State of Connecticut Department of Banking

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IN THE MATTER OF:

OXFORD COLLECTION
AGENCY, INC.

d/b/a

OXFORD MANAGEMENT
SERVICES

   

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FINDINGS OF FACT,

CONCLUSIONS OF LAW

AND

DEFAULT ORDER

FINDINGS OF FACT

 1.   On March 24, 2010, the Banking Commissioner issued a Notice of Intent to Revoke and Refuse to Renew Consumer Collection Agency License; Notice of Intent to Issue Order to Cease and Desist; Notice of Intent to Impose Civil Penalty; and Notice of Right to Hearing (the “Notice”) against Oxford Collection Agency, Inc. d/b/a Oxford Management Services (“Respondent”) (Ex. 1, tr. 7).  The Notice is incorporated by reference herein.
 
 2. The Notice quoted provisions from Sections 36a-52(a), 36a-51(a) and 36a-50(a) of the Connecticut General Statutes concerning the consequences of a failure to appear at a scheduled hearing (Ex. 1).
 
 3. The Notice stated that it was issued pursuant to Part XII of Chapter 669, Sections 36a-800 to 36a-810, inclusive, of the Connecticut General Statutes governing Consumer Collection Agencies and the regulations thereunder (Sections 36a-809-6 to 36a-809-17, inclusive, of the Regulations of Connecticut State Agencies) (Ex. 1).
 
 4. The Notice stated that Oxford Collection Agency, Inc. was a New York corporation with its main office at 135 Maxess Road, Melville, New York (Ex. 1).
 
 5. According to New York State Department of State online records retrieved on March 23, 2011 and introduced at the hearing, (1) Respondent was formed as a New York domestic business corporation on November 14, 1995; (2) the last address of record for Respondent was 135 Maxess Road, Suite 2A, Melville, New York  11747; (3) Respondent is an active corporation; (4) Charles Harris is the Executive Vice President of Respondent, and (5) Peter Pinto is the Respondent’s Chief Executive Officer (Ex. 9).
 
 6. The Notice stated that, since October 1, 2007, Respondent has been licensed as a consumer collection agency under Section 36a-801 of the Connecticut General Statutes (Ex. 1).
 
 7. On September 29, 2008, Jean Wright of the Consumer Credit Division of the State of Connecticut Department of Banking (the “Department”) received an e-mail regarding Respondent from Connecticut attorney Joanne S. Faulkner.  In her e-mail, Ms. Faulkner wrote:  “failure to account for funds.  Please investigate.” (Ex. 11).  Jean Wright works in the licensing area of the Department’s Consumer Credit Division (tr. 20).  The e-mail included a citation to, and an excerpted quotation of the related arbitrator’s decision, from the following case:  AmeriCredit Financial Services Inc. v. Oxford Management Services (Docket No. 07-CV-3948) (E.D.N.Y. 9/18/2008) (Ex. 11).
 
 8. In a publicly reported decision, the court in AmeriCredit Financial Services Inc. v. Oxford Management Services (Docket No. 07-CV-3948) (E.D.N.Y. 9/18/2008) had confirmed an arbitration award which determined that Respondent had violated a Recovery Services Agreement by engaging in certain conduct following termination of the contract, specifically, (1) failing to transmit meaningful records of its activities to the claimant; (2) allowing its employees to deliberately destroy records that could have resolved the parties’ competing claims; and (3) improperly retaining in its private accounts funds legally belonging to the claimant.  The arbitrator assessed Respondent over $400,000 for damages, interest and costs.
   
 9. Jean Wright forwarded Ms. Faulkner’s September 29, 2008 e-mail to Carmine Costa of the Department on September 30, 2008 (Ex. 11).
   
 10. Carmine Costa is a Banking Department Manager with the agency, and is assigned to the Consumer Credit Division (tr. 19).
  
 11. In explaining Ms. Faulkner’s September 29, 2008 e-mail, Carmine Costa testified that “Oxford was the collection agency.  AmeriCredit was the client, and as a client of a collection agency, the collection agency is supposed to maintain funds in a trust account and remit those funds to the client . . . .” (tr. 21)
 
 12. Carmine Costa testified that, upon receiving Ms. Faulkner’s e-mail, he wrote a memo to then Deputy Commissioner Alan Cicchetti referring the matter for further investigation (tr. 22; Ex. 12)  That memorandum, dated September 30, 2008, was introduced into evidence as Exhibit 12 (tr. 22).
 
 13. According to the Notice, on August 28, 2009, Respondent filed an application for Renewal of Consumer Collection Agency License in Connecticut (the “Connecticut Renewal Application”) (Ex. 1).
 
