ALJDEC decisions subject to certification as final

25A-078-INS · Department of Insurance and Financial Institutions - Insurance · 2026-03-06

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

In the Matter of:

Dan Edward Droeg

(National Producer No. 1245156)

Petitioner/Respondent

No. 25A-078-INS

25A-143-INS

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: February 20, 2026

APPEARANCES: Assistant Attorney General Zachary Howard appeared on behalf of the Department of Insurance and Financial Institutions.

ADMINISTRATIVE LAW JUDGE: Adam D. Stone

EXHIBITS ADMITTED INTO EVIDENCE: Arizona Department of Financial Institutions Exhibits 1-9 were admitted into evidence.

_____________________________________________________________________

FINDINGS OF FACT

Dan Edward Droeg holds an Arizona resident insurance producer license.

The Department of Insurance and Financial Institutions (“Department”) first issued an Arizona resident insurance producer license, National Producer Number 1245156, to Mr. Droeg on August 21, 1987. The license encompasses three lines of authority: (1) accident and health or sickness, (2) life, and (3) variable life and variable annuity insurance. The license was last renewed on October 1, 2021, and expired on September 30, 2025.

Mr. Droeg's address of record with the Department is Droeg Financial Services, Inc., 1839 S. Alma School Rd., Ste. 175, Mesa, Arizona 85210 (business and mailing). His email addresses are [email redacted] and [email redacted].

Mr. Droeg was registered as a securities salesman with the Arizona Corporation Commission ("ACC") from 1987 until October 11, 2021, and was licensed as an investment adviser representative from 2007 until October 11, 2021. Mr. Droeg was further registered with the Financial Industry Regulatory Authority ("FINRA") as a broker from June 1986 until March 3, 2022.

On September 3, 2025, the Department issued a Notice of Hearing and Complaint in case number 25A-078-INS.

On October 28, 2025, the Department issued a Notice of Hearing and Complaint in case number 25A-143-INS.

The matters were subsequently consolidated, and a hearing was set for December 19, 2025, upon the request of the Department.

On November 20, 2025, Mr. Droeg filed a Motion to Continue, requesting additional time to find an attorney, which was granted and the hearing was re-set for January 5, 2026.

On January 2, 2026, Mr. Droeg filed a Motion to Continue, again requesting additional time to hire representation, which was granted and the hearing was re-set for February 20, 2026.

On February 18, 2026, Mr. Droeg filed yet another Motion to Continue, this time stating that he had hired an attorney, but that attorney needed additional time to prepare for the case. Mr. Droeg did not attach and retainer agreement or any further documentation indicating an attorney-client relationship.

On February 20, 2026, the hearing commenced at 9:00 a.m. as scheduled. Mr. Droeg (and/or his attorney) failed to appear after fifteen minutes, and the tribunal denied the Motion to Continue, and proceeded with the hearing.

The Department presented the testimony of Wendy Greenwood, the Department’s Chief Investigator, and Licensing Supervisor, Aqueelah Currie.

Ms. Greenwood testified as to the events in Complainant 25A-078-INS, as follows:

In August 2023, the ACC notified the Department that it had filed a Notice of Opportunity for Hearing on Proposed Order to Cease and Desist, Order for Restitution, Order for Administrative Penalties, and Order of Revocation regarding Mr. Droeg. The ACC indicated that its case against Mr. Droeg involved annuities.

The Department began an investigation of Mr. Droeg and potential violations of Arizona insurance statutes and rules.

In its investigation, the Department discovered administrative actions taken against Mr. Droeg that he failed to disclose. These included a March 2, 2022, and September 23, 2023, FINRA Administrative Actions. In the first, Mr. Mr. Droeg was barred him from association with any FINRA member in all capacities due to improper use of a customer's securities or funds and failing to observe high standards of commercial honor and just and equitable principles of trades in the conduct of his business. In the second action, FINRA issued an “indefinite suspension” against Mr. Mr. Droeg for failure to comply with an arbitration award or settlement agreement or to satisfactorily respond to a FINRA request to provide information concerning the status of compliance. Ms. Greenwood testified that Mr. Mr. Droeg never disclosed these two Actions to the Department.

On January 22, 2025, the ACC, Docket No. S-21269-A-23-0247 issued an Opinion and Order against Mr. Droeg. The Opinion and Order found, in part, that:

• Mr. Droeg violated the Securities Act and IM Act.

• Mr. Droeg committed fraud in connection with the offer and sale of securities.

