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IN THE MATTER OF: APPROVED FUNDING CORP. |
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CONSENT ORDER |
WHEREAS, the Banking Commissioner (“Commissioner”) is charged with the administration of Part I of Chapter 668, Sections 36a-485 to 36a-534c, inclusive, of the Connecticut General Statutes, “Mortgage Lenders, Correspondent Lenders, Brokers and Loan Originators”;
WHEREAS, Approved Funding is a New York corporation that is currently licensed as a mortgage lender under Part I of Chapter 668, Sections 36a-485 et seq., of the Connecticut General Statutes;
WHEREAS, the Commissioner, through the Consumer Credit Division (“Division”) of the Department of Banking (“Department”), investigated the activities of Approved Funding pursuant to the authority granted by Sections 36a-17(a) and 36a-498f of the Connecticut General Statutes, to determine if it had violated, was violating or was about to violate the provisions of the Connecticut General Statutes within the jurisdiction of the Commissioner;
WHEREAS, on March 27, 2013, as a result of the investigation, the Commissioner, acting pursuant to Sections 36a-494(b), 36a-52(a) and 36a-50(a) of the Connecticut General Statutes, 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”) against Approved Funding, which Notice is incorporated herein by reference;
WHEREAS, the Commissioner alleged in the Notice that Approved Funding failed to timely file certain mortgage call reports, specifically, a MCR – Standard – Financial Condition report that was due on March 30, 2012, a first quarter report that was due on May 15, 2012, and a second quarter report that was due on August 14, 2012, all in violation of Section 36a-534b(c)(3) of the 2012 Supplement to the General Statutes and/or Section 36a-534b(c)(3) of the Connecticut General Statutes;
WHEREAS, on March 28, 2013, the Notice was sent by certified mail, return receipt requested, to Approved Funding (Certified Mail No. 70110470000225729489);
WHEREAS, the Notice provided Approved Funding with the opportunity for a hearing, and stated that if a hearing was not requested within 14 days of its receipt, the Commissioner would issue an order that Approved Funding cease and desist from violating Section 36a-534b(c)(3) of the Connecticut General Statutes, and may order a civil penalty in an amount not to exceed One Hundred Thousand Dollars ($100,000) per violation be imposed upon Approved Funding;
WHEREAS, on or about April 17, 2013, the United States Postal Service posted the status of the Notice mailing as “Unclaimed”;
WHEREAS, on December 27, 2012, Approved Funding requested renewal of its mortgage lender license for the 2013 licensing period for the address to which the Notice had been mailed, and on February 4, 2013, the Division renewed the license for such address;
WHEREAS, on or about April 19, 2013, the Division contacted Approved Funding, confirmed the Division had the correct address for the licensed office and provided Approved Funding with a copy of the Notice and pertinent United States Postal Service tracking information via e-mail;
WHEREAS, on April 22, 2013, the Notice mailed to Approved Funding was returned to the Department marked “Returned to Sender – Unclaimed”;
WHEREAS, Section 36a-52(a) of the Connecticut General Statutes provides, in pertinent part, that “[t]he notice shall be deemed received by the person on the earlier of the date of actual receipt or seven days after mailing or sending”;
WHEREAS, Section 36a-50(a)(1) of the Connecticut General Statutes provides, in pertinent part, that “[t]he notice shall be deemed received by the person on the earlier of the date of actual receipt or seven days after mailing or sending”;
WHEREAS, Section 36a-52(a) provides, in pertinent part, that “[i]f the person does not request a hearing within the time specified in the notice . . . the commissioner shall issue an order to cease and desist against the person”;
WHEREAS, Section 36a-50(a)(2) of the Connecticut General Statutes provides, in pertinent part, that “[i]f such person does not request a hearing within the time specified in the notice . . . the commissioner may . . . order that a civil penalty not exceeding one hundred thousand dollars per violation be imposed upon such person”;
WHEREAS, no request for a hearing has been received by the Commissioner;
WHEREAS, Section 4-177(c) of the Connecticut General Statutes and Section 36a-1-55(a) of the Regulations of Connecticut State Agencies provide that a contested case may be resolved by consent order, unless precluded by law;
WHEREAS, the Commissioner and Approved Funding now desire to resolve the matters alleged in the Notice and set forth herein;
WHEREAS, Approved Funding admits that the reports described in the Notice and set forth herein were not filed on their respective due dates and acknowledges that this Consent Order is a public record and is a reportable event for purposes of the regulatory disclosure questions on the Nationwide Mortgage Licensing System and Registry (“NMLS”), as applicable;
WHEREAS, Approved Funding voluntarily agrees to consent to the entry of the sanction described below solely for the purpose of obviating the need for further formal administrative action concerning the allegation contained in the Notice and set forth herein;
WHEREAS, Approved Funding herein represents to the Commissioner that it has reviewed and updated its internal policies, procedures and controls for timely and accurately filing reports with the Commissioner through NMLS as required or as otherwise permitted under Part I of Chapter 668, Sections 36a-485 et seq., of the Connecticut General Statutes;
WHEREAS, Approved Funding agrees that the Notice may be used in construing the terms of this Consent Order and agrees to the language of this Consent Order;
AND WHEREAS, Approved Funding, through its execution of this Consent Order, voluntarily agrees to waive any applicable procedural rights as it pertains to the allegation contained in the Notice and set forth herein, and voluntarily waives its right to seek judicial review or otherwise challenge or contest the validity of this Consent Order.
