| * * * * * * * * * * * * * * * * * * * * * * * * IN THE MATTER OF: HOVG, LLC | * * * * * * * * * * * | CONSENT ORDER |
WHEREAS, the Banking Commissioner (“Commissioner”) is charged with the administration of Part XII of Chapter 669, Sections 36a-800 to 36a-810, inclusive, of the Connecticut General Statutes, “Consumer Collection Agencies”, and Sections 36a-809-6 to 36a-809-17, inclusive, of the Regulations of Connecticut State Agencies (“Regulations”);
WHEREAS, HOVG is a Nevada limited liability company with its main office at 4145 Shackelford Road, Suite 330B, Norcross, Georgia, and a branch office at Third Floor, Sharada Arcade, Pune Satara Road, Maharashtra, India, which offices are licensed to act as a consumer collection agency in Connecticut;
WHEREAS, the Commissioner, through the Consumer Credit Division of the Department of Banking, conducted an investigation pursuant to Section 36a-17 of the Connecticut General Statutes into the activities of HOVG to determine if it had violated, was violating or was about to violate the provisions of the Connecticut General Statutes and Regulations within the jurisdiction of the Commissioner;
WHEREAS, as a result of such investigation, on February 11, 2014, the Commissioner issued an Order to Make Restitution, Notice of Intent to Revoke and Refuse to Renew Consumer Collection Agency Licenses, Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing (“Order and Notice”) against HOVG, which Order and Notice is incorporated herein by reference;
WHEREAS, the Commissioner alleged in the Order and Notice that HOVG (1) acted as a consumer collection agency from an unlicensed location, in violation of Section 36a-801(c) of the Connecticut General Statutes; (2) added interest to a Connecticut debtor’s balance when such debtor was not contractually liable for such interest, in violation of Section 36a-809-12(1) of the Regulations; (3) failed to remit funds to its clients within sixty (60) days from the last day of the month in which such funds were collected, in violation of Section 36a-805(a)(9) of the Connecticut General Statutes in effect prior to October 1, 2013; (4) failed to have sufficient funds in its client trust accounts to cover outstanding remittances to clients, in violation of Section 36a-809-7(b) of the Regulations; and (5) failed to meet the requirements for renewal of its licenses as required by Section 36a-801 of the Connecticut General Statutes in effect prior to October 1, 2013;
WHEREAS, on February 11, 2014, the Order and Notice was sent by certified mail, return receipt requested, to HOVG (Certified Mail Nos. 70121010000173173479 and 70121010000173173486);
WHEREAS, on February 19, 2014, HOVG received the Order and Notice, and on March 3, 2014, HOVG requested a hearing, which hearing is currently subject to an open-ended continuance;
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 HOVG now desire to resolve the matters alleged in the Order and Notice and set forth herein;
WHEREAS, HOVG specifically assures the Commissioner that the violations contained in the Order and Notice and set forth herein shall not occur in the future;
WHEREAS, HOVG also specifically assures the Commissioner that upon receipt of the Order and Notice it ceased to collect interest on Connecticut consumer debtors’ balances when such debtors were not contractually liable for such interest, in accordance with Section 36a-809-12(1) of the Regulations;
WHEREAS, HOVG voluntarily agrees to consent to the entry of the sanctions described below without admitting the allegations contained in the Order and Notice and set forth herein and solely for the purpose of obviating the need for further formal administrative proceedings concerning the allegations set forth herein;
WHEREIN, HOVG denies liability for its past conduct and avers that it does not currently engage in the cited violations;
WHEREAS, HOVG agrees that the Order and Notice may be used in construing the terms of this Consent Order and agrees to the language of this Consent Order;
WHEREAS, HOVG acknowledges that this Consent Order is a public record and is a reportable event for purposes of the Nationwide Mortgage Licensing System and Registry (“NMLS”), as applicable;
AND WHEREAS, HOVG, through its execution of this Consent Order, voluntarily agrees to waive its procedural rights, including a right to a hearing as it pertains to the allegations contained in the Order and 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 SANCTIONS
WHEREAS, HOVG, through its execution of this Consent Order, consents to the Commissioner’s entry of a Consent Order imposing the following sanctions:
| 1. | HOVG shall immediately cease and desist from (a) acting as a consumer collection agency from any unlicensed location, in violation of Section 36a-801(c) of the Connecticut General Statutes; (b) adding interest to Connecticut consumer debtors’ balances when such debtors were not contractually liable for such interest, in violation of Section 36a-809-12(1) of the Regulations; (c) failing to remit funds to its clients within sixty (60) days from the last day of the month in which such funds were collected, in violation of Section 36a-805(a)(9) of the Connecticut General Statutes; and (d) failing to have sufficient funds in its client trust accounts to cover outstanding remittances to clients, in violation of Section 36a-809-7(b) of the Regulations; |
| 2. | HOVG shall remit to the Department of Banking by cashier’s check, certified check or money order made payable to “Treasurer, State of Connecticut”, the sum of Thirty Thousand Dollars ($30,000) as a civil penalty, which may be paid in two equal installments of Fifteen Thousand Dollars ($15,000), provided that the first installment is made by January 1, 2016, and the second installment is made by February 1, 2016; and |
| 3. | HOVG shall submit quarterly certifications prepared by an independent certified public accountant certifying that at all relevant times HOVG’s trust account into which collections from Connecticut consumer debtors have been deposited have had adequate funds to cover all checks written on such accounts. Such certifications shall be submitted quarterly for a period of two (2) years, with the first quarterly report due March 30, 2016, for the calendar quarter ending December 31, 2015, and each subsequent quarterly report shall be due within sixty (60) days following the end of the calendar quarter. |
CONSENT ORDER
NOW THEREFORE, the Commissioner enters the following:
| 1. | The Sanctions set forth above be and are hereby entered; |
| 2. | 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 HOVG based upon the allegations contained herein; provided that issuance of this Consent Order is without prejudice to the right of the Commissioner to take enforcement action against HOVG 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 HOVG and reflected herein is subsequently discovered to be untrue; |
| 3. | In the event of nonperformance or violation by HOVG of any term or condition set forth in this Consent Order, including, without limitation, HOVG’s obligation to submit quarterly certifications from an independent certified public accountant, as set forth in paragraph 3 of the Consent to Entry of Sanctions above, the Commissioner shall issue to HOVG a notice of violation. In the event that the claimed violation remains uncured after the expiration of fifteen (15) calendar days from HOVG’s receipt of said notice, HOVG consents to the immediate entry and imposition of a civil penalty in the amount of Ten Thousand Dollars ($10,000), knowingly, willfully and voluntarily waiving its right to notice and an administrative hearing in conjunction therewith. Any modification or extension of the certification deadlines by HOVG absent prior written authorization from and prior review by the Commissioner shall be construed as a violation of this Consent Order, except that such authorization shall not be unreasonably withheld, and an extension of deadlines of fifteen (15) calendar days shall be deemed presumptively reasonable; |
| 4. | So long as this Consent Order is promptly disclosed by HOVG and its control persons, as applicable, on NMLS, nothing in the issuance of this Consent Order shall adversely affect the ability of HOVG to apply for or obtain a license or renewal license under Part XII of Chapter 669, Sections 36a-800 et seq., of the Connecticut General Statutes, provided HOVG meets the statutory requirements for such license or renewal license; and |
| 5. | This Consent Order shall become final when issued. |
Issued at Hartford, Connecticut
this 30th day of December 2015. _______/s/_________
Jorge L. Perez
Banking Commissioner
I, Taylor Pensoneau, state on behalf of HOVG, LLC d/b/a Bay Area Credit Service, 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 HOVG, LLC d/b/a Bay Area Credit Service, LLC; that HOVG, LLC d/b/a Bay Area Credit Service, LLC agrees freely and without threat or coercion of any kind to comply with the sanctions entered and terms and conditions ordered herein; and that HOVG, LLC d/b/a Bay Area Credit Service, LLC voluntarily agrees to enter into this Consent Order, expressly waiving the procedural rights set forth herein as to the matters described herein.
________/s/___________
Name: Taylor Pensoneau
Title: General Counsel
HOVG, LLC
d/b/a Bay Area Credit Service, LLC
State of: Georgia
County of: Gwinnett
On this the 28th day of December 2015, before me, Lisa E. Scully, the undersigned officer, personally appeared Taylor Pensoneau who acknowledged himself to be the General Counsel of HOVG, LLC d/b/a Bay Area Credit Service, LLC, a Nevada limited liability company, and that he as such General Counsel, being authorized so to do, executed the foregoing instrument for the purposes therein contained, by signing the name of the limited liability company by himself as General Counsel.
In witness whereof I hereunto set my hand.
_________/s/_________
Notary Public
Date Commission Expires: 1/2/2017