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Volume 5, No. 10 - October 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 Investigative & Forensic Services for criminal investigation.

Case: Investigators received a complaint from a consumer that a bail bond agent failed to return collateral provided for a bail bond upon discharge of the bond. The complainant was the indemnitor and had used a credit card to make a $6,000 collateral payment to indemnify the bond.

Investigators obtained a statement from the consumer that he paid the bail bond agent $6,516, which included the bail bond premium and collateral. The bail bond agent's bank records were analyzed to confirm deposit of the funds in dispute. During an agency inspection, the bail bond agent was unable to produce record of the transaction or the required daily bond register. Through investigators' efforts, the consumer received a refund of the funds paid, less the bail bond premium and 3% charge for the credit card transaction fee.
Disposition: Fined $5,816.

Case: The Department was notified by an insurance company that a life insurance agent was terminated for cause. Investigators requested insurance company records of complaints or suspicious transactions and determined that the agent had surrendered five consumers' existing life insurance policies and submitted applications for new policies without their knowledge or consent. Investigators obtained statements from each of the affected consumers that signatures on the documents were not their true signatures. In each case, the agent used the cash value from the surrendered policies to pay the first annual premium for the replacement policies. The agent earned new first year commissions for the sales, but left the consumers with higher premiums they were unable to afford. The policies lapsed for non-payment of premium, leaving the consumers without life insurance. The insurance company cancelled the fraudulently issued policies and reinstated the insureds' original policies.
Disposition: License revoked.

Case: An investigation was opened on a health insurance agent after receiving a complaint from an insurer that the agent had given the questions and answers for the insurer's annual Medicare training certification course to agents who worked in the agency he was employed by. During the course of the investigation, the agent was interviewed by investigators about the allegations. The agent told investigators he felt he "owned" the questions and answers from the course exam because he had paid to attend the course and could share them if he chose to do so.
Disposition: Fined $2,700 and placed on probation for one year.

Case: Investigators opened a case after a routine follow-up of an agency that had lost its agency license for failing to designate a new Agent in Charge. The agent, the new officer and Agent in Charge, had applied for a new agency license and submitted a notarized statement to the Department attesting the agency had not transacted insurance business while unlicensed. Investigators obtained documentation from the insurance companies the agent was appointed with and found the agency had conducted insurance business during the period it was unlicensed.
Disposition: Fined $500 and placed on probation for one year.

Case: An insurance company filed a complaint with the Department alleging a life, health and variable annuity agent had misappropriated funds, forged signatures, altered applications, submitted fraudulent applications, and participated in unlicensed activity. During the course of investigation, documents were obtained from the insurer indicating the agent had submitted at least 153 applications listing his personal bank account information, address, email address and telephone number on the application. Investigators determined other Information on the applications including dates of birth and social security numbers were fictitious.
Disposition: License revoked.

Case: The Department's Division of Investigative & Forensic Services notified investigators of the arrest of a title insurance agent. The agent was arrested on a count of Scheme to Defraud, alleging that she closed a real estate transaction listing a title insurance policy for a title insurance underwriter she was not authorized to represent.  In addition, the agent's agency was not properly licensed or appointed to transact insurance at the time of the alleged violation.  During the course of the investigation, it was discovered that the agent diverted funds from several real estate closings for her own personal use, with a total financial loss to the victims in excess of $350,000. 
Disposition: License surrendered with the same force and effect as revocation.

Case: The Florida Office of Insurance Regulation (OIR) sent a referral to investigators advising that a title insurance agency failed to submit date for the 2015 Title Data Call. The subsequent investigation confirmed that the Subject did in fact fail to file the required data. The representative for the title agency told investigators he did not wish to disrupt his business operations to take time to comply with the Data Call requirements mandated by Florida Statutes. Despite efforts by investigators to mitigate the violation by offering to assist the title agency with complying, the Data Call filing was not submitted.
Disposition: License suspended for six months; the agency must submit proof it has complied with the Data Call before license reinstatement will be considered.