S*380 Session 112 (1997-1998)
S*0380(Rat #0271, Act #0262 of 1998) General Bill, By McConnell
Similar(H 3410)
A BILL TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION
38-25-315 SO AS TO PROVIDE FOR EMERGENCY CEASE AND DESIST ORDERS TO PREVENT
THE UNAUTHORIZED TRANSACTION OF INSURANCE BUSINESS WITHIN THIS STATE AND
PROVIDE FOR RELATED MATTERS; AND TO AMEND SECTION 38-25-330, AS AMENDED,
RELATING TO THE PENALTY FOR VIOLATING CHAPTER 25, TITLE 38 ON THE UNAUTHORIZED
TRANSACTION OF INSURANCE BUSINESS, SO AS TO REQUIRE A WILFUL VIOLATION BEFORE
A CONVICTION MAY BE HAD OR A PENALTY IMPOSED, AND CHANGE THE OFFENSE FROM A
MISDEMEANOR TO A FELONY.-AMENDED TITLE
02/18/97 Senate Introduced and read first time SJ-2
02/18/97 Senate Referred to Committee on Banking and Insurance SJ-2
03/20/97 Senate Committee report: Favorable with amendment
Banking and Insurance SJ-11
03/25/97 Senate Amended SJ-16
03/25/97 Senate Read second time SJ-16
03/25/97 Senate Unanimous consent for third reading on next
legislative day SJ-16
03/26/97 Senate Read third time and sent to House SJ-21
03/26/97 Senate Reconsidered SJ-21
03/26/97 Senate Ordered to third reading with notice of
amendments SJ-21
04/10/97 Senate Amended SJ-23
04/10/97 Senate Read third time and sent to House SJ-23
04/16/97 House Introduced and read first time HJ-19
04/16/97 House Referred to Committee on Labor, Commerce and
Industry HJ-20
01/28/98 House Committee report: Favorable Labor, Commerce and
Industry HJ-1
01/29/98 House Read second time HJ-6
02/03/98 House Read third time and enrolled HJ-11
02/17/98 Ratified R 271
02/20/98 Signed By Governor
02/20/98 Effective date 02/20/98
03/02/98 Copies available
04/01/98 Act No. 262
(A262, R271, S380)
AN ACT TO AMEND THE CODE OF LAWS OF SOUTH
CAROLINA, 1976, BY ADDING SECTION 38-25-315 SO AS TO
PROVIDE FOR EMERGENCY CEASE AND DESIST ORDERS TO
PREVENT THE UNAUTHORIZED TRANSACTION OF INSURANCE
BUSINESS WITHIN THIS STATE AND PROVIDE FOR RELATED
MATTERS; AND TO AMEND SECTION 38-25-330, AS AMENDED,
RELATING TO THE PENALTY FOR VIOLATING CHAPTER 25,
TITLE 38 ON THE UNAUTHORIZED TRANSACTION OF
INSURANCE BUSINESS, SO AS TO REQUIRE A WILFULL
VIOLATION BEFORE A CONVICTION MAY BE HAD OR A
PENALTY IMPOSED, AND CHANGE THE OFFENSE FROM A
MISDEMEANOR TO A FELONY.
Be it enacted by the General Assembly of the State of South Carolina:
Creates emergency order to prevent unauthorized insurance
business
SECTION 1. The 1976 Code is amended by adding:
Section 38-25-315. (A) As an alternative to the procedural remedy
detailed within Section 38-25-310, whenever the director, from evidence
which is satisfactory to him, has reasonable grounds to believe that a
person has engaged in, or is about to engage in, the transaction of
insurance business in violation of this chapter and that transaction will
adversely impact upon public health, public safety, or public welfare, he
may reduce his findings of fact and his conclusions of law to writing and
he may issue an emergency cease and desist order. That order must be
served upon the person either by certified mail, return receipt requested,
at that person's last known address, or in any other manner permitted by
law.
(B) An emergency cease and desist order issued by the director must,
within its provisions, give notice that the person may contest that order by
petitioning for an immediate public hearing before an administrative law
judge. The filing of the petition does not itself stay enforcement of the
director's decision. The administrative law judge may order a stay upon
appropriate terms, and if a stay is granted, the administrative law judge
must specifically consider in his order the appropriateness of the posting
of a bond by the petitioner. At the public hearing the person must be
given the opportunity to be heard upon the findings and conclusions
within the emergency cease and desist order. If no request for a public
hearing is received within ten days from the person's receipt of service of
the emergency cease and desist order, then upon application by the
director and without a public hearing, the administrative law judge must
make that emergency order a permanent cease and desist order.
(C) If an administrative law judge determines that the person charged
with transacting insurance business in violation of this chapter knew or
should have known that his actions were in violation of this chapter, then
in addition to declaring the cease and desist order to be permanent the
administrative law judge may impose a penalty of up to fifty thousand
dollars for each violation. The penalty may be imposed following a
public hearing requested by the person pursuant to subsection (B) or
following a public hearing requested by the director following an
administrative law judge's default permanent cease and desist order.
(D) In addition to any other penalties or remedies available, including
Sections 38-25-320, 38-25-330, and 38-25-360, if the director believes
that a person has violated a permanent cease and desist order issued by an
administrative law judge, then the director may certify the relevant facts
to the circuit court in any county of this State where that person has
transacted business in violation of the permanent cease and desist order.
The circuit court, upon its finding that the permanent cease and desist
order has been violated, may order the violator to pay an additional
penalty of up to twenty-five thousand dollars for each violation.
(E) Any penalties ordered pursuant either to subsection (C) or (D) may
be entered immediately by the director upon the judgment rolls in any
county where that person resides or where that person has transacted
business. Collection proceedings may be initiated immediately by the
director.
Imposes felony conviction for wilful violation
SECTION 2. Section 38-25-330 of the 1976 Code, as amended by
Section 211 of Act 184 of 1993, is further amended to read:
"Section 38-25-330. A person wilfully violating any provisions of this
chapter is guilty of a felony and, upon conviction, must be fined in the
discretion of the court or imprisoned not more than three years, or both."
Time effective
SECTION 3. This act takes effect upon approval by the Governor.
Approved the 20th day of February, 1998. |