 14.  At the time the Connecticut Renewal Application was filed, Respondent was the subject of a June 10, 2009 Consent Decree filed in the United States District Court for the Eastern District of New York (United States of America v. Oxford Collection Agency, Inc. d/b/a Oxford Management Services, Richard Pinto, Peter Pinto, Charles Harris and Salvatore Spinelli; Docket No. CF 09-2467) (Ex. 13). The Consent Decree resulted from civil litigation brought under the Fair Debt Collection Practices Act, 15 U.S.C. §1692 et seq. The Consent Decree, while not involving an admission of liability on the part of the consenting defendants, did permanently enjoin Respondent, the Pintos and Charles Harris from misrepresenting to consumers the consequences of paying or not paying a debt; failing to abide by the limitations on communicating with consumers set forth in Section 805(a)(1) of the Fair Debt Collection Practices Act and violating Sections 805(b), 805(c) and 806 of the Fair Debt Collection Practices Act.  Pursuant to the Consent Decree, Respondent, the Pintos and Charles Harris were ordered to pay a civil penalty of $1,060,000 under Section 5(m)(1)(A) of the Federal Trade Commission Act, with all but $250,000 of the payment being suspended if the $250,000 were paid no later than ten days after entry of the Consent Decree (Ex. 13).
 
 15. At the time the Connecticut Renewal Application was filed, Respondent and Charles Harris were the subject of a July 27, 2009 Consent Order (No. 09F-BD067-BNK) issued by the State of Arizona Department of Financial Institutions.  The Arizona Consent Order recited that:  (1) the Consent Order had been preceded by a June 19, 2009 Amended Notice of Hearing to Revoke and Complaint; (2) Respondents Oxford Collection Agency, Inc. and Charles Harris had violated A.R.S. §6-124(c) by refusing to allow the Department to conduct an examination of Oxford Collection Agency, Inc., had failed to maintain all records required under A.A.C. R20-4-1504 and had failed to timely make those records available for examination, investigation or audit in Arizona within 3 working days following a demand by the Superintendent; and (3) Respondents had violated a February 3, 2009 Final Order to Cease and Desist, Notice of Opportunity for Hearing, Consent to Entry of Order by failing to produce records in a timely manner and pay a $5,000 civil money penalty.  The July 27, 2009 Consent Order issued by the State of Arizona directed respondents to (a) allow the department to conduct future examinations of Oxford Collection Agency, Inc. under A.R.S. §6-122(B)(3) and to maintain all records required under A.A.C. R20-4-1504 and timely make those records available for examination, investigation or audit in Arizona within 3 working days following a demand by the Superintendent; and (b) pay an $8,000 civil money penalty, jointly and severally, plus an examination fee of $1,105 under A.R.S. §6-122(B)(3).  Respondent Oxford Collection Agency, Inc., by Charles Harris, signed the Arizona Consent Order on July 16, 2009 (Ex. 14).
  
 16. The Notice stated that Question 8 of the Connecticut Renewal Application filed by Respondent on August 28, 2009 asked if the applicant or any officer, director, trustee, principal employee or shareholder owning 10% or more of the applicant’s common stock “(e) has ever been the subject of actions (cease and deist [sic] orders, consent orders, injunctions, license suspensions or revocations) by any regulatory agency, state or federal.”  The Notice alleged that Respondent answered “no” to Question 8.
  
 17. The Notice alleged that, in responding “no” to Question 8(e) on the Renewal Application, Respondent made a material misstatement, and that such conduct would constitute sufficient grounds for the Commissioner to revoke and refuse to renew Respondent’s consumer collection agency license in Connecticut pursuant to Section 36a-804(a)(1) of the Connecticut General Statutes and subsections (a) and (b) of Section 36a-51 of the 2010 Supplement to the General Statutes (Ex. 1).
 
 18. The record does not contain any amended Connecticut Renewal Application filed by Respondent.
 
 19. During the hearing, counsel for the Consumer Credit Division of the Department represented to the Hearing Officer that no correction to Question 8 of the Connecticut Renewal Application had been received by the Department (tr. 30).
 
 20. By letter dated November 5, 2009 to the Consumer Credit Division of the Department, Charles Harris, Executive Vice President of Respondent, responded to regulatory concerns expressed by the Consumer Credit Division in correspondence dated September 2, 2009.  The September 2, 2009 correspondence was not introduced into evidence.  In his November 5, 2009 letter, Charles Harris stated that  “The litigation filed in United States District Court for the Eastern District of New York included a Consent Decree settlement agreement in which Oxford agreed to settle with the Federal Trade Commission (FTC) for alleged violations of the Federal Fair Debt Collection Practices Act (FDCPA) without admitting any liability for any of the matters alleged in the Complaint.  Oxford was not aware of the responsibility to notify the Commissioner, in writing, since a settlement agreement was reached at the same time.  If further explanation or formalization is desired, please let us know.” (Ex. 15)
 
 21. In his November 5, 2009 letter, Charles Harris did not address the July 27, 2009 Consent Order (No. 09F-BD067-BNK) issued by the State of Arizona Department of Financial Institutions.
 
