CFO Alex Sink's Consumer eViews NewsletterFLORIDA CHIEF FINANCIAL OFFICER

Volume 6 Number 50 December 11, 2009


Dear Floridian:

When the SBA Board of Trustees, which is consists of the Governor, the Attorney General, and myself, met this week, I proposed important reforms to strengthen oversight of the state’s $110 billion pension fund.

Two of my proposals that would require fiduciary training for board members and regular, independent audits received a positive outcome. However, another very important change to create a new pension fund oversight board -- a board that includes qualified financial professionals and at least one member who is a beneficiary or participant in the fund -- was unfortunately blocked.

The current board consists of just three elected officials who are not required to have financial expertise, and I strongly believe this is unacceptable. That’s why I will continue to push for reform by working with members of the Florida Legislature this spring in order to better protect Floridians’ retirement security.


Alex Sink
State of Florida

CFO Sink continues push for real pension fund reform

Florida CFO Alex Sink’s proposal to improve the oversight of the state’s pension fund and protect Floridians’ retirement security was blocked on Tuesday during a meeting of the State Board of Administration (SBA). Governor Crist and Attorney General McCollum refused to vote for recommending that the Legislature change the membership of the Board to strengthen oversight of the state’s $110 billion pension fund and other investment funds.

“It takes more than three elected officials – none of whom are required to have investment experience – to oversee the $110 billion fund that our teachers, firefighters, and police officers depend on for a secure retirement,” said CFO Sink. “The status-quo shouldn’t be good enough when it comes to overseeing the fourth largest pension fund in the country.”

CFO Sink noted her 26 years of business experience and the recent governance study when advocating for reforming the oversight structure of the fund almost one million Floridians depend on for a secure retirement. CFO Sink will move forward with members of the Florida Legislature on a bill for the spring session that will change the makeup of the board that oversees the state’s pension fund and other investments managed by the SBA. She is recommending the changed board include at least one member with extensive and relative investment experience and at least one member who are a beneficiary or participant in the Florida Retirement System.

CFO Sink’s other reforms that were tabled at a September 2009 SBA meeting, including requirements for fiduciary training, and instituting regular, independent audits, received a positive outcome today. The Board of Trustees voted unanimously to institute a schedule for independent audits and they will be reviewing proposals for fiduciary training.

In March 2008, CFO Sink presented her ten-point plan designed to toughen the SBA’s financial safeguards, increase transparency in SBA communications and strengthen board oversight, which included recommendations such as expansion of the Board of Trustees.

Tampa-area senior helps catch convicted scammer in undercover sting

Florida CFO Alex Sink on Thursday announced the arrest of Randolph Kahl-Winter, a previously convicted senior scammer, after a vigilant Tampa-area senior tipped off investigators and participated in an undercover sting operation.

After learning how to identify annuity fraud at one of CFO Sink’s ‘Safeguard Our Seniors’ workshops, the brave senior helped Division of Insurance Fraud investigators nab Kahl-Winter and another man, Donald Robert, who was also in the scam.

“This unscrupulous scammer met his match when he tried to prey on another senior just months after previously being convicted of grand theft,” said CFO Sink. “This case is another disturbing example of why we need to create tougher penalties and better protections for Florida’s seniors.”

Kahl-Winter was charged with making insurance transactions without a license and violation of probation, and Robert was charged with aiding and abetting an unlicensed insurance agent. Kahl-Winter and Robert, both of New Port Richey, were booked into the Pinellas County Jail late yesterday. Additional charges are pending.

With the senior’s tip that Kahl-Winter had misrepresented an annuity she purchased, investigators staged a meeting with the senior to discuss the purchase of another annuity. Kahl-Winter and Robert, currently a licensed insurance agent, met with the victim and had her sign the necessary paperwork. When Kahl-Winter and Robert left the site, Division of Insurance Fraud investigators immediately arrested them.

Kahl-Winter had previously been arrested for grand theft and insurance fraud by CFO Sink’s Division of Insurance Fraud in March 2009. He was convicted, but only sentenced to 10 years probation. Kahl-Winter also had his insurance license revoked by CFO Sink’s Department in October.

To learn more about CFO Sink’s Safeguard Our Seniors initiative or what to consider when purchasing annuities, visit Floridians who believe they may have been the victim of financial fraud should call (850) 413-3089 or toll-free at 1-877-My-FL-CFO (1-877-693-5236), or visit to file a complaint.

State employees donate Toys to help Marines  with the annual Toys for Tots drive

Local Marine Corps representatives were honored at the Cabinet meeting this week for their exemplary support of the Toys for Tots campaign in recognition of the 62nd anniversary of the program. Toys for Tots gives gifts to children of low-income families and truly shows the holiday spirit of giving at its best.

State employees embrace this worthwhile project each year by donating new toys for children of all ages. The Marines distribute the toys locally to give many children a special gift for the holidays.

CFO Sink commends passage of rail legislation

Florida CFO Alex Sink on Tuesday released the following statement following the Florida Legislature’s passage of the rail bill heard in special session:

“Today Florida has proven our commitment to high speed and commuter rail and I commend the work of the Florida Legislature to pass this important legislation. This comprehensive vision for rail in our state not only creates jobs right now, but will help move Florida forward as we grow our state’s new economy.

