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IN THE MATTER OF: MEDFORD MORTGAGE LLC ("Respondent") * * * * * * * * * * * * * * * * * * * * * * |
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NOTICE OF INTENT TO ISSUE NOTICE OF INTENT TO IMPOSE AND NOTICE OF RIGHT TO HEARING |
I. LEGAL AUTHORITY AND JURISDICTION
The Banking Commissioner (“Commissioner”) is charged with the administration of Part I of Chapter 668, Sections 36a-485 to 36a-534b, inclusive, of the Connecticut General Statutes, “Mortgage Lenders, Correspondent Lenders, Brokers and Loan Originators”.
Pursuant to the authority granted by Section 36a-17 of the Connecticut General Statutes, and Section 36a-498f of the Connecticut General Statutes, as amended by Public Act 17-38, the Commissioner, through the Consumer Credit Division (“Division”) of the Department of Banking, has investigated the activities of Respondent to determine if it has violated, is violating or is about to violate the provisions of the Connecticut General Statutes within the jurisdiction of the Commissioner.
Section 36a-17(a) of the Connecticut General Statutes provides, in pertinent part, that:
The commissioner, in the commissioner’s discretion, may, subject to the provisions of section 36a-21 and the Freedom of Information Act, as defined in section 1-200, (1) make such public or private investigations or examinations within or outside this state, concerning any person subject to the jurisdiction of the commissioner, as the commissioner deems necessary to carry out the duties of the commissioner . . . .
Section 36a-498f(a) of the Connecticut General Statutes, as amended, provides, in pertinent part, that:
In addition to any authority provided under this title, the commissioner shall have the authority to conduct investigations and examinations as follows:
(1) For purposes of . . . general or specific inquiry or investigation to determine compliance with sections 36a-485 to 36a-498f, inclusive, . . . 36a-534a and 36a-534b, . . . the commissioner may access, receive and use any books, accounts, records, files, documents, information or evidence including, but not limited to: . . . (C) any other documents, information or evidence the commissioner deems relevant to the inquiry or investigation regardless of the location, possession, control or custody of such documents, information or evidence.
Section 36a-52(a) of the Connecticut General Statutes, as amended by Public Act 17-233, provides, in pertinent part, that:
Whenever it appears to the commissioner that any person has violated, is violating or is about to violate any provision of the general statutes within the jurisdiction of the commissioner . . . the commissioner may send a notice to such person by registered or certified mail, return receipt requested, or by any express delivery carrier that provides a dated delivery receipt, unless such person is licensed by the commissioner, in which case the notice may be provided by personal delivery, as defined in section 4-166, in accordance with section 6 of . . . [public act 17-233]. The notice shall be deemed received by the person on the earlier of the date of actual receipt, or seven days after mailing or sending, and in the case of a notice sent by electronic mail, the notice shall be deemed received by the person in accordance with section 6 of . . . [public act 17-233]. Any such notice shall include: (1) A statement of the time, place, and nature of the hearing; (2) a statement of the legal authority and jurisdiction under which the hearing is to be held; (3) a reference to the particular sections of the general statutes . . . alleged to have been violated; (4) a short and plain statement of the matters asserted; and (5) a statement indicating that such person may file a written request for a hearing on the matters asserted within fourteen days of receipt of the notice. If a hearing is requested within the time specified in the notice, the commissioner shall hold a hearing upon the matters asserted in the notice, unless the person fails to appear at the hearing. After the hearing, the commissioner shall determine whether an order to cease and desist should be issued against the person named in the notice. If the person does not request a hearing within the time specified in the notice or fails to appear at the hearing, the commissioner shall issue an order to cease and desist against the person. No such order shall be issued except in accordance with the provisions of chapter 54.
Section 36a-50(a)(1) of the Connecticut General Statutes, as amended by Public Act 17-233, provides, in pertinent part, that:
Whenever the commissioner finds as the result of an investigation that any person has violated any provision of the general statutes within the jurisdiction of the commissioner . . . the commissioner may send a notice to such person by registered or certified mail, return receipt requested, or by any express delivery carrier that provides a dated delivery receipt, unless such person is licensed by the commissioner, in which case the notice may be provided by personal delivery, as defined in section 4-166, in accordance with section 6 of . . . [public act 17-233]. The notice shall be deemed received by the person on the earlier of the date of actual receipt or seven days after mailing or sending, and in the case of a notice sent by electronic mail, the notice shall be deemed received by the person in accordance with section 6 of . . . [public act 17-233]. Any such notice shall include: (A) A statement of the time, place, and nature of the hearing; (B) a statement of the legal authority and jurisdiction under which the hearing is to be held; (C) a reference to the particular sections of the general statutes . . . alleged to have been violated; (D) a short and plain statement of the matters asserted; (E) the maximum penalty that may be imposed for such violation; and (F) a statement indicating that such person may file a written request for a hearing on the matters asserted not later than fourteen days after receipt of the notice.
Sections 36a-50(a)(2) and 36a-50(a)(3) of the Connecticut General Statutes provide, in pertinent part, that:
(2) If a hearing is requested within the time specified in the notice, the commissioner shall hold a hearing upon the matters asserted in the notice unless such person fails to appear at the hearing. After the hearing, if the commissioner finds that the person has violated any such provision, . . . the commissioner may, in the commissioner’s discretion and in addition to any other remedy authorized by law, order that a civil penalty not exceeding one hundred thousand dollars per violation be imposed upon such person. If such person does not request a hearing within the time specified in the notice or fails to appear at the hearing, the commissioner may, as the facts require, order that a civil penalty not exceeding one hundred thousand dollars per violation be imposed upon such person.
