DOB: News Bulletin 2128 - December 3, 2004

The Department of Banking News Bulletin 

 Bulletin # 2128
Week Ending December 3, 2004

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.


BRANCH ACTIVITY
State Bank 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 Financial Institutions Division, (860) 240-8180.

Date Bank Location Activity
12/01/04 NewAlliance Bank
New Haven
FROM:  176 Amity Road
          Woodbridge, CT  06525
TO:     211 Amity Road
          Woodbridge, CT  06525
approved
to relocate

ACQUISITION AND MERGER

On November 30, 2004, pursuant to Section 36a-185 of the Connecticut General Statutes, as amended by Public Act 03-259, the Commissioner issued a notice of intent not to disapprove the acquisition by Webster Financial Corporation of all of the outstanding voting securities of First City Bank, a Connecticut bank and trust company. The acquisition will take place, pursuant to Section 36a-126(b) of the Connecticut General Statutes, through the merger of First City Bank with and into Webster Bank, N.A., a national banking association that is a wholly-owned subsidiary of Webster Financial Corporation.

SECURITIES AND BUSINESS INVESTMENTS DIVISION ACTIVITY 
New York Man Barred from Conducting Securities Activity in Connecticut
for Ten Years

On November 8, 2004, the Commissioner entered a Consent Order with respect to Steven Douglas Klein of 1549 August Road, North Babylon, New York. Respondent Klein had been the subject of a March 29, 2004 Order to Cease and Desist and Notice of Intent to Fine alleging that 1) from at least October 1989 to September 23, 2003, the respondent was the president and 75% owner of Ameriprop, Inc., a broker-dealer; 2) in that capacity, the respondent was the authorized signatory on the Form BDW (Uniform Request for Broker-dealer Withdrawal) filed by Ameriprop, Inc. and on the Form U-5 (Uniform Termination Notice for Securities Industry Registration) filed by Ameriprop, Inc. and relating to respondent Klein's association with that firm; 3) in October 2003, the respondent filed a Form U-4 (Uniform Application for Securities Industry Registration or Transfer) to apply for registration as a broker-dealer agent of Seidel & Shaw, LLC; and 4) the respondent violated Section 36b-23 of the Connecticut Uniform Securities Act and Section 36b-31-14e(a) of the Regulations thereunder by failing to address in the filings a June 23, 2003 Notice of Opportunity for Hearing issued by the Georgia Commissioner of Securities against respondent Klein and Ameriprop, Inc. The Order to Cease and Desist, being uncontested, had become permanent on April 21, 2004.  The Consent Order resolved the allegations in the Notice of Intent to Fine. In entering the Consent Order, the Commissioner acknowledged that the respondent had demonstrated economic hardship such that the respondent was financially incapable of paying the maximum fine. The Consent Order barred the respondent for ten consecutive years from transacting business as a broker-dealer, investment adviser, agent or investment adviser agent in or from Connecticut, and from acting as a finder for compensation, splitting commissions, or receiving referral fees in connection with any recommendation, sale or purchase of securities. The Consent Order also required that the respondent reimburse the department $500 for investigative costs.

Agent Registration Revoked

On November 23, 2004, the Commissioner entered an Order revoking the broker-dealer agent registration of Dean Russel Baker of Oakland Park, Florida. Dean Russel Baker had been associated with LH Ross & Company, Inc., a securities brokerage firm located at 2255 Glades Road, Suite 425W, Boca Raton, Florida. The respondent had been the subject of a July 19, 2004 Notice of Intent to Revoke Registration as Agent and Notice of Intent to Fine alleging that from at least June 2002 through November 2003, the respondent 1) engaged in unauthorized trading; 2) failed to obtain written discretionary trading authority from customers where required by law to do so; and 3) failed to provide Connecticut customers with the margin disclosure statement described in NASD Rule 2341(a). The July 19, 2004 Notice of Intent to Revoke Registration as Agent and Notice of Intent to Fine also alleged that such conduct constituted a dishonest or unethical practice in the offer, sale or purchase of a security within the meaning of Section 36b-4(b) of the Connecticut Uniform Securities Act, and formed a basis for the initiation of administrative proceedings under Sections 36b-15(a)(2)(B) and 36b-15(a)(2)(H) of the Act.

In revoking the respondent's agent registration, the Commissioner found that the respondent had wilfully violated Section 36b-4(b) of the Connecticut Uniform Securities Act and had engaged in a dishonest or unethical practice in the securities business. The respondent did not appear or contest the revocation of his agent registration.