• Mr. Droeg committed fraud in connection with a transaction or transactions within or from Arizona involving the provision of investment advisory services.

• Mr. Droeg's conduct constituted grounds for a cease-and-desist order.

• Mr. Droeg's conduct constituted grounds for an order of restitution and administrative penalties.

Further, the ACC ordered, in part, that:

• Mr. Droeg's registration as a securities salesman in Arizona be revoked.

• Mr. Droeg's licensure as an investment adviser representative in Arizona be revoked.

• Mr. Droeg cease and desist from violating the Securities Act and the Arizona Investment Management Act.

• Mr. Droeg pay restitution in the amount of $1,105,187.09, plus interest from April 16, 2024, through the date of the issuance of the ACC Opinion and Order.

• Mr. Droeg pay administrative penalties in the amount of $150,000.00.

Mr. Droeg did not report the ACC administrative action to the Department.

On February 7, 2025, the Department sent an email to Mr. Droeg notifying him of its investigation and requesting that he respond by February 21, 2025. Mr. Droeg never responded to the Department.

Aqueelah Currie testified as to the events in Complainant 25A-143-INS, as follows:

On September 29, 2025, Mr. Droeg submitted a renewal application to the Department for his Arizona resident insurance producer license through the National Insurance Producer Registry (the "Application").

In the Application, under Background Questions, Mr. Droeg answered "No" to Question 2, which asks "Have you been named or involved as a party in an administrative proceeding, including a FINRA sanction or arbitration proceeding regarding any professional 17 or occupational license or registration, which has not been previously reported to this insurance department?”

The Department discovered Ms. Mr. Droeg failed to disclose all of his administrative proceeding history on his application, as described above in Ms. Greenwood’s testimony.

On October 10, 2025, the Department issued correspondence to Mr. Droeg that his renewal application was denied to him providing incorrect, misleading, incomplete or materially untrue information in the license application, attempting to obtain a license through misrepresentation or fraud, and having an insurance producer license denied, suspended or revoked.

Mr. Droeg timely submitted an appeal, which led to the Notice of Hearing and Complaint.

CONCLUSIONS OF LAW

This matter lies with the Department’s jurisdiction and was properly brought before OAH for adjudication.

The copies of the Notice of Hearing that the Department sent to Respondent at his address of record and at his email address of record were reasonable and Respondent is deemed to have received notice of the hearing. A.R.S. §§ 41-1092.04 and 41-1092.05(D).

The Department bears the burden of proof that Mr. Droeg violated the State’s insurance laws. While Mr. Droeg bears the burden of proof to establish that he is qualified to receive an insurance license. The standard of proof on all issues in this matter is that of a preponderance of the evidence.

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).

Respondent's conduct, as described above, constitutes improperly withholding, misappropriating or converting any monies or properties received in the course of doing insurance business, pursuant to A.R.S. § 20-295(A)(4).

Respondent's conduct, as described above, constitutes using fraudulent, coercive or dishonest practices, or demonstrating incompetence, untrustworthiness or financial irresponsibility in the conduct of business in this state or elsewhere, pursuant to A.R.S. § 20-295(A)(8).

Respondent's conduct, as described above, constitutes failing to report an administrative action in another jurisdiction within 30 days after the final disposition of the matter, pursuant to A.R.S. § 20-301(A).

Because of Petitioner's "No" response to Question 2 with respect to whether he had ever been named or involved as a party in an administrative proceeding, including a FINRA sanction or arbitration proceeding regarding any professional or occupational license or registration, which has not been previously reported to this insurance department, Petitioner provided incorrect and misleading information on his insurance producer application, as well as attempting to obtain the license renewal, the Department properly denied the application pursuant to A.R.S § 20-295(A)(1) and (3).

Finally, because Petitioner's licensure as an investment adviser representative and registration as a securities salesman in Arizona were revoked in the ACC action, Petitioner is in violation of A.R.S. § 20-295(A)(9).

RECOMMENDED ORDER

IT IS ORDERED that Dan Edward Droeg's Arizona resident insurance producer license, National Producer Number 1245156 be revoked; and the Department’s denial of Appellant’s Application be upheld.

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.

-54864001

001

-137160-45720000Done this day, March 6, 2026.

/s/ Adam D. Stone

Administrative Law Judge

Transmitted by either mail, e-mail, or facsimile to:

Charles Bassett, Interim Director

Department of Insurance and Financial Institutions - Insurance

Dan Edward Droeg

[email redacted]

Zachary Howard

Office of the Attorney General

[email redacted]

By: OAH Staff