A Cloquet insurance agent’s license was suspended Tuesday by the Minnesota Department of Commerce for alleged failure to send premiums to insurance companies after collecting payments from his clients.
Robert Pavlatos, owner of All Sports Insurance, has five counts against his company, including failure to direct at least $200,000 to American Insurance Alliance and Premium Finance Specialists, according to legal documents filed by the commerce department.
The charges against All Sports include forged insurance documents and a diversion of money that resulted in clients operating without insurance.
All Sports insures sports camps, leagues and facilities nationwide. Pavlatos, who has 30 years of insurance experience, runs the family business with his son, Adam Pavlatos.
“I’m definitely going to fight these charges,” Robert Pavlatos said. “I need to talk to my attorney. This is a shock to me that it has gotten this far.”
Commerce Commissioner Glenn Wilson expressed equal resolve for pursuing the charges.
“There is no room in the marketplace for an agency that takes your money and leaves you without insurance,” he said in a statement.
The five counts against Pavlatos will be considered at an April 20 hearing with an administrative law judge in St. Paul.
The charges state that:
All Sports failed to pay $107,000 to American Insurance Alliance for about 35 insurance policies placed for All Sports clients.
All Sports withheld, misappropriated or converted money of about $20,000 intended to pay two premium payments from Premium Finance Specialists.
All Sports withheld, misappropriated or converted money from 17 clients totaling at least $64,000.
The charges also said that All Sports continues to owe clients between $25,000 and $48,000 for overpayment or diversion of money.
One client, Sharpstown Ice Center in the Houston area, suffered hurricane-related losses of about $50,000 because All Sports failed to forward its premium payment to the insurance company, according to the legal documents.
Not every client is dissatisfied, however. Brad Buetow, who runs the Buetow School of Hockey camps, clinics and leagues in Colorado, said he has held insurance through All Sports for about 10 years without having to file a claim.
“I have total confidence in Bob, and his son, Adam,” Beutow told the News Tribune. “I’ve referred them to other people. Things have been very efficient, and I absolutely have no complaints.”
Premium Finance Specialists in Kansas City, Mo., filed a complaint in August 2008, claiming that it paid $20,000 to All Sports in 2007 for two policies that were never issued and/or canceled, the documents state. All Sports wrote four checks to Premium Finance Specialists with insufficient funds from December 2007 to March 2008. All Sports paid $11,000 in April 2008, but still owes Premium Finance Specialists $10,000 with interest and late fees, the documents claim.
American Insurance Alliance in Bellingham, Wash., filed the complaint in November 2008, claiming that All Sports sent forged insurance documents, reinstatement papers and insurance binders, according to legal documents.
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