The Seventh District Court of Appeals has reinstated Ohio Department of Insurance Director Lee Covington’s order revoking the license of John Sprankle of New Springfield, to sell insurance in Ohio.
The reinstatement of the order means that Sprankle is no longer authorized to engage in the business of insurance in the state of Ohio.
In December 1998, Sprankle was notified by the Department of its intent to take disciplinary action against him for a number of violations of Ohio insurance law related to the sale of replacement life insurance policies, which included failure to accurately record the replacement information, failure to alert the insurer that the policy was a replacement. His activities were in violation of a 1992 consent agreement that prohibited him from selling replacement life insurance policies. An amended notice was issued in March of 1999.
A second amended notice was handed down in July of 1999, after the Pennsylvania Department of Insurance took disciplinary action against Sprankle for commingling funds, misrepresenting the terms of polices, misrepresenting the financial condition of an insurance company, and falsely informing 25 potential clients that their insurance agent was retiring.
Sprankle’s Ohio insurance license was revoked in April of 2000 by order of Director Covington. Sprankle appealed the revocation order to the Mahoning County Common Pleas Court, which imposed a one-year license suspension in lieu of the revocation ordered by Covington. The Department appealed the ruling to the Seventh District Court of Appeals.
The Court of Appeals reversed the trial court decision on Sept. 10, ruling that the Court of Common Pleas of Mahoning County “abused its discretion by concluding that the Department of Insurance’s order was not supported by reliable, probative and substantial evidence and further erred as a matter of law by modifying the sanction imposed.” The appeals court also found that the lower court “committed reversible error as a matter of law by not affording the Department an opportunity to be heard.”
Sprankle has filed a motion for reconsideration and a motion of stay, which is currently pending. At this time, however, Sprankle’s is not licensed to sell insurance products in Ohio.