1 A premium rate of $0.47 per month per $1,000 of group term life insurance was used. This rate includes waiver of premium and accidental death and dismemberment benefits. The Prudential Insurance Co., which is the insurance company that underwrote the fund's present group term life insurance program, used this rate. 2A 10 percent retention rate was used in this calculation. The actual retention rate quoted by the Prudential Insurance Co. in its preposal for the fund's present group term life insurance policy was 4.8 percent. Please take further notice that: (a) This citation is issued to you pursuant to the provisions of Section 37-L of the Insurance Law. (b) Notice of this hearing is given to you in accordance with the provisions of Sections 22, 23 and 37-L of the Insurance Law. (c) You may, if you wish, be represented by counsel at the hearing. Should you intend to be so represented, it is required that at least five days before the return date of this citation, a written answer shall be filed with the Office of General Counsel of this Department, which answer shall concisely admit or deny the charge and every paragraph of the specification thereof. Opportunity for explanation or statement in mitigation will be afforded you at the hearing. (d) Should you desire the presence of witnesses at the hearing, subpoenas will be forwarded to you, if you make your request in writing to the Office of General Counsel of this Department. (e) Should you fail to appear at the time and place fixed, the hearing will proceed as scheduled. The action taken, if any, may result in the case of Fund Trustee, Officer, Agent or Employee-Respondents, in their removal from office and/or the imposition of monetary penalties, and in the case of all Respondents, subject them to a depletion action and such other and further action as may be provided for by the Insurance Law. Yours etc. BENJAMIN R. SCHENCK Dated: April 18 1974. To: CERTIFIED MAIL-RETURN RECEIPT REQUESTED James Costa, 179-30 149th Street, Jamaica, N. Y. 11434. Julius November, President, Fringe Program Inc., 377 Fifth Avenue, New York, N. Y. 10016. Rubin Steiner 138-01 Springfield Blvd., Jamaica, N.Y. Dina Gelman, care of Fringe Programs, Inc., 377 Fifth Avenue New York, N. Y. 10016. Cy Reeves Snyder, 1562 Northeast 191st Street, North Miami Beach, Fla. Louis C. Ostrer, 181 Kings Point Road, Kings Point, N. Y. Seymour Greenfield, President, Viscount Agency, Inc., 384 Fifth Avenue, New York, N. Y. Seymour Greenfield, 32-16 Healy Avenue, Far Rockaway, N.Y. William R. Tenney, President, Executive Life Insurance Co. of New York, 390 Broadway, Jericho, N. Y. 11753. Stanley L. Carver, President, Trans World Life Insurance Co. of New York, 511 Fifth Avenue, New York N. Y. 10017. Frank Della Pelle, Building No. 150, Newark Airport Newark, N.J. William Ermer, 150-15 New York Blvd., Jamaica N.Y. Martin Hoffenberg, Building No. 89, J.F.K. Airport Jamaica, N. Y. Dina Gelman, 104-60 Queens Blvd., Forest Hills, N. Y. 11375. Cy Reeves Snyder, care of Sindon, 660 82nd Street, Miami Beach, Fla. Seymour Greenfield, President, Viscount Agency, Inc., 377 Fifth Avenue, New York, N. Y. STATE OF NEW YORK INSURANCE DEPARTMENT, [Certified mail: Return receipt requested] SIR: Please take notice that you and each of you are hereby cited to appear at a hearing to be held at the office of the Insurance Department, 123 William Street, New York, New York (18th floor) on the 28th day of February, 1973 at 10 o'clock in the forenoon to show cause why all licenses issued to you should not be suspended or revoked, and why all pending applications for licenses should not be denied by reason of the following charge and specifications. CHARGE I You have demonstrated your untrustworthiness and/or incompetence to act as an insurance agent within the contemplation of the insurance law. Specification A 1. (a) In the period between December 10, 1970 and February 9, 1971 respondent Cy Reeves Snyder was the agent of record in connection with a life insurance program underwritten by Executive Life Insurance Company of New York for members of Local 295 Severance Trust Fund. (b) In truth and in fact respondent Cy Reeves Snyder had not solicited or placed the insurance program on behalf of Executive Life Insurance Company of New York nor did he know the details of said program. (c) In the period between December 10, 1970 and February 9, 1971, respondent Cy Reeves Snyder, in violation of Section 110 