The Division
of Insurance
has reported on its website decisions revoking the nonresident producer
licenses of Tawanda Unique Brown of Harrisburg, Pennsylvania, and Gahan Sharei
Adams, of Akron, Ohio.
On October
22, 2019, Division of Insurance hearing officer, Jean F. Farrington, entered
orders and fines on Orders to Show Cause filed by the Division of Insurance
against Ms. Brown and then on November 4, 2019, entered similar orders and
fines against Ms. Adams.
The only similarity
in the two revocation decisions was that each nonresident producer failed to
report to the Massachusetts Division of Insurance administrative actions taken
in other states against their resident or nonresident producer licenses and that
Massachusetts fined both for their failure to report these administrative
actions.
Of the fifty states, Massachusetts seems like the most aggressive state in fining nonresident producers who fail to report such administrative actions regardless of the nature of the violation. In some cases, the fines seem quite justified. See Agency Checklists’ article of May 12, 2014, “DOI Fines Producer and Revokes License for Premium Theft from Two Agencies.” ($2,000 fine). In other cases, the fines seem disproportionate, if not draconian. See Agency Checklists’ article of June 25, 2014, “DOI fines agent $4000 for not reporting license revocations.” (Call center employee did not send in fingerprints).
In both these decisions, the hearing officer also entered orders on the Division’s Orders to Show Cause:
- Revoking any licenses, including their nonresident producer licenses issued to the Respondents:
- Ordering the return to the Division any license in their possession, custody, or control.
- Prohibiting the Respondents from directly or indirectly transacting any insurance business or acquiring, in any capacity whatsoever, any insurance business in Massachusetts; and
- Ordering the Respondents to comply with the provisions of M.G.L. c. 175, §166B, and dispose of any interests in Massachusetts as proprietor, partner, stockholder, officer, or employee of any licensed insurance producer.
The hearing
officer also fined Ms. Adams $1,250,00 and Ms. Brown $1,000.00 with orders to
pay the fines owed to the Division within 30 days of the entries of the orders.
Both
Respondents defaulted on the Order to Show Cause filed by the Division against
them. The allegations in the Division’s Order to Show Cause that the hearing
officer accepted regarding each of the Respondents were the following:
Ms. Adams’ consent agreement in Ohio over unpaid taxes starts her problems
Massachusetts licensed first Ms. Adams as a nonresident insurance producer on March 25, 2014. Her home state, Ohio, had issued her a resident producer license. Like the laws in Massachusetts, a person holding a state-issued license can have their professional license suspended or revoked for unpaid state taxes.
On August 15, 2016, Ms. Adams and Ohio entered into a
consent agreement resolving a dispute over her suitability for licensure as a
result of unpaid tax obligations to the state of Ohio. Ms. Adams made the
following applications to states requesting nonresident producer license status
without disclosing her consent agreement with Ohio resulting in the following
administrative actions:
- On February 23, 2017, the Utah Insurance Commissioner notified Ms. Adams that her application for a Utah non-resident producer license was denied for providing incorrect, misleading, incomplete or materially untrue information [about the Ohio action] on that application.
- On August 29, 2017, respectively, the South Dakota Division of insurance notified Ms. Adams that her applications for non-resident producer licenses she submitted on June 13, 2017, was denied based on her answer to the application questions concerning whether or not she had ever been a party an administrative proceeding. She answered, “No. But in reviewing the National Producer Index, it was discovered that she had been subject to administrative action in Ohio in 2016.
Also, the states where Ms. Adams had nonresident producer
licenses in force took action to revoke her licenses based on her failure to
report her consent agreement with Ohio.
- On November 1, 2017, the California Department
of Insurance revoked Ms. Adams’s non-resident producer license for failure to
respond to its inquiry about the Ohio administrative action and the South
Dakota March 29, 2017 license denial. - On March 2, 2018, the State of Washington
revoked Ms. Adams’s license for failure to report the 2017 administrative
actions to it and failure to respond to inquiries from the Washington Insurance
Commissioner. - On August 16, 2018, the Virginia State
Corporation Commission revoked Adams’s non-resident producer license for
failure to report administrative actions by other jurisdictions. - On August
21, 2018, Wisconsin revoked Ms. Adams’s nonresident intermediary license and ordered
her to pay a forfeiture of $1,000.00, based on allegations of her failing to
timely disclose administrative actions taken by the states of Ohio, South
Dakota, North Carolina, and California
Massachusetts moves for revocation of Ms. Adams’ Massachusetts license
On May 3, 2019, the Division of Insurance filed an Order to
Show Cause against Ms. Adams seeking the revocation of her Massachusetts nonresident
producer license on the grounds that she failed to report to the Division the 2016
administrative action against her by Ohio, denial by Utah and South Dakota of Ms.
