Bulletin # 3014 - Week Ending November 26, 2021

 

 

CONSUMER CREDIT DIVISION ACTIVITY

Order to Make Restitution, Notice of Intent to Revoke and Refuse to Renew Consumer Collection Agency License, Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty 

On November 22, 2021, the Commissioner issued an Order to Make Restitution, Notice of Intent to Revoke and Refuse to Renew Consumer Collection Agency License, Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing (collectively, “Order and Notice”) in the Matter of: HOVG, LLC d/b/a Bay Area Credit Service, LLC (NMLS # 945496) (“Respondent”), Norcross, Georgia. The Order and Notice was the result of an investigation and examination by the Consumer Credit Division. The Commissioner alleges that: (1) Respondent’s acting as a consumer collection agency from an unlicensed location by receiving Connecticut debtor payments at an unlicensed office location in Georgia constitutes a violation of Section 36a-801(a) of the Connecticut General Statutes; (2) Respondent failed to maintain the minimum tangible net worth of $50,000 as required pursuant to Section 36a 801(b) of the Connecticut General Statutes; (3) Respondent’s failure to account for and remit to its clients all money collected not in dispute within sixty (60) days from the last day of the month when said money was collected constitutes a violation of Section 36a-805(a)(9) of the Connecticut General Statutes; (4) Respondent’s failure to establish, enforce and maintain policies and procedures for supervising employees, agents and office operations that are reasonably designed to achieve compliance with applicable consumer collection laws and regulations constitutes a violation of Section 36a-805(a)(16) of the Connecticut General Statutes; (5) Respondent’s failure to avoid the commingling of funds of consumer debtors with the funds of Respondent and using said consumer debtor funds in the conduct of Respondent’s business constitutes a violation of Section 36a-811(b) of the Connecticut General Statutes; (6) Respondent’s failure to maintain its consumer debtor and creditor records so as to clearly identify the amounts and dates of all payments collected or received from consumer debtors and all remittances made to creditors, failure to identify all trust accounts utilized by Respondent, and failure to retain consumer debtor and creditor records for a period of not less than two years of the date of final entry thereon constitutes a violation of Section 36a-801(a) of the Connecticut General Statutes; (7) Respondent’s communications with Connecticut debtors during inconvenient times before 8:00 a.m. local time at the debtor’s location without the prior consent of the debtor or the express permission of a court constitutes a violation of Section 36a-809-9(d) of the Regulations of Connecticut State Agencies (“Regulations”); (8) Respondent’s collection of amounts in excess of the amount placed with Respondent and not expressly authorized by the agreement creating the debt or permitted by law constitutes a violation of Section 36a-809-12(1) of the Regulations; (9) Respondent’s failure to account for and remit to its clients all money collected not in dispute within sixty (60) days from the last day of the month when said money was collected, receipt of Connecticut debtor payments at an unlicensed location, failure to maintain accounting records in accordance with generally accepted accounting principles, failure to identify amounts and dates of payments collected or received from consumer debtors and remittances made to creditors, failure to identify all trust accounts utilized by Respondent and failure to preserve all records related to its collection activities and Respondent’s collection of amounts in excess of the amount placed with Respondent and not expressly authorized by the agreement creating the debt or permitted by law, constitute violations of the 2015 Consent Order issued under the statutes within the jurisdiction of the Commissioner; and (10) Respondent’s conduct renders the Commissioner unable to determine that the financial responsibility, character, reputation, integrity and general fitness of Respondent, the control persons of Respondent, the qualified individual and any branch manager, are such as to warrant belief that the business will be operated soundly and efficiently, in the public interest and consistent with the purposes of Section 36a-800 to 36a-814, inclusive, and that Respondent meets the applicable tangible net worth requirement, as required pursuant to Section 36a-801(c)(2) of the Connecticut General Statutes, as amended by Public Act 21-138. As part of the Order to Make Restitution, Respondent was ordered to promptly refund all amounts, charges and fees received from Connecticut consumer debtors that could not be legally collected plus interest at the legal rate set forth in Section 37-1 of the Connecticut General Statutes for the period of time including January 1, 2017 through the date of the Order to Make Restitution. Respondent was afforded an opportunity to request a hearing with regard to the allegations set forth in the Order and Notice.