of the Insurance Law, allowed his name to be used as agent of record in order to allow Dina Gelman, who was not a licensed agent of Executive Life Insurance Company of New York prior to December 31, 1970, to be the agent in fact on the insurance program in question. (d) In the period between December 10, 1970 and February 9, 1971 respondent Cy Reeves Snyder, in violation of Section 113 of the Insurance Law, paid or permitted to be paid all commissions paid to him as agent of record by Executive Life Insurance Company of New York to Dina Gelman. In said period of time Dina Gelman was either not licensed as an agent of Executive Life Insurance Company of New York or was not the agent of record for the aforesaid insurance program. Specification B 1. In the period December 1970 to the present respondents Cy Reeves Snyder and/or Dina Gelman, in violation of Section 110 of the Insurance Law, aided and abetted one Louis Ostrer, who is not a licensee of the Insurance Department, to act as an insurance agent in connection with the aforesaid insurance program. Louis Ostrer was the individual who actually solicited the insurance program with Local 295 Severance Trust Fund. Specification C 1. (a) In December 1970 respondent Dina Gelman, in violation of Section 110 of the Insurance Law, acted as an insurance agent of Executive Life Insurance Company of New York in connection with the aforesaid insurance_program without having authority to do so by virtue of a license issued by the Insurance Department to represent said insurance company. (b) In the period between January 1971 and February 1971 respondent Dina Gelman acted as the insurance agent in fact in connection with the aforesaid insurance program but, in truth and in fact, she was not the agent of record thereof. 2. (a) On February 9, 1971 respondent Dina Gelman signed a "Development Allowance Time Certification" for Executive Life Insurance Company of New York stating that she had served as a General Agent or Agency Manager of a life insurance company or companies for a period of 5 years. Said Certification indicated that Section 213 (8) (f) of the New York Insurance Law and the applicable Regulations of the New York State Insurance Department provide in part that any person contracted by and under the authority of the Insurance Law of the State of New York as a General Agent shall not be paid additional compensation, if he, or any other person who is in fact the General Agent, has in excess of a total of 5 years of service, prior to the date hereof, as General Agent or Agency Manager of any life insurance company or companies. In the years 1971 and 1972 respondent Dina Gelman contracted for and accepted an agency development allowance from the Trans World Life Insurance Company of New York in connection with the aforesaid Local 295 Severance Trust Fund Insurance Program. Respondent knew or should have known that she was not entitled to the aforesaid agency development allowance from Trans World Life Insurance Company of New York since she bad previously certified to Executive Life Insurance Company of New York that she had 5 years experience as a general agent or agency manager of a life insurance company or companies. (b) In the years 1971 and 1972 respondent Dina Gelman contracted for and accepted an agency development allowance from the Trans World Life Insurance Company of New York in connection with the aforesaid Local 295 Severance Trust Fund Insurance Program. Respondent in said years failed to use such moneys for the establishment and development of an agency organization and knew or should have known that acceptance of an agency development allowance constituted a violation of Section 213(8) (f) of the Insurance Law and Regulation No. 50 of the Insurance Department. Please take further notice that: 1. According to the records of the Insurance Department respondents are presently licensed as follows: (a) Cy Reeves Snyder is individually licensed as an insurance agent under Section 113 of the Insurance Law; as President and sole sublicensee of Sportsmens Affiliates, Inc., insurance agent; as President and sole sublicensee of B.M.S. Agency, Inc., insurance agent. (b) Dina Gelman is individualy licensed as an insurance agent under Section 113 of the Insurance Law; as President and sole sublicensee of William David Agency, Inc., insurance agent; as President, Treasurer and sole sublicensee of Sutter Agency, Inc., insurance agent. 