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100 West Cypress Creek Road, Suite 930

Fort Lauderdale, FL 33309

Office (954) 761-3700

Fax (954) 761-1004

8875 Hidden river PKWY, Suite 230

Tampa, FL 33637

Office (813) 775-2131

Fax (866) 388-3029

3500 Financial Plaza, Suite 330

Tallahassee, FL 32312

Office (850) 250-3830

Fax (866) 388-3029


FL Office of Financial Regulations Extorting Business Owners Money

The Florida Office of Financial Regulations (“OFR” or “Office”) provides regulatory oversight for Florida’s financial services providers. The OFR is self-supporting in that all of its operating revenues come from the organizations and individuals it regulates. As a result, the Office is extremely aggressive in its examinations and imposition of fines.

Over the past six months, the OFR has collected approximately 1.2 million in penalties from check cashers and money transmitters alone. Additionally, the Office has taken away several licenses, which means depriving business owners of their livelihoods for minimal violations that are oftentimes mistakes. The majority of money transmitters and check cashers are smaller unsophisticated businesses. As a result, these businesses don’t have the money to pay the large penalty assessments the Office brings against them. The businesses are then left to surrender their licenses if they are unable to pay these large sum assessments.

Under 560.1141, F.S., the Florida legislature has granted the Office rulemaking authority. This means that the OFR has authority to make rules to regulate all businesses that have licenses administered by the OFR. This also means that for the OFR to do something they first have to put forth a rule making it public, providing those it affects due process of the law. However, the Office abuses this discretion by imposing the highest level of fines possible on almost all violations. Within the statute granting OFR rulemaking authority the OFR is required to adopt mitigating and aggravating circumstances. The Office has laid out mitigating factors under 69V-560.1000(148). However, the Office decides when to apply these mitigating factors depending on their mood that day, possibly amounting to unadopted rulemaking.

One case in which the Offices abuse of discretion really stood out is Millard Enterprises Inc, where the business was assessed the maximum level fine for minimal administrative mistakes. This case started with the Office filing an administrative complaint against the business for two counts: the first count was for missing 5/11 required fields on their electronic payment log; and the second count was for issues with 3 customer ID’s. The Office has laid out by rule minimum and maximum penalties for each violation. For both counts, the Office had the choice of imposing anywhere between $3,500 to $7,500 and a 10-20 day suspension. For the first count, the Office imposed the highest possible fine of $7,500 and a 20 day suspension. For the second count, the Office imposed a lower fine amount of $3,600 and 10 day suspension. The Office also could have taken mitigating factors into account to bring the fine down, but failed to do so.

It is important to note the business provided the missing fields in the electronic payment log only one day after the Office requested it during examination. However, the Office still imposed the highest fine and suspension possible. Additionally, for the issues with the 3 ID’s, the Office claimed that the copies of 2 of the ID’s were blurry and 1 was expired. It is clear these violations were minimal and administrative mistakes any business owner could make and now the business was required to pay a total of $11,100 and have its license suspended for 30 days or fight back. The business chose to fight back.

The business requested a hearing at which it presented evidence supporting its claim that the fines imposed were unproportionate to the violations, claiming mitigating factors should be taken into account to reduce the fine. The hearing officer agreed with the business and issued a Recommended Order reducing the penalty based on mitigating factors: no harm to the public, no pattern of misconduct, the licensees conduct was neither willful nor reckless, and the licensee was cooperative. Then, the Office filed a Motion for Reconsideration of Recommended Penalty claiming that the mitigating factors should not apply. The Office stated in its motion” the Office has consistently declined to accept an absence of harm to the public, willful or reckless misconduct, or absence of a pattern of misconduct as mitigating factors.” If the Office consistently did not take mitigating factors into consideration then they should not have adopted them by rule as mitigating factors. Then, the hearing officer issued an Amended Recommended Order denying the Offices motion and reducing the fine by $4,000 which the Office then adopted as its Final Order.

About Our Firm: Moffa, Sutton, Donnini, PA has built its foundation on representing and protecting business owners from agency actions. The Office of Financial Regulations is essentially extorting taxpayer money and taking away small business owners livelihoods for minor violations. What the Office of Financial Regulations is doing is wrong. As check cashers and money transmitters get examined every five years it is important to stay compliant. However, if you have been contacted by the Office of Financial Regulations for a violation contact us because we can help you.

Additional Resources

FL Office of Financial Regulation – Check Cashers & Money Transmitters Prepare for Examination, published September 26, 2016, by Matthew Parker, Esq.

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