ALJDEC decisions subject to certification as final

18A-078-INS · Department of Insurance · 2019-01-30

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: January 8, 2019, record open until January 11, 2019. APPEARANCES: Assistant Attorney General Deian Ousounov represented the Arizona Department of Insurance (“Department”). Tranisha Kay Robinette appeared, representing Respondents. ADMINISTRATIVE LAW JUDGE: Kay Abramsohn _____________________________________________________________________

FINDINGS OF FACT Respondent ASAP Bail Bonds LLC (“ASAP”) was licensed in October 2015; the ASAP license is set to expire on October 31, 2019. Tranisha Kay Robinette (“Ms. Robinette”) was licensed as a bail bond agent in October 2014; her license expired on December 31, 2017. Ms. Robinette was the sole manager/member of ASAP and was the Designated Responsible Licensed Producer of ASAP. The Department received a Request for Assistance (“RFA”) on October 12, 2017 from Martin Perez alleging that ASAP and Ms. Robinette had failed to post a $100,000.00 surety bond in a particular criminal case, and subsequently failed to provide a full refund of the $10,000.00 premium he had paid.[1] On inquiry from the Department, Ms. Robinette explained that she had been informed by her insurance agent that there was a second mortgage on Mr. Perez’ home and that his property, therefore, did not meet the equity requirements for the bond which resulted in Ms. Robinette not completing bond services. The Department was unable to locate any evidence of a second mortgage or a line of credit on the Perez property.[2] While Ms. Robinette returned $5,000.00 to Mr. Perez in November 2017, she failed to return the entire premium amount Perez had paid to her. The surety company with whom Ms. Robinette was associated, Sun Surety, paid $5,000.00 to Mr. Perez on March 13, 2018. The Department received a RFA on January 12, 2018 from Tami Doherty alleging that ASAP and Ms. Robinette had failed to release a $900.00 cash bond following a December 15, 2017 Maricopa County Superior Court Order in a particular criminal case despite numerous communications to Ms. Robinette. Sun Surety paid $900.00 to Ms. Doherty on January 17, 2018. The Department received a RFA on January 12, 2018 from Jong W. Lee alleging that ASAP and Ms. Robinette had failed to release both a $3,500.00 cash bond and the title to a vehicle that had been used to secure a bond in 2017 regarding three particular criminal matters. In November 2017, the Maricopa County Superior Court had ordered that all three bonds be exonerated and released. On inquiry from the Department, Ms. Robinette explained that there had been fees in the amount of $400.00 on the bonding, leaving a collateral amount of only $3,100.00 and that she had tried to discuss the matter with “Mr. Woo.”[3] On behalf of ASAP, on October 1, 2017, an attorney had attended one court session regarding these matters. On October 5, 2017, the court had ordered the scheduled October 10, 2017 bond forfeiture hearing be vacated. There is no evidence that an attorney on behalf of ASAP had attended any court session other than the first court session regarding these matters. Sun Surety notified the Department by letter dated February 28, 2018 that it was canceling the surety bonds of ASAP and of Ms. Robinette. Sun Surety refunded $2,400.00 to Mr. Lee Woo on March 13, 2018. In June 2018, the Department was able to confirm, through an attorney for Lee Woo, that the lien on the family vehicle had been removed. Based on the receipt of the three complaints, the Department issued a Subpoena Duces Tecum to Ms. Robinette for the ASAP bail bond log for the period of December 31, 2017 through January 23, 2018.[4] Ms. Robinette failed to comply with the subpoena by surrendering the log to the Department. The matter was not resolved informally and on December 27, 2018, the Department issued its Notice of Hearing with regard to the matter. Ms. Robinette’s answer essentially admitted the complaints, but indicated that she did not have sufficient information to admit or deny some of the factual allegations. Ms. Robinette indicated that she had not received the subpoena in time to respond with the log and that, once she did receive the subpoena, she had submitted the log to Sun Surety on February 18, 2018 and “worked exclusively with Sun Surety to submit the required documentation to the Department…” At hearing, Ms. Robinette indicated that she believed that she was being compliant because the general insurer, Sun Surety, was working with the Department to take care of things. At hearing, Ms. Robinette indicated that she had kept separate accounts for the collateral and the premiums; however, at the time when she was required to return the $10,000.00, she “only had $5,000.00” of the $10,000.00 and she had spent $5,000.00 on “other company things.” At hearing, she testified that she knew such collateral was not able to be used until the fees are charged. Ms. Robinette attributed miscommunication between she and Sun Surety regarding the