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(g) Use of a fraudulent or dishonest practice by the licensee in the conduct of business under the license, or demonstration therein that the licensee is incompetent, untrustworthy or a source of injury and loss to the public or others.

The evidence establishes that Respondent was providing the Advantage Discount to insureds who did not qualify for the discount. To qualify the insureds for the discount, Respondent used the policy numbers of other insureds who had homeowner or renter insurance policies. He used his own homeowner policy number to qualify a number of insureds for the 20 percent discount on the auto insurance. He changed the number sometimes in excess of six months later to the insured’s correct homeowner policy number after the insured’s policy was written.

Respondent testified that the practice was in response to problems he and other agents had with the insurer’s billing system. He also attributed the use of other insured’s homeowner policy numbers to typographical errors by his unlicensed customer service representative, Ms. Green. He blamed what he viewed as the wrongful termination of his agent contract on the insurer’s desire to save money by getting rid of experienced productive agents and assigning the policies to agents making half as much as the experienced agents. I do not find Respondent’s efforts to shift the blame to others to be credible or persuasive. Even if Ms. Green was the individual who entered the false numbers into the data system, Respondent conceded that as the licensed agent, he was ultimately responsible for what went on in his agency. Moreover, as argued by the department, the false numbers were not typos but rather the product of a conscious decision to circumvent the underwriting rules and rates by intentionally listing the homeowner policy numbers of others to fraudulently obtain the discount for his clients. Consequently, I find that the department has met its burden of proving that Respondent violated ORS 744.013(2)(g) in six instances.


The department proposes revocation of Respondent’s resident agent license. ORS 744.013(1)(a)(1999) gives the director authority to, inter alia, revoke an insurance agent’s license for violations of the Oregon Insurance Code. Here, I have found that Respondent has violated ORS 744.013(2)(g) in six instances. In that regard, the record reflects that Respondent used the fraudulent or dishonest practice of using other’s homeowner policy numbers to provide his clients with a 20 percent discount on their auto insurance when they did not qualify for the discount. This pattern of using this fraudulent or dishonest practice demonstrates that

(a) The director may refuse to renew or may suspend or revoke a license issued under ORS 744.002 or the authority under a license to engage in any category of insurance business or any class of insurance.

Michael C. Eaton (Case No: INS 02-10-016) Page 5 of 6

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