The Department of Banking News Bulletin Bulletin # 2101 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 firstname.lastname@example.org. Written comments will be considered only if they are received within ten days from the date of this bulletin. UPCOMING CONFERENCES
The Department of Banking News Bulletin
Bulletin # 2101
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 email@example.com. Written comments will be considered only if they are received within ten days from the date of this bulletin.
Commissioner John P. Burke is sponsoring a special training conference for CEOs and bank directors on Tuesday, June 15, 2004 at the Marriott Hotel in Farmington, Connecticut. Pressures from everyone, not only bank regulators, have encouraged reform within the boardroom and have demanded more accountability from directors. We believe when they are more knowledgeable about the businesses they oversee and familiar with the regulatory scope they must adhere to, directors can be more responsible and effective in performing their duties. The bank directors' conference will define the responsibilities of the board, collectively and individually, identify what comprises responsible corporate governance, and will focus on such topics as interest rate risk, duties of the audit committee, and performance evaluations, including board self exams. Our seminar will help bring the new director quickly up-to-speed and serve as a refresher for experienced directors. Advance registration is required. For further conference information, visit the department's web site or call the agency at (860) 240-8170.
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 Financial Institutions Division, (860) 240-8180.
On May 17, 2004, pursuant to Section 36a-412(a)(2) of the Connecticut General Statutes, as amended by Public Acts 03-196 and 04-136, and Section 36a-145(c)(1) of the Connecticut General Statutes, as amended by Public Act 03-196, Imperial Capital Bank, a California-chartered bank with its main office in La Jolla, California, filed an application to establish a de novo limited branch to operate under the name Imperial Capital Express, a division of Imperial Capital Bank Ė Stamford Office, at One Stamford Plaza, 263 Tresser Boulevard, 9th Floor, Stamford, Connecticut, to engage solely in loan production.
CHECK CASHING SERVICE LICENSE ACTIVITY
On May 25, 2004, pursuant to Section 36a-581 of the Connecticut General Statutes, Fran Cash Enterprises, LLC filed an application to operate a check cashing service general facility at 161 Boston Avenue, Bridgeport, Connecticut.
CREDIT UNION ACTIVITY
On May 24, 2004, pursuant to Section 36a-462b(d) of the Connecticut General Statutes, Corporate America Family Credit Union of Elgin, Illinois, filed an application to expand its field of membership in the State of Connecticut to include the employees of Ray-Jurgen, Inc. of Bristol, Connecticut.
CONSUMER CREDIT DIVISION ACTIVITY
On May 27, 2004, the Commissioner entered into a Settlement Agreement with Abacus Lending Services, LLC D/B/A Abacus Mortgage ("Abacus"). The Settlement Agreement was based on an investigation by the Consumer Credit Division that found that on or about March 2004, Abacus, through an employee, attempted to broker a secondary mortgage loan without a secondary mortgage license and provided the lender with a secondary mortgage license reflecting an altered expiration date. Such finding constituted grounds for the revocation of Abacusí first mortgage correspondent lender license pursuant to Section 36a-494(a)(1) of the Connecticut General Statutes and for the imposition of a civil penalty pursuant to Section 36a-50 of the Connecticut General Statutes. Pursuant to the Settlement Agreement, Abacus agreed not to perform any actions that would be in violation of Chapter 668 of the Connecticut General Statutes and the regulations implementing that chapter, including the brokering of any secondary mortgage loans without a current license to do so, or permitting or causing any employee of Abacus to represent that Abacus holds a current Secondary Mortgage License if it does not hold such license. Abacus also agreed to obtain a Secondary Mortgage Correspondent Lender/Broker license, forthwith, and based upon the information currently known to the Department, the Department agreed to issue the license upon execution of the Settlement Agreement. In addition, Abacus agreed to remit to the Department of Banking $20,000 as a civil penalty.
SECURITIES AND BUSINESS INVESTMENTS DIVISION ACTIVITY
On May 25, 2004, the Commissioner issued an Order to Cease and Desist, Notice of Intent to Revoke Registration as Broker-dealer and Notice of Intent to Fine against LH Ross & Company, a Connecticut-registered broker-dealer having its principal office at 2255 Glades Road, Suite 425W, Boca Raton, Florida. The action alleged that the firm 1) engaged in dishonest or unethical practices by employing "cold callers" who were not registered with the NASD and by using sales scripts that had not been approved by a registered principal of the firm; 2) violated Section 36b-6(b) of the Connecticut Uniform Securities Act by employing unregistered agents; 3) violated Section 36b-31-14a(a) of the Regulations under the Act by failing to accurately record loans and failing to keep payroll or bonus related records for any of the firmís cold callers; 4) engaged in dishonest or unethical practices by engaging in unauthorized trading on behalf of Connecticut customers; 5) engaged in dishonest or unethical practices by executing securities transactions without first obtaining written discretionary authority from affected customers; 6) violated a June 7, 2002 Consent Order entered by the Commissioner by employing unregistered personnel, failing to establish and enforce adequate supervisory procedures and failing to report a customer complaint; 7) engaged in dishonest or unethical practices by opening margin accounts for Connecticut customers without providing the margin disclosure statement described in NASD Rule 2341(a); and 8) violated Section 36b-31-6f(b) of the Regulations under the Act by failing to enforce and maintain a system for supervising the activities of its agents that was reasonably designed to achieve compliance with applicable securities laws and regulations.
The respondent was afforded an opportunity to request a hearing on the Order to Cease and Desist and the Notice of Intent to Revoke Registration as Broker-dealer. A hearing on the Notice of Intent to Fine has been scheduled for July 21, 2004.
Dated: Wednesday, June 2, 2004