Consent Order Conditioning Registration as an Investment Adviser Agent and Restricting Securities-Related Activities Entered

On November 29, 2004, the Commissioner entered a Consent Order conditioning the investment adviser agent registration of Martin Scott Sands and restricting Martin Sands' securities-related activities. Sands had applied for Connecticut registration as an investment adviser agent of Sands Brothers Asset Management LLC, an SEC-registered investment adviser. Sands is also registered as a broker-dealer agent of Sands Brothers & Co., Ltd. and Sands Brothers International Ltd. under the Connecticut Uniform Securities Act. All three entities are affiliated. The Consent Order was based on allegations that Sands had been subject to a December 18, 2003 bar and an October 2000 suspension by the New York Stock Exchange.

The Consent Order required that during Sands' association with Sands Brothers Asset Management LLC, Sands Brothers & Co., Ltd. and/or Sands Brothers International Ltd., 1) Sands would refrain, for 72 hours following any securities recommendation he made to a customer or client or following any purchase or sale effected on behalf of a customer or client by Sands, from buying or selling any security being recommended, purchased or sold to the client by or through Sands' efforts; 2) Sands would not, directly or through intermediary accounts, buy or sell any security for 72 hours after Sands received oral or written notice that any of the firms would be modifying any recommendation concerning the advisability of investing in, purchasing or selling such security; 3) Sands would be subject to the direct supervision of a principal or other employee of higher grade; and 4) the chief compliance of officer of each firm would approve any trading in Sands' personal accounts and those of his immediate family. Sands Brothers Asset Management LLC, Sands Brothers & Co., Ltd. and Sands Brothers International Ltd. concurred with these restrictions on Sands' activities by signing the Consent Order. The Consent Order also required that, for two years, quarterly reports concerning any securities-related complaints, actions or proceedings involving Sands be filed with the department. The Consent Order also placed Sands on administrative probation for two years.

Martin Scott Sands became registered as an investment adviser agent of Sands Brothers Asset Management LLC in Connecticut on November 29, 2004.

Wisconsin Firm Fined $1,500 for Unregistered Activity

On November 30, 2004, the Commissioner entered into a Stipulation and Agreement with Broker/Dealer, Inc. of 2675 North Mayfair Road, Suite 410, Milwaukee, Wisconsin. The Stipulation and Agreement claimed that from approximately March 2004 until May 2004, the firm transacted business as a broker-dealer absent registration by selling securities in a private placement to three Connecticut accredited investors. The Stipulation and Agreement also claimed that the firm employed an unregistered agent. Both the firm and the agent, neither of whom have any reported disciplinary history, have since become registered under the Connecticut Uniform Securities Act. Pursuant to the Stipulation and Agreement, the firm agreed to revise and implement supervisory and compliance procedures designed to prevent regulatory violations and to pay a $1,500 fine to the department.

Order to Cease and Desist and Notice of Intent to Fine Issued

On December 2, 2004, the Commissioner entered an Order to Cease and Desist, Notice of Intent to Fine and Notice of Right to Hearing against Anthony John Catinella of 3097 NW 72nd Avenue, Margate, Florida. The action alleged that, during August 2003, the respondent 1) violated Section 36b-16 of the Connecticut Uniform Securities Act by offering unregistered non-exempt securities of Care Concepts, Inc. to at least one Connecticut person; and 2) transacted business as an unregistered broker-dealer agent of Richmark Capital Corporation in contravention of Section 36b-6(a) of the Act. The respondent was afforded an opportunity to request a hearing on the Order to Cease and Desist. A hearing on the Notice of Intent to Fine has been scheduled for January 13, 2005.

Notice of Intent to Revoke Registration as Broker-dealer and Notice of Intent to Fine Issued

On December 2, 2004, the Commissioner entered a Notice of Intent to Revoke Registration as Broker-dealer, Notice of Intent to Fine and Notice of Right to Hearing with respect to Richmark Capital Corporation, a registered broker-dealer having its principal office at 5525 North MacArthur Boulevard, Suite 615, Irving, Texas. The action alleged that the respondent 1) wilfully violated Section 36b-6(b) of the Connecticut Uniform Securities Act by employing at least two unregistered broker-dealer agents; 2) engaged in dishonest or unethical practices in the securities business by executing transactions on behalf of customers without authority to do so, and exercising discretionary power in effecting customer transactions without first obtaining written discretionary authority from the customers; 3) wilfully violated Section 36b-16 of the Act by offering unregistered non-exempt securities of Care Concepts, Inc. to at least one Connecticut person; 4) violated Section 36b-31-14a(a) of the Regulations under the Act by failing to keep accurate books and records concerning the representatives assigned to Connecticut accounts; and 5) wilfully violated Section 36b-31-6f(b) of the Regulations under the Act by failing to establish, enforce and maintain an adequate supervisory system.

The respondent was afforded an opportunity to request a hearing on the Notice of Intent to Revoke Registration as Broker-dealer. A hearing on the Notice of Intent to Fine has been scheduled for January 13, 2005.

 

Dated: Tuesday, December 7, 2004

John P. Burke
Commissioner