended that Dwyer move an existing annuity into SunAmerica/AIG.  When Dwyer agreed, Steve Effron, a licensed agent, joined them with an application.  Brown told Effron what had been discussed and, with no additional recommendations, Effron began completing the contract.  At that point, Dwyer walked away and Det. Spirn walked in and advised Brown that he could not continue the transaction with a revoked license.   


CFO SINK PRESENTS 2006 FIRE SERVICE AWARDS 

Florida Chief Financial Officer and State Fire Marshal Alex Sink honored 10 fire and rescue service personnel and a community college for exemplary dedication to fire and rescue services last year.  CFO Sink recognized each honoree in a round of events, including during this morning’s regular Cabinet meeting in the Capitol, and presented them with proclamations signed by Governor Charlie Crist and members of the Cabinet. 

“These men and women have been chosen by their peers for this recognition because they have demonstrated exemplary courage and commitment to their profession,” said CFO Sink.  “That our responders regularly honor those they consider the best among them demonstrates the integrity they all bring to their work, and they have my utmost gratitude for all that they do.” 

In addition to honoring these individuals, the Cabinet has designated April 15-21, 2007, as Florida Firefighter Appreciation Week.  During the week, Florida’s firefighters and paramedics also are recognized for their work on behalf of the Muscular Dystrophy Association (MDA).   Last year, their annual “Fill the Boot” campaign raised a record amount of nearly $2.2 million.  The men and women of Florida’s fire and emergency services have supported the MDA for 53 years.

Following is a list of those individually recognized for their work in 2006:

Randall Pettitt, Plantation Fire Department - Volunteer Firefighter of the Year
Leslie Adent,
Southern Manatee Fire Rescue - Fire Service Inspector of the Year
Kurt Larson
, Pensacola Junior College - Fire Instructor of the Year
Jason Long
, Department of Agriculture and Consumer Services, Division of Forestry - Forestry Firefighter of the Year
Rand Napoli
, Division of State Fire Marshal - Fire Marshal of the Year
Al Cruz
, Miami-Dade Fire Rescue- Professional Firefighter of the Year
William Riley
, Hillsborough County Fire Rescue - Career Firefighter of the Year
Michael Murphy
, Marco Island Fire-Rescue Department - Fire Chief of the Year
Christopher Scovotto
, Division of State Fire Marshal, Bureau of Fire and Arson Investigations - Fire Investigator of the Year
Linda Stoughton
, St. Johns County Department of Emergency Management - Emergency Preparedness Manager of the Year
Brevard
Community College
- Training Center of the Year


REWARD MONEY GROWS IN ISLAMIC CENTER ARSON 

Florida Chief Financial Officer Alex Sink, who also serves as state fire marshal, announced that an additional $2,500 reward is being offered for information leading to the arrest of whoever is responsible for a fire last week at the Islamic Education Center of Tampa.  The reward money, posted by the Florida Advisory Council on Arson Prevention, is in addition to $10,000 in rewards already being offered by the Tampa chapter of the Council on American-Islamic Relations and Crime Stoppers of Tampa Bay. 

“Our country was founded on religious freedom and it is simply un-American that anyone would victimize a religious community,” said CFO Sink.  “Arson is a violent crime, and we need to get whoever did this off the street as quickly as possible.  I urge anyone with information about this tragic crime to come forward.”  

CFO Sink expressed appreciation for efforts by U.S. Sen. Bill Nelson, Florida’s former State Fire Marshal, to generate heightened attention to the case by bringing state and federal agencies together to work closely and quickly. 

The Division of State Fire Marshal, Bureau of Fire and Arson Investigations, is working with the Federal Bureau of Investigation, the U.S. Bureau of Alcohol, Tobacco and Firearms, and Hillsborough County Fire Rescue to determine who started the blaze, which has now been ruled arson. The FBI has a toll-free telephone number, 1-866-838-1153, for anyone who may have information about the fire.  “Anyone with any information, any information at all, about this case should call that number,” said FBI spokesman David Couvetier.   Callers can remain anonymous. Crime Stoppers also has a toll-free line available for information at 1-800-873-TIPS. 