CONSENT TO ENTRY OF SANCTION
WHEREAS, Approved Funding, through its execution of this Consent Order, consents to the Commissioner’s entry of a Consent Order imposing the following sanction:
No later than the date this Consent Order is executed by Approved Funding, Approved Funding shall remit to the Department by cashier’s check, certified check or money order made payable to “Treasurer, State of Connecticut”, the sum of Two Thousand Five Hundred Dollars ($2,500) as a civil penalty.
CONSENT ORDER
NOW THEREFORE, the Commissioner enters the following:
| 1. | The Sanction set forth above be and is hereby entered; |
| 2. | No later than the date this Consent Order is executed by Approved Funding, Approved Funding shall have satisfactorily filed on NMLS all mortgage call reports required to date, expressly including the MCR – Standard – RMLA (Q1) due on May 15, 2013. In the future, Approved Funding shall file timely and accurately all required reports on NMLS or as otherwise permitted under Part I of Chapter 668 of the Connecticut General Statutes in connection with its current and any future license issued to Approved Funding; |
| 3. | Upon issuance of this Consent Order by the Commissioner, this matter will be resolved and the Commissioner will not take any future enforcement action against Approved Funding based upon the allegation set forth in the Notice and contained herein; provided that issuance of this Consent Order is without prejudice to the right of the Commissioner to take enforcement action against Approved Funding 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 representation made by Approved Funding and reflected herein is subsequently discovered to be untrue; |
| 4. | So long as this Consent Order is promptly disclosed by Approved Funding and its control persons on NMLS, as applicable, nothing in the issuance of this Consent Order shall adversely affect the ability of Approved Funding to apply for or obtain licenses or renewal licenses under Part I of Chapter 668, Sections 36a-485 et seq., of the Connecticut General Statutes, provided all applicable legal requirements for such license are satisfied; and |
| 5. | This Consent Order shall become final when issued. |
Issued at Hartford, Connecticut
this 15th day of July 2013. _______/s/_________
Howard F. Pitkin
Banking Commissioner
I, Shmuel Shayowitz, state on behalf of Approved Funding Corp., 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 Approved Funding Corp.; that Approved Funding Corp., agrees freely and without threat or coercion of any kind to comply with the sanction entered and terms and conditions ordered herein; and that Approved Funding Corp., voluntarily agrees to enter into this Consent Order, expressly waiving the procedural rights set forth herein as to the matters described herein.
By: ________/s/________
Name: Shmuel Shayowitz
Title: President
Approved Funding Corp.
State of: NJ
County of: Bergen
On this the 5th day of July 2013, before me, Baruch Klahr, the undersigned officer, personally appeared Shmuel Shayowitz who acknowledged himself/herself to be the President of Approved Funding Corp., a corporation, and that he/she as such President, being authorized so to do, executed the foregoing instrument for the purposes therein contained, by signing the name of the corporation by himself/herself as President.
In witness whereof I hereunto set my hand.
_________/s/_________
Notary Public
Date Commission Expires: 8/18/2014