WHEREAS, the Banking Commissioner (“Commissioner”) is charged with the administration of Chapter 672a of the Connecticut General Statutes, the Connecticut Uniform Securities Act (“Act”), and Sections 36b-31-2, et seq. of the Regulations of Connecticut State Agencies promulgated under the Act (“Regulations”);

WHEREAS, the Commissioner, through the Securities and Business Investments Division (“Division”) of the Department of Banking, conducted an investigation pursuant to Section 36b-26(a) of the Act into the activities of Respondent, to determine whether Respondent had violated, was violating or was about to violate any provisions of the Act or Regulations;

WHEREAS, on February 9, 2006, the Commissioner, acting pursuant to Section 36b-27(d) of the Act, Section 36b-27(d) of the Act, as amended by Public Act 05-177 and Section 4-182(c) of the Connecticut General Statutes, issued an Order to Cease and Desist, Notice of Intent to Fine (“Fine Notice”) and Notice of Right to Hearing against Respondent (collectively “Notice”), which Notice is incorporated by reference herein;

WHEREAS, the Fine Notice stated that the Commissioner intended to impose a fine against Ernest P. Lamonica (“Respondent Lamonica”), Digital Entertainment Corp. (“Respondent Digital”) and Pacific Rim Investment Partners (“Respondent Pacific Rim”), that a hearing would be held on April 4, 2006 on the matters alleged in the Fine Notice, and that if any Respondent failed to appear at the hearing, the Commissioner may order a maximum fine of Two Hundred Thirty Thousand Dollars ($230,000) on Respondent Lamonica, a maximum fine of Twenty Thousand Dollars ($20,000) on Respondent Digital and a maximum fine of One Hundred Thousand Dollars (“$100,000”) on Respondent Pacific Rim;

WHEREAS, on February 10, 2006, the Notice was sent by registered mail, return receipt requested to Respondent Lamonica;

WHEREAS, on February 10, 2006, the Notice was sent by registered mail, return receipt requested to Respondent Digital;

WHEREAS, on February 10, 2006, the Notice was sent by registered mail, return receipt requested to Respondent Pacific Rim;

WHEREAS, on February 22, 2006, the Notice was received by Respondent Digital;

WHEREAS, the Notice sent to Respondent Lamonica was returned to the Department marked “Returned To Sender-Unclaimed”;

WHEREAS, the Notice sent to Respondent Pacific Rim was returned to the Department marked “Returned To Sender-Addressee unknown”;

WHEREAS, on April 4, 2006, Respondent Lamonica failed to appear at the Hearing;

WHEREAS, on April 4, 2006, Respondent Digital failed to appear at the Hearing;

WHEREAS, on April 4, 2006, Respondent Pacific Rim failed to appear at the Hearing;

WHEREAS, in the Notice the Commissioner alleged that Respondent Lamonica was President and CEO of Respondent Digital and Respondent Pacific Rim;

WHEREAS, in the Notice the Commissioner alleged that from at least September 1996 to the date of the Notice, Respondent Digital was an issuer of securities in the form of stock and notes (“Digital Securities”);

WHEREAS, in the Notice the Commissioner alleged that from at least May 2005 to the date of the Notice, Respondent Pacific Rim was an issuer of securities in the form of stock (“Pacific Rim Securities”);

WHEREAS, in the Notice the Commissioner alleged that on several occasions between September 1996 and September 2003, Respondent Lamonica, on behalf of Respondent Digital, offered and sold Digital Securities to at least one Connecticut investor for a total of approximately $50,000;

WHEREAS, in the Notice the Commissioner alleged that in approximately May 2005, Respondent Lamonica, on behalf of Respondent Pacific Rim, offered and sold Pacific Rim Securities to at least one Connecticut investor;

WHEREAS, in the Notice the Commissioner alleged that on July 30, 1998, the Superintendent of Securities of the State of Iowa issued a Cease and Desist Order against Respondent Lamonica and Respondent Digital for violating the Iowa Uniform Securities Act by engaging in acts, practices or courses of business which operated as a fraud or deceit upon a person in connection with the offer or sale of Digital Securities in Iowa;