 22. The Notice alleged that, from at least July 1 through September 30, 2008, Respondent commingled money collected from debtors on behalf of creditors with its own funds and used such money for the conduct of Respondent’s business (Ex. 1).
 
 23. The Notice alleged that Respondent’s commingling of money collected from debtors on behalf of creditors with Respondent’s own funds and using such funds for Respondent’s own business violated Section 36a-805(a)(12) of the Connecticut General Statutes and Section 36a-809-7(b) of the Regulations, and therefore constituted grounds for the Commissioner to (1) revoke or refuse to renew Respondent’s Connecticut consumer collection agency license under Section 36a-804(a)(3) of the Connecticut General Statutes and subsections (a) and (b) of Section 36a-51 of the 2010 Supplement to the General Statutes; (2) issue an order to cease and desist against Respondent under Sections 36a-804(b) and 36a-52(a) of the Connecticut General Statutes; and (3) issue an order imposing civil penalty under Sections 36a-804(b) and 36a-50(a) of the Connecticut General Statutes (Ex. 1).
 
 24. In Exhibit 15, Respondent stated, in part, that:  “Oxford has set up a new trust account with its financial institution, Webster Bank, which will solely house all CT payments and will not be commingled with any other finances.  The account will be an intermediary to ensure that CT consumer payments are not charged a processing fee and then these payments will be redirected to the proper client trust accounts.  The First National Bank of Long Island (FNBLI) trust account that previously housed CT payments was fund segregated and the Oxford accounting team ensured all payments received where [sic] reported and remitted to the proper clients.  However, prior to designating the FNBLI account for CT payments, the account was used to make payroll tax payments, insurance premium payments for the executive group, and other small miscellaneous payments.” (Ex. 15)
 
 25. The Notice stated that, on January 22, 2010, the Consumer Credit Division, acting pursuant to Section 4-182(c) of the Connecticut General Statutes, sent a letter to Respondent giving Respondent an opportunity to show compliance with all lawful requirements for retention of Respondent’s consumer collection agency license in Connecticut (Ex. 1).
 
 26. The January 22, 2010 compliance letter was not introduced into evidence at the hearing.
 
 27. The Notice stated that, by letter dated January 28, 2010, Respondent responded to the Consumer Credit Division’s January 22, 2010 letter.  The January 28, 2010 response was not introduced into evidence at the hearing.
  
 28. The Notice stated that, on March 25, 2010, the Notice was sent by registered mail, return receipt requested, to (1) Oxford Collection Agency, Inc. d/b/a Oxford Management Services, Attention:  Denise Robbins, Cornerstone Support, Inc., 11111 Houze Road, Suite 200, Roswell, Georgia (registered mail no. RB028036929US); and (2) Peter Pinto, President, 135 Maxess Road, Melville, New York  11747 (registered mail no. RB028036976US) (Ex. 1).
  
 29. Photocopies of Domestic Return Receipts (PS Form 3811) included in Exhibit 1 indicate that (1) on March 31, 2010, registered mail number RB028036929US was delivered to Respondent at the Roswell, Georgia address; and (2) on March 29, 2010, registered mail number RB028036976US was delivered to Respondent at the Melville, New York address.
   
 30. On April 5, 2010, Charles Harris, Executive Vice President of Respondent, sent a fax to Attorney Doniel Kitt of the department.  Responding to the Notice, Charles Harris included in the fax an Appearance and Request for Hearing form on behalf of Respondent (Ex. 2, tr. 7).
   
