ALJDEC decisions subject to certification as final

20A-AL19-015-BTR · Board of Technical Registration · 2020-03-11

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

In the Matter of:

Amanda Hensley,

Controlling Person Cert. # 67706

(Delinquent),

Alarm Agent Cert. # 63230

(Pending),

and

EnGarde, LLC,

Firm Registration # 19953

(Pending),

Respondents.

No. 20A-AL19-015-BTR

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: February 21, 2020.

APPEARANCES: Deanne Reh, Assistant Attorney General, appeared on behalf of the Arizona State Board of Technical Registration. Amanda Hensley and EnGarde, LLC, Respondents, did not appear.

ADMINISTRATIVE LAW JUDGE: Antara Nath Rivera.

_____________________________________________________________________

FINDINGS OF FACT

On or about August 31, 2016, Respondents submitted an initial firm registration application (Application).

On November 23, 2016, Respondents applied for a Controlling Person Certificate (Certificate). Respondents were granted Certificate #63232.

On or about August 30, 2018, Certificate #63232 expired as a matter of course and Respondents were requested to reapply for another Certificate.

On or about October 5, 2018, Respondents reapplied for another Certificate.

On or about October 17, 2018, Respondents were granted Certificate #67706. Respondents failed to pay the fees on Certificate #67706.

On or about November 16, 2018, Certificate #67706 became delinquent.

Respondents’ Business Registration Certificate #19953 was in pending status because of the lack of affiliation with a validly certified controlling person. Respondent’s Business Registration remained in the pending status unless affiliated with a certified controlling person and would ultimately expire on August 31, 2021, unless renewed and reinstated. Pending status was equivalent to a suspension of a certification, in which the certification is held inactive status until the situation that caused the suspension was resolved. Pursuant to Arizona Revised Statutes (A.R.S.) §§ 32-122.05(A) and 32-122.06(A), certification or registration is valid for a three year period.

Amanda Hensley created EnGarde and registered it as an alarm business and an alarm agent. Shea Hensley, Mrs. Hensley’s husband, worked for Respondents as an alarm agent. Mr. Hensley was not certified or registered as an alarm agent as required by A.R.S. §§ 32-121, 32-122.06, and 32-145.

On or about February 1, 2018, Mr. Hensley sold an alarm system to Earl Wallace at 208 South 72nd Place, Mesa, Arizona, on behalf of Respondents.

On or about March 1, 2018, Mr. Hensley sold an alarm system to Vicky Learn at 123 South 75th Circle, Mesa, Arizona, on behalf of Respondents.

On or about March 1, 2018, Mr. Hensley sold an alarm system to Betty Learn at 318 South 74th Street, Mesa, Arizona, on behalf of Respondents.

On or about April 1, 2018, Mr. Hensley sold an alarm system to Heidi Ellefson at 302 South 72nd Circle, Mesa, Arizona, on behalf of Respondents.

On or about May 8, 2018, Mr. Hensley sold an alarm system to Gerald and Rosalie Rother at 312 South 74th Street, Mesa, Arizona, on behalf of Respondents.

On or about October 28, 2019, the Arizona State Board of Technical Registration (the Board) filed a Complaint against Respondents. A hearing was set, before the Board, on December 10, 2019. Respondents were given until December 2, 2019, to file an answer to the Complaint. Respondent failed to file a timely answer.

On or about December 4, 2019, Respondents filed an answer. In its Answer, Respondents denied that Mr. Hensley sold alarm systems and that Mr. Hensley represented himself as an alarm agent. Respondents stated that Mr. Hensley only represented himself as a television salesperson who addressed television needs and questions.

The State of Arizona Attorney General’s Office (Attorney General) filed a Motion to Deem Allegations Admitted (Motion to Deem).

On or about December 10, 2019, the Board waived the late filing of Respondents’ answer and denied the Motion to Deem. The Board referred the case to the Office of Administrative Hearings (OAH), an independent state agency, for an evidentiary hearing.

On or about January 8, 2020, the Board issued a Second Amended Complaint and Notice of Hearing (Second Complaint) setting the matter for hearing on February 21, 2020. In the Second Complaint, the Board alleged that Respondents aided and abetted the unlicensed activity of Mr. Hensley, who sold alarm services to the public, on five separate occasions, without the Board’s certification. Respondents may be disciplined pursuant to A.R.S. § 32-128(C)(3).

The Notice of Hearing informed the parties that “[i]f you fail to appear for the hearing, the hearing may proceed in your absence.”

Respondents did not request to appear telephonically and did not request that the hearing be continued. Although the start of the hearing was delayed 20 minutes, Respondents did not appear through an authorized member, employee, or attorney. Consequently, Respondents did not present any evidence.

