ALJDEC decisions subject to certification as final
22A-014-INS · Department of Insurance and Financial Institutions - Insurance · 2022-07-15
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
In the Matter of:
Sarkisian, Harout
(National Producer License No. 17633096)
Respondent
No. 22A-014-INS
ADMINISTRATIVE LAW JUDGE
DECISION
HEARING: June 27, 2022
APPEARANCES: Harout Sarkisian on his own behalf; James Rolstead, Esq. for the Department of Insurance and Financial Institutions
ADMINISTRATIVE LAW JUDGE: Thomas Shedden
FINDINGS OF FACT
On May 16, 2022, the Arizona Department of Insurance and Financial Institutions (“Department”) issued a Notice of Hearing and Complaint setting the above-captioned matter for hearing on June 27, 2022 at the Office of Administrative Hearings.
Through its Complaint, the Department alleged that Respondent Harout Sarkisian failed to report that through a Final Order dated July 26, 2021, the New Mexico Office of Superintendent of Insurance revoked his non-resident producer’s license, and that Mr. Sarkisian had failed to properly update his email address of record.
The Department presented the testimony of its Administrative Enforcement Supervisor Wendy Greenwood.
Mr. Sarkisian appeared and testified on his own behalf.
Mr. Sarkisian is a licensed Arizona resident producer, holding National Producer Number 17633096 issued by the Department on January 30, 2019. Mr. Sarkisian’s license is due to expire on September 30, 2022.
Mr. Sarkisian was employed by United Services Automobile Association (“USAA”). In or about November 2020, USAA terminated his employment for cause having determined that he issued “Value Personal Property without express member consent.”
USAA sent letters advising some states in which Mr. Sarkisian was licensed that it had terminated his employment.
The Department has no record of receiving such a letter from USAA.
On January 12, 2021, Ms. Greenwood received from the Nevada Division of Insurance a copy of the letter Nevada received from USAA. After that, the Department received from licensing authorities in Ohio, North Carolina, Utah, and Delaware inquiries about whether it would act on Mr. Sarkisian’s license.
Because the consumers who were affected by the allegations in USAA’s letter to Nevada were not located in Arizona, as a matter of policy, the Department did not investigate those allegations. Ms. Greenwood testified that as such, the Department was not basing its decision to discipline Mr. Sarkisian’s license on the underlying allegations made by USAA.
After the Department received information from Delaware, Ms. Greenwood consulted the national database and learned that New Mexico had revoked Mr. Sarkisian’s license, which he had not reported to the Department.
Ms. Greenwood obtained from the New Mexico Superintendent a Notice to Show Cause dated June 16, 2021 that provided Mr. Sarkisian thirty days to show why his New Mexico license should not be revoked based on information New Mexico obtained in an investigation after its receipt of a letter from USAA showing it had terminated Mr. Sarkisian’s employment.
Ms. Greenwood checked the National Insurance Producer Registry and found that Mr. Sarkisian had not reported that New Mexico revoked his license.
New Mexico’s Notice shows that it was sent to Mr. Sarkisian at an address in Glendale Arizona, which was no longer a valid address for him.
On July 26, 2021, the New Mexico Superintendent issued a Final Order showing that its Notice to Show Cause, which was sent to Mr. Sarkisian’s home address of record, was returned as unclaimed, that Mr. Sarkisian did not respond to the Superintendent’s Notice to Show Cause, and that his New Mexico license was revoked.
Mr. Sarkisian acknowledged that he had not properly updated his addresses of record with the Department and effectively acknowledged that he had not done so in other states. According to Mr. Sarkisian, he was not aware that he was required to do so and/or that he did not understand the process. He further explained that when hired by USAA, it took care of all the paperwork, but when was fired he was left without help. He added that he had spoken to friends or former associates who advised him that he could let his licenses lapse or expire.
As of the hearing date, Mr. Sarkisian was not actively using his producer’s license.
Because Mr. Sarkisian had not updated his address of record with New Mexico’s Superintendent he did not receive from New Mexico its Notice to Show Cause or its Final Order revoking his New Mexico license.
As of the hearing date, Mr. Sarkisian had not updated his contact information with the Department and that information showed an outdated email address and outdated home and business addresses.
Regarding the allegations that he had issued Value Personal Property policies without express member consent, Mr. Sarkisian testified to the effect that there was controversy regarding these policies when he worked at USAA. He testified that managers were telling the producers (or at least him) to issue the policies, but no one was willing to give him feedback as to how he was performing.
While at USAA, Mr. Sarkisian was paid hourly and he testified that he had no incentive to sell policies that consumers did not want.
Mr. Sarkisian testified to the effect that he would have long discussions with potential purchasers (up to 3 hours) and that he would not add the VPP policy unless he was sure that a consumer wanted that policy, which was good to have, but he acknowledged that there may have been times that he did not explicitly ask if the customer wanted it.
Ms. Greenwood testified to the effect that the Department cannot regulate a licensee if that licensee does not provide it with current contact information.
The Department’s Complaint and Notice of Hearing was sent to Mr. Sarkisian at his address in Glendale, which was no longer current. Mr. Sarkisian learned of the hearing when he received a telephone call from the Department’s attorney shortly before the hearing.
The Department requests that Mr. Sarkisian’s license be revoked.
CONCLUSIONS OF LAW
The Department bears the burden of persuasion. Ariz. Rev. Stat. § 41-1092.07(G).
The burden of proof at an administrative hearing falls to the party asserting a claim, right or entitlement. The standard of proof is that of the preponderance of the evidence. Ariz. Admin. Code § R2-19-119.
A preponderance of the evidence is:
The 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.
Black’s Law Dictionary 1373 (10th ed. 2014).
Mr. Sarkisian was required to inform the Department of any changes to his email address of record within thirty days of that change, but failed to do so, which is a violation Ariz. Rev. Stat. section 20-286(C)(1) and of section 20-295(A)(2).
Because Mr. Sarkisian did not report to either the Department or to the National Insurance Producer Registry that his New Mexico license had been revoked within thirty days of that revocation, he has violated Ariz. Rev. Stat. section 20-301(A), which is also a violation of section 20-295(A)(2).
Because Mr. Sarkisian violated Ariz. Rev. Stat. section 20-295(A)(2) and because New Mexico revoked his license, Ariz. Rev. Stat. section 20-295(A)(9), the Department has authority to suspend or revoke his Arizona license and to impose a civil penalty against him.
Considering the facts of this matter, particularly that New Mexico’s Superintendent has revoked Mr. Sarkisian’s license, his Arizona license should be revoked.
ORDER
IT IS ORDERED that Harout Sarkisian’s license number 17633096 is revoked.
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.
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-137160-45720000Done this day, July 15, 2022.
/s/ Thomas Shedden
Thomas Shedden
Administrative Law Judge
Transmitted electronically to:
Evan G. Daniels,
Department of Insurance and Financial Institutions - Insurance
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-137160-45720000By Miranda Alvarez
Legal Secretary