 31. On April 7, 2010, the Banking Commissioner issued a Notification of Hearing and Designation of Hearing Officer appointing Cynthia Antanaitis as Hearing Officer with respect to the Notice and setting the hearing date for May 12, 2010.  The Notification of Hearing and Designation of Hearing Officer stated that the hearing was being held in accordance with a written request for hearing received on April 5, 2010 from Charles Harris, Executive Vice President of Respondent, and indicated that the attorney representing the Department was Doniel Kitt.  The Notification of Hearing and Designation of Hearing Officer contained a Certification page signed by Paralegal Tina M. Daigle indicating that, on April 8, 2010, she had caused the original Notification of Hearing and Designation of Hearing Officer to be sent by first class mail to Charles Harris, Executive Vice President, Oxford Collection Agency, Inc. d/b/a Oxford Management Services, 135 Maxess Road, Melville, New York 11747.  (Ex. 3, tr. 8)
 32. Attached as Exhibit A to the April 7, 2010 Notification of Hearing and Designation of Hearing Officer was a copy of the Notice which quoted provisions from Sections 36a-52(a), 36a-51(a) and 36a-50(a) of the Connecticut General Statutes concerning the consequences of a failure to appear at a scheduled hearing (Ex. 3).
 33. On May 6, 2010, Charles Harris sent a fax to Attorney Doniel Kitt and to the Hearing Officer, acknowledging receipt of the Notification of Hearing and Designation of Hearing Officer.  The fax stated that Charles Harris was unable to attend the hearing on May 12, 2010 “due to prior business commitments in FL.”  The fax requested that Attorney Kitt advise Charles Harris concerning Attorney Kitt's availability to discuss resolution and settlement of the claims before or after May 12, 2010 (Ex. 4).
 34. At 9:15 a.m. on May 7, 2010, Attorney Kitt e-mailed the Hearing Officer, with a copy to Charles Harris, requesting a continuance of approximately thirty days on behalf of the Department and the Respondent “to facilitate settlement discussions.” Attorney Kitt requested that the hearing be continued to June 16, 2010 (Ex. 4).  At 9:42 a.m. on May 7, 2010, the Hearing Officer advised Attorney Kitt and Charles Harris via e-mail that the hearing had been continued to June 16, 2010 (Ex. 4).
 35. On June 11, 2010 at 1:48 p.m., Charles Harris e-mailed Attorney Kitt asking, “[D]o we still need to be there next Wednesday for the hearing?” (Ex. 4).  At 2:18 p.m. on June 11, 2010, Attorney Kitt e-mailed Charles Harris, “I guess that would depend on how the discussion goes on Monday.  We can request a continuance of the hearing if we are making progress towards settlement.” (Ex. 4)
 36. On June 14, 2010, at 3:17 p.m., Attorney Kitt e-mailed the Hearing Officer, with a copy to Charles Harris, referring the Hearing Officer to Respondent's included continuance request and stating that the department did not oppose the continuance.  Included with the e-mail was the following text:  “Mr. Kitt: I will be available Monday afternoon and Tuesday morning if needed.  I am respectfully requesting until June 30 to negotiate a settlement with a conference call next Wednesday instead of the hearing.  Please advise.  Thanks.  Charlie”  (Ex. 4).  At 3:39 p.m. on June 14, 2010, the Hearing Officer e-mailed Attorney Kitt, with a copy to Charles Harris, continuing the hearing to June 30, 2010 per mutual agreement of the Respondent and the department (Ex. 4).
 37. On June 29, 2010, at 7:56 a.m., Attorney Kitt e-mailed Charles Harris, “To the extent that we are still in settlement discussions, I think it would be appropriate to request a sixty (60) day extension, which would give us enough time to resolve any differences, document terms and get documents executed.  If you agree, I can forward a mutual request for a continuance to the hearing officer.”  (Ex. 4).  At 1:28 p.m. on June 29, 2010, Charles Harris e-mailed Attorney Kitt, agreeing to a 60 day extension “to continue settlement discussions.  We are hopeful that mutually agreeable settlement terms can be reached shortly.”  (Ex. 4)  At 1:30 p.m. on June 29, 2010, Attorney Kitt e-mailed the Hearing Officer, “Based upon the below emails, the Respondent and the Department are mutually requesting a continuance of the hearing scheduled for June 30, 2010.  We are working to get this matter resolved as quickly as possible.”  (Ex. 4)  On June 29, 2010 at 1:52 p.m., the Hearing Officer e-mailed Attorney Kitt and Charles Harris, continuing the hearing to August 26, 2010 (Ex. 4).
 38. On August 24, 2010, at 8:29 a.m., Charles Harris e-mailed Attorney Kitt and the Hearing Officer, indicating that Respondent agreed to a 45 day continuance of the hearing scheduled for August 26, 2010.  At 6:24 p.m. on August 24, 2010, the Hearing Officer e-mailed Charles Harris and Attorney Kitt, continuing the hearing to October 27, 2010 (Ex. 4).
 
