The Division is well on its way to cleaning out a backlog of nonresident producer licensees cases involving Massachusetts producer licensees failing to report final administrative actions against their insurance licenses in other states.
Since June 16, 2020, a division hearing officer has issued eight decisions revoking the nonresident producer licenses of eight individuals. Agency Checklists reported on the first six revocations. See Agency Checklists articles of June 30, 2020, “Mass. DOI Hearing Officer Revokes Two Producers’ Licenses But Denies The Revocation Of A Third’s,” and July 14, 2020, “Mass. DOI Hearing Officer Revokes 3 Additional Producers’ Licenses And Issues Fines On 2.”
The hearing officer now has issued two additional revocation decisions. In these decisions, the Division of Insurance (“Division”) hearing officer, Jean F. Farrington, entered orders and imposed fines on Orders to Show Cause filed by the division against:
- Jessica Elaine Edney of Fredericksburg, Virginia
- Henri-Bernard Courbin of Little Rock, Arkansas
Fines and Orders on the two Orders to Show Cause filed by the Division
In the cases of these two nonresident producer licensees (“Licensees”), the hearing officer also entered Orders against them:
- Revoking any licenses, including their nonresident producer licenses issued to the Licensees.
- Ordering the return to the division of any license in their possession, custody, or control.
- Prohibiting the Licensees from directly or indirectly transacting any insurance business or acquiring, in any capacity whatsoever, any insurance business in Massachusetts.
- Ordering the Licensees to comply with the provisions of G. L. c. 175, §166B, and dispose of any interests in Massachusetts as a proprietor, partner, stockholder, officer, or employee of any licensed insurance producer.
The hearing officer also fined Mr. Courbin $500.00, and Ms. Edney $900.00 The Orders entered require these fines paid to the division within 30 days.
Both licensees defaulted on the Orders to Show Cause filed by the division against them.
The fact and allegations involved in the Orders to Show Cause that the hearing officer accepted, regarding each of the licensees, on the division’s motions for summary decision, were the following:
Jessica Elaine Edney
The Commonwealth of Virginia issued Ms. Edney, her home-state resident producer license. She held nonresident producer licenses in several states, including North Dakota, Idaho, and Arkansas. Massachusetts first issued her a nonresident insurance producer on July 28, 2015.
Admitted misstatement leads to $200 fine but no license revocation
In September 2016, the North Dakota Insurance Department learned, under circumstances that are not entirely clear, from Ms. Edney that she had incorrectly answered background question 1A on her August 19, 2016, application for a nonresident insurance producer license. On the application, Ms. Edney answered “no” to background question 1A, which states, “Have you ever been convicted of a misdemeanor, had a judgment withheld or deferred, or are you currently charged with committing a misdemeanor?” She advised the department that she should have answered “yes” and disclosed a 2002 conviction for tax evasion.
Based on Ms. Edney’s misstatement, the North Dakota Department and Ms. Edney signed a consent decree effective March 9, 2017. Ms. Edney agreed to pay a $200.00 fine but kept her North Dakota nonresident producer license.
Failure to report $200 fine to home state leads to loss of resident producer license
Ms. Edney did not report the North Dakota fine within thirty days to the Virginia Corporation Commission’s Bureau of Insurance as required by Virginal law. As a result, on October 17, 2018, the Virginia Corporation Commission revoked Ms. Edney’s resident producer license.
Arkansas followed on Virginia’s revocation by suspending her nonresident producer license on November 17, 2017, because she no longer had a resident producer license in her home state.
On July 9, 2018, the Idaho Department of Insurance also revoked Ms. Edney’s nonresident producer license on the ground that she no longer had a producer license in her home state.
Massachusetts files against Ms. Edney for failure to report administrative proceedings against her
On June 5, 2019, the Division filed an Order to Show Cause against Ms. Edney seeking revocation of her Massachusetts nonresident producer license alleging she was subject to discipline under the provisions of M.G.L. c.175, §162R (a)(9) (“failing to report within thirty days administrative proceedings in other states”). The Division’s show-cause order alleged that Ms. Edney failed to report to the Division administrative actions revoking the producer licenses issued to her by North Dakota, Idaho, and Virginia. The show-cause order also alleged that she failed to report her license suspension by the state of Arkansas.
After Ms. Edney did not respond to the show-cause order, the Division moved, on July 25, 2019, for the entry of a default and the allowance of a motion for a summary decision revoking Ms. Edney’s nonresident producer license and entering the division’s requested Orders. The hearing officer scheduled a hearing on the summary decision motion for August 20, 2019.