The fire occurred last Thursday at the center, located at 6450 Rockpointe Drive.  Investigators say the fire began after someone poured a flammable liquid in and around a broken window.  No one was injured and the fire was contained to one room. 

The Bureau of Fire and Arson Investigations (BFAI) is a law enforcement branch of the Division of State Fire Marshal that assists other state and local fire and law enforcement agencies in the investigation of fires of suspicious origin.  To report suspected arson to the BFAI, call 1-877-NOARSON (1-877-662-7766). 


FLORIDA TREASURY JOINS INVESTOR NETWORK ON CLIMATE RISK
State Joins Network of Financial Leaders Managing More than $3.7 Trillion in Assets
 

Fresh off the heels of hosting the first in a series of “Conversations on Climate Change,” Florida Chief Financial Officer Alex Sink announced that as the state treasurer, she will join the Investor Network on Climate Risk (INCR), a national network of investors focused on the business impacts of climate change. CFO Sink is the first Florida-based institutional investor to join the three-year-old organization, which now includes more than 50 public and private institutional investors managing more than $3.7 trillion in assets that focus on the future financial risks and investment opportunities posed by climate change. 

“As the State Treasurer managing more than $20 billion in Floridians’ tax dollars, my first priority is safeguarding the people’s money,” said CFO Sink, who oversees the Department of Financial Services.  “Joining the Investor Network on Climate Risk will keep our state prepared for the potential risks that climate change can pose to our investments.” 

INCR was launched at the first Institutional Investor Summit on Climate Risk at the United Nations in November 2003 with 10 investors managing $600 billion in assets— and since has grown five-fold.  Florida joins a dozen other states that are INCR members through their state treasuries or pension funds, including: California, Connecticut, Illinois, Iowa, Kentucky, Maine, Maryland, New Jersey, New York, North Carolina, Oregon, Pennsylvania and Vermont.  

Ceres President Mindy Lubber, whose organization coordinates INCR, applauded today's announcement by Florida's top financial official.  “Whether from extreme weather events, regulatory changes or growing demand for renewable energy, climate change is a serious business issue facing all investors,” Lubber said. “We are pleased that CFO Sink is taking a proactive approach to better understand the risks and opportunities that climate change means for investors such as Florida's Treasury.  Today’s announcement is a big step forward for INCR, which will benefit enormously from CFO Sink’s investment expertise and Florida’s prominence in the asset management industry.”

INCR members participate in educational forums, engage policymakers and interact with companies to protect the long-term health of their investments from climate-related impacts, including emerging

carbon-reducing regulations, ecosystem and weather changes and growing global demand for climate-friendly technologies.   To learn more about INCR, visit their website at www.incr.com. 

“Florida has the opportunity to be a national leader in the effort to create innovative solutions to our energy challenges,” said Ken Locklin, Director, Finance & Investment at the Clean Energy Group and a panelist at the first climate change conversation.  “It’s wonderful for Florida’s taxpayers that the Governor and Cabinet are cognizant of both the potential risks and opportunities that climate change presents.” 

Upon learning that the risk and insurance industries are re-evaluating the state’s risks in light of new reports about the potential impact of climate change, CFO Sink has launched an effort to prepare Floridians for the possible future implications of climate change.  To date her efforts have included partnering with Commissioner of Agriculture Charles Bronson to host the first in a series of “Conversations on Climate Change” and launching a new climate change website.  For more information on climate change, please visit our website at www.floridaclimatechange.com. 

Ceres, which coordinates INCR, is a leading coalition of investors, environmental groups and other public interest organizations working with companies to address environmental and social challenges such as global climate change. For more information, visit http://www.ceres.org   


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