The Department of Banking News Bulletin
Bulletin # 2979 - Week Ending March 26, 2021
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 Jorge L. Perez, Banking Commissioner, Department of Banking, 260 Constitution Plaza, Hartford, CT 06103-1800. Written comments will be considered only if they are received within ten business days from the date of this bulletin.
STATE BANK ACTIVITY
Branch Activity
Section 36a-145 of the Connecticut General Statutes requires certain applications for a branch or limited branch at which loans will be made, address how the establishment of the branch will be consistent with safe and sound banking practices and promote the public convenience and advantage. Plans are submitted when such applications are filed and are available for public inspection and comment at the Department for a period of 30 days. Questions concerning branch activity should be directed to the Financial Institutions Division, (860) 240-8180.
DATE: March 25, 2021
BANK: Liberty Bank, Middletown
LOCATION: 94 Shaker Road, East Longmeadow, MA 01028
ACTIVITY-BRANCH TYPE: Approved to Establish Loan Production Office
CONSUMER CREDIT DIVISION ACTIVITY
Notice of Intent to Issue Order to Cease and Desist
and Notice of Intent to Impose Civil Penalty
On March 16, 2021, the Commissioner issued a Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing (“Notice”) in the Matter of: USIO, Inc. f/k/a Payment Data Systems, Inc. (“Respondent”), San Antonio, Texas. The Notice was the result of an investigation by the Consumer Credit Division. The Commissioner alleges that Respondent engaged in the business of money transmission in this state without obtaining the required license, in violation of Section 36a-597(a) of the Connecticut General Statutes, in effect prior to October 1, 2017. Respondent was afforded an opportunity to request a hearing on the allegation set forth in the Notice.
SECURITIES AND BUSINESS INVESTMENTS DIVISION ACTIVITY
Consent Order
The Consent Order had been preceded by a January 9, 2020 administrative action naming Renison, his father, Thomas David Renison, and ARO Equity, LLC, a self-described “private investment fund.” The administrative action had sought the entry of a cease and desist order and a civil penalty against Renison. Renison was a member and owner of ARO Equity, LLC. The action alleged that Renison violated Section 36b-23 of the Connecticut Uniform Securities Act by making materially false or misleading statements in filings made with the Commissioner. More specifically, at the time Renison was registered as a broker-dealer agent in Connecticut, Renison failed to disclose his involvement with ARO Equity, LLC and the related compensation he received. The action had also alleged that Renison materially aided ARO Equity, LLC and Thomas David Renison in fraudulent conduct they allegedly perpetrated against investors.
The Consent Order permanently barred Renison from transacting business in Connecticut as an agent, broker-dealer, broker-dealer agent, investment adviser or investment adviser agent; maintaining an ownership interest in a broker-dealer or investment adviser required to be registered in Connecticut; and acting in any other capacity requiring a license or registration under laws administered by the Commissioner. The Consent Order also directed Renison to cease and desist from regulatory violations. Acknowledging that Renison had provided the agency with documentation that he was financially unable to pay the fine that otherwise would have been imposed against him, the Consent Order stayed imposition of the fine for three years. If, during that three year period, Renison's financial situation changed, he would be automatically obligated to pay a fine of $100,000 to the department. If Renison's financial situation remained unchanged, the fine would be waived after three years.
Order to Cease and Desist, Order to Make Restitution,
Notice of Intent to Fine and Notice of Right to Hearing Issued
On March 26, 2021, the Banking Commissioner issued an Order to Cease and Desist, Order to Make Restitution, Notice of Intent to Fine and Notice of Right to Hearing (Docket No. CRF-21-8433-S) against Travis Smith of Hamden, Connecticut. Smith, a former broker-dealer agent and investment adviser agent, was also the managing member and control person of Executive Consulting Group LLC, an inactive Connecticut entity. The action alleged that, while Smith was registered as a broker-dealer agent and an investment adviser agent under the Connecticut Uniform Securities Act, he made arrangements with three Connecticut residents to manage their money without notifying his employing firm. Smith allegedly persuaded the affected investors to invest their monies in securities issued by Woodbridge Group of Companies, LLC and its affiliates (collectively, "Woodbridge"). Woodbridge compensated Smith for the sales. The action further alleged that Smith misappropriated a portion of investor monies and channeled them to Executive Consulting Group LLC's bank account for his personal use. The affected investors were not advised of, nor did they consent to, the transfer.
The action alleged that Smith 1) sold unregistered securities in violation of Section 36b-16 of the Connecticut Uniform Securities Act; 2) violated the antifraud provisions in Section 36b-4(a) of the Act; 3) engaged in dishonest or unethical practices in violation of Section 36b-4(b) of the Act; 4) violated Section 36b-6(a) of the Act by transacting business as an unregistered agent of issuer; 5) violated Section 36b-23 of the Act by not disclosing his involvement with Woodbridge in filings made with the Commissioner; and 6) violated Section 36b-31-14e of the Regulations under the Act by failing to update his regulatory filings.
Smith was afforded an opportunity to request a hearing on the allegations in the action.
Jorge L. Perez
Banking Commissioner