“I am also happy that we are achieving commuter rail for Central Florida, especially with improved liability provisions. It was made clear that this comprehensive approach to rail was needed to ensure Florida did not miss out on billions of our federal taxpayer dollars set aside for rail projects, and I now urge Washington to fully fund Florida’s applications.”

People's Trust MGA to pay penalty, alert consumers in settlement reached with CFO Sink

Florida CFO Alex Sink announced that People’s Trust Insurance’s Managing General Agent (MGA) will pay $100,000 and contact customers who may not have purchased insurance from a licensed agent, based on the terms of a settlement agreement with the Department of Financial Services finalized today. In March 2009, CFO Sink’s Department of Financial Services took legal action against People’s Trust MGA, LLC charging that they had used unlicensed personnel to market and sell homeowners insurance.

“It is my responsibility to make sure Floridians are getting the best advice for protecting their families and homes by properly licensed agents,” said CFO Sink. “Standing up for Florida’s consumers is one of my top priorities, which is why it was so important to ensure that People’s Trust is following the law by only using licensed insurance agents in the transaction of their insurance business.”

People’s Trust MGA will pay a $100,000 administrative penalty, one of the largest penalties ever paid to the Department of Financial Services by an insurance agency. People’s Trust MGA must also send a letter to every customer who bought homeowners insurance between March 6, 2008, and March 5, 2009, if their policies have not already been re-underwritten, offering a review of their coverage with a licensed insurance agent or customer representative. These customers will have the option to compare policies, re-underwrite their policy, or cancel their policy without penalties and have their pro-rated unearned premiums refunded.

People’s Trust must pay the $100,000 penalty within 30 days and mail the policyholder letters, to be approved by CFO Sink’s Department, at least 30 days prior to the renewal of the customers’ insurance policies. The Settlement Stipulation for Consent Order was signed December 1, and formalized by the Consent Order signed today.

CFO Sink issued an Order to Show Cause on March 5, 2009 against the Boca Raton-based People’s Trust MGA, LLC after an investigation by CFO Sink’s Department revealed that People’s Trust MGA had allowed unlicensed agents to transact insurance.

Link to the Settlement Stipulation for Consent Order with People’s Trust MGA, LLC

Link to the Consent Order with People’s Trust MGA, LLC

Consumers with coverage questions should visit CFO Sink’s web site,, or call her consumer helpline at 1-850-413-3089 or 1-877-MY-FL-CFO.

Division of Insurance Fraud captain and team recognized for fraud efforts

On December 4, 2009, Division of Insurance Fraud Captain Steve Smith and his team were honored at the National Insurance Crime Bureau’s (NICB) Fraud Task Force meeting in Plantation, Florida. Captain Smith and his fraud team in Miami-Dade were recognized for their ongoing efforts in the fight against fraud. Captain Smith graciously accepted the award on behalf of his team.

NICB is a non-profit organization that receives support from approximately 1,000 property/casualty insurance companies and partners with insurers and law enforcement agencies to facilitate the identification, detection, and prosecution of insurance criminals.

Congratulations to Captain Smith and the Miami-Dade fraud team!

CFO Sink in honor of Pearl Harbor Remembrance Day

Florida CFO Alex Sink on Monday made the following statement in remembrance of the December 7, 1941, attacks on Pearl Harbor:

“Today we pause to remember the sacrifice of the brave men and women who served at Pearl Harbor. We honor the memory of those we lost and the sacrifice of all who have served through the support of our veterans and troops stationed at home and overseas.”

When war was declared on December 8, 1941, more than 250,000 Floridians signed up to serve in the U.S. military. Today, Florida is home to five major naval bases and installations in the communities of Pensacola, Panama City, Milton, Mayport and Jacksonville.

COBRA Premium Assistance Expiration Alert

By Sean M. Shaw, Esq., Florida Insurance Consumer Advocate

On February 17, 2009, President Obama signed the American Recovery and Reinvestment Act. This legislation provided COBRA premium assistance to help those who lost their jobs by offsetting the costs of continuing health insurance. The premium assistance program will continue for nine months from the March 1 passage date through December 31 of this year. Individuals who are eligible for COBRA during this time period will receive nine months of assistance upon applying for their benefits, even if it extends beyond the end of the year.

Individuals who have been involuntarily terminated are eligible for nine months of COBRA premium assistance as long as they have applied for their COBRA benefits by December 31 of this year. Individuals currently receiving COBRA benefits at a reduced rate because of the assistance will continue to receive the assistance for the duration of the statutorily granted nine month period. The premium assistance program also applies to state continuation coverage, also known as mini-COBRA.

