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CFO PATRONIS ANNOUNCES AUDIT OF FLA. CLERKS OF COURT RELATED TO PENN CREDIT

2/1/2021

For Immediate Release: Monday, February 1, 2021 Contact: Office of Communications, Communications@MyFloridaCFO.com, 850.413.2842

CFO PATRONIS ANNOUNCES AUDIT OF FLA. CLERKS OF COURT RELATED TO PENN CREDIT ~ Fed. Indictment Alleges Penn Credit Bribed Certain Fla. Clerks~    TALLAHASSEE, Fla. - Today, Florida Chief Financial Officer (CFO) Jimmy Patronis notified Florida Clerks of Court that the Department of Financial Services intends to audit certain clerks for their involvement with Penn Credit, a debt collection vendor that has come under federal scrutiny for allegations related to public corruption. To narrow the scope of the audit, the Department has requested all Florida Clerks of Court self-report within 30-days on whether Penn Credit was an approved vendor. The full letter is below.    CFO PATRONIS LETTER TO FLA. CLERKS OF COURT February 1, 2021   Dear Clerk of Court:                                                                                     I am writing to you today with great concern regarding Penn Credit Corporation (Penn Credit), a Pennsylvania-based debt-collection vendor, which has been used by many clerks across Florida and the United States. Penn Credit has come under scrutiny through a federal indictment filed in the U.S. District Court, Northern District of Illinois, Eastern Division. As Chief Financial Officer (CFO) of the State of Florida, I am committed to fighting waste, fraud, and abuse. Therefore, I am notifying the various Florida Clerks of Court of the Department of Financial Services’ intent to use its authority under Chapter 28.35, Florida Statutes, to audit dealings the various clerks have had with Penn Credit.   The facts laid out by the U.S. Department of Justice illustrate public corruption and moral depravity at the highest levels of certain local governments.[1] The indictment includes charges against Penn Credit for violating federal laws concerning bribery and conspiracy relating to federally funded programs. Specifically, Penn Credit is alleged to have offered and given gifts and services to five clerks of court for the purposes of receiving favorable treatment in the award of debt collection work. The indictment includes alarming allegations of bids rigging, fee hikes, squashing competitive bidding and more. Of the five Clerks in the complaint, four are Florida clerks from three different Florida counties. The indictment alleges Penn Credit:   • “[P]aid approximately $936 to a strip club in West Palm Beach, Florida, which payment covered expenses incurred by [Penn Credit CEO] DONAGHER, Clerk B, and other attendees…” • Provided “free, discounted, and in-kind contribution in the form of automated telephone calls (commonly referred to as ‘robocalls’) for certain Clerks.” • Provided “gifts to certain Clerks, including free meals and entertainment.”   In addition to the improprieties detailed in the indictment, it appears that Penn Credit may have revised their organizational structure in filings with the Office of Financial Regulation (OFR) in an effort to hide their ongoing legal challenges.   Overall, I have concerns regarding the charges pending against Penn Credit and their possible attempts to bribe Florida officials. That is why I am invoking the authority vested in me by Section 17.03, Florida Statutes, and request that you respond to this letter within 30 days advising whether your Office contracts with Penn Credit.  Responses may be provided to the Department of Financial Services, Division of Accounting and Auditing at ArticleVBOA@myfloridacfo.com OR mail to Bureau of Auditing, 200 East Gaines Street, Tallahassee FL 32399. The purpose of this review is to determine to what extent Clerk of Court Operations would be disrupted if Penn Credit’s license to operate as a Consumer Credit Agency is revoked.     Thank you for your continuing dedication to your constituents and communities.   Sincerely,   Jimmy Patronis Chief Financial Officer   cc: Office of Financial Regulation Commissioner Russel Weigel   ### About CFO Jimmy Patronis  Chief Financial Officer and State Fire Marshal Jimmy Patronis is a statewide elected official and a member of Florida’s Cabinet who oversees the Department of Financial Services. CFO Patronis works each day to fight insurance fraud, support Florida’s firefighters, and ensure the state’s finances are stable to support economic growth in the state. Follow the activities of the Department on Facebook (FLDFS) and Twitter (@FLDFS). ________________________________________ [1] See generally United States of America v. Donald Donagher, JR., and Penn Credit Corporation, No. 19 CR 240 (U.S. D.C. N.D. Ill., E.D. filed Field March 4, 2019).