ALJDEC

98A-191-INS · Department of Insurance · 1999-01-27

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: January 26, 1999 APPEARANCES: Elmer L. Sweet on his own behalf; Assistant Attorney General Michael J. De La Cruz on behalf of the Arizona Department of Insurance ADMINISTRATIVE LAW JUDGE: Lewis D. Kowal _____________________________________________________________________

FINDINGS OF FACT 1. On November 4, 1998, Elmer L. Sweet (“Mr. Sweet”) filed an application for a property and casualty agent’s license (“the Application”) with the Arizona Department of Insurance (“the Department”). 2. Mr. Sweet answered “Yes” to Section V, Question A, of the Application which asked “Have you EVER been convicted of a felony?” 3. Mr. Sweet attached to the Application an explanation relating to his prior criminal conviction. 4. It is undisputed that Mr. Sweet pleaded guilty to misapplication of funds from a lending or financial institution in violation of federal law. Mr. Sweet was sentenced to three years in prison. After serving one year in prison, Mr. Sweet was released and provided two years probation. There was no restitution ordered by the court that imposed sentencing. 5. The underlying activity giving rise to the above-mentioned felony conviction involved Mr. Sweet arranging for a fictitious loan while acting as a loan officer for a savings and loan bank Midland, Texas. 6. On November 9, 1998, the Department denied the Application. 7. On November 13, 1998, Mr. Sweet timely filed a request for hearing on the denial of the Application.

8. During the hearing, Mr. Sweet admitted that he committed the above-mentioned criminal activity, which was a mistake, and expressed remorse for that incident. Mr. Sweet further testified that prior to and after that criminal conviction, he has had no other arrests or criminal convictions other than one traffic ticket. 9. Mr. Sweet testified that he successfully completed the terms of his probation in the above-mentioned case. Mr. Sweet affirmatively acknowledged the above-mentioned conviction and admitted that he made a mistake in his past but represented that he has changed and is not the same person as the one who committed those offenses. 11. In mitigation, Mr. Sweet testified that, since his release from prison, he has been gainfully employed and actively participates in church related activities as set forth below. 12. Mr. Sweet presented a letter from Larry Siple, his brother-in- law, as a letter of character and representing that if Mr. Sweet is successful in obtaining an insurance agent license, there is a position available for him at Arizona Sun Insurance Services. As a letter of character, the letter was given very little weight because Mr. Siple was not present at the hearing and was not subject to cross-examination by counsel for the Department. 13. Mr. Sweet has taken general education classes at Glendale Community College. Currently, Mr. Sweet is employed as an independent contractor for Pro-Em, an event management company, where he assists in a variety of functions but mainly as parking attendant who handles parking tickets and cash payments for parking at events. Mr. Sweet has been employed in this capacity since August, 1998. The evidence of record established that owner of Pro-Em hired Mr. Sweet after Mr. Sweet disclosed that he had been convicted of a felony and served one year in prison. Mr. Sweet did not disclose the nature of the felony conviction or underlying criminal activity but was not asked to provide further details. 14. In the position of a parking attendant for Pro-Em at Arizona Cardinals games, Mr. Sweet collects between $5,000.00 and $10,000.00 per game. After the game commences and the parking lot closes, Mr. Sweet balances the parking tickets he as issued with the cash collected and has never had a situation wherein there was a shortage of money or an issue raised as to the amount of money that should have been provided to the owner of Pro-Em. 15. Mr. Sweet is also currently employed by a Kentucky Fried Chicken establishment as a delivery person. In that capacity, he handles between $200.00 and $300.00 in cash. Mr. Sweet has never had a shortage of funds or had an issue raised concerning money that involved his services. 16. Mr. Sweet has been a Sunday school teacher and coach of volleyball and softball with the Trinity United Methodist Church from August 1986 through the summer of 1998. He has also been on an administrative board with the church and been its finance committee chairman. The latter position involves financial reporting and budgeting. There has never been questions concerning any of the church’s financial matters in which Mr. Sweet has been involved. . Although Mr. Sweet did not present a reason why he committed the above-mentioned criminal activity and the evidence of record established that he did not financially profit and would not profit from the commission of that act, Mr. Sweet presented credible evidence that he is rehabilitated and deserving of an opportunity to hold an insurance agent’s license. 18. Mr. Sweet demonstrated that he has paid his debt to society for the above-mentioned criminal offense and that he has become an active member of his community. 19. Mr. Sweet was a credible witness and the Department did not present credible evidence to refute or rebut Mr. Sweet’s testimony as set forth above.

CONCLUSIONS OF LAW 1. The Director has jurisdiction over this matter pursuant to A.R.S. §20-161. 2. The conduct of Mr. Sweet as set forth above in the Findings of Fact constitutes a record of dishonesty on the part of Mr. Sweet in business or financial matters pursuant to A.R.S. §20-290 (B)(2). 3. Mr. Sweet’s above-mentioned felony conviction constitutes a record of conviction by final judgment of a felony involving moral turpitude within the meaning of A.R.S. §20-290 (B) (6). 4. Pursuant to A.R.S. §20-290 (B)(2) and 20-290(B)(6), the Director has discretionary authority to grant or deny the Application. 5. Notwithstanding the prior conduct and conviction of Mr. Sweet, Mr. Sweet sustained his burden of proof by establishing that, at this time, he possesses the requisite qualifications to be licensed by the Department as a property and casualty insurance agent.

RECOMMENDED ORDER Under the particular facts and circumstances of this case and the evidence presented, including but not limited to the duration of time that has elapsed since the criminal activity, incarceration for that offense and probation as well as Mr. Sweet’s employment history and involvement in the community since the offense, Mr. Sweet’s application for an individual property and casualty insurance agent license submitted to the Department on November 4, 1998 should be granted. Done this day, February 4, 1999.

_________________________________ Lewis D. Kowal Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 1999, to:

Mr. Charles R. Cohen, Director Department of Insurance 2910 North 44th Street, Ste. 210 Phoenix, AZ 85018

ATTN: Curvey Burton

By _______________________________

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Office of Administrative Hearings 1700 West Washington, Suite 602 Phoenix, Arizona 85007 (602) 542-9826