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CFO Sink: Guilty Plea by Senior Scammer Shows Need for Better Protections

9/30/2009

CONTACT: Kyra Jennings or Kevin Cate, 850-413-2842
 
TALLAHASSEE— Florida CFO Alex Sink today reiterated her calls for Safeguard our Seniors legislation that would increase penalties against agents who defraud senior investors and establish better disclosures and protections, after a guilty plea by a Tampa Bay Area scammer resulted in no jail time.
 
Last week, Port Richey senior scammer Randolph H. Kahl-Winter was sentenced to 10 years felony probation and ordered to pay restitution under a plea deal only on charges of grand theft from the insurance company.  If CFO Sink’s Safeguard our Seniors legislation had been passed into law last session, Kahl-Winter would have also had to answer for his crimes against 82-year old Bonnie Madden.
 
“As this case proved, some unscrupulous insurance agents will take advantage of Florida's senior population to pad their own wallets, which is why safeguarding our seniors against these scammers is essential in these tough economic times,” said CFO Sink. “I’m proud of the work of my team in uncovering Kahl-Winter’s misdeeds; however, our state still needs tougher penalties in our laws to help deter crimes against our greatest generation from ever happening in the first place.”
 
Bonnie Madden at the advice of Kahl-Winter, liquidated her existing investments to fund the purchase of two annuities with 10- and 15-year surrender periods.  He then converted the annuities into a $1.75 million life insurance policy by forging Madden’s name on several documents and inflating her net worth from $450,000 to $1,770,000 to qualify her.  This generated $52,355 in commissions for him, while Madden would have been left unable to pay the premium on the inflated policy.  CFO Sink’s Department of Financial Services recovered Bonnie Madden’s money.
 
Currently, CFO Sink’s Department has seven pending administrative charges against Kahl-Winter, including making fraudulent representations to Madden. Now  that he has been convicted of a felony, the department will file a notice of revocation— the most severe license penalty for an insurance agent under current insurance codes.
 
Last legislative session, CFO Sink teamed up with key lawmakers to push legislation that increases the penalty for agents who defraud senior investors to a third degree felony and establish better disclosures and protections upfront for seniors who invest in these products. The legislation was approved unanimously by the Florida Senate but did not make it out of committee in the Florida House.
 
In the last fiscal year, CFO Sink’s department opened 267 annuity investigations involving seniors statewide and 52 in the Tampa Bay Area, recovering more than $1.5 million for Tampa Bay area seniors since February 2008 as part of her Safeguard Our Seniors initiative.
 
Florida is currently home to more than 2.9 million Floridians over the age of 65.  The state’s senior population is projected to grow by as much as 30 percent, and many of these seniors will look into investing in annuities.  To learn more about CFO Sink’s Safeguard Our Seniors Task Force or what to consider when purchasing annuities, visit www.flseniors.net.  Floridians who believe they may have been the victim of annuity fraud should call (850) 413-3089 or toll-free at 1-877-My-FL-CFO (1-877-693-5236), or visit our website, www.MyFloridaCFO.com, to file a complaint.
 
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As a statewide elected officer of the Florida Cabinet, CFO Alex Sink oversees the Department of Financial Services.  A successful businesswoman with nearly three decades of experience in the private sector, Sink is serving her first term as Florida's CFO.  As CFO, Sink's priorities include using her business experience to cut wasteful government spending, cracking down on financial and insurance fraud and reforming the state government's contracting practices