Bulletin # 2636
This bulletin constitutes the only official notification you will receive from this office concerning any of the following applications. Any observations you may have are solicited. Any comments should be in writing to Howard F. Pitkin, Banking Commissioner, at the above address. Written comments will be considered only if they are received within ten days from the date of this bulletin.
STATE BANK ACTIVITY
On August 27, 2014, Savings Institute Bank and Trust Company, a federally-chartered stock savings association and wholly-owned subsidiary of SI Financial Group, Inc., a federal savings and loan holding company, filed an application pursuant to Section 36a-137 of the Connecticut General Statutes to convert into a capital stock Connecticut bank to be known as Savings Institute Bank and Trust Company with its main office located in Willimantic, Connecticut.
On August 27, 2014, Putnam Bank, a federally-chartered stock savings association and wholly-owned subsidiary of PSB Holdings, Inc., a federal savings and loan holding company, filed an application pursuant to Section 36a-137 of the Connecticut General Statutes to convert into a capital stock Connecticut bank to be known as Putnam Bank with its main office located in Putnam, Connecticut. Putnam Bancorp, MHC, a federally-chartered mutual savings and loan holding company, owns a majority of the outstanding shares of common stock of PSB Holdings, Inc.
STATE CREDIT UNION ACTIVITY
Conversion and Field of Membership
On August 29, 2014, American Eagle Federal Credit Union, a federal credit union with its main office in East Hartford, Connecticut, filed an application to convert to a Connecticut credit union pursuant to Section 36a-469b of the Connecticut General Statutes and an application to expand its field of membership to include the county of New Haven, Connecticut pursuant to Sections 36a-437a(h) and 36a-438a(d) of the Connecticut General Statutes.
SECURITIES AND BUSINESS INVESTMENTS DIVISION ACTIVITY
Consent Order Entered
On August 26, 2014, the Banking Commissioner entered a Consent Order (Docket No. CF-13-8064-S) with respect to Gregory Richard Imbruce, Hunton Oil Genpar LLC, Giddings Genpar LLC and Asym Capital III LLC, four of seven respondents named in a December 17, 2013 Order to Cease and Desist, Notice of Intent to Fine and Notice of Right to Hearing (Docket No. CF-13-8064-S). Settling respondents Hunton Oil Genpar LLC, Giddings Genpar LLC and Asym Capital III LLC (the “General Partners”) were the general partners of non-settling respondents Hunton Oil Partners LP, Giddings Oil & Gas LP and Asym Energy Fund III LP (the “Investment Funds”). The General Partners were, in turn, controlled by Glenrose Holdings LLC which was controlled by respondent Imbruce.
The December 17, 2013 action had alleged that 1) at designated times between 2009 and 2012, the Investment Funds offered and sold unregistered securities absent compliance with Section 36b-16 of the Connecticut Uniform Securities Act; 2) the General Partners transacted business as unregistered investment advisers in contravention of Section 36b-6(c)(1) of the Act; 3) Imbruce violated Section 36b-6(c)(2) of the Act by transacting business as an unregistered investment adviser agent; and 4) respondent Asym Energy Fund III LP employed an unregistered agent of issuer in violation of Section 36b-6(b) of the Act. The action had also alleged that the respondents violated the antifraud provisions of the Act by failing to disclose material facts to prospective limited partners, including disciplinary proceedings initiated by FINRA against respondent Imbruce involving Imbruce’s activities while he was associated with Bernard L. Madoff Investment Securities LLC. The December 17, 2013 action had also alleged that, to induce several prospective limited partners to invest, respondent Imbruce represented to them that he personally invested in the affected limited partnership when that was not the case. In addition, the action had alleged that the subscription agreements for two of the Investment Funds falsely represented that all applicable blue sky registration requirements had been fulfilled. On June 10, 2014, the December 17, 2013 action was amended to amplify the allegation that respondent Imbruce also violated Section 36b-23 of the Act by making materially misleading statements to the department.
The Consent Order acknowledged that, on August 25, 2014, Glenrose Holdings LLC as well as each of the General Partners had applied for investment adviser registration in Connecticut, and that an investment adviser application had also been filed for Asym Energy Partners LLC, a Delaware-based entity controlled by Imbruce. In addition, the Consent Order acknowledged that respondent Imbruce had applied for registration as an investment adviser agent of Glenrose Holdings, LLC, Asym Energy Partners LLC and each of the General Partners. As a precondition to the registration of Glenrose Holdings LLC and Asym Energy Partners LLC as investment advisers, the Consent Order required that Imbruce retain a regulatory consultant to perform on-site compliance reviews of each applicant and that affidavits confirming compliance be filed with the Division.
The Consent Order fined respondent Imbruce $75,000 and directed each of the settling respondents to cease and desist from regulatory violations. In addition, the Consent Order restricted Imbruce’s securities activities. Pursuant to the Consent Order, for three years, Imbruce would limit his investment advisory activities in or from Connecticut to advice regarding securities of issuers in the energy or energy-related industries, and refrain from offering or selling securities issued by entities that were not in the energy or energy-related industries. The Consent Order also required Imbruce to retain experienced securities legal counsel prior to offering or selling securities in or from Connecticut, submit regulatory filings and fees through such retained counsel and support any exemption claim with a signed opinion of counsel.
The administrative proceeding remains pending with respect to the nonsettling Investment Funds.
Dated: Wednesday, September 3, 2014
Howard F. Pitkin