(3) Each action undertaken by the commissioner under this subsection shall be in accordance with the provisions of chapter 54.
Section 6 of Public Act 17-233 provides, in pertinent part, that:
[T]he Banking Commissioner may provide notice pursuant to . . . sections 36a-50 to 36a-52, inclusive, of the general statutes, as amended by this act, to any person licensed by the commissioner by personal delivery, as defined in section 4-166 of the general statutes. For licensed persons who are not natural persons, the electronic mail addresses of the natural persons designated as primary contacts by such licensed persons in the contact employee fields on the system shall constitute an acceptable means of communication for personal delivery, and a notice sent by electronic mail to such primary contacts at such electronic mail addresses shall constitute notice. For licensed persons who are natural persons, the electronic mail address identified by such licensed persons on the system shall constitute an acceptable means of communication for personal delivery within the meaning of section 4-166 of the general statutes, and a notice sent by electronic mail to such electronic mail address shall constitute notice. Any notice provided in accordance with this section shall be deemed received by the person on the earlier of the date of actual receipt or seven days after mailing or sending, and in the case of a notice sent by electronic mail, the notice shall be deemed received by the person on the earlier of the date of actual receipt by any natural person to whom such notice was sent or seven days after such notice was sent.
II. MATTERS ASSERTED
| 1. | Respondent is a New Jersey limited liability company. |
| 2. | Respondent was licensed by the Commissioner through the Nationwide Multistate Licensing System and Registry (“System”) to act as a mortgage broker in Connecticut from its main office located at 32 S Main Street, Suite B, Medford, New Jersey, for the January 1 to December 31, 2016 licensing period, and is presently so licensed for the January 1 to December 31, 2017 licensing period. |
| 3. | The System required Respondent to file, among other things, certain Mortgage Call Reports (“MCRs”), one of which was on March 31, 2017 (“MCR–Standard–Financial Condition–2016”). |
| 4. |
When a licensee fails to file MCRs, the System automatically generates and posts a license item to the licensee’s account, and automatically generates an e-mail that is sent to the licensee indicating that a license item has posted to the account. |
| 5. |
On April 1, 2017, the System posted a license item to Respondent’s account for failure to file the MCR–Standard–Financial Condition–2016 described in paragraph 3 above, and Respondent was notified of the license item by the System via e-mail as described in paragraph 4 above. |
| 6. | On May 31, 2017, the Division notified all licensees who had outstanding MCRs, including Respondent, via e-mail and letter that they would be subject to administrative action, including a civil penalty, if they did not file any outstanding MCR by June 9, 2017. |
| 7. |
Respondent failed to file its MCR–Standard–Financial Condition–2016 described in paragraph 3 above until October 9, 2017.
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III. STATUTORY BASIS FOR ORDER TO CEASE
AND DESIST AND IMPOSITION OF CIVIL PENALTY
IV. NOTICE OF INTENT TO ISSUE ORDER TO CEASE AND DESIST,
NOTICE OF INTENT TO IMPOSE CIVIL PENALTY
AND NOTICE OF RIGHT TO HEARING
WHEREAS, the Commissioner has reason to believe that Respondent has engaged in acts or conduct which forms the basis to issue an order to cease and desist against Respondent pursuant to Sections 36a-494(b) and 36a-52(a) of the Connecticut General Statutes, as amended, and to impose a civil penalty upon Respondent pursuant to Sections 36a-494(b) and 36a-50(a) of the Connecticut General Statutes, as amended.
NOW THEREFORE, notice is hereby given to Respondent that the Commissioner intends to issue an order requiring Respondent to CEASE AND DESIST from violating Section 36a-534b(c) of the Connecticut General Statutes, as amended, and that the Commissioner intends to impose a CIVIL PENALTY upon Respondent as set forth herein, subject to Respondent’s right to a hearing on the allegation set forth above.
A hearing will be granted to Respondent if a written request for a hearing is received by the Department of Banking, Consumer Credit Division, 260 Constitution Plaza, Hartford, Connecticut 06103-1800 within fourteen (14) days following its receipt of this Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing as set forth in Sections 36a-52(a) and 36a-50(a) of the Connecticut General Statutes, as amended. This Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing shall be deemed received on the earlier of the date of actual receipt, or seven days after mailing or sending. To request a hearing, complete and return the enclosed Appearance and Request for Hearing Form to the above address. If Respondent will not be represented by an attorney at the hearing, please complete the Appearance and Request for Hearing Form as “pro se”. Once a written request for a hearing is received, the Commissioner may issue a notification of hearing and designation of hearing officer that acknowledges receipt of a request for a hearing, designates a presiding officer and sets the date of the hearing in accordance with Section 4-177 of the Connecticut General Statutes and Section 36a-1-21 of the Regulations of Connecticut State Agencies. If a hearing is requested, the hearing will be held on January 23, 2018, at 10 a.m., at the Department of Banking, 260 Constitution Plaza, Hartford, Connecticut.
The hearing will be held in accordance with the provisions of Chapter 54 of the Connecticut General Statutes, unless Respondent fails to appear at the requested hearing. At such hearing, Respondent will have the right to appear and present evidence, rebuttal evidence and argument on all issues of fact and law to be considered by the Commissioner.
If Respondent does not request a hearing within the time prescribed or fails to appear at any such hearing, the allegation herein will be deemed admitted. Accordingly, the Commissioner will issue an order that Respondent cease and desist from violating Section 36a-534b(c) of the Connecticut General Statutes, as amended, and may order that the maximum civil penalty be imposed upon Respondent.
Dated at Hartford, Connecticut
this 13th day of November 2017. ________/s/_________
Jorge L. Perez
Banking Commissioner