ALJDEC - Licensing

23A-092-INS · Department of Insurance and Financial Institutions - Insurance · 2024-04-19

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

In the Matter of:

Travis Jacob Adams

(National Producer License No. 19429384),

Respondent.

No. 23A-092-INS

ADMINISTRATIVE LAW JUDGE

DECISION

HEARING: April 2, 2024

APPEARANCES: Respondent failed to appear. Assistant Attorney General Zachary Howard represented the Arizona Department of Insurance and Financial Institutions – Insurance.

ADMINISTRATIVE LAW JUDGE: Kay A. Abramsohn

EXHIBITS ADMITTED INTO EVIDENCE: Department Exhibits 1 through 6 and Notice of Hearing.

_____________________________________________________________________

FINDINGS OF FACT

Travis Jacob Adams (“Respondent”) was at all material times licensed in the State of Arizona as an Insurance Producer, National Producer License Number 19429384, with lines of authority in casualty insurance and property insurance. The Arizona Department of Insurance and Financial Institutions (“Department”) issued Respondent’s license on March 6, 2020. Respondent’s license was scheduled to expire on February 29, 2024. The Department retains jurisdiction because the investigation was open prior to the time of the license expiration.

On June 21, 2023, the Department received a case referral from Allstate Insurance Company (“Allstate”) which indicated that, after an investigation, Respondent had been terminated “for-cause” for binding policies without consent. Allstate provided a copy of its June 15, 2023 “Closing Memo” regarding its investigation.

The Closing Memo provided details regarding the investigated incidents demonstrating that Adams may have falsified payment information on 16 policies by issuing policies with a Cash on Demand (“C.O.D.”) payment method and falsified policyholder information on 7 policies by issuing Auto policies to individuals without insurable interest in order to meet production requirements and obtain commission.

On October 4, 2023, Insurance Analyst/Investigator Rachel Smith (“Smith”) emailed Respondent regarding the Allstate referral and requested that he provide certain specific information, including a written narrative responding to the Allstate allegations and referral. The Department requested that the responsive information be provided by October 11, 2023.

The Department did not receive a response from Respondent.

On October 12, 2023, Smith again reached out to Respondent through an email, granting a one-time extension, and requesting the requisite response by October 19, 2023.

Receiving no response, on October 19, 2023, the Department issued a Subpoena Duces Tecum (“Subpoena”) to Respondent requiring that he appear on November 2, 2023 in a virtual meeting with the Department and produce the previously specified information. With the Subpoena, the Department included a letter dated October 19, 2023 informing Respondent that his continued failure to respond to the Department’s Subpoena would be considered non-compliance and result in his license being revoked pursuant to A.R.S. § 20-295(A)(2). The subpoena notice was sent both to Respondent’s personal email and his mailing address.

Respondent failed to appear virtually on November 2, 2023.

On February 14, 2024, the Department issued a Notice of Hearing and Complaint setting an administrative hearing for April 2, 2204 at the Arizona Office of Administrative Hearings (“OAH”) regarding the Complaint.

At the time set for the administrative hearing, the Department presented its evidence regarding the matter through sworn witness testimony and documents, and requested that Respondent’s Arizona licensure be revoked.

At the time set for the administrative hearing, and for the duration of the administrative hearing conducted by the Administrative Law Judge, Respondent did not appear at OAH either in person, telephonically, or through any designated representative. Therefore, Respondent did not present any evidence to refute or rebut the evidence presented by the Department.

CONCLUSIONS OF LAW

The Department was created and enabled to administer certain Arizona laws regarding the licensure and regulation of the insurance producer profession in Arizona pursuant to A.R.S. § 20-142 and §§ 20-281 et seq.

This matter is a disciplinary proceeding wherein the Department has the burden to demonstrate by a preponderance of the evidence that Respondent violated the Arizona insurance laws.

A.R.S. § 20-295 provides, in pertinent part, as follows:

A. The director may deny, suspend for not more than twelve months, revoke or refuse to renew an insurance producer's license or may impose a civil penalty in accordance with subsection F of this section or any combination of actions for any one or more of the following causes:

. . . .

2. Violating any provision of this title or any rule, subpoena or order of the director.

. . . .

8. Using fraudulent, coercive or dishonest practices, or demonstrating incompetence, untrustworthiness or financial irresponsibility in the conduct of business in this state or elsewhere.

. . .

H. The director shall retain the authority to enforce this title and impose any penalty or remedy authorized by this title against any person who is under investigation for or charged with a violation of this title even if the person's license has been surrendered or has lapsed by operation of law.

Respondent’s conduct, as described above, constitutes violating any provision of this title or any rule, subpoena, or order of the director, within the meaning of A.R.S. § 20-295(A)(2).

Respondent’s conduct, as determined through the Allstate investigation, constitutes using fraudulent, coercive or dishonest practices, or demonstrating incompetence, untrustworthiness or financial irresponsibility in the conduct of business in this State or elsewhere, within the meaning of A.R.S. § 20-295(A)(8).

Based on the foregoing, grounds exist for the Director of the Department to suspend, revoke, or refuse to renew the License pursuant to A.R.S. § 20-295(A) and A.R.S. § 20-295(H).

Respondent’s failure to respond to the Department’s requests, failure to appear at EUO meeting, and failure to appear at the noticed administrative hearing demonstrate that Respondent is not able to be regulated at this time.

RECOMMENDED ORDER

IT IS ORDERED Respondent’s National Producer License Number 19429384 shall be revoked on the effective date of the Order entered in this matter.

Pursuant to A.R.S. § 41-1092.08(I), the licensee may accept the Administrative Law Judge Decision by advising the Office of Administrative Hearings in writing not more than ten (10) days after receiving the decision. If the licensee accepts the Administrative Law Judge Decision, the decision shall be certified as the final decision by the Office of Administrative Hearings.

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 forty (40) days from the date of that certification.

Done this day, April 19, 2024.

/s/ Kay Abramsohn

Administrative Law Judge

Transmitted electronically April 19, 2024 to:

Travis Jacob Adams

[email redacted]

Zachary Howard

Assistant Attorney General

[email redacted]

Barbara D. Richardson

Department of Insurance and Financial Institutions - Insurance

Arizona Department of Insurance and Financial Institutions

By: OAH Staff