After Ms. Edney did not appear at the hearing or otherwise communicate with the Division about the hearing, the hearing officer found her in default and proceeded to rule on the undisputed evidence concerning the unreported administrative actions against Ms. Edney in North Dakota, Virginia, Arkansas, and Idaho.
Hearing officer finds no violation for not reporting suspended license but sustains other violations
Consistent with her prior decisions on the question of licensees reporting license suspensions in other states, the hearing officer, in ruling on Ms. Edney’s failure to report her Arkansas license suspension to the Division found:
The statutory reporting requirement M.G.L. c. 175, § 162V(a) is limited to “final” dispositions; I am not persuaded that a suspension is appropriately characterized as final, absent evidence that the license in question was subsequently revoked. For that reason, I conclude that Ms. Edney was not obligated to report the Arkansas suspension.
However, the hearing officer found that: “The record supports the conclusion that Ms. Edney did not report to the Division the North Dakota, Virginia or Idaho administrative actions and thereby violated M.G.L. c. 175, §162V(a).”
Hearing officer denies Division’s request for multiple $1,000 fines
The Division, consistent with its standard requests in these types of revocation cases, sought for the hearing officer to impose civil penalties of $1,000 per each failure to report. The Division’s argument rested on the terms of G.L. c. 175, § 162R(a)(2) that prohibits “violating any insurance laws.” That statute, § 162R, also lists other violations but generally provides that the commissioner may allow fines for any of the violations equal to those allowed under G.L. c. 176D, §7 (which allows for fines of up to $1,000 for “unfair and deceptive acts committed in the business of insurance”).
The hearing officer denied, as she had done before, the Division’s request. She reasoned that decisions in license revocation proceedings distinguish between affirmative acts of a licensee in Massachusetts, resulting in license revocation and acts by third-parties, e.g., out-of-state insurance commissioners, to revoke or suspend a Massachusetts licensee’s nonresident producer license in that state.
The hearing officer summed up her position on the Division’s request for a higher fine as “I find no reason to expand a specific violation of a reporting statute into a ground for revoking a license and imposing a second fine.”
Ms. Edney fined a total of $900 for the three reporting violations
On the imposition of a fine, the hearing officer noted that, on October 13, 2017, Ms. Edney’s home state, Virginia, revoked her producer license. On that date, by operation of law, she became ineligible to hold a Massachusetts producer license. To the hearing officer, Ms. Edney’s failure timely to report the loss of her license in her home state, as required under §162V (a) within thirty days, allowed her to remain licensed as a nonresident Massachusetts producer for approximately a year after she became ineligible for that license. Based on that fact, the hearing officer imposed the maximum fine, $500, for that violation.
Revocations, the hearing officer noted, by other jurisdictions may support disciplinary action, but do not automatically and immediately affect a licensee’s eligibility to hold a nonresident producer license. In this case, however, the North Dakota action was based on Ms. Edney’s failure to correctly answer a background question on her nonresident license application that was submitted contemporaneously with her Massachusetts application. The hearing officer opined that “had that action been reported, Massachusetts might have revisited its decision to approve her application.” Also, a report of the Idaho action might have resulted in a more immediate response to Ms. Edney’s ineligibility for a Massachusetts license, according to the hearing officer. Based on those facts, the hearing officer imposed a fine of $200 each for Ms. Edney’s failure to report the administrative actions taken by North Dakota and Idaho with a final order of:
FURTHER ORDERED: that Jessica Elaine Edney shall pay a fine of Nine Hundred Dollars ($900) to the Division within 30 days of the entry of this order. to the Division within 30 days of the entry of this order.”
Mr. Courbin began work for Teletech in Little Rock, Arkansas, where he lived in 2014. Teletech (now known as TTEC) is a public company that describes itself as “a customer experience technology and services company.” Primarily, the company operates call centers in the United States and globally for large companies that market to consumers. TTEC provides these marketing and customer relation services from and through call centers operating on six continents that employ over 48,000 full-time and contract workers.
Selling insurance around the country from a call center for three years
Mr. Courbin’s focus at TTEC’s Little Rock call center involved selling and servicing health insurance policies for companies like United Health.
To work at Teletech, Mr. Courbin obtained his resident insurance producer license in Arkansas on September 20, 2014. Based on that resident producer license, he obtained a Massachusetts nonresident insurance producer on October 17, 2014. He renewed his Massachusetts nonresident producer license on January 20, 2017.
Besides his nonresident producer license in Massachusetts, Mr. Courbin applied for an obtained similar nonresident producer licenses from Nebraska, Mississippi, and Idaho and other states.