A hearing was held before the OAH on February 21, 2020. The Board submitted seven exhibits and presented the testimonies of Rene Segura, Robert Stam, Investigator Douglas Kraemer, Rosalie Rother, and Vicky Learn.

HEARING EVIDENCE

Mr. Segura testified that he was an alarm technician. He worked for various subcontractors and installed alarm systems. Mr. Segura worked for Respondents when Respondents owned Cingo and EnGarde. Mr. Segura’s job was to install alarm systems for Respondents. Mr. Segura never sold alarm systems. Mr. Segura installed alarm systems for Ms. Learn and Mr. Wallace when he worked for Respondents.

Mr. Stam testified that he was the Licensing and Operations Manager for the Board. Mr. Stam processed applications for the alarm industry. Mr. Stam investigated Respondents and authored a timeline for Respondents’ certifications. Certificates #19953 (the Firm), #63230 (the Alarm agent), #63232 (the Controlling Person), and #67706 (the Controlling Person) were active from November 23, 2016 to August 30, 2018. All Certificates expired on August 31, 2018. They were expired until October 16, 2018. On or about October 17, 2018, all Certificates became active until November 16, 2018. From November 17, 2018, until present, Certificates #19953 and #63230 were pending awaiting renewal payment from a Controlling Person. Mr. Stam stated that meant the Certificates were suspended. Certificates #63232 and #67706 were delinquent and expired and also awaiting renewal payment by a Controlling Party. Mr. Stam opined that an alarm agent cannot be active unless he/she worked for an active firm.

Mr. Stam stated that Mr. Hensley did not have a certificate or license to be an alarm agent.

Investigator Kraemer testified that he was an investigator with the Board and investigated Respondents’ case. His investigation revealed that in 2016, Mr. Hensley sold alarm systems to senior citizens who could not afford the alarm systems. Mr. Hensley sold them bundled packages which included alarm systems and television services. After they signed up, they were double billed for their services and any existing services they had.

Investigator Kraemer investigated Mrs. Hensley after he received Mr. Wallace’s complaint that his television did not work after it was installed by Respondents. On or about February 1, 2018, Mr. Wallace entered into a sales contract with Safe Streets, a subcontractor. Mr. Wallace came in to contact with Mr. Hensley after Mr. Hensley canvassed Mr. Wallace’s neighborhood, Mesa Mobile Home Park. Mr. Hensley was described as a “walk and talk knocker.” That was a term for people who went door to door to sell products. Mr. Hensley offered Mr. Wallace an alarm system and television bundle to save Mr. Wallace money. Mr. Wallace purchased the alarm system and television bundle from Mr. Hensley. Mr. Wallace stated that neither the television nor the alarm system worked. Additionally, he received a large bill for nonpayment for his previous service. Mr. Wallace never dealt with a female.

Investigator Kraemer interviewed Ms. Ellefson. Ms. Ellefson also purchased an alarm system and television bundle from Mr. Hensley. Ms. Ellefson provided Investigator Kraemer with Mr. Hensley’s business card. Mr. Hensley sold Ms. Ellefson products under the guise of operations manager for EnGarde. While Ms. Ellefson was unable to remember whether she bought an alarm system and television bundle or just the alarm system, she remembered it was through ADT.

Investigator Kraemer interviewed Mr. and Mrs. Rother and Ms. Learn. Mr. Hensley sold an alarm system and television bundle to Mr. and Mrs. Rother and Ms. Learn. All of them faced the same issues that the television and/or alarm system did not work. Additionally, Mr. and Mrs. Rother were doubled billed.

Investigator Kraemer attempted to locate Mr. and Mrs. Hensley. He was unable to contact them by phone or email and their mail was returned as undeliverable.

At the hearing, Mrs. Rother testified that Mr. Hensley sold her and her husband an alarm system and free television. Mr. Segura installed the system in the Rother’s home in Arizona. Mrs. Rother wanted the same system in her home in Minnesota. Mr. Henley sold the Rothers the same system for their home in Minnesota. When Mrs. Rother informed ADT of the new system, ADT stated that it could not remove the system due to the current contract. Mr. Hensley spoke directly with an agent at ADT and explained that he was in the process of buying the contract. Based on that conversation, ADT removed the system and Mr. Hensley hired someone install Respondents’ system through Guardian. Mrs. Rother was double billed by ADT and Guardian. Mrs. Rother tried to stop the billing but was unsuccessful. Mrs. Rother called Respondents and spoke to a woman who instructed Mrs. Rother not to pay the bills. Ultimately, the Rother’s television was shut off by Respondents in Minnesota.

