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Volume 3, No. 1 - January 2014

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: An insurance carrier filed a complaint with the Department stating that they discovered a life agent who had allegedly forged client signatures on applications for insurance as well as embellished the policy and loan provisions for a life insurance customer in order to entice them to purchase the policy. During the investigation, it was revealed that the agent was signing in place of clients and had 65 life insurance policies in a drawer that had never been delivered to his clients. According to the agent, he felt that the cost of mailing the policies to his clients was too expensive and he did not have time to personally deliver them.
Disposition: License revoked. Also, he is currently paying back over $67,000 in restitution to the company to reimburse their costs in remedying the harm caused by him in falsifying the policy and loan provisions.

Case: Shortly after a revoked life agent completed his one-year sentence for Conspiracy to Commit Wire Fraud, he went to work for a life & health agent's agency. When Department staff arrived at the agency, the revoked agent stated, "I'm only the receptionist." However, to the contrary, it was discovered that his business cards identified him as the National Marketing Director, and he then admitted sending out several insurance quotes and explaining coverage. All of this was done under the watchful eye of his boss - the life & health agent.
Disposition: The life & health agent was fined $4,000. The revoked agent's license remains revoked and his employment was terminated.

Case: A general lines agent used premium finance monies to allegedly purchase insurance for consumers but did not purchase the insurance as represented. The agent deposited the monies into the agency account and months later would submit the application to the insurer financing the premium using another premium finance company's monies. The consumers had no knowledge of the transactions, the finance agreements, or the applications submitted without the true signature of the insured. The agent also made material changes to company-issued binders and invoices.
Disposition: License revoked. The agent's agency was fined $25,000, ordered to pay restitution of just under $30,000, and placed on probation for two years.

Case: An investigation of a life agent revealed he had submitted 74 life insurance applications with false personal and banking information. In speaking with several of the named insureds on the submitted applications, the consumers stated they were not aware the agent had submitted additional applications for insurance in their name and the banking information was not one they recognized.
Disposition: License revoked and permanently barred from the insurance industry.

Case: The Department received notification of Final Judgments issued against a bail bond agent. The judgments were issued for the forfeiture of bail bonds. Though the judgments were set aside, there was no evidence that the judgments were paid or money deposited with the Clerk of Court when the motions to set aside were filed. The investigation revealed that bail bond agent executed approximately 190 bail bonds while the judgments were outstanding.
Disposition: Fined $1,500 and placed on one year probation.

Case: The Department was notified by the Office of Insurance Regulation that an unlicensed warranty sales representative was named in an investigation they conducted for possible unauthorized sale of service warranties for wireless phones. Documentation provided showed that they had written 3,012 contracts in Florida during a two-year period. On a subsequent investigation, the Department also alleged the entity acted as a managing general agent in relation its Wireless Protection Program.
Disposition: Fined $17,500. The entity now holds valid managing general agent and nonresident agency licenses.

Case: A customer representative, while employed at an insurance agency, used incorrect garaging addresses/zip codes to lower rates on 91 automobile insurance policies. The insurance company endorsed all 91 policies to reflect the correct garaging addresses/zip codes, totaling $13,557.64, which was paid by the agency to the insurance company.
Disposition: The customer representative's license was revoked. The agent in charge of the agency was fined $3,000.00 and placed on probation for one year for failing to properly supervise the customer representative and failing to complete a designation of supervising agent form for the customer representative.

Case: An investigation of the president and agent in charge of an insurance agency revealed that the agent was employed full time elsewhere and that an International Water Safety Foundation (IWSF) policy was sold by the agency. In addition, an insurance company terminated the agent's contract and appointment and discovered during their audit that the agency had sent evidence of property insurance certificates to title companies when no coverage was in effect. The agent was charged by the Department with issuing evidence of insurance certificates when no coverage was in effect, aided and abetted an unauthorized insurer to transact insurance in Florida, failed to be active full time charge of the agency as the designated agent in charge and failed to properly supervise a customer representative.
Disposition: License suspended for 12 months.