ALJDEC

99A-205-INS · Department of Insurance · 1999-11-23

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: November 22, 1999 APPEARANCES: Richard Paul Souza on his own behalf; Assistant Attorney General Michael De La Cruz on behalf of the Arizona Department of Insurance ADMINISTRATIVE LAW JUDGE: Lewis D. Kowal _____________________________________________________________________ FINDINGS OF FACT 1. On August 31, 1999, Richard Paul Souza (“Mr. Souza”) filed an application for a life and disability insurance agent’s license (“Application”) with the Arizona Department of Insurance (“Department”). 2. Mr. Souza answered “Yes” to Question B of Section V, on the Application that asks: Have you EVER had any professional, vocational, business license, or certification refused, denied, suspended, revoked or restricted, or a fine imposed by any public authority? On March 23, 1990, the Commissioner of the California Department of Insurance (“Commissioner”) entered a decision in Case No. SAC 4842-AP, In the Matter of the Licenses and Licensing Rights of: Richard Paul Souza, revoking Mr. Souza’s insurance agent’s license. In the Decision, the Commissioner found that Mr. Souza knowingly and wilfully made misstatements on his California insurance license application regarding his criminal background and determined that the undisclosed criminal conviction involved a dishonest and fraudulent act that was substantially related to the functions, qualifications, and duties of a licensee. . . . The evidence of record established that the above-mentioned conviction was for theft, a misdemeanor. 5. On September 1, 1999, the Department denied the Application. 6. On September 29, 1999, Mr. Souza timely filed a request for a hearing on the Department’s denial of the Application, resulting in the instant hearing. 7. During the hearing, Mr. Souza testified that since the above-mentioned revocation, he has been continuously employed in the pipeline industry and the automobile sales industry and he has not had any other criminal convictions. 8. Mr. Souza testified concerning the circumstances surrounding the above- mentioned criminal conviction. According to Mr. Souza, he and three other friends had been drinking alcoholic beverages and, while visiting a gas station, noticed an open cash register. Mr. Souza and his friends took approximately $220.00 from the cash register and that such activity was observed by an employee of the station. That employee contacted the police who confronted Mr. Souza about the theft incident. Subsequently, Mr. Souza returned all of the stolen money to the owner of the gas station. 9. Although during the hearing Mr. Souza testified that did not know that he had been convicted of a misdemeanor, he recognized that this Tribunal and the parties are bound by the determination made by the Commissioner of the California Department of Insurance that he knowingly and wilfully did not disclose the conviction on his California insurance agent’s license application. 10. Mr. Souza candidly admitted that he now recognizes that he incorrectly answered the question relating to his criminal background on his California insurance agent’s license application. 11. During the Arizona insurance license application process, Mr. Souza disclosed the above-mentioned conviction and revocation and provided documents to the Department concerning the above-mentioned revocation. 12. Mr. Souza testified concerning his education and work experience and demonstrated that he has rehabilitated himself and become a productive member of society. Further, Mr. Souza recognized his obligation to have inquired into his criminal conviction and accepted responsibility for not disclosing it to the California Department of Insurance. 13. During the hearing, Mr. Souza expressed remorse concerning the activity underlying the above-mentioned criminal conviction and nondisclosure of the conviction to the California Department of Insurance. 14. Mr. Souza testified that for the one year prior to the revocation of his California insurance agent’s license, he had not had any complaints made against him in connection with insurance transactions. 15. Mr. Souza testified the he has disclosed his prior conviction, the revocation of his California insurance agent’s license and the instant matter to Life USA , with whom he has an opportunity to sell that company’s products through Legacy Estates and Insurance Services. Mr. Souza further testified that if the Application is approved, that opportunity still exists. 16. Mr. Souza’s testimony, as set forth above, is determined to be credible. 17. Although Mr. Souza did not present any witnesses or letters of character, it is determined that Mr. Souza’s testimony, as set forth above, is credible and sufficient to show that he possesses the requisite qualifications to hold an insurance agent’s license. CONCLUSIONS OF LAW The above-mentioned revocation constitutes a record of revocation of an insurance license in any jurisdiction within the meaning of A.R.S. §20- 290(B)(5). The above-mentioned revocation constitutes a record of dishonesty in business and financial matters within the meaning of A.R.S. §20-290(B)(5). Mr. Souza’s above-mentioned conviction and the acts and conduct underlying the conviction do not constitute a record of dishonesty in business and financial matters within the meaning of A.R.S. §20-290(B)(2). Based on the above, grounds exist for the Director of the Department to deny the Application pursuant to A.R.S. §§20-290(B)(2) and (B)(5). . . . Mr. Souza has met his burden of proving by a preponderance of the evidence that he meets the requisite qualifications to hold an insurance agent’s license. RECOMMENDED ORDER Under the particular facts and circumstances of this matter, despite the above-mentioned conviction and revocation, because of the passage of time since such occurrences as well as the age of Mr. Souza when such events occurred, Mr. Souza’s education, Mr. Souza’s work experience, and the lack of any other criminal history, it is recommended that the Department’s denial of the Application be reversed and the Director of the Department approve the Application. Done this day, November 30, 1999

______________________________________ Lewis D. Kowal Administrative Law Judge

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

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

ATTN: Curvey Burton

By ___________________________

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Office of Administrative Hearings 1400 West Washington, Suite 101 Phoenix, Arizona 85007 (602) 542-9826