 39. On October 26, 2010, at 7:50 a.m., Attorney Kitt e-mailed Charles Harris, “Since this matter is still scheduled for a hearing tomorrow, October 27, 2010, we need to request a further continuance of approximately forty-five days while we finalize the Settlement Agreement.  With your concurrence, I will forward our mutual request to the hearing officer.  Please let me know at your earliest convenience.” (Ex. 4).  On October 26, 2010 at 7:52 a.m., Charles Harris e-mailed Attorney Kitt, stating “we concur.” (Ex. 4)  At 8:05 a.m. on October 26, 2010, Attorney Kitt e-mailed the Hearing Officer, with a copy to Charles Harris, requesting a 45 day continuance “to enable us to finalize our settlement discussions.” (Ex. 4)  At 12:56 p.m. on October 26, 2010, the Hearing Officer e-mailed Attorney Kitt with a copy to Charles Harris, continuing the hearing to December 14, 2010 “based on the parties’ representations that they are finalizing a settlement.” (Ex. 4)
 40. On December 9, 2010, Attorney Kitt e-mailed the Hearing Officer, with a copy to Charles Harris, forwarding as an FYI the following two e-mails:  (1) A November 23, 2010 e-mail from Attorney Kitt to Charles Harris referencing a Settlement Agreement; and (2) a December 7, 2010 e-mail from Attorney Kitt to Charles Harris indicating that Attorney Kitt was checking on the status of the Settlement Agreement (Ex. 4).
 41. On December 9, 2010 at 1:11 p.m., the Hearing Officer e-mailed Attorney Kitt with a copy to Charles Harris, reminding Attorney Kitt and Charles Harris that a hearing was scheduled for the following week, asking Charles Harris if the signed settlement and remittance had been returned to the department and asking Attorney Kitt if he received the signed settlement (Ex. 4).
 
 42. On December 10, 2010, the Hearing Officer e-mailed Attorney Kitt, with a copy to Charles Harris, indicating that, due to a scheduling conflict, the Hearing Officer found it necessary to reschedule the hearing from December 14, 2010 to January 18, 2011 (Ex. 4).  The e-mail message added that:  “To date, the hearing officer has received no notice that this matter has been settled, so it is scheduled to go forward.” (Ex. 4)
   
 43. On January 14, 2011 at 8:54 a.m., Attorney Kitt e-mailed the Hearing Officer, with a copy to Charles Harris:  “As you are aware, the above-referenced matter is currently on the hearing calendar for Tuesday, January 18, 2011.  On January 11, 2011, I sent an email message to Mr. Harris, Executive Vice President of Oxford, inquiring about the status of a proposed Settlement Agreement.  Having received no response, on January 13, 2011, I placed a phone call to Mr. Harris at 772-882-3569 and left a voice mail message asking Mr. Harris to contact the undersigned.  Inasmuch as Monday, January 17, 2011 is a holiday and our offices will be closed, hopefully we will hear from Oxford before the close of business today.  In any event, due to the unavailability of the Department’s witness and the upcoming holiday, the Department would need a short continuance if this matter is going forward as a hearing.” (Ex. 4)  On January 14, 2011 at 8:56 a.m., a response was received from Charles Harris:  “Will be returning January 17th.”  On January 14, 2011 at 9:37 a.m., the Hearing Officer e-mailed Attorney Kitt with a copy to Charles Harris, noting that Attorney Kitt had requested a continuance due to the unavailability of a department witness and the possibility of settlement.  The Hearing Officer continued the hearing to February 8, 2011. (Ex. 4)
   
 44. On February 7, 2011 at 8:17 a.m., Attorney Kitt e-mailed Charles Harris, “Inasmuch as there is a hearing scheduled for tomorrow, please have your attorney contact me ASAP to discuss this matter preliminarily so we can determine whether a new continuance request is in order.” (Ex. 4) At 9:23 a.m. on February 7, 2011 Charles Harris e-mailed Attorney Kitt, “I am out sick with the flu and in this condition I doubt I will be able to make it tomorrow.  I will reach out to our attorney to see if he can call you today.” (Ex. 4)  At 11:59 a.m. on February 7, 2011, Attorney Kitt e-mailed Charles Harris, “If you cannot reach your counsel, it appears that a continuance request from you on behalf of Oxford might be appropriate since you, as a potential witness, would not be available.” (Ex. 4)  At 1:25 p.m. on February 7, 2011, Charles Harris e-mailed Attorney Kitt, “I apologize, but His [sic] office says he is in court today.  Based on this and my illness, Oxford is requesting a continuance.” (Ex. 4)
   
 45. On February 7, 2011 at 1:27 p.m., Attorney Kitt forwarded Charles Harris’ 1:25 p.m. e-mail to the Hearing Officer, with a copy to Charles Harris.  Attorney Kitt stated that “the Department does not object to this request as we would like to continue possible settlement discussions.” (Ex. 4)
   
 46. On February 7, 2011 at 3:01 p.m., the Hearing Officer e-mailed Attorney Kitt, with a copy to Charles Harris, requesting that Respondent identify its counsel and provide his e-mail address (Ex. 4).  At 3:19 p.m. on February 7, 2011, Charles Harris e-mailed Attorney Kitt and the Hearing Officer, stating that “Our attorney’s name is John G. Poli, III.  His email address is Poli11768ataol.com.” (Ex. 4) At 3:41 p.m. on February 7, 2011, the Hearing Officer e-mailed Charles Harris, Attorney Kitt and Poli11768ataol.com, continuing the hearing to March 24, 2011 (Ex. 4).
   
