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IN THE MATTER OF:

DONATAS BELYS VILDZIUS

    (CRD Number 2202883)

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CONSENT ORDER
CONDITIONING
REGISTRATION AS AN AGENT

File
No. CO-06-7298-S

WHEREAS the Banking Commissioner (the "Commissioner") is charged with the administration of Chapter 672a of the Connecticut General Statutes, the Connecticut Uniform Securities Act (the "Act") and Sections 36b-31-2 et seq. of the Regulations of Connecticut State Agencies promulgated under the Act (the “Regulations");
WHEREAS Source Capital Group, Inc. (CRD number 36719) of 276 Post Road West, Westport, Connecticut is registered as a broker-dealer under the Act;
WHEREAS Donatas Belys Vildzius (“Vildzius”) applied for registration as an agent of Source Capital Group, Inc. on April 4, 2006;
WHEREAS on April 10, 2006, the National Association of Securities Dealers (the “NASD”) suspended Vildzius from association with any NASD member in any capacity for 30 days, fined him $9,000 and ordered him to pay restitution of $16,000 to a Connecticut customer based on allegations that Vildzius, while employed by another firm, violated NASD Rules 2510(b), 2310 and 2110 as well as Interpretive Material 2310-2 by exercising discretion in the account of a public customer without the customer's prior written authorization, and engaging in unsuitable and/or excessive trading in the customer's account (Acceptance Waiver and Consent; Docket/Case No. E112003069901) (hereinafter, the “2006 AWC”);
WHEREAS the 30 day suspension imposed by the 2006 AWC commenced with the opening of business on May 1, 2006 and concluded at the close of business on May 30, 2006;
WHEREAS the sanctions imposed by the 2006 AWC have not been stayed or overturned by appeal or otherwise;
WHEREAS the Commissioner, through the Securities and Business Investments Division (the "Division") of the Department of Banking has conducted an investigation of Vildzius pursuant to Sections 36b-8 and 36b-26 of the Act;
WHEREAS Section 36b-15(a) of the Act provides, in part, that "[t]he commissioner may by order deny, suspend, or revoke any registration or by order restrict or impose conditions on the securities or investment advisory activities that an applicant or registrant may perform in this state if the commissioner finds that (1) the order is in the public interest, and (2) that the applicant or registrant . . . (F) is the subject of any of the following sanctions that are currently effective or were imposed within the past ten years . . . (iii) a suspension, expulsion or other sanction issued by a national securities exchange or other self-regulatory organization registered under federal laws administered by the Securities and Exchange Commission . . . if the effect of the sanction has not been stayed or overturned by appeal or otherwise . . . . ”;
WHEREAS Vildzius acknowledges that he was the subject of the NASD sanctions in Acceptance, Waiver and Consent No. E112003069901;
WHEREAS Vildzius agrees to the entry of this Consent Order Conditioning Registration as an Agent solely for the purpose of obviating the need for formal administrative proceedings on the matters described above;
WHEREAS Section 36b-6(b) of the Act states, in part, that:  “No broker-dealer shall employ an agent unless such agent is … registered under  . . . [the Act]”;
WHEREAS Source Capital Group, Inc. agrees to the entry of this Consent Order Conditioning Registration as an Agent solely as a condition to the registration of Vildzius as an agent under the Act, and understands that the entry of this Consent Order Conditioning Registration as an Agent does not constitute a finding by the Commissioner of a violation of any provision of the Act or any regulation or order under the Act by Source Capital Group, Inc., nor shall it operate as a restriction or limitation on the securities activities of Source Capital Group, Inc. in the State of Connecticut;
WHEREAS Vildzius voluntarily agrees to waive any right to a hearing upon the entry of this Consent Order Conditioning Registration as an Agent, and waives the right to seek judicial review or otherwise challenge or contest the validity of this Consent Order Conditioning Registration as an Agent;


