The Department of Banking News Bulletin
Bulletin # 2235
Week Ending December 22, 2006
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 Howard F. Pitkin, Banking Commissioner, at the Connecticut Department of Banking, 260 Constitution Plaza, Hartford, CT 06103-1