 47. On February 7, 2011 at 3:50 p.m., the Hearing Officer e-mailed Charles Harris and Attorney Kitt indicating that the e-mail address supplied for Respondent's counsel had been returned as undeliverable (Ex. 4).  At 3:54 p.m. on February 7, 2011, Charles Harris replied to the Hearing Officer and to Attorney Kitt, “Sorry it should have been: Polilawat11768ataol.com” (Ex. 4).  At 3:59 p.m. on February 7, 2011, the Hearing Officer e-mailed Charles Harris and Attorney Kitt, “I tried to resend it [the message] to Polilawat11768ataol.com, but received a message saying that Microsoft Outlook does not recognize that address.” (Ex. 4).  On February 7, 2011 at 4:18 p.m., Charles Harris e-mailed the Hearing Officer and Attorney Kitt, "Polilaw11768ataol.com" (Ex. 4)
   
 48. Section 36a-1-32 of the Regulations provides, in part, that:  “(a)  Attorneys duly admitted to practice law in the state of Connecticut and in good standing may represent others before the department.  (b)  Attorneys in good standing from other jurisdictions may request and, for good cause shown, be allowed to appear in a contested case, provided an attorney admitted to practice in Connecticut is present during the entire proceeding, signs all pleadings and other papers filed in the proceeding and agrees to take full responsibility for supervising the conduct of the attorney . . . (d)  Each person making an appearance before the commissioner as counsel or representative in connection with any contested case shall promptly notify the commissioner or presiding officer in writing by filing a notice of appearance at or before the time such person submits papers or otherwise appears on behalf of a party in the contested case.  The notice of appearance shall include a declaration that the individual is currently qualified as provided in this section and is authorized to represent and accept service on behalf of the represented.”
   
 49. There is no evidence in the record that (1) John G. Poli, III is duly admitted to practice law in the State of Connecticut; or (2) that John G. Poli filed a written request to appear on behalf of Respondent pursuant to subsection (b) or subsection (d) of Section 36a-1-32 of the Regulations.
   
 50. On March 23, 2011 at 11:42 a.m., the Hearing Officer e-mailed Charles Harris, with a copy to Attorney Kitt and to Polilaw11768ataol.com, reminding them of the March 24, 2011 hearing, noting that past e-mails to counsel John G. Poli, III were returned as undeliverable, and adding that she would attempt to relay this message via the last e-mail provided.  The message also stated that the Respondent and the department might find Sections 36a-51(a), 36a-52(a) and 36a-50(a) of the Connecticut General Statutes, addressing the consequences of a default, instructive (Ex. 5, tr. 9).
   
 51. The Hearing Officer’s March 23, 2011 message was delivered to Polilaw11768ataol.com on March 23, 2011 (Ex. 7, tr. 11).
   
 52. The Hearing Officer’s March 23, 2011 message was delivered to Charles Harris on March 23, 2011 (Ex. 8) and read by Charles Harris on March 23, 2011 at 11:50 a.m. (Ex. 8).
   
 53. All told, the proceeding was continued eight times over a ten month period as the Respondent and the Department purportedly discussed settlement.
   
 54. On March 24, 2011 at 10:20 a.m., a hearing was held at the Department of Banking (tr. 5).
   
 55. Respondent did not withdraw its request for a hearing on the Notice.
   
 56. Neither the Respondent nor its legal counsel appeared at the hearing.
   
 57. At the outset of the hearing, both counsel for the department and the Hearing Officer noted for the record that neither had received any communications from Respondent or its counsel excusing Respondent’s absence at the hearing or requesting an additional continuance (tr. 6-7).
   
 58. During the hearing, counsel for the Department presented the following observations relating to the amount of the fine, if any, to be imposed:  (1) Respondent was an active corporation under New York Law and had not been dissolved (tr. 13, 15); (2) the Respondent had not filed for bankruptcy (tr. 13); and (3) a fine was appropriate in light of the allegations in the Notice (tr. 14).
   
 59. The Department requested a default ruling against Respondent in light of its failure to appear (tr. 12-13).

CONCLUSIONS OF LAW

Jurisdiction and Procedure

1.    The Commissioner has jurisdiction over the licensing and regulation of consumer collection agencies pursuant to Part XII of Chapter 669, Sections 36a-800 to 36a-810, inclusive, of the Connecticut General Statutes and the regulations thereunder (Sections 36a-809-6 to 36a-809-17, inclusive of the Regulations of Connecticut State Agencies).
 
