The Department of Banking News Bulletin 

Bulletin # 1936
Week Ending March 30, 2001

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 John P. Burke, Commissioner of Banking, at the Connecticut Department of Banking, 260 Constitution Plaza, Hartford, CT 06103-1800 or via E-mail to john.burke@ct.gov. Written comments will be considered only if they are received within ten days from the date of this bulletin.

NEWS BULLETIN BY E-MAIL

As a means to improve customer service, the Department of Banking is considering whether to establish a free service to deliver the News Bulletin and other publications directly to you by E-mail. Subscribers would receive the Bulletin on the day that it is issued as an E-mail attachment - at no cost. Please take a moment to tell us if you would find this service beneficial. Would you subscribe to a Department of Banking E-mail list? If so, what computer file format would be preferable for publications (Microsoft Word, HTML, PDF, other)? As a subscriber, would you still wish to receive printed Bulletin copies by postal mail? Please respond by E-mail to jeanne.charbonneau@ct.gov or complete a brief on-line survey.

STATE BANK ACTIVITY
Branch Activity

Section 36a-145 of the Connecticut General Statutes requires that each application for a branch, or for a limited branch at which loans will be made, be accompanied by a plan detailing how adequate services to meet the banking needs of all community residents will be provided. Plans are submitted when such applications are filed and are available for public inspection and comment at this Department for a period of 30 days. Questions concerning branch activity should be directed to the Bank Examination Division, (860) 240-8180.
Note: dates are listed in month/day/year format.

MONEY ORDER AND TRAVELERS CHECK LICENSE ACTIVITY

On March 30, 2001, pursuant to Section 36a-600 of the Connecticut General Statutes, UNITRANSFER NEW YORK, INC. D/B/A UNITRANSFER filed an application to engage in the business of receiving money for transmitting the same.

CREDIT UNION DIVISION ACTIVITY
Merger

On March 28, 2001, pursuant to Section 36a-470 of the Connecticut General Statutes, CenConn Healthcare Credit Union, Inc., Meriden, filed an application to merge EdConn Federal Credit Union, New Britain, with and into CenConn Healthcare Credit Union, Inc.

SECTION 36a-425 APPROVAL

On March 30, 2001, approval was granted to FMR Corp., a Delaware corporation, to establish an office of its subsidiaries, Fidelity Brokerage Services LLC, a Massachusetts limited liability company, and Strategic Advisers, Inc., d/b/a Fidelity Personal Advisory Services, a Massachusetts corporation, at 100 Pearl Street, Hartford; and to maintain four offices of such subsidiaries at the following locations: 265 Church Street, New Haven; 300 Atlantic Street, Stamford; 29 South Main Street, West Hartford; and 48 West Putnam Avenue, Greenwich, Connecticut, as a result of the merger of FMR Corp., a Massachusetts corporation, with and into FMR Corp., a Delaware corporation.

ACQUISITION AND MERGER

On March 27, 2001, pursuant to Sections 36a-70(p), 36a-125 and 36a-184 of the Connecticut General Statutes, Liberty Bank, a mutual savings bank, filed an application for the acquisition of all the outstanding stock of Hometown Bank, a capital stock savings bank, through the establishment of an interim Connecticut bank as a subsidiary of Liberty Bank, to be known as Liberty Interim Bank, the merger of Liberty Interim Bank with and into Hometown Bank, and the subsequent merger of Hometown Bank with and into Liberty Bank. In connection with the application, Liberty Bank filed a community reinvestment plan that is available for public inspection and comment at the Department of Banking for a period of 30 days.

SECURITIES AND BUSINESS INVESTMENTS DIVISION ACTIVITY
Investment Adviser Assessed $8,100

On March 26, 2001, the Commissioner of Banking entered into a Stipulation and Agreement with SEB Asset Management America Inc., an investment adviser regulated by the Securities and Exchange Commission and having its principal office at One Stamford Plaza, 263 Tresser Boulevard, Stamford, Connecticut. The Stipulation and Agreement was based on allegations that, from approximately 1997 until January 30, 2001, when a notice filing was made, SEB failed to make the investment advisory notice filing and pay the fees required by Section 36b-6(e) of the Connecticut Uniform Securities Act. In entering into the Stipulation and Agreement, the Commissioner made note of the firm's representation that its Connecticut client base was largely institutional in nature.

Pursuant to the Stipulation and Agreement, the firm agreed to pay $8,100 to the department, $7,500 of which constituted a monetary penalty and $600 of which represented reimbursement for past due notice filing fees. The firm also agreed to review, revise and implement such supervisory and compliance procedures as were necessary to ensure compliance with state notice filing requirements.

New Jersey Firm Assessed $7,500 for
Unregistered Broker-dealer and Agent Activity

On March 27, 2001, the Commissioner of Banking entered a Consent Order with respect to Greater Metropolitan Investment Services, Inc. of 5 Cold Hill Road South, Suite 13, Mendham, New Jersey. The Consent Order alleged that on intermittent occasions between 1995 and 1999, the firm transacted business as a broker-dealer absent registration in violation of Section 36b-6(a) of the Connecticut Uniform Securities Act and employed unregistered agents in violation of Section 36b-6(b) of the Act.

The Consent Order directed the firm to cease and desist from regulatory violations. In addition, the Consent Order required the firm to provide a report prepared by outside counsel demonstrating that the firm had implemented revised supervisory and compliance procedures addressing state broker-dealer and agent licensing requirements. The Consent Order also directed the firm to pay the department $7,500; of that amount, $5,000 constituted an administrative fine, $1,000 represented reimbursement of past due registration fees and $1,500 constituted reimbursement for agency investigative costs. Finally, the Consent Order mandated that the firm file quarterly reports for two years describing any securities-related complaints, actions or proceedings involving Connecticut residents.

New York Firm Ordered to Cease and Desist from Regulatory Violations;
Notice of Intent to Fine Issued

On March 27, 2001, the Commissioner of Banking entered an Order to Cease and Desist and Notice of Intent to Fine against Montgomery Sterling Corporation of 651 Willowbrook Road, Staten Island, New York. The action was predicated on allegations that on or about June 12, 2000, the respondent sold unregistered non-exempt units of its common stock to at least one Connecticut resident in violation of Section 36b-16 of the Connecticut Uniform Securities Act. The Order to Cease and Desist and Notice of Intent to Fine also claimed that the respondent could not rely on the exemption for Rule 504 offerings under Connecticut law since Ernest Cappone, an executive officer, director and beneficial owner of the respondent, had been the subject of an April 9, 1999 Consent Order issued by the State of Delaware prohibiting Cappone from pursuing registration as a broker-dealer agent in that state for three years. Montgomery Sterling Corporation was afforded an opportunity to request a hearing on the allegations in the Order to Cease and Desist. A hearing on the Notice of Intent to Fine has been scheduled for May 15, 2001.