alleged second mortgage and Mr. Perez, therefore, not meeting the equity requirements. Ms. Robinette indicated that it was her understanding that collateral monies needed to be returned “within seven to thirty days,” that being the “general consensus of the industry.” Ms. Robinette stated that, in the Lee Woo matter, the attorney for ASAP had attended two court sessions, recalling that she kept track of such through a regular practice of the attorney texting to her when he was in court for an appearance. The hearing record was held open until January 11, 2019 for Ms. Robinette to search for such a text message and provide it to the Tribunal; however, the Tribunal did not receive any such information from Ms. Robinette. With regard to the entire matter, Ms. Robinette indicated that this was her first business, that she had been overwhelmed and that she had, since, worked to resolve the issues which she wants to continue to work to resolve any outstanding matters. Ms. Robinette requested that she not be “revoked” but be given a permanent suspension. The Department requested that the ASAP and Robinette licenses be revoked to protect the public interest regarding proper conducting of bail bond services. The Department argued that Ms. Robinette had improperly retained collateral beyond the time it should have been returned to the customers and that she had failed to communicate or respond with the Department, showing that she cannot be regulated. CONCLUSIONS OF LAW This matter lies within the Department’s jurisdiction.[5] The Department bears the burden of proof to establish cause to discipline Respondent’s bail bond agent’s license by a preponderance of the evidence.[6] “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[7] The Department established that ASAP’s and Ms. Robinette’s conduct, as described above, constituted improperly withholding, misappropriating, or converting monies received in the course of insurance business, within the meaning of A.R.S. § 20-295(A)(4) as applied to bail bond agents under A.R.S. § 20-340.06. The Department established that ASAP’s and Ms. Robinette’s conduct, as described above, constituted using fraudulent, coercive or dishonest practices, or demonstrating incompetence, untrustworthiness or financial irresponsibility in the conduct of insurance business in the state or elsewhere, within the meaning of A.R.S. § 20-295(A)(8) as applied to bail bond agents under A.R.S. § 20-340.06. The Department established that ASAP’s and Ms. Robinette’s conduct, as described above, constituted failing to return to the person who deposited it with the bail bond agent, as soon as the obligation, the satisfaction of which was secured by the collateral, is discharged, within the meaning of Arizona Administrative Code R20-6-601(E)(4)(b). The Department established that ASAP’s and Ms. Robinette’s conduct, as described above, constituted violations of the applicable statutes and rules, within the meaning of A.R.S. § 20-295(A)(2) as applied to bail bond agents pursuant to A.R.S. § 20-340.06. The conduct of ASAP and Ms. Robinette Respondent’s conduct, as described above, provides grounds for the Director of the Department, or any Interim Director, to suspend or revoke the ASAP license and Ms. Robinette’s bail bond agent license, or refuse to renew, impose a civil penalty and/or order restitution, pursuant to A.R.S. § 20-295(A)(2), (B), and (F) as applied to bail bond agents pursuant to A.R.S. § 20-340.06. RECOMMENDED ORDER Based on the foregoing, it is recommended that the Director, or Interim Director, revoke the ASAP’s Arizona License ID 1126048 and revoke Tranisha K. Robinette’s Arizona License ID 1091011. In the event of certification of the Administrative Law Judge Decision by the Director of the Office of Administrative Hearings, the effective date of the Order will be five days from the date of that certification. Done this day, January 30, 2019.

/s/ Kay Abramsohn Administrative Law Judge

Transmitted electronically to:

Keith A. Schraad, Interim Director Arizona Department of Insurance

----------------------- [1] A different bail bond agent posted a $100,000.00 bond for Mr. Perez on September 29, 2017. [2] At hearing, the Department’s witness indicated that they found Mr. Perez had refinanced in 2016, that the first mortgage had been paid off at the time he obtained the refinancing, and that there was no second mortgage. [3] Exhibit 19 shows a client form for “Lee Woo” and a $400.00 fee and a $50.00 fee amount. [4] As Ms. Robinette’s license had expired on December 31, 2017, the Department wanted to be assured that she was not still offering bond services with an expired license. [5] See A.R.S. § 20-340 et seq. [6] See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(A) and A.A.C. R2-19- 119(B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). [7] Morris K. Udall, Arizona Law of Evidence § 5 (1960).

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Office of Administrative Hearings 1740 West Adams Street, Lower Level Phoenix, Arizona 85007 (602) 542-9826