WHEREAS, in the Notice the Commissioner alleged that on September 23, 1999, an order issued by the Tennessee Department of Commerce instructing Respondent Lamonica and Respondent Digital to cease and desist from violating the Tennessee Securities Act of 1980 became a Final Order;

WHEREAS, in the Notice the Commissioner alleged that the Final Order stated that Respondent Lamonica and Respondent Digital had employed a device, scheme or artifice to defraud and had made untrue statements of material fact or omitted to state material facts necessary in order to make statements made, in light of the circumstances under which they were made, not misleading with respect to the sale of Digital Securities in Tennessee;

WHEREAS, in the Notice the Commissioner alleged that at no time relevant to this matter was Respondent Lamonica registered in Connecticut as an agent of Respondent Digital or Respondent Pacific Rim, nor was Respondent Lamonica an associated person representing a broker-dealer in effecting transactions described in subdivisions (2) and (3) of Section 15(h) of the Securities Exchange Act of 1934, nor was he excluded from the definition of “agent” under Section 36b-3(1) of the Act; 

WHEREAS, in the Notice the Commissioner alleged that the Digital Securities and Pacific Rim Securities that were offered and sold by Respondents were not registered in Connecticut under Section 36b-16 of the Act, nor were they exempt from registration under Section 36b-21 of the Act, nor were they covered securities;

WHEREAS, in the Notice the Commissioner alleged that at no time relevant to this matter did Respondent Lamonica and Respondent Digital disclose, in connection with the offer and sale of Digital Securities to the Connecticut investor, that cease and desist orders had been issued against Respondent Lamonica and Respondent Digital for fraudulent activities in connection with the offer and sale of Digital Securities;

WHEREAS, Section 36a-1-31(b) of the Regulations provides, in relevant part, that “[w]hen a party fails to appear at a scheduled hearing, the allegations against the party may be deemed admitted”;

WHEREAS, Section 36b-27(d)(2) of the Act, as amended, provides, in relevant part, that “[i]f such person . . . fail[s] to appear at the hearing, the commissioner may, as the facts require, order that a fine . . . be imposed upon such person”;

WHEREAS, Section 36b-15(f) of the Act provides, in pertinent part, that “[n]o order may be entered under this section except as provided in subsection (c) of this section without (1) appropriate prior notice to the applicant or registrant . . . , (2) opportunity for hearing, and (3) written findings of fact and conclusions of law”;

WHEREAS, Section 4-182(c) of the Connecticut General Statutes provides, in relevant part, that “No revocation, suspension, annulment or withdrawal of any license is lawful unless, prior to the institution of agency proceedings, the agency gave notice by mail to the licensee of facts or conduct which warrant the intended action, and the licensee was given an opportunity to show compliance with all lawful requirements for the retention of the license”;

WHEREAS, the facts as set forth in paragraphs 7 through 15, inclusive, of the Notice shall constitute findings of fact, and the statutory and regulatory basis for the imposition of a fine set forth in paragraphs 16 through 21, inclusive, of the Notice shall constitute conclusions of law;

WHEREAS, the Commissioner has complied with the requirements of Section 36b-15(f) of the Act and Section 4-182(c) of the Connecticut General Statutes;

WHEREAS, the Commissioner finds that Respondent Lamonica committed one violation of Section 36b-4(a)(2) of the Act, two violations of Section 36b-6(a) of the Act and two violations of Section 36b-16 of the Act;

WHEREAS, the Commissioner finds that Respondent Digital committed one violation of Section 36b-4(a)(2) of the Act and one violation of Section 36b-16 of the Act;

WHEREAS, the Commissioner finds that Respondent Pacific Rim committed one violation of Section 36b-16 of the Act;

