ORDERS:
Consent Order of Settlement
This matter comes before the Administrative Law Court pursuant to the request of both the
Petitioner and the Respondent to confirm a mutually agreed upon settlement of Petitioner’s action
seeking revocation of Respondent’s resident insurance agent license for alleged violations of Title
38 of the Code of Laws of South Carolina.
After careful review of the entire file and the settlement proposal as agreed upon by both parties, I
have determined that a reasonable and fair settlement has been reached between the parties pursuant
to the facts and law of this case as set forth herein. Accordingly:
I HEREBY FIND AS FACT
1. That on October 7, 2002, William Worthy, as president of Employers Life Insurance
Company (ELIC), executed a Consent Order with the Petitioner whereby ELIC, the corporation, was
required to pay an administrative penalty of $50,000 for numerous violations of South Carolina Law
involving illegal financial transactions involving ELIC and Carolina Benefit Administrators (CBA);
2. That on May 1, 2003, William Worthy, as president of CBA, executed on behalf of CBA
a Consent Order with the Petitioner, which imposed an administrative penalty of $35,000 against
CBA for violating numerous statutory provisions:
3. That both of the above stated actions were brought against ELIC and CBA pursuant to a
financial examination that was conducted by the Petitioner. During the pendency of these actions,
the Petitioner contacted South Coast Community Bank and confirmed that William Worthy had not
only misled the Petitioner concerning a purported loan to CBA but he had altered loan documents
with the intent of misleading the Petitioner from discovering that William Worthy had yet again
illegally pledged insurance company assets to secure loan(s) of $450,000;
4. That the altered loan documents submitted by William Worthy to the Petitioner were not
mentioned in either previous order because their fraudulent nature had not yet been confirmed. The
matter was forwarded to the South Carolina Attorney General’s office for investigation and possible
criminal prosecution;
5. That on October 1, 2003, in the matter of Duncan MacDonald vs. Employers Life Holding
Corporation, William Worthy, Carolina Benefit Administrators, Inc. Worthy Insurance, et al, the
Honorable Larry R. Patterson, presiding Circuit Court Judge of the Seventh Judicial Circuit, issued
an order granting a temporary injunction enjoining William Worthy his agents, and/or adjunct
companies from defaming, libeling, slandering, or otherwise disparaging ELIC based on its
assertions that Worthy had violated Sec. 38-57-90 of the South Carolina Code of Laws, which
prohibits defamation of an insurer;
6. That S.C. Code Sec. 38-57-80 specifically prohibits the submission of “any false statement
of financial condition of an insurer with intent to deceive”. In addition to S.C. Code Ann. Sec. 38-43-130(7), William Worthy, by his own admission, has also violated S.C. Code Ann. Sec. 38-43-130(8) by “using fraudulent, coercive, or dishonest practices, or demonstrating incompetence,
untrustworthiness, or financial irresponsibility in the conduct of business in this state”, furthermore;
I HEREBY CONCLUDE AS A MATTER OF LAW that the Respondent, William Worthy
II, has knowingly violated S.C. Code Sec. Ann § 38-57-80; 38-43-130, et seq (2002), and, therefore;
IT IS HEREBY ORDERED
1. That the resident insurance agent license of the Respondent, William M. Worthy II, is
suspended subject to payment of an administrative fine against the Respondent in the total amount
of one hundred thousand ($100,000). Upon payment of the one hundred thousand dollar fine
($100,000), the Respondent’s resident insurance agent license will be reinstated on a probationary
basis for two (2) years. During this probationary period, the Respondent will have (30) days to cure
any infractions of which he is notified by the Petitioner. If Respondent fails to cure infractions of
which he has been made aware, absent any appeals he may take, the Respondent’s resident insurance
agent license will be summarily revoked;
2. That the parties have reached this consensual resolution as a result of negotiation and
compromise and in consideration of the corrective measures the Respondent intends to voluntarily
undergo. By the signature of the Respondent upon this consent order, the Respondent acknowledges
he has entered into a compromised settlement of a disputed claim. The Respondent also understands
that this consent order is a matter of public record subject to the disclosure requirements of the State
of South Carolina’s Freedom of Information Act, S.C. Code Ann. §§ 30-4-10, et seq. (1991 and
Supp. 2001);
3. That nothing contained within this Consent Order of Settlement should be construed to
limit or to deprive any person of any private right of action under the law. Nothing contained within
this Consent Order of Settlement should be construed to limit, in any manner, the criminal
jurisdiction of any law enforcement or judicial officer. Nothing contained within this Consent Order
of Settlement should be construed to limit the statutory duty, pursuant to S.C. Code Ann. § 38-3-110
(2002), of the Director of Insurance, exercised either directly or through the Petitioner, to “report to
the Attorney General or other appropriate law enforcement officials criminal violations of the laws
relative to the business of insurance or the provisions of this title which he considers necessary to
report”;
4. That a copy of this consent order be immediately transmitted to the National Association
of Insurance Commissioners for distribution to its member states;
5. That this consent order becomes effective on the date of my signature below.
AND IT IS SO ORDERED. |
