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IHS HEROLD INC.
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STIPULATION AND No. ST-12-7978-S |
WHEREAS, the Banking Commissioner is charged with the administration of Chapter 672a of the Connecticut General Statutes, the Connecticut Uniform Securities Act (the “Act”) and Sections 36b-31-2 et seq. of the Regulations of Connecticut State Agencies (the “Regulations”) promulgated under the Act;
WHEREAS, IHS Herold Inc. (“IHS”) of 200 Connecticut Avenue, Third Floor, Norwalk, Connecticut 06854 has been registered as an investment adviser under the Act since April 26, 1985;
WHEREAS, during the course of an examination of IHS, the Securities and Business Investments Division (the “Division”) of the Department of Banking obtained evidence that, from at least 2006, IHS had engaged unregistered investment adviser agents;
WHEREAS, Section 36b-6(c)(3) of the Act provides, in part, that: “No investment adviser shall engage an investment adviser agent unless such investment adviser agent is registered under sections 36b-2 to 36b-34, inclusive”;
WHEREAS, Section 36b-3(12)(A) of the Act defines the term “investment adviser agent” to include: “(i) any individual, including an officer, partner or director of an investment adviser, or an individual occupying a similar status or performing similar functions, employed, appointed or authorized by or associated with an investment adviser to solicit business from any person for such investment adviser in this state and who receives compensation or other remuneration, directly or indirectly, for such solicitation; or (ii) any partner, officer, or director of an investment adviser, or an individual occupying a similar status or performing similar functions, or other individual employed, appointed, or authorized by or associated with an investment adviser, who makes any recommendation or otherwise renders advice regarding securities to clients and who receives compensation or other remuneration, directly or indirectly, for such advisory services”;
WHEREAS, a violation of Section 36b-6(c)(3) of the Act would support the initiation of administrative proceedings under Sections 36b-15 and 36b-27 of the Act;
WHEREAS, an administrative proceeding initiated under Sections 36b-15 and 36b-27 of the Act would constitute a “contested case” within the meaning of Section 4-166(2) of the Connecticut General Statutes;
WHEREAS, Section 4-177(c) of the Connecticut General Statutes and Section 36a-1-55(a) of the Regulations of Connecticut State Agencies provide that a contested case may be resolved by stipulation, unless precluded by law;
WHEREAS, IHS, through its execution of this Stipulation and Agreement, represents to the Commissioner that it has retained an independent consultant to ensure future compliance with the Act and the Regulations;
WHEREAS, IHS, through its execution of this Stipulation and Agreement, represents to the Commissioner that it has implemented revised supervisory and compliance procedures designed to improve regulatory compliance, which procedures, at a minimum, provide for enhanced monitoring of investment adviser agent licensing requirements;
WHEREAS, the Commissioner acknowledges that IHS cooperated with the Division in providing requested information and documents;
WHEREAS, IHS, through its execution of this Stipulation and Agreement, represents to the Commissioner that applications to register the investment adviser agents in question will be filed no later than June 30, 2012;
WHEREAS, IHS desires to settle the matters described herein and voluntarily enters into this Stipulation and Agreement, acknowledging that this Stipulation and Agreement is in lieu of any court action or administrative proceeding adjudicating any issue of fact or law on the matters described herein;
AND WHEREAS, IHS, through its execution of this Stipulation and Agreement, voluntarily waives any rights it may have to seek judicial review or otherwise challenge or contest the terms and conditions of this Stipulation and Agreement;
NOW THEREFORE, THE PARTIES HERETO DO MUTUALLY AGREE AS FOLLOWS:
| 1. |
No later than the date this Stipulation and Agreement is executed by the Commissioner, IHS shall remit to the department by certified bank check payable to “Treasurer, State of Connecticut” the sum of eight thousand and fifty dollars ($8,050), five thousand dollars ($5,000) of which shall constitute an administrative fine; and three thousand fifty dollars ($3,050) of which shall be applied to reimburse the department for past due registration fees; |
| 2. |
IHS, its officers, directors, representatives, agents, employees, affiliates, and successors in interest shall refrain from engaging, directly or indirectly, in conduct constituting or which would constitute a violation of the Act or any regulation or order under the Act; |
| 3. | Execution of this Stipulation and Agreement by the Commissioner is without prejudice to the right of the Commissioner to take enforcement action against IHS based upon a violation of this Stipulation and Agreement or the basis for its entry if the Commissioner determines that compliance is not being observed with the terms hereof or if any representation made by or on behalf of IHS and reflected herein is subsequently determined to be untrue; and |
| 4. | This Stipulation and Agreement shall become binding when executed by IHS and the Commissioner. |
IN WITNESS WHEREOF, the undersigned have executed this Stipulation and Agreement on the dates indicated.
| Dated at Hartford, Connecticut | _______/s/_________ | |
| this 9th day of May, 2012. | Howard F. Pitkin | |
| Banking Commissioner |
I, William Redman, state on behalf of IHS Herold Inc., that I have read the foregoing Stipulation and Agreement; that I know and fully understand its contents; that I am authorized to execute this Stipulation and Agreement on behalf of IHS Herold Inc.; and IHS Herold Inc. agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein.
IHS Herold Inc.
By
___/s/_______________
William Redman
President
On this 7th day of May 2012, personally appeared William Redman, signer of the foregoing Stipulation and Agreement, who, being duly sworn, did acknowledge to me that he was authorized to execute the same on behalf of IHS Herold Inc., a corporation, and acknowledged the same to be his free act and deed, before me.
_____/s/___________________________
Notary Public
My Commission Expires: August 31, 2016