Any individuals who have questions regarding the process for receiving COBRA benefits should contact their employer. Consumers should also be aware that the rules for applying for COBRA and mini-COBRA are not identical. Thus, individuals should confirm what type of COBRA they are eligible for before applying. Also, if you are about to lose the premium assistance, do not cancel your COBRA coverage - instead shop around for an individual policy with the benefit level you want and a premium you can afford. Watch for Congressional changes and if you have any questions, contact the Division of Consumer Services at 1-877-693-5236 or

The Insurance Consumer Advocate is appointed by Florida Chief Financial Officer Alex Sink and is committed to finding solutions to insurance issues facing Floridians, calling attention to questionable insurance practices, promoting a viable insurance market responsive to the needs of Florida’s diverse population and assuring that rates are fair and justified.

Florida Housing Help: Making trial mortgage modifications permanent

As homeowners across the country have been struggling to keep their homes, many lenders have offered trial modifications to help bridge the financial crisis families have been facing. Many of those homeowners who are participants in the federal Making Homes Affordable Program now have the opportunity to make those three- to six-month modifications permanent.

The plan asks for homeowners to:

Additionally, struggling homeowners can attend one of CFO Sink’s Florida Housing Help workshops to speak directly to representatives of lenders, legal aid, and community resources. To learn more about CFO Sink’s Florida Housing Help initiative, visit

Upcoming Florida Housing Help events:

Tuesday, December 15 at 6 p.m. Foreclosure Prevention Workshop Greenacres City Community Hall, Swain Blvd, Greenacres City, FL

Wednesday, December 16 at 5 p.m. Florida Housing Help Workshop Joseph P. D'Alessandro Office Complex (State Building) 2295 Victoria Ave., Fort Myers, FL 33901

State Fire Marshal Sink's bomb squad hosts explosive device training

Last week State Fire Marshal Sink's Bureau of Fire & Arson Investigations bomb squad hosted a training course in Tallahassee on explosive devices to teach students about the different types of explosives known to be used by criminals. During the demonstration the class was able to see, and in some cases actually feel, the power of each explosive. The training was led by Bureau Investigator Joe Spano, with assistance from other State Fire Marshal team members, the Federal Bureau of Alcohol, Tobacco & Firearms and the Florida Public Safety Institute.

The class consisted of representatives from  fire departments, emergency management services, forensic labs, crime scenes labs, and other organizations. After the conclusion of the demonstrations, the trainees reviewed the area where the explosives were detonated. Investigator Spano and other members of the State Fire Marshal team taught the class how to assess the damages caused by each of the 12 explosives.

For more about State Fire Marshal Sink's bomb squad go to

Consumer Corner: Running a small business? Check your insurance

If you own a small business or are thinking of starting a small business, here are some things you need to know when it comes to insurance.

Florida law requires business owners to have workers’ compensation and commercial automobile insurance under the following circumstances:

Workers’ compensation coverage

Workers’ compensation coverage provides medical and partial wage replacement benefits to employees injured as a result of work-related activity. In most instances, having insurance coverage also protects the employer from a civil lawsuit by an injured employee. In Florida, this coverage is provided by a workers’ compensation policy, secured by the employer.

The type of business - defined by classification codes as either construction or non-construction - and the business structure are the key factors in determining whether coverage is required.

Applications for election of coverage or exemption from coverage must be filed with and approved by the CFO Sink's Division of Workers’ Compensation. These applications have specific requirements and may require submission of additional documentation. Applications and instructions are available at the Division’s web site at

For more information on workers’ compensation insurance, call the DFS Bureau of Compliance toll-free at 1-800-742-2214; the Workers’ Compensation Employer Customer Service Center at (850) 413-1601; or visit the Division’s Web site at

Commercial automobile coverage

If your business owns, leases or operates motor vehicles, you must obtain commercial automobile coverage. Coverage requirements and options vary, so check with your insurance agent to determine what types of coverage you need. You also should contact your city and county government and the U.S. Department of Transportation to check for any other requirements.

Commercial motor vehicle coverage is similar to the auto insurance most people carry on their personal cars. Most policies include property coverage for your vehicle, as well as liability coverage for damage caused by an employee driving a company vehicle. If you are using your personal automobile for business purposes, you may not be covered, as the rules and guidelines are different for each insurance company. Review the business use of your personal vehicle with your insurance agent to be sure you are covered.

You can purchase coverage through an insurance company, or you can self-insure your vehicles. For more information on self insurance, contact the Florida Department of Highway Safety and Motor Vehicles, Division of Financial Responsibility, Neil Kirkman Building, 2900 Apalachee Parkway, Tallahassee, FL, 32399-0500, or call (850) 617-2000.

My Family CFO: Planning ahead for the new financial year

Get organized. Organization is the key to success in all things financial.

Write down your goals. Have you ever written down the things you want in life? Not all good things cost money, but savings can give you the opportunity to travel, to retire early, to start a business or to change careers. Putting goals in writing makes them real and becomes a starting point for the planning you need to do.

Create a budget. Your budget is your roadmap, or even better in today's day and age, your GPS for financial planning.

Track your spending. If you haven’t purchased financial accounting software or set up a reliable accounting method of your own, consider doing it. Diligently tracking your expenses is an important part of getting your personal finances in order.

Consider financial advice. Get references on tax professionals and consider sitting down with a financial planning expert to discuss your current plan and what you should do to plan your financial future.

Chief Financial Officer Alex Sink's Consumer eViews 1-877-MY-FL-CFO