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STEVEN HADLEY HAYNES ("Haynes") * * * * * * * * * * * * * * |
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CONSENT ORDER DOCKET NO. ND-2006-7172-S |
PRELIMINARY STATEMENT
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, on April 29, 2005, Haynes filed with the Commissioner applications for registration as an agent and an investment adviser agent in Connecticut (collectively “Applications”).
WHEREAS, the Commissioner, through the Securities and Business Investments Division (“Division”) of the Department of Banking, conducted an investigation pursuant to Section 36b-8 of the Act (the “Investigation”);
WHEREAS, as a result of the Investigation, the Division alleges that, between September 3, 2003 and March 25, 2005, Haynes split commissions with David Faubert who was employed by the same broker-dealer and investment adviser. The Division alleges that such splitting of commissions may constitute grounds for denial of the Applications pursuant to Section 36b-15(a)(2)(H) of the 2006 Supplement to the General Statutes and Section 36b-31-15b(a)(5) of the Regulations;
WHEREAS, on August 3, 2005, Haynes voluntarily, without the Division requesting him to do so, withdrew the Applications by filing a Notice of Intent to Withdraw the Applications;
WHEREAS, as a result of the Investigation, the Commissioner obtained information that on November 2, 2005, the National Association of Securities Dealers, Inc. (“NASD”), barred Haynes from association with any NASD member for failure to appear for an on-the-record interview in connection with an investigation into alleged payments of commissions to another individual, which bar constitutes a ground for denial of the Applications pursuant to Section 36b-15(a)(2)(F)(iii) of the 2006 Supplement to the General Statutes;
WHEREAS, on April 6, 2006, the Commissioner, acting pursuant to Sections 36b-15(a)(2)(H) and 36b-15(a)(2)(F)(iii) of the 2006 Supplement to the General Statutes, issued a Notice of Intent to Deny Registration as Agent and Investment Adviser Agent and Notice of Right to Hearing (collectively “Notice”), which Notice is incorporated by reference herein;
WHEREAS, on April 8, 2006, the Notice was received by Haynes;
WHEREAS, on May 1, 2006, Haynes filed a request for hearing on the matters alleged in the Notice;
WHEREAS, Section 36b-31(a) of the 2006 Supplement to the General Statutes provides, in relevant 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, Haynes offered an agreement to resolve the matters alleged in the Notice without a hearing;
WHEREAS, Section 4-177(c) of the Connecticut General Statutes provides, in relevant part, that “[u]nless precluded by law, a contested case may be resolved by . . . consent order”;
WHEREAS, Section 36a-1-55(a) of the Regulations provides, in relevant part, that “unless precluded by law, any contested case may be resolved by . . . consent order”;
WHEREAS, Haynes and the Commissioner now desire to resolve the matters alleged in the Notice;
WHEREAS, Haynes agrees that the Notice may be used in construing the terms of this Consent Order and agrees to the language in this Consent Order.
CONSENT TO WAIVER OF PROCEDURAL RIGHTS
WHEREAS, Haynes, through his execution of this Consent Order, voluntarily waives the following rights:
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To be afforded an opportunity for a hearing within the meaning of Section 36b-15(f) of the 2006 Supplement to the General Statutes and Section 4-177(a) of the Connecticut General Statutes;
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To present evidence and argument and to otherwise avail himself of Section 36b-15(f) of the 2006 Supplement to the General Statutes and Section 4-177c(a) of the Connecticut General Statutes;
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To present his position in a hearing in which he is represented by counsel;
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To have a written record of the hearing made and a written decision issued by a hearing officer; and
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To seek judicial review of, or otherwise challenge or contest the matters described herein, including the validity of this Consent Order.
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ACKNOWLEDGEMENT OF THE COMMISSIONER'S ALLEGATIONS
WHEREAS, Haynes, through his execution of this Consent Order, acknowledges that the Commissioner has made the following allegations, without admitting or denying them:
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The entry of this Consent Order 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 the Act;
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Splitting commissions constitutes grounds for denial of the Applications pursuant to Section 36b-15(a)(2)(H) of the 2006 Supplement to the General Statutes and Section 36b-31-15b(a)(5) of the Regulations; and
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The NASD barred Haynes from association with any NASD member, which bar constitutes a ground for denial of the Applications pursuant to Section 36b-15(a)(2)(F)(iii) of the 2006 Supplement to the General Statutes. |
WHEREAS, the Commissioner would have the authority to enter findings after granting Haynes an opportunity for a hearing;
WHEREAS, Haynes acknowledges the possible consequences of an administrative hearing and voluntarily agrees to consent to the entry of the sanctions described below.
CONSENT TO ENTRY OF SANCTIONS
WHEREAS, Haynes, through his execution of this Consent Order, consents to the Commissioner’s entry of a Consent Order imposing on him the following sanctions:
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Except as provided in paragraph 2 of this Consent to Entry of Sanctions, for a period of five (5) years commencing on the date this Consent Order is issued by the Commissioner, Haynes is barred from applying for registration as an agent or an investment adviser agent in Connecticut;
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Two (2) years from the date this Consent Order is issued by the Commissioner, Haynes may apply for registration as an investment adviser agent in Connecticut. At the time Haynes chooses to apply for registration under this paragraph, the Commissioner, in the Commissioner’s sole discretion, may enter Haynes’ name on the appropriate register, deny Haynes’ registration, or restrict or impose conditions on any such registration without making the findings required by Section 36b-15(a) of the Act or complying with the requirements of subsections (f) and (g) of Section 36b-15 of the Act; and
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No later than the date this Consent Order is issued by the Commissioner, Haynes shall remit to the Department of Banking, by cashier’s or certified check made payable to “Treasurer, State of Connecticut”, the sum of Two Thousand Five Hundred Dollars ($2,500) as reimbursement for the Division’s investigative costs.
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AND WHEREAS, Haynes specifically assures the Commissioner that the practice of splitting commissions described in the Notice shall not occur in the future.
CONSENT ORDER
NOW THEREFORE, the Commissioner enters the following:
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The Sanctions set forth above be and are hereby entered;
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Entry of this Consent Order by the Commissioner is without prejudice to the right of the Commissioner to take enforcement action against Haynes based upon a violation of this Consent Order or the matters underlying its entry, if the Commissioner determines that compliance with the terms herein is not being observed or if any representations made by Haynes and reflected herein are subsequently discovered to be untrue; and |
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This Consent Order shall become final when issued. |
Issued at Hartford, Connecticut
this 21st day of September 2006. ________/s/_________
John P. Burke
Banking Commissioner
CONSENT TO ENTRY OF ORDER
I, Steven Hadley Haynes, state that I have read the foregoing Consent Order; that I know and fully understand its contents; that I agree freely and without threat or coercion of any kind to comply with the terms and conditions stated herein; and that I consent to the issuance of this Consent Order, expressly waiving any right to a hearing on the matters described herein.
________/s/_________
Steven Hadley Haynes
State of: Massachusetts
County of: Hampden
On this the 29th day of August 2006, before me, Janice K. Perreault, the undersigned officer, personally appeared Steven Hadley Haynes, known to me (or satisfactorily proven) to be the person whose name is subscribed to the within instrument and acknowledged that he executed the same for the purposes therein contained.
In witness whereof I hereunto set my hand.
________/s/_________
Notary Public
Date Commission Expires: October 19, 2012