Adams’s applications to renew her non-resident producer license in those
states, and revocation by the states of California, Washington, Virginia and
Wisconsin of her non-resident producer licenses in those jurisdictions,
According the Division’s Order to Show Cause, this failure to report within
thirty days these administrative actions to the Division violated M.G.L. c.
175, §162V(a).
The Order to Show Cause also sought the imposition of fines
for each violation of §162V(a), the Division seeks orders that, among other
things, require Ms. Adams to dispose of any insurance-related interests in
Massachusetts and prohibit her from conducting business in the Commonwealth.
After Ms.
Adams failed to appear, the hearing officer granted a summary decision on Ms.
Adams’s default.
Based on the undisputed evidence of the failure to report
that administrative actions alleged in the Division’s Order to Show Cause, the
hearing officer found that Ms. Adams had failed to report the Ohio, Utah, South
Dakota, California, Washington, Virginia, and Wisconsin administrative actions
to the Massachusetts Division of Insurance within thirty days after the dates
of those orders as required by M.G.L. c. 175, § 162V.
As a result,
the hearing officer entered the requested orders revoking her nonresident
producer license and fined her $1,250, with the fine payable within thirty
days.
Ms. Brown’s failure to disclose food stamp fraud pleas leads to revocations
Massachusetts
licensed Ms. Brown as a nonresident insurance producer on October 5, 2017. She had previously been issued a resident producer license
in her home state of Pennsylvania after she applied in April 2016.
After Ms. Brown had received her resident producer license, the Commissioner of Insurance in Pennsylvania came to discover that Ms. Brown had pled nolo contendere to three felonies: One count of Fraud in obtaining Food Stamps Assistance and two (2) counts of Conspiracy to commit Fraud in Obtaining Food Stamps Assistance. Ms. Brown had not disclosed these pleas on her license application. (For all purposes, except civil liability, a nolo contendere plea is a plea of guilty).
As a result, the Pennsylvania Commissioner entered into a consent order with Ms. Brown revoking her resident producer license as of May 3, 2018. Ms. Brown did not report the revocation of her Pennsylvania license to the Massachusetts Division, within thirty days, as required by law.
Likewise,
she did not report two other administrative actions following Pennsylvania’s
action:
- The August 8,
2018 order of the South Carolina Division of Insurance revoking Ms. Brown’s
non-resident producer license; and, - The October 3,
2018 order by which Delaware revoked Ms. Brown’s non-resident producer license.
Ms. Brown defaults, and hearing officer enters orders and fines
On January 24, 2019, the Division of Insurance (“Division”)
filed an Order to Show Cause (“OTSC”) against Ms. Brown seeking the revocation
of her Massachusetts producer license on the grounds that she was subject to
discipline under the provisions of M.G.L. c.175, §162R (a)(9) for “having an
insurance producer license, or its equivalent, denied, suspended or revoked in
any other state, province, district or territory.”
The Order to Show Cause also alleged that Ms. Brown failed
to report to the Division administrative actions revoking producer licenses
issued to her by her home state, Pennsylvania, and by South Carolina and
Delaware, within thirty days as M.G.L. c. 175, §162V (a) required. In addition
to revocation of Ms. Brown’s license and the imposition of fines, the Division
sought its usual orders that required a respondent, such as Ms. Brown, to
dispose of any insurance-related interests in Massachusetts and prohibit them from
conducting any insurance-related business in the state.
Based on Ms.
Brown’s failure to contest the Division’s Order to Show Cause, the hearing
officer defaulted her and granted the Division’s request for a summary
decision. The hearing officer granted the orders requested by the Division
listed above and imposed $1,000 in fines. The fine consisted of $500 for
failure to report the Pennsylvania revocation and $250 each for the failure to
report the Delaware and South Carolina revocations.