2. This citation is issued pursuant to the provisions of Section 117 of the Insurance Law. 3. Notice of this hearing is given to you in accordance with the provisions of Sections 22, 23 and 117 of the Insurance Law. 4. You may, if you wish, be represented by counsel at the hearing. Should you intend to be so represented it is required that at least two days before the return date of this citation, a written answer shall be filed with the Office of General Counsel of this Department which answer shall concisely admit or deny the Charge and every specification and subdivision thereof. Opportunity for explanation or statement in mitigation will be afforded you at the hearing. 5. Should you desire the presence of witnesses at the hearing, subpenas will be forwarded to you if you make your request in writing to the Office of General Counsel of this Department. 6. Should you fail to appear at the time and place fixed, the hearing will proceed as scheduled. The disciplinary action taken, if any, may result in the suspension or revocation of all licenses issued to you and in the denial of all pending applications for licenses. 7. Notice of the institution of this proceeding is also given to Sportsmens Affiliates, Inc.; B.M.S. Agency, Inc.; William David Agency, Inc. and Sutter Agency, Inc., so they may take whatever action is indicated to protect their interests in accordance with Section 117 of the Insurance Law. Yours, BENJAMIN R. SCHENCK, APPENDIX XXXV STATE OF NEW YORK INSURANCE DEPARTMENT, Superintendent of Insurance Thomas A. Harnett announced today that the Department has recovered $200,000 for the members of the Local 295 Severance Trust Fund. The recovery was made under the terms of a stipulation between ten Trustees of the Fund, two life insurance companies and the Insurance Department. The Department charged that James Costa, James Hallahan, Michael Hunt, John Moran, Tom Sweeney, Frank Della Pelle, William Ermer, Martin Hoffenberg, Frank La Bell and Rubin Steiner, Trustees; Fringe Programs, Inc., Fund Administrator; Executive Life Insurance Company of New York and Trans World Life Insurance Company of New York; Dina Gelman, Cy Reeves Snyder, Seymour Greenfield and Viscount Agency, Inc., insurance agents; and Louis C. Ostrer, a former insurance agent whose license was revoked by the Department, had caused a depletion of $1,185,728 in the Fund's assets by their wrongful or negligent acts or omissions. The Trustees were alleged to have imprudently purchased excessively costly individual whole life insurance policies for Fund members, upon the advice of Ostrer, without checking his background. The companies were alleged to have violated the Insurance Law by issuing individual policies without obtaining the individual member's written consent to having his life insured and by paying commissions grossly in excess of those permitted under the National Association of Insurance Commissioners' Code of Ethical Practices. Ostrer's license as an insurance agent had been revoked by the Insurance Department in 1967 for diverting more than $700,000 from a life insurance company. He later was indicted for grand larceny, first degree, in the Supreme Court of the State of New York, County of New York, a charge to which he pleaded guilty on June 17, 1969. Gelman and Snyder were licensed insurance agents whose licenses were revoked by the Department in 1974 for their part in the Local 295 Severance Trust Fund transaction. The revocations have been appealed. Greenfield and Viscount Agency, Inc., resigned all their insurance agent and broker licenses on December 17, 1973. The Trustees and the insurers agreed, without conceding liability, to pay $200,000 to the Superintendent for transmittal to the Fund and to comply with the Insurance Law and Departmental Regulations. The proceedings against them were discontinued. However, proceedings will continue against Ostrer, Gelman, Snyder, Greenfield, Viscount Agency, Inc., and Fringe Programs, Inc., at the Department's New York City offices on March 15th. The Local 295 Severance Trust Fund is affiliated with Local 295 of the International Brotherhood of Teamsters Union. Both are headquartered at 179-30 149th Avenue, Jamaica, N. Y. As of the end of the fiscal year on June 30, 1975, the Fund's net assets were $7,785,610. In fiscal 1975, some 128 employers contributed $3,036,652 to the Fund on behalf of 1,543 covered employees working mainly in the air freight industry. |