Volume 1, Number 21, May 24, 2004
When you consider making a living and building a future, Florida is truly a place where opportunity abounds - the opportunity for every child to learn to reach their full potential, the opportunity to feel safe at work and in our neighborhoods, and the opportunity to thrive and grow as a business. It is these opportunities that bring nearly 900 new people a day to live in Florida.
Today, Florida continues to lead the nation in job growth, a position we have
held for the last two years. In fact, our unemployment rate has again dropped to
4.6 percent in April from 4.9 percent in March and down from 5.3 percent a year
ago. These numbers mean that Florida’s job market has expanded by more than
168,000 jobs in the last year.
Our current tax structure, and our governor and legislature’s commitment to tax relief, have helped foster economic growth and job creation. Our expanding economy demands that we devote our resources to help educate and train hard-working Floridians to fill the jobs.
These are important challenges for state leaders as we continue to develop Florida’s economic growth, and I’m committed to the principles which will lead to future success.
-- Tom Gallagher
TRAVEL INSURANCE: THE VACATION RAINCHECK
This coverage can be beneficial, but be sure to read the fine print
As Floridians are preparing for summer
vacations, with many planning to travel during the Memorial Day weekend,
Florida’s Chief Financial Officer Tom Gallagher is reminding consumers to
consider options for ensuring your trip won’t be rained out.
GALLAGHER HONORED BY FINANCIAL LITERACY ORGANIZATION
Florida’s Chief Financial Officer Tom Gallagher was honored by the Florida Council on Economic Education (FCEE) with their prestigious President’s Award. Gallagher was recognized for his years of advocating increased financial literacy of Florida’s students, working families and seniors. The President’s Award is presented to Floridians demonstrating leadership in promoting financial education and free-market principles.
“I am truly honored to accept this award,” Gallagher said. “Preparing our citizens for financial challenges is one of my most important tasks, and I will continue to provide Floridians, especially students and seniors, with the tools needed for financial success.”
Gallagher, recognized as having helped create the FCEE and provide crucial funding while serving as a state lawmaker, was honored with an award for his leadership in initiating several statewide financial education efforts. Gallagher was instrumental in the success of programs such as Florida Stock Market Simulation, Financial Freedom and Strive to Drive, which provides teens with information and instruction related to car-buying.
“CFO Gallagher richly deserves this award. His service to the FCEE and Florida’s students has been exemplary,” said Don Fell, President of the FCEE.
“It is vital that students graduate from Florida schools with an understanding of personal finance and the free enterprise system,” said Dr. Zachariah P. Zachariah, Chairman of the FCEE. “No one in our state has done more to promote that understanding than CFO Gallagher.”
Gallagher also sponsored a resolution proclaiming April 2003, Financial Literacy Month. The resolution was passed at a recent meeting of the governor and Cabinet, on which Gallagher serves.
Gallagher served three terms as Treasurer and Insurance Commissioner and was sworn in as Chief Financial Officer in 2003.
Established in 1975, the Florida Council on Economic Education is a non-profit, statewide agency that teaches students and teachers business basics. In addition to developing educational programs, the Council recognizes individuals who are leaders in promoting a greater understanding of the free enterprise system. The Council is funded by the Florida Department of Education and leading businesses throughout the state, and is an affiliate of the National Council on Economic Education.
BETTING THE RANCH: RISKING YOUR HOME TO BUY SECURITIES
As part of an ongoing effort to improve the state’s financial literacy and provide information to consumers making important investment decisions, Florida’s Chief Financial Officer Tom Gallagher is warning Floridians about the risks involved in playing the stock market with the equity in your home.
“Taking out a mortgage on your home to make an investment means you must rely on investment returns to make your mortgage payments. You could end up defaulting on your home loan if the investment declines,” said Gallagher, who oversees the Department of Financial Services. “Investors who bet the ranch could lose it.”
With a rising stock market, record low interest rates, and large gains in home value, some investors have taken out new mortgages, refinanced, or obtained lines-of-credit secured by their homes for the specific purpose of investing in securities. The hope is that the investment will not only pay the mortgage, but also generate additional income. Unfortunately, it doesn't always work out that way.
Taking money out of your house to buy securities compounds your risk for the following reasons:
“If you don’t have a secure salary or reserve funds to make mortgage payments in the event your investments lose value, you are taking a chance on losing your home,” said Don Saxon, Director of the Office of Financial Regulation which regulates state-chartered banks and securities in Florida.
Consumers can contact the Florida Department of Financial Services’ toll-free helpline 1-800-342-2762 or visit the Department’s web site at www.MyFloridaCFO.com for additional information or assistance.
TOWING CONTRACTOR ARRESTED FOR WORKERS’ COMPENSATION FRAUD
The owner of a towing company with local government contracts has been charged with failing to provide workers’ compensation for his employees, according to Chief Financial Officer Tom Gallagher.
“Employers who avoid paying workers’ compensation premiums contribute to the rise in workers’ compensation rates and gain an unfair advantage over competitors,” said Gallagher, who oversees the Department of Financial Services. “We will continue to aggressively investigate instances of fraud and abuse of the workers’ compensation system.”
Investigators with the department’s Division of Insurance Fraud say Michael Mucha, 42, of 14761 Madison Place in Davie, and owner of Bob’s Towing Inc., failed to provide required workers’ compensation coverage for his employees, including at least 20 drivers. Mucha allegedly provided a fraudulent certificate of coverage to Town of Davie employees, with which the company had a contract for services. The Davie municipal employees then contacted the Davie Police Department.
State insurance fraud investigators were contacted to assist, and Michael Mucha was arrested and charged with two counts of workers’ compensation fraud. Mucha was booked into the Broward County jail. If convicted, Mucha faces up to ten years in prison.
Under Florida law, employers in non-agriculture or construction-related industries, who have four or more employees, must maintain workers’ compensation coverage for their employees.
The Department of Financial Services, Division of Insurance Fraud, investigates various forms of fraud in insurance, including health, life, auto, property and workers’ compensation insurance. Anyone with information about this case or another possible fraud scheme should call the department's Fraud Hotline at 1-800-378-0445. A reward of up to $25,000 may be offered for information leading to a conviction.
PHONY MORTGAGE BROKER
SENTENCED FOR ROLE IN FRAUD SCHEME
DEPARTMENT ADVISES CONSECO POLICYHOLDERS ON OPTIONS
response to numerous calls from seniors who have a home health care policy with
Conseco Senior Health Insurance Company, the Florida Department of Financial
Services is alerting them that notices are now arriving in their mailboxes with
options regarding their policies. Conseco Senior has approximately 18,650
policies in force.
Option 2 - Choose a replacement policy. The policy will have a maximum 25
percent increase the first year with a 15 percent maximum increase per year for
the lifetime of the policy. There will be four changes on the replacement
policy: 1) the removal of the restoration of benefits; 2) eligibility of
benefits will require a Licensed Health Care Practitioner to certify the insured
is unable to perform at least two activities of daily living (ADLs) for a period
of 90 days or suffers from severe cognitive impairment; 3) minimum 20-day
elimination period, and 4) lifetime benefit period policies will be converted to
Florida Department of