The Department of Banking News Bulletin 

STATE BANK ACTIVITY

Branch Activity

Section 36a-145 of the Connecticut General Statutes requires certain applications 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 Financial Institutions Division, (860) 240-8180.

CONSUMER CREDIT DIVISION ACTIVITY

Check Cashing Service License Activity

Temporary Order to Cease and Desist, Notice of Intent to Issue Order to Cease and Desist and Notice of Intent to Impose Civil Penalty

On April 26, 2012 the Commissioner issued a Temporary Order to Cease and Desist, Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing (“Notice”) in the Matter of:  Home Credit Law Center (“Home Credit”) and United Processing Center, Inc. (“United Processing”) (collectively, “Respondents”), of Los Angeles and Irvine, California, respectively.  The Notice was the result of an investigation by the Consumer Credit Division.  The Notice alleges that Home Credit engaged in debt negotiation in this state without obtaining the required license, in violation of Section 36a-671(b) of the Connecticut General Statutes, in effect prior to October 1, 2011, and that United Processing offered to engage in debt negotiation in this state without obtaining the required license, in violation of Section 36a-671(b) of the Connecticut General Statutes, in effect prior to October 1, 2011.  The Commissioner also found that public welfare required the issuance of a Temporary Order to Cease and Desist against Respondents.  Respondents were afforded an opportunity to request a hearing with regard to the allegations set forth in the Notice.

Consent Orders

On April 26, 2012, the Commissioner entered into a Consent Order with Dimension Financial Services LLC (“Dimension”), Rocky Hill, Connecticut, and Harris Delroy McFarlane (NMLS # 89001) (“McFarlane”) (collectively “Respondents”).  The Consent Order was based on an investigation by the Consumer Credit Division.  As a result of such investigation, the Commissioner alleged that in 2010 Dimension acted as an unlicensed mortgage broker with respect to two residential mortgage loans, in violation of Section 36a-486(a) of the then applicable Connecticut General Statutes, and that in 2010 McFarlane engaged in the business of a mortgage loan originator with respect to two residential mortgage loans without the requisite license, in violation of Section 36a-486(b) of the then applicable Connecticut General Statutes.  The Commissioner further alleged that Dimension had engaged or offered to engage in debt negotiation without a license in violation of Section 36a-671(b) of the then applicable Connecticut General Statutes.  As part of the Consent Order, Respondents were ordered to pay $2,500 as a civil penalty.

On April 26, 2012, the Commissioner entered into a Consent Order with Michael A. Lupolover; Law Offices of Michael Lupolover, PC; Premier Consultant Group, LLC d/b/a Premier Debt Solvers; and Premier Debt Pro Servicing, LLC (“Respondents”), all of Englewood Cliffs, New Jersey.  The Consent Order was based on an investigation by the Consumer Credit Division.  As a result of such investigation, the Commissioner alleged that from at least October 2009 to July 2011, Respondents were engaged unlicensed debt negotiation activity in Connecticut, in violation of Section 36a-671(b) of the Connecticut General Statutes.  Pursuant to the Consent Order, Respondents were ordered to pay $3,000 as a civil penalty and to cease and desist from engaging or offering to engage in unlicensed debt negotiation activity in Connecticut, and refunded all fees paid directly or indirectly to Respondents by Connecticut residents for debt negotiation services from October 2009 through the date of the Consent Order.

On May 2, 2012, the Commissioner entered into a Consent Order with Amado America LLC d/b/a J&M Check Cashing Store (“J&M Check Cashing”), Hartford, Connecticut.  The Consent Order was based on an investigation by the Consumer Credit Division.  As a result of such investigation, the Commissioner alleged that J&M Check Cashing, during the period of at least January 1 through April 13, 2012, engaged in the business of cashing checks, drafts and money orders for consideration without licensure for a general facility at 21 New Britain Avenue, Hartford, Connecticut, in violation of Section 36a-581(a) of the 2012 Supplement to the General Statutes.  As part of the Consent Order, J&M Check Cashing was ordered to pay $1,000 as a civil penalty.

Order to Cease and Desist, Order of Repayment of Fees and Order Imposing Civil Penalty

On April 27, 2012, the Commissioner issued an Order to Cease and Desist, Order of Repayment of Fees and Order Imposing Civil Penalty (“Order”) In the Matter of:  Alliance Mitigation Group (“Respondent”), Los Angeles, California.  The basis of the Order was that Respondent engaged in debt negotiation in this state without obtaining the required license, in violation of Section 36a-671(b) of the Connecticut General Statutes, in effect on July 2, 2010, and offered to engage in debt negotiation in this state without obtaining the required license, in violation of Section 36a-671(b) of the 2012 Supplement to the General Statutes.  Respondent was ordered to cease and desist from violating Section 36a 671(b) of the Connecticut General Statutes, in effect on July 2, 2010, and Section 36a-671(b) of the 2012 Supplement to the General Statutes, to repay fees to identified Connecticut residents, and to pay a civil penalty in the amount of $10,000.

SECURITIES AND BUSINESS INVESTMENTS DIVISION ACTIVITY

Order Imposing Fine; Order to Cease and Desist Becomes Permanent

On May 15, 2012, the Commissioner entered an Order Imposing Fine against Stephen P. Pazdar of Glastonbury, Connecticut.  Respondent Pazdar had been the subject of a March 27, 2012 Order to Cease and Desist, Notice of Intent to Fine and Notice of Right to Hearing alleging that 1) in April or May 2008, respondent Pazdar approached two Connecticut residents to invest with Michael S. Goldberg, member of Michael S. Goldberg, LLC d/b/a Acquisitions Unlimited Group; and 2) Goldberg told investors that Acquisitions Unlimited Group liquidated distressed assets obtained from JP Morgan Chase Bank, thus enabling Goldberg to pay investors returns of up to 20% over the short term.  The two Connecticut residents ultimately invested $400,000 in total with Goldberg, and Stephen P. Pazdar received a $25,000 referral fee in connection with their investments.  Goldberg was ultimately charged with allegedly devising and executing a scheme to defraud investors of over $100 million over a 12 year period.  Goldberg pleaded guilty to three counts of wire fraud and was sentenced on May 16, 2011 to 120 months in prison on each count, the sentence to be served concurrently (United States v. Michael S. Goldberg, D. Conn., Criminal No. 3:10 CR192 (JCH)).  The March 27, 2012 action had also alleged that respondent Pazdar offered and/or sold unregistered securities in violation of Section 36b-16 of the Connecticut Uniform Securities Act and transacted business as an unregistered agent of issuer in violation of Section 36b-6 of the Act.

Finding that respondent Pazdar committed one violation of Section 36b-16 of the Act and one violation of Section 36b-6(a) of the Act, the Commissioner fined Pazdar $25,000.  Respondent Pazdar did not appear or contest the imposition of the fine.  Similarly uncontested was the March 27, 2012 Order to Cease and Desist which became permanent on May 11, 2012.