2. Section 36a-1-31(b) of the Regulations of Connecticut State Agencies provides that:  “When a party fails to appear at a scheduled hearing, the allegations against the party may be deemed admitted.  Without further proceedings or notice to the party, the presiding officer shall submit to the commissioner a proposed final decision containing the relief sought in the notice, provided the presiding officer may, if deemed necessary, receive evidence from the department, as part of the record, concerning the appropriateness of the amount of any civil penalty, fine or restitution sought in the notice.  The commissioner shall issue a final decision in accordance with section 4-180 of the Connecticut General Statutes and section 36a-1-52 of the Regulations of Connecticut State Agencies.”
 
3.  The Notice issued by the Commissioner comported with the requirements of Section 4-177(b) of Chapter 54 of the Connecticut General Statutes.
    
4.  The Commissioner complied with the requirements of Section 4-182(c) of Chapter 54 of the Connecticut General Statutes.
  
5. The Notice complied with the notice requirements of Sections 36a-50(a) [civil penalty], 36a-51(a) [revocation or refusal to renew proceeding] and 36a-52(a) [cease and desist order] of the Connecticut General Statutes.
   
6.  The Respondent received notice that the hearing, originally scheduled for May 12, 2010, was ultimately continued to March 24, 2011 following a series of postponements initiated by the Respondent and/or the Department.  One postponement was initiated by the Hearing Officer.
7. Section 4-177(c) of Chapter 54 of the Connecticut General Statutes provides, in part, that:  “Unless precluded by law, a contested case may be resolved by . . . the default of a party.”   
   
   
Section 36a-51(a) of the Connecticut General Statutes Requires
Revocation and Refusal to Renew a License
Where There is a Failure to Appear
  
8.  Section 36a-51 of the Connecticut General Statutes provides, in part, that:

(a) The commissioner may . . . revoke or refuse to renew any license issued by the commissioner under any provision of the general statutes by sending a notice to the licensee by registered or certified mail, return receipt requested, or by any express delivery carrier that provides a dated delivery receipt . . (b) 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 licensee fails to appear at the hearing.  After the hearing, the commissioner shall . . . revoke or refuse to renew the license for any reason set forth in the applicable licensing provisions of the general statutes if the commissioner finds sufficient grounds exist for such . . . revocation or refusal to renew.   If the licensee . . . fails to appear at the hearing, the commissioner shall . . . revoke or refuse to renew the license.  No such license shall be suspended or revoked except in accordance with the provisions of chapter 54.”  (Emphasis supplied)

      
9. In accordance with Section 36a-1-31(b) of the Regulations of Connecticut State Agencies, the factual and legal allegations against the Respondent which were contained in the Notice are deemed admitted and adopted in the Findings of Fact and Conclusions of Law herein contained.
      
10. In accordance with Section 36a-1-31(b) of the Regulations of Connecticut State Agencies, the Commissioner finds that (1) Respondent violated Section 36a-805(a)(12) of the Connecticut General Statutes and Section 36a-809-7(b) of the Regulations; and (2) sufficient grounds exist for the Commissioner to revoke and to refuse to renew Respondent’s consumer collection agency license pursuant to Sections 36a-804(a)(1) and 36a-804(a)(3) of the Connecticut General Statutes and subsections (a) and (b) of Section 36a-51 of the 2010 Supplement to the General Statutes.
       
11. The express terms of Section 36a-51(a) of the Connecticut General Statutes require that the Commissioner revoke or refuse to renew Respondent’s consumer collection agency license given Respondent’s failure to appear at the hearing.
 
 
Section 36a-52(a) of the Connecticut General Statutes Requires
that a Cease and Desist Order be Issued
Where There is a Failure to Appear
 
12.  Subject to a respondent’s right to request a hearing on the matters alleged, Section 36a-52(a) of the Connecticut General Statutes authorizes the Commissioner to issue a cease and desist order where 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, or any regulation, rule or order adopted or issued thereunder . . . . ” Section 36a-52(a) also provides, in part, that:  “If the person . . . 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.”   (Emphasis added)
 
13.  In accordance with Section 36a-1-31(b) of the Regulations of Connecticut State Agencies, the factual and legal allegations against the Respondent which were contained in the Notice are deemed admitted and adopted in the Findings of Fact and Conclusions of Law herein contained.
     
14. In accordance with Section 36a-1-31(b) of the Regulations of Connecticut State Agencies, the Commissioner finds that (1) Respondent violated Section 36a-805(a)(12) of the Connecticut General Statutes and Section 36a-809-7(b) of the Regulations; and (2) sufficient grounds exist for the Commissioner to issue an order to cease and desist against Respondent under Sections 36a-804(b) and 36a-52(a) of the Connecticut General Statutes.
      
15. The express terms of Section 36a-52(a) of the Connecticut General Statutes require that the Commissioner issue a cease and desist order against the Respondent given the Respondent’s failure to appear at the hearing.
     