Although Mr. Courbin kept his nonresident producer licenses in force in 2017, by 2018, he was no longer selling insurance for TTEC. When his Arkansas license expired on February 1, 2018, he did not renew it, and the license lapsed.
Lapsing home-state license without notifying other states, a trap for the unwary
While Mr. Courbin committed no violation by allowing his license to lapse, he did have the duty to report the lapse to the states where he held nonresident producer licenses. His nonresident producer licenses depended on his maintaining his primary state producer license in full force and effect. Once that resident producer license lapsed, all his nonresident producer licenses became legally invalid. However, after his resident producer license lapsed, Mr. Corbin did not notify Nebraska, Mississippi, Idaho, or Massachusetts of his resident producer license had lapsed.
When the Nebraska Department of Insurance learned of the lapse of his resident producer license, they revoked Mr. Courbin’s nonresident producer license on October 3, 2018. The grounds for the revocation was that his home-state producer license had expired in February 2018.
Three weeks later, on October 24, 2018, the Mississippi Insurance Department revoked Courbin’s nonresident producer license for the same reason: He no longer had a resident producer license in his home state.
On the same day, October 24, 2018, the Idaho Insurance Department revoked Mr. Courbin’s license, again for the same reason. He no longer had an insurance license in his home state.
Mr. Courbin did not report the Nebraska, Mississippi, or Idaho administrative actions to the Division as required under M.G.L. c. 175, § 162V(a)(9) requiring notice of final administrative actions against a Massachusetts licensee in another state within thirty days.
Division files against Mr. Courbin for failure to report revocation of nonresident producer licenses
On July 1, 2019, the Division of Insurance filed its Order to Show Cause against Mr. Courbin. The Division alleged that his failure to report to the Division, his license revocations by Nebraska, Mississippi, and Idaho within thirty days as required by law, violated G.L. c. 175, §162V.
The Division served the show-cause order on Mr. Courbin by certified mail, return receipt requested to his business address at TTEC, which the Post Office returned marked as “unclaimed.” The mail to Mr. Courbin’s residential address in Little Rock was returned with the legend, “vacant unable to forward.”
On November 20, 2019, the Division moved for entry of a default and filed a motion for summary decision. The hearing officer set a hearing on the motion for summary decision for December 20, 2019.
Because Mr. Courbin did not contest the show-cause order or appear at the hearing, the hearing officer defaulted him and reviewed the evidence of the Division.
The evidence at the summary decision motion hearing included documentation of the Nebraska, Mississippi, and Idaho license revocations showing violations of G.L. c. 175, § 162V(a)(9)’s requirement for reporting out-of-state administrative actions within thirty days to the Division.
No need to report home-state license lapse, but must still report nonresident producer license revocations
The hearing officer remarked in her decision that the Division had submitted no information about the lapse of Mr. Courbin’s Arkansas license. She noted that unless the lapse related to an administrative proceeding, of which there was no such evidence, Mr. Courbin had no obligation under Massachusetts law to report the lapse to the Division.
However, the hearing officer found that Mr. Courbin had had an obligation to report to Nebraska, Mississippi, and Idaho any revocations within thirty days of the final administrative action revoking his nonresident producer licenses in those states.
Since Mr. Courbin’s Massachusetts nonresident producer license continued in effect for more than thirty days after the Nebraska, Mississippi, and Idaho revocations took effect, he had the legal duty under Massachusetts law to report those administrative actions to the Massachusetts DOI. Since the hearing officer found the division’s evidence of Mr. Courbin’s reporting violation, she allowed the division’s motion for summary decision.
The hearing officer granted the Division’s request for revoking Mr. Courbin’s Massachusetts licenses. She also entered the Division’s requested orders prohibiting him from being directly or indirectly involved in Massachusetts insurance transactions or businesses.
Division’s request for multiple fines denied
In Mr. Courbin’s case, as in Ms. Edney’s, the declined to impose the fines requested by the Division. The Division requested the maximum fines allowed for each violation. The hearing officer demurred stating: “In the circumstances of this matter, I am not persuaded that multiple fines are appropriate.”
The hearing officer reasoned that:
[A] timely report of the first of the administrative actions, by Nebraska, would have been sufficient to notify the Division that [Mr.] Courbin was no longer licensed in his home state, and rendered the subsequent actions repetitive. [Mr.] Courbin’s failure to comply allowed him to remain licensed in Massachusetts long after he was eligible to hold such a license, and I will, therefore, impose a fine of $500, the maximum available for a violation of §162V(a).
The hearing officer final order on the fine was
FURTHER ORDERED: that Henri-Bernard Courbin shall pay a fine of Five Hundred Dollars ($500) to the Division within 30 days of the entry of this order.