I. PRELIMINARY STATEMENT

WHEREAS, the Banking Commissioner (“Commissioner”) is charged with the administration of Chapter 672a of the General Statutes of Connecticut, the Connecticut Uniform Securities Act (“Act”), and Sections 36b-31-2 to 36b-31-33, inclusive, of the Regulations of Connecticut State Agencies (“Regulations”) promulgated under the Act;

WHEREAS, the Commissioner, through the Securities and Business Investments Division of the Department of Banking (“Department”), conducted an investigation into the activities of Stead-Fast Custom Linings, LLC (“Respondent”), pursuant to Section 36b-26(a) of the Act, to determine if Respondent had violated, was violating or was about to violate provisions of the Act or Regulations (“Investigation”);

WHEREAS, on December 17, 2012, based on the Investigation, the Commissioner, acting pursuant to Sections 36b-27(a), 36b-27(b) and 36b-27(d) of the Act, issued an Order to Cease and Desist, Order to Make Restitution, Notice of Intent to Fine and Notice of Right to Hearing against Respondent (collectively “Notice”), which Notice is incorporated by reference herein;

WHEREAS, the Commissioner alleged in the Notice that Respondent offered and sold unregistered securities in or from Connecticut to at least one investor, which securities were not registered in Connecticut under the Act.  The offer and sale of such securities absent registration constitutes a violation of Section 36b-16 of the Act, which forms a basis for an order to cease and desist to be issued against Respondent under Section 36b-27(a) of the Act, an order that Respondent make restitution under Section 36b-27(b) of the Act, and for the imposition of a fine upon Respondent under Section 36b-27(d) of the Act;

WHEREAS, the Commissioner alleged in the Notice that Respondent engaged unregistered agents of issuer.  Such conduct constitutes a violation of Section 36b-6(b) of the Act, which forms a basis for an order to cease and desist to be issued against Respondent under Section 36b-27(a) of the Act, and for the imposition of a fine upon Respondent pursuant to Section 36b-27(d) of the Act;

WHEREAS, the Commissioner alleged in the Notice that the conduct of Respondent constitutes, in connection with the offer, sale or purchase of any security, directly or indirectly employing any device, scheme or artifice to defraud, making any untrue statements of a material fact or omitting to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they are made, not misleading, or engaging in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person.  Such conduct constitutes a violation of Section 36b-4(a) of the Act, which forms a basis for an order to cease and desist to be issued against Respondent under Section 36b-27(a) of the Act, an order that Respondent make restitution under Section 36b-27(b) of the Act, and for the imposition of a fine upon Respondent under Section 36b-27(d) of the Act;

WHEREAS, the Notice stated, inter alia, that the Commissioner intended to impose a fine upon Respondent, that Respondent would be afforded an opportunity for a hearing on the allegations set forth in the Notice if a written request for a hearing was received by the Department within fourteen (14) days following Respondent’s receipt of the Notice, and that the Commissioner may order that the maximum fine be imposed upon Respondent if Respondent failed to request a hearing within the prescribed time period or failed to appear at any such hearing;

WHEREAS, on December 17, 2012, the Notice was sent by certified mail, return receipt requested, to Respondent;

WHEREAS, on December 21, 2012, the Notice was returned to the Department of Banking marked “Return to Sender – Not Deliverable as Addressed – Unable to Forward”;

WHEREAS, on January 15, 2013, the Notice was served on the Commissioner, and on January 17, 2013, in accordance with Section 36b-33(h) of the General Statutes of Connecticut, Notice of Service on the Banking Commissioner In the Matter of:  Stead-Fast Custom Linings, LLC dated January 17, 2013 (“Notice of Service”), was sent by registered mail, return receipt requested, to Respondent;

WHEREAS, Respondent has failed to request a hearing on the matters set forth in the Notice within 14 days of the date of the Notice of Service;

WHEREAS, on February 19, 2013, a Certification was issued rendering the Order to Cease and Desist and Order to Make Restitution permanent as of February 1, 2013, which Certification is incorporated by reference herein;

WHEREAS, Section 36a-1-31(a) of the Regulations provides, in pertinent part, that:

WHEREAS, Section 36b-31(a) of the Act provides, in pertinent part, that “[t]he commissioner may from time to time make . . . such . . . orders as are necessary to carry out the provisions of sections 36b-2 to 36b-34, inclusive”;

AND WHEREAS, Section 36b-31(b) of the Act provides, in pertinent part, that “[n]o . . . order may be made . . . unless the commissioner finds that the action is necessary or appropriate in the public interest or for the protection of investors and consistent with the purposes fairly intended by the policy and provisions of sections 36b-2 to 36b-34, inclusive.”

II.  FINDINGS OF FACT AND CONCLUSIONS OF LAW

III.  ORDER

Having read the record, I hereby ORDER, pursuant to Section 36b-27(d) of the Act, that:

This Order was sent by certified mail,
return receipt requested, to
Respondent on March 19, 2013.

Stead-Fast Custom Linings, LLC
641 Main Street
East Haven, CT 06512
Certified mail no. 7012 1010 0001 7264 6264 
                          

Administrative Orders and Settlements