 
Civil Penalty
        
16.  Subject to a respondent’s right to request a hearing on the matters alleged, Section 36a-50(a) of the Connecticut General Statutes authorizes the Commissioner to issue a notice of intent to impose a civil penalty of up to $100,000 per violation where 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, or any regulation, rule or order adopted or issued thereunder . . . . ”

Subdivisions (2) and (3) of subsection (a) of Section 36a-50 provide 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, regulation, rule or order, 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 . . . 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 chapter 54.”  (Emphasis added)

17.  Section 36a-1-31(b) of the Regulations of Connecticut State Agencies provides that:  “When a party fails to appear at a scheduled hearing, the allegations against the party may be deemed admitted.  Without further proceedings or notice to the party, the presiding officer shall submit to the commissioner a proposed final decision containing the relief sought in the notice, provided the presiding officer may, if deemed necessary, receive evidence from the department, as part of the record, concerning the appropriateness of the amount of any civil penalty, fine or restitution sought in the notice.  The commissioner shall issue a final decision in accordance with section 4-180 of the Connecticut General Statutes and section 36a-1-52 of the Regulations of Connecticut State Agencies.”
 
18.  In accordance with Section 36a-1-31(b) of the Regulations of Connecticut State Agencies, the factual and legal allegations against the Respondent which were contained in the Notice are deemed admitted and adopted in the Findings of Fact and Conclusions of Law herein contained.
 
19.  In accordance with Section 36a-1-31(b) of the Regulations of Connecticut State Agencies, the Commissioner finds that (1) Respondent violated Section 36a-805(a)(12) of the Connecticut General Statutes and Section 36a-809-7(b) of the Regulations; and (2) sufficient grounds exist for the Commissioner to impose a civil penalty pursuant to Sections 36a-804(b) and 36a-50(a) of the Connecticut General Statutes.
 
20.  Pursuant to Section 36a-1-31(b) of the Regulations of Connecticut State Agencies, the Hearing Officer, deeming it necessary, received evidence from the Department as part of the record solely concerning the appropriateness of the $30,000 civil penalty sought in the Notice.
   
21. The Commissioner finds that, in light of the Respondent’s violations as more fully set forth in paragraph 19 of these Conclusions of Law, the facts require the imposition of a fine against Respondent.  The Connecticut Supreme Court has stated that “[t]he assessment of civil penalties is a fact-specific and broadly discretionary determination.”  Rocque v. Light Sources, Inc., 275 Conn. 420, 450 (2005).  Although the Commissioner finds that the imposition of a fine is warranted, based upon the record and the matters alleged in the Notice, the facts do not require the imposition of the fine requested against Respondent.  The Commissioner notes that Exhibit 15 suggests that the Respondent may have instituted some operational measures to ensure the segregation of client funds and prevent future commingling.

ORDER

Having read the record, I hereby ORDER, pursuant to Sections 36a-50(a), 36a-51(a), 36a-52(a), and 36a-804 of the Connecticut General Statutes that:
 

1.    The consumer collection agency license of Respondent Oxford Collection Agency, Inc. d/b/a Oxford Management Services shall not be renewed and is hereby REVOKED;
  
2.  Respondent Oxford Collection Agency, Inc. d/b/a Oxford Management Services shall CEASE AND DESIST from violating Section 805(a)(12) of the Connecticut General Statutes and Section 36a-809-7(b) of the Regulations of Connecticut State Agencies;
   
3.  A civil penalty of twenty thousand dollars ($20,000) shall be imposed against Oxford Collection Agency, Inc. d/b/a Oxford Management Services, such civil penalty to be remitted to the Department of Banking by cashier’s check, certified check or money order, made payable to “Treasurer, State of Connecticut”, no later than 45 days from the date this Order is mailed;
 
4.  If Oxford Collection Agency, Inc. d/b/a Oxford Management Services does not comply with the terms of this Order, the Department may seek its enforcement by the Office of the Attorney General to include the collection of fines imposed herein; and
   
5.  This Order shall become effective when mailed.
   



So ordered at Hartford, Connecticut     ______/s/___________ 
this 13th day of May, 2011. Howard F. Pitkin 
Banking Commissioner


This Order was sent by certified mail,
return receipt requested, to Respondent
on May 13, 2011.


Oxford Collection Agency, Inc.   
d/b/a Oxford Management Services
135 Maxess Road - Suite 2A
Melville, New York  11747
Certified Mail No. 7007 2680 0001 3136 4510

Oxford Collection Agency, Inc.   
d/b/a Oxford Management Services
Attention:  Denise Robbins, Cornerstone Support, Inc.
11111 Houze Road - Suite 200
Roswell, Georgia  30076
Certified Mail No. 7007 2680 0001 3136 4503

Administrative Orders and Settlements