Ms. Learn testified that a neighbor referred her to Mr. Hensley because of the alarm system and television bundle he sold them. Ms. Learn, along with her mother, Betty Learn, contacted Mr. Hensley. Mr. Hensley sold Betty Learn an alarm system and television bundle. Her alarm system were installed by Mr. Segura.

Mr. Hensley sold the same alarm system and television bundle, he sold Betty Learn, to Ms. Learn. Mr. Segura also installed Ms. Learn’s alarm system. After the installation, Mr. Hensley informed Ms. Learn that there was a problem with Guardian and that he switched to ADT. Soon thereafter, the television did not work. Mr. Hensley promised to write checks to Ms. Learn and Betty Learn for payments and bills owed by Ms. Learn and her mother as a result of the contract and television issues. Ms. Learn tried to contact Mr. Hensley but he stopped answering his phone.

Furthermore, Ms. Learn testified that while Mr. Hensley sold her the bundle, the name on the contract was “Amanda Hensley.” When Ms. Learn asked Mr. Hensley who “Amanda Hensley” was, Mr. Hensley replied that she was his wife. Ms. Learn never dealt with Mrs. Hensley.

CONCLUSIONS OF LAW

The Board is the duly constituted authority for the regulation and control of the alarm industry, and the firms under which registrants practice pursuant to A.R.S. § 32-101. The Board is authorized by A.R.S. § 32-128(C)(4) to take disciplinary action against the holder of a certificate or registration who is charged with a violation of the Board’s rules or statutes.

Pursuant to A.R.S. § 32-128(E), the Board issued a Second Complaint. Respondents was the holder of three certificates: one as an alarm agent under Certificate #63230; one as the controlling agent of Respondents’ business under Certificate #67706, firm registration under Certificate #19953. Thus, the Board possesses jurisdiction over this subject matter.

Respondents bear the burden of proof to establish that it met statutory and regulatory qualifications for an alarm agent and a controlling person certification by a preponderance of the evidence. Respondent did not present evidence to establish such compliance.

“A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” A preponderance of the evidence is “[t]he greater weight of the evidence, not necessarily established by the greater number of witnesses testifying to a fact but by evidence that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”

The evidence presented at hearing established that Amanda Hensley, holder of a Controlling Person Certificate and Alarm Agent Certificate, and EnGarde, holder of Alarm Firm Registration practiced without registration with the Board in violation of A.R.S. § 32-128(E). Mr. Hensley, an unlicensed and unregistered agent of Respondents, sold alarm systems as an alarm agent, on five occasions, under the guise of Respondents’ name. The evidence showed that Mrs. Hensley aided and abetted Mr. Hensley when her name appeared on the alarm system contract that was sold by Mr. Hensley. The evidence also showed that Mr. Hensley’s actions as an alarm agent and his modus operandi were similar, over the years, when he worked for Respondents.

Since May 1, 2013, alarm agents and alarm businesses cannot operate in Arizona unless they have received certificates from the Board. See A.R.S. § 32-122.05(A). A.R.S. § 32-122.07(A) allows the Board to “deny an application for certification as an alarm business or alarm agent if a controlling person of an alarm business or an alarm agent lacks good moral character . . . .” A.A.C. R4-30-101(12)(e) provides that “‘[g]ood moral character and repute’ means that the registration or certification applicant/registrant . . . [h]as not engaged in fraud or misrepresentation in connection with the application for registration, certification, or related examination.”

The evidence presented at hearing established by a preponderance of the evidence that Respondents and Respondents’ Firm failed to comply with the Board’s rules and statutes in violation of A.R.S. § 32-121 when it allowed an unregistered agent to represent himself as an alarm agent to sell alarm systems.

Respondents’ actions, as set forth above, constitute grounds for discipline against Respondent pursuant to A.R.S. § 32-106.02, which authorizes the Board to impose discipline against persons who practice or offer to practice a Board regulated profession without first securing proper registration.

The Board is authorized to impose a civil penalty of no more than $2,000.00 per violation. There were five violations in this matter. Given the nature of Respondent’s and Respondent Firm’s conduct, the Administrative Law Judge finds that a civil penalty of $10,000.00 is appropriate.

ORDER

IT IS ORDERED that Respondents violated A.R.S. § 32-128(C)(3);

IT IS FURTHER ORDERED that the Board impose disciplinary action against Respondents for three statutory violations and require Respondents to pay the sum of $10,000.00 ($2,000.00 for each violation) as a civil penalty pursuant to A.R.S. § 32-106.02(B).

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 is five days after the date of that certification.

Done this day, March 12, 2020.

/s/ Antara Nath Rivera

Administrative Law Judge

Transmitted electronically to:

Melissa Cornelius, Executive Director

Board of Technical Registration

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