Bulletin # 3022 - Week Ending January 21, 2022

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 Jorge L. Perez, Banking Commissioner, Department of Banking, 260 Constitution Plaza, Hartford, CT 06103-1800.  Written comments will be considered only if they are received within ten business days from the date of this bulletin.

BANK ACTIVITY

Special Meeting

On February 7, 2022, pursuant to Sections 1-225 and 36a-70(i) of the Connecticut General Statutes, a special meeting of the Banking Commissioner will be held for the purpose of considering the application of the organizers of TNB USA Inc., Norwalk, Connecticut, for an extension of their Temporary Certificate of Authority to organize an uninsured bank. The meeting is scheduled to be held on February 7, 2022, at 3:00 p.m. via videoconference and via teleconference at (860) 840-2075, conference ID: 630 371 252#.

CONSUMER CREDIT DIVISION ACTIVITY

Order Revoking Consumer Collection Agency License, Order to Cease and Desist and Order Imposing Civil Penalty

On January 10, 2022, the Commissioner issued an Order Revoking Consumer Collection Agency License, Order to Cease and Desist and Order Imposing Civil Penalty (“Order”) in the Matter of: Yes Online Inc d/b/a Dynamic Legal Recovery d/b/a YES ONLINE INC (NMLS # 1431632), Santa Clara, California (“Respondent”). The basis of the Order was that: (1) Respondent failed to provide records requested during an examination or to otherwise cooperate with the Commissioner, in violation of Section 36a-17(e) of the Connecticut General Statutes; and (2) Respondent’s conduct renders the Commissioner unable to determine that the financial responsibility, character, reputation, integrity and general fitness of Respondent are such 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, as required pursuant to Section 36a-801(c)(2) of the Connecticut General Statutes. The Order revokes Respondent’s license to act as a consumer collection agency in Connecticut from 25600 Rye Canyon Road Suite 209, Santa Clarita, California, orders Respondent to cease and desist from violating Section 36a-17(e) of the Connecticut General Statutes, and imposes a civil penalty in the amount of $100,000 upon Respondent.

Findings of Fact, Conclusions of Law and Order

On January 11, 2022, following an administrative hearing, the Banking Commissioner issued Findings of Fact, Conclusions of Law and an Order in the matter of: USIO, INC. f/k/a Payment Data Systems, Inc., San Antonio, Texas (“USIO”).

The hearing considered allegations brought by the Commissioner on March 16, 2021, through a Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing issued against USIO (“Notice”). In the Notice, the Commissioner alleged that USIO’s engaging in the business of money transmission in this state without obtaining the required license constitutes at least one violation of Section 36a-597(a) of the Connecticut General Statutes, in effect prior to October 1, 2017.

The hearing decision concluded that USIO violated Section 36a-597(a) of the Connecticut General Statutes, and ordered that USIO cease and desist from violating Section 36a-608(c) of the Connecticut General Statutes and imposed a civil penalty of $10,000 upon USIO.

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

On January 11, 2022, the Commissioner issued an Order to Make Restitution, 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: Optima Advocates, Inc., Irvine, California (“Optima”), Optima Student Loan Services, LLC, Irvine, California (“SLS”), LoanHero, Inc., San Diego, California (“LoanHero”), and Monterey Financial Services LLC d/b/a Monterey Collection Services, NMLS # 253155, Oceanside, California (“Monterey”) (collectively, “Respondents”). The Order and Notice was the result of an investigation by the Consumer Credit Division. The Commissioner alleges that: (1) Optima’s engaging or offering to engage in debt negotiation in this state without obtaining the required license constitutes at least one violation of Section 36a-671(b) of the Connecticut General Statutes, in effect at such time; (2) SLS’s engaging or offering to engage in debt negotiation in this state without obtaining the required license constitutes at least one violation of Section 36a-671(b) of the Connecticut General Statutes, in effect at such time; (3) SLS’s offering, soliciting, brokering, directly or indirectly arranging, placing or finding a small loan for a prospective Connecticut borrower, without obtaining the required license, constitutes at least one violation of Section 36a-556 of the Connecticut General Statutes, in effect at such time; (4) LoanHero’s making or offering, soliciting, brokering, directly or indirectly arranging, placing or finding a small loan for a prospective Connecticut borrower and receiving payments of principal and interest in connection with a small loan made to a Connecticut borrower without obtaining the required license constitutes at least one violation of Section 36a-556 of the Connecticut General Statutes, in effect at such time; and (5) Monterey’s receiving payments of principal and interest in connection with a small loan made to a Connecticut borrower and purchasing, acquiring or receiving assignment of a small loan made to a Connecticut borrower without obtaining the required license constitutes at least one violation of Section 36a-556 of the Connecticut General Statutes, in effect at such time. As part of the Order to Make Restitution, LoanHero was ordered to repay $9,203.45 plus interest to an identified Connecticut consumer, and repay any amounts received from any other Connecticut debtor on any other small loan; Monterey was ordered to repay $8,519.54 plus interest to an identified Connecticut consumer, and repay any amounts received from any other Connecticut debtor on any other small loan; and Optima and SLS were ordered to repay to any Connecticut debtor who entered into an agreement for debt negotiation services with Optima or SLS, respectively, any fees paid by such Connecticut debtor to Optima or SLS, plus interest. Respondents were afforded an opportunity to request a hearing with regard to the allegations set forth in the Order and Notice.

SECURITIES AND BUSINESS INVESTMENTS DIVISION ACTIVITY

Extreme Marketing Alliance LLC, Matt Graham and Orlando Diaz

On January 20, 2022, the Banking Commissioner entered a Consent Order (No. CO-21-202026-B) with respect to Extreme Marketing Alliance LLC, a Nevada limited liability company, and its principals Matt Graham and Orlando Diaz. Respondent Extreme Marketing Alliance LLC was in the business of offering consumers the opportunity to achieve financial freedom by starting their own online businesses through coaching assistance provided by Respondents.

The Consent Order alleged that, from at least April 2019 through August 2020, the Respondents 1) violated Sections 36b-62(a) and 36b-67(1) of the Connecticut Business Opportunity Investment Act by selling unregistered coaching business opportunities to Connecticut purchaser-investors; 2) violated Section 36b-63 of the Act by failing to provide Connecticut purchaser-investors with required disclosures; and 3) violated Section 36b-67(2) of the Act by making earnings claims without including documented data to substantiate those claims.

The Respondents extended a rescission offer to affected Connecticut purchaser-investors. The aggregate amount refunded totaled $116,687.

The Consent Order directed the Respondents to cease and desist from violating the Act and barred them from selling business opportunities in Connecticut for five years. After the expiration of three years, the Consent Order permitted the Respondents to apply for business opportunity registration under the Act. The Consent Order also imposed a $10,000 fine on Respondent Extreme Marketing Alliance LLC.