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.
