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Volume 4, No. 11 - November 2015

News You Can Use

- Updating you on what's going on

Clearwater Insurance Agent’s License Stripped After Ruling in First District Court of Appeals

Florida CFO Jeff Atwater announced that William “Bill” Pearson, 64, has been stripped of his insurance license for charging an illegal, unauthorized fee to a deceased veteran’s senior widow and conducting transactions that cost her thousands of dollars in annuity surrender charges. This follows a nearly year-long appeal by Pearson to the First District Court of Appeals (DCA) that the Department successfully fought.

On February 5, 2015, Pearson’s license was suspended for 15 months following a recommendation by an administrative law judge with the Division of Administrative Hearings. He appealed to the First DCA and on May 14, 2015, the suspension was stayed which allowed him to continue transacting insurance during the appeal process, with the exception that he could not solicit to persons over the age of 60. Each member of the DCA’s three-judge panel agreed that the suspension should be upheld. Following the suspension period, Pearson will have to apply for reinstatement.

In July 2010, another insurance agent, Glenn Cummings, gained the victim’s trust and referred her to Pearson in order to liquidate and consolidate her investments. She later testified that no one ever explained investment options or consequences, which Pearson also acknowledged. As part of the rollover transactions that occurred, the senior incurred thousands of dollars in annuity surrender charges. That’s when the Department’s Division of Agent and Agency Services' Bureau of Investigation stepped in. The Department mandated that Cummings pay restitution to cover the losses the victim incurred, and his license was placed on probation.

Click here to read the press release>>

State Fire Marshal’s Office Arrests Serial Arsonist in Pensacola

The Florida State Fire Marshal’s Office, which operates under the direction of the Florida Department of Financial Services and CFO Jeff Atwater, announced the arrest of David McIntyre, 37, for a structure fire set in the Pensacola area.

On November 2nd, State Fire Marshal investigators from the Pensacola field office responded to and conducted a fire examination at 2009 East Olive Road in Pensacola. A building located near the rear of Ruth’s Uniforms had burned and investigators determined that the fire had been set intentionally. A neighborhood canvas identified McIntyre as a possible suspect and witness statements led to an arrest warrant being filed for his arrest. Days later, he was arrested for arson without incident, bond was set at $50,000, and McIntyre was ordered to wear a GPS monitor until trial.

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Florida Health Insurance Advisory Board Adopts 2015 Florida Health Insurance Market Report

The Florida Health Insurance Advisory Board (FHIAB) adopted the 2015 Florida Health Insurance Market Report via a conference call meeting held on Monday, November 16, 2015.

For more information about the FHIAB, visit http://www.floir.com/Sections/LandH/FHIAB.aspx​.

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Office Issues Final Order Approving Workers' Compensation Rates for 2016

The Florida Office of Insurance Regulation (Office) has approved an overall decrease of 4.7% in workers’ compensation insurance rates in Florida. Following the disapproval of its original rate filing request, the National Council on Compensation Insurance (NCCI) submitted additional information for the Office’s consideration on Friday, November 6, 2015 (Office Statement). NCCI requested that the Office re-evaluate three specific items pertaining to its annual rate filing: expense constant, indemnity trend, and the profit and contingency factor. The Final Order issued today re-confirms the Office’s denial of the requested modifications to the expense constant and indemnity trend. However, the Office granted an increase in the profit and contingency factor from the current approved 2.5% to 2.75%, which lowered the decrease in workers’ compensation rates from 5.1% to 4.7% overall. The new rates become effective January 1, 2016 for both new and renewal workers’ compensation rates.

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Florida Office of Financial Regulation Supports Operation Collection Protection

The Florida Office of Financial Regulation (OFR) announced their participation in Operation Collection Protection. Led by the Federal Trade Commission (FTC), Operation Collection Protection is a coalition of more than 75 local, state and federal enforcement and regulatory organizations committed to collaboratively addressing illegal debt collection practices.

“Protecting Floridians from illegal activity within the financial services industry is the Florida Office of Financial Regulation’s highest priority,” said OFR Commissioner Drew J. Breakspear. “We remain committed to working with our state and federal partners in Operation Collection Protection to combat illegal debt collection practices.”

Operation Collection Protection is the latest initiative that seeks to elevate the integrity of debt collection across the nation. The OFR enforces Florida’s Consumer Collection Practices Act, which clearly defines prohibited practices when collecting consumer debts. In Florida, debt collection companies may not threaten violence, call before 8:00 a.m. or after 9:00 p.m., or disclose the debt to a third party. For more information on forbidden practices, please see the OFR’s Consumer Alert on Prohibited Debt Collection Practices. In 2013, the OFR supported legislation that was passed strengthening the registration requirements of consumer collection agencies by requiring a state and federal background check of all applicants. The background checks include live-scan fingerprinting and the retention of fingerprints, which provides the OFR immediate notification of an arrest. This law not only makes it more efficient to regulate these entities, but also helps to protect Floridians from bad actors.

View the FTC’s press release for a list of regulatory and enforcement actions included in Operation Collection Protection.

To report possible unlawful consumer collection activity, file a complaint online at www.flofr.com or call (850) 487-9687. You may also file a complaint online with the FTC at www.ftccomplaintassistant.gov.

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Duo Sentenced for Investment Fraud Scheme Arrests

The Florida Office of Financial Regulation (OFR) announced the November 5, 2015, sentencing of Brian Newton and Victoria Snow for their role in defrauding more than 60 victims, costing them more than $7.2 million. Newton was sentenced to 15 years and 8 months and Snow was sentenced to 4 years and 9 months. The perpetrators were ordered to pay more than $7.2 million in restitution.

“The Florida Office of Financial Regulation is committed to fighting financial fraud and protecting your money,” said OFR Commissioner Drew J. Breakspear. “These egregious acts of fraud will not be tolerated.”

“Thank you to our partners in the U.S. Attorney’s Office for the Middle District of Florida and the Federal Bureau of Investigation for their assistance in this case,” said OFR Acting Chief of Financial Investigations Alex Toledo. “The outcome of this case is a direct result of the OFR’s diligent work with our partners.”

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We highly recommend that licensees routinely check their MyProfile account(s) for messages from the Department. We send an email notification when a message has been sent to remind you to check your MyProfile account but on rare occasions you may not receive that email. For that reason, we suggest you add our domains dfs.state.fl.us and MyFloridaCFO.com to your email software's Trusted or Safe Senders List to ensure you are able to receive email notifications from us. Licensees who have a valid email address on file with the Department, as required by law, are sent important email notifications when something that affects their application, license, continuing education, or appointment(s) occurs. Additionally, we will keep you informed with warnings regarding new schemes and scams being marketed to licensees. You can update your contact information through your MyProfile account. We want to keep you informed in a timely manner of pertinent information. You are still required to abide by the Florida Insurance Code regardless of whether you read the information we provide or attempt to provide.