WHEREAS, the Commissioner finds that Respondent Lamonica’s failure to disclose to the Connecticut investor that cease and desist orders had been issued against Respondent Lamonica and Respondent Digital constitutes, in connection with the offer, sale or purchase of a security, omitting to state material facts necessary in order to make the statements made, in light of the circumstances under  which they are made, not misleading in violation of Section 36b-4(a)(2) of the Act and constitutes a basis for the imposition of a fine against Respondent Lamonica under Section 36b-27(d) of the Act, prior to October 1, 2003;

WHEREAS, the Commissioner finds that Respondent Digital’s failure to disclose to the Connecticut investor that cease and desist orders had been issued against Respondent Lamonica and Respondent Digital constitutes, in connection with the offer , sale or purchase of a security, omitting to state material facts necessary in order to make the statements made, in light of the circumstances under which they are made, not misleading in violation of Section 36b-4(a)(2) of the Act and constitutes a basis for the imposition of a fine against Respondent Digital under Section 36b-27(d) of the Act, prior to October 1, 2003;

WHEREAS, the Commissioner finds that Respondent Lamonica acted as an agent of issuer on at least two occasions, absent registration, in violation of Section 36b-6(a) of the Act, which constitutes a basis for the imposition of a fine against Respondent Lamonica for one violation under Section 36b-27(d) of the Act prior to October 1, 2003 and for one violation under Section 36b-27(d) of the Act, as amended; 

WHEREAS, the Commissioner finds that Respondent Lamonica offered and sold unregistered securities to at least one Connecticut investor which were not registered in Connecticut under the Act, in violation of Section 36b-16 of the Act which constitutes a basis for the imposition of a fine against Respondent Lamonica for one violation under Section 36b-27(d) of the Act prior to October 1, 2003 and for one violation under Section 36b-27(d) of the Act, as amended;

WHEREAS, the Commissioner finds that Respondent Digital offered and sold unregistered securities to at least one Connecticut investor which were not registered in Connecticut under the Act, in violation of Section 36b-16 of the Act which constitutes a basis for the imposition of a fine against Respondent Digital for one violation under Section 36b-27(d) of the Act prior to October 1, 2003;

WHEREAS, the Commissioner finds that Respondent Pacific Rim offered and sold unregistered securities to at least one Connecticut investor which were not registered in Connecticut under the Act, in violation of Section 36b-16 of the Act which constitutes a basis for the imposition of a fine against Respondent Pacific Rim for one violation under Section 36b-27(d) of the Act, as amended;

WHEREAS, the Commissioner finds that the facts require the imposition of a fine against Respondents;

WHEREAS, Section 36b-31(a) of the Act provides, in pertinent part, that “[t]he commissioner may from time to time make . . . such . . . orders as are necessary to carry out the provisions of sections 36b-2 to 36b-33, inclusive”;

WHEREAS, Section 36b-31(b) of the Act provides, in pertinent part, that “[n]o . . . order may be made . . . unless the commissioner finds that the action is necessary or appropriate in the public interest or for the protection of investors and consistent with the purposes fairly intended by the policy and provisions of sections 36b-2 to 36b-33, inclusive”;

AND WHEREAS, the Commissioner finds that this order is necessary, appropriate in the public interest, for the protection of investors and consistent with the purposes fairly intended by the policy and provisions of sections 36b-2 to 36b-33, inclusive.

ORDER

                                                     
Entered at Hartford, Connecticut
this 19th day of May 2006.               ________/s/_________
                                                   John P. Burke
                                                   Banking Commissioner

This Order was sent by registered
mail, return receipt requested, to
the Respondents on May 19, 2006.

Ernest P. Lamonica                          Registered Mail No. RB 028 033 057 US
6200 Meadowood #131
Reno, Nevada 89502

Digital Entertainment Corp.                Registered Mail No RB 028 033 065 US
3702 South Virginia Street, #G-12
Reno, Nevada 89502

Pacific Rim Investment Partners          Registered Mail No. RB 028 033 074 US
3702 South Virginia Street, #G-12
Reno, Nevada 89502

Administrative Orders and Settlements