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VANDERBILT SECURITIES, LLC * * * * * * * * * * * * * * * * * * |
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CONSENT ORDER No. CO-14-7988A-S |
PRELIMINARY STATEMENT
CONSENT TO WAIVER OF PROCEDURAL RIGHTS
WHEREAS, Vanderbilt, through its execution of this Consent Order, voluntarily waives the following rights:
1. | To be afforded an opportunity for a hearing within the meaning of Sections 36b-15(f) and 36b-27(d)(2) of the Act, and Section 4-177(a) of the Connecticut General Statutes; |
2. | To present evidence and argument and to otherwise avail itself of Sections 36b-15(f) and 36b-27(d)(2) of the Act, and Section 4-177c(a) of the Connecticut General Statutes; |
3. | To present its position in a hearing in which it is represented by counsel; |
4. | To have a written record of the hearing made and a written decision issued by a hearing officer; and |
5. | To seek judicial review of, or otherwise challenge or contest, the matters described herein, including the validity of this Consent Order. |
ACKNOWLEDGEMENT OF THE COMMISSIONER'S ALLEGATIONS
WHEREAS, Vanderbilt, through its execution of this Consent Order, without admitting or denying any of the allegations or findings herein and solely for the purpose of obviating the need for formal administrative proceedings on the matters described herein, acknowledges the following allegations of the Commissioner:
In contravention of Section 36b-31-6f of the Regulations, and based upon the activities of Stephen Burton Blankenship and/or Deer Hill Financial Group, LLC, Vanderbilt failed to establish, enforce and maintain a system for supervising the activities of its agents and its Connecticut office operations reasonably designed to achieve compliance with applicable securities laws. Such conduct, if proven, would constitute a basis for an order suspending or revoking Vanderbilt's registration as a broker-dealer in Connecticut pursuant to Sections 36b-15(a)(2)(B) and 36b-15(a)(2)(K) of the Act and an order imposing a fine pursuant to Section 36b-27(d) of the Act; |
WHEREAS, if the foregoing allegations were proven, the Commissioner would have the authority to enter findings after granting Vanderbilt an opportunity for a hearing;
WHEREAS, Vanderbilt acknowledges the possible consequences of an administrative hearing and voluntarily agrees to consent to the entry of the sanctions described below;
WHEREAS, through its execution of this Consent Order, Vanderbilt represents to, and specifically assures the Commissioner that none of the violations alleged herein shall occur in the future;
CONSENT TO ENTRY OF SANCTIONS
WHEREAS, Vanderbilt, through its execution of this Consent Order, consents to the Commissioner’s entry of a Consent Order imposing on it the following sanctions:
1. | Vanderbilt, its officers, 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, including failing to establish, enforce and maintain a system for supervising the activities of its agents and its Connecticut office operations reasonably designed to achieve compliance with applicable securities laws; and |
2. | Within sixty (60) days from the date this Consent Order is entered by the Commissioner, Vanderbilt shall hire a consultant, not unacceptable to the Division Director, to review Vanderbilt's supervisory and compliance procedures and make written recommendations concerning implementing such additional procedures as are necessary to ensure compliance with all applicable securities laws, regulations and administrative orders. The review shall focus on the adequacy and effective implementation of safeguards to prevent recurrence of the conduct described in this Consent Order. No later than ninety (90) days following the Commissioner's entry of this Consent Order, Vanderbilt will provide the Division Director with (a) the completed consultant's report; (b) a summary of the recommendations therein contained; (c) the date(s) each recommendation will be implemented and (d) if any recommendations are not to be implemented, the reasons therefor. The Division will return the report to Vanderbilt within forty-five (45) days after the Division receives it. The Division reserves the right to request that the report be resubmitted at a later date, in which case Vanderbilt shall immediately abide by such request. |
CONSENT ORDER
NOW THEREFORE,
the Commissioner enters the following:1. | The Sanctions set forth above be and are hereby entered; |
2. | Entry of this Consent Order by the Commissioner is without prejudice to the right of the Commissioner to take enforcement action against Vanderbilt based upon its 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; if any representations made herein by Vanderbilt are subsequently discovered to be untrue; or if Vanderbilt fails to make payment to any Affected Investor in accordance with this Consent Order; |
3. | Vanderbilt shall not take any action or make or permit to be made any public statement denying, directly or indirectly, any allegation in this Consent Order or creating the impression that this Consent Order is without factual basis. Nothing in this paragraph affects Vanderbilt's (i) testimonial obligations, or (ii) right to take legal or factual positions in defense or prosecution of litigation of other legal proceedings to which the Department is not a party; and |
4. | This Consent Order shall become final when entered. |
So ordered at Hartford, Connecticut | _______/s/_________ | |
this 8th day of October, 2014. | Howard F. Pitkin | |
Banking Commissioner |
I, Stephen A. Distante, state on behalf of Vanderbilt Securities, LLC that I have read the foregoing Consent Order; that I know and fully understand its contents; that I am authorized to execute this Consent Order on behalf of Vanderbilt Securities, LLC; that Vanderbilt Securities, LLC agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein; and that Vanderbilt Securities, LLC voluntarily consents to the entry of this Consent Order, expressly waiving any right to a hearing on the matters described herein.
Vanderbilt Securities, LLC | |
By | _______/s/_____________ |
Stephen A. Distante | |
Chief Executive Officer |
On this 30th day of September 2014, personally appeared Stephen A. Distante, signer of the foregoing Consent Order, who, being duly sworn, did acknowledge to me that he was authorized to execute the same on behalf of Vanderbilt Securities, LLC, a limited liability company, and acknowledged the same to be his free act and deed, before me.
____/s/_______________________ |
Notary Public |
My Commission Expires: 11/03/16 |