NOW THEREFORE, THE COMMISSIONER ORDERS AS FOLLOWS:
1. Vildzius shall comply in all respects with the 2006 AWC, including the restitutionary payment schedule set forth therein.  Vildzius shall also file with the Division Director, at the same time that he has made such filings with the NASD, periodic proof that he has paid the bimonthly restitution payments required by the 2006 AWC.  This obligation shall cease only when Vildzius has furnished proof to the Division that the restitutionary amount has been paid in full.  If, as stated in the 2006 AWC, Vildzius cannot locate the affected investor after reasonable and documented efforts made within the period agreed to by NASD staff, Vildzius shall immediately notify the Division Director in writing of such fact.  Should Vildzius become obligated to forward undistributed restitution and interest to the escheat, unclaimed property or abandoned property fund for the state where the investor was last known to have resided, Vildzius shall file with the Division Director evidence he has so forwarded the unclaimed funds to the appropriate state authority in accordance with the 2006 AWC;
2. While Vildzius is associated with Source Capital Group, Inc., Source Capital Group, Inc. shall observe, and Vildzius shall abide by, the following procedures with respect to Vildzius’ activities as an agent:  (a) Vildzius will be subject to supervisory oversight by a qualified principal and will not manage or supervise himself or the securities-related activities of other agents transacting business for Connecticut residents or from Connecticut; (b) All outgoing written securities-related communications, including, without limitation, correspondence, advertising, newsletters, client literature and e-mail, from Vildzius will be approved or initialed by Vildzius’ supervisor before the communication is mailed or otherwise disseminated, and a copy of such communication shall be delivered to the compliance department to be maintained in Vildzius’ file; (c) All incoming written securities-related communications, including correspondence and e-mail, directed to Vildzius shall be forwarded to Vildzius’ supervisor for review, and a copy of all such securities-related communications maintained in a separate on-site communications file; (d) All order tickets reflecting securities transactions effected by Vildzius will be signed by Vildzius’ supervisor or, in the supervisor’s absence, by the backup supervisor; and (e) Vildzius’ supervisor will review all monthly statements relating to accounts serviced by Vildzius, and will initial the firm’s copy of each such monthly statement to show that the supervisor has reviewed it;
3. During the term of his association with Source Capital Group, Inc., Vildzius shall be supervised by David Harris (Central Registration Depository number 237802), an individual unrelated to Vildzius, who holds the position of President, and who shall be located in the same office and in close physical proximity to Vildzius.  Should David Harris be unable to perform such supervisory functions, Source Capital Group, Inc. shall notify the Division Director concerning the identity of David Harris’ successor within five business days following David Harris’ cessation of such activities;
 4.  For so long as Vildzius remains associated with Source Capital Group, Inc., but no later than two years from the date hereof, Source Capital Group, Inc. shall notify the Division Director in writing each calendar quarter of any securities-related complaints, actions or proceedings (including arbitrations and updates thereto) involving Vildzius which occur during the quarter, including the disposition thereof.  Such report shall be provided no later than ten business days following the close of the quarter and shall include any written reprimands, censures or warnings issued by Source Capital Group, Inc. to Vildzius.  If no complaints, actions, proceedings, firm actions or updates exist for the quarter, the report shall so indicate.  The first report shall cover the quarter ending September 30, 2006, and the final report shall cover the quarter ending June 30, 2008;
 5.  Entry of this Consent Order Conditioning Registration as an Agent is without prejudice to the right of the Commissioner to take enforcement action against Vildzius for violations of this Consent Order Conditioning Registration as an Agent, or based on the predicate for its entry, if the Commissioner determines that compliance is not being observed with the terms hereof;
    
 6.  The name of Donatas Belys Vildzius be and is hereby entered on the Register of Agents pursuant to Section 36b-8 of the Act; and
7. This Consent Order Conditioning Registration as an Agent shall become final when issued.

               ________/s/_________
 John P. Burke
            Banking Commissioner


So ordered at Hartford, Connecticut                 
this 29th day of August 2006.                         

CONSENT TO ENTRY OF ORDER

I, Donatas Belys Vildzius, being duly sworn, do state that I agree voluntarily and without threat or coercion of any kind to the entry of this Consent Order Conditioning Registration as an Agent, voluntarily waiving any right to a hearing on the matters described herein.  



  ________/s/_______________
 Donatas Belys Vildzius
  


Subscribed and sworn to before me this 24 day of August 2006.

_______________/s/_______________________
Notary Public
My Commission Expires:  June 30, 2008



I, David Harris, President of Source Capital Group, Inc., state on behalf of that entity that I have read the foregoing Consent Order Conditioning Registration as an Agent with respect to Donatas Belys Vildzius ; that I know and fully understand its contents; that I am authorized to execute the same on behalf of Source Capital Group, Inc.; and that Source Capital Group, Inc. agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein with respect to Donatas Belys Vildzius , expressly waiving any right to a hearing on the matters described herein.
 


Source Capital Group, Inc.

By

  ________/s/_______________
 David Harris
 President 


On this 24 day of August, 2006, personally appeared David Harris, signer of the foregoing Consent Order Conditioning Registration as an Agent with respect to Donatas Belys Vildzius, who, being duly sworn, did acknowledge to me that he was authorized to execute the same on behalf of Source Capital Group, Inc. and acknowledged the same to be his free act and deed, before me.

_______________/s/_______________________
Notary Public
My Commission Expires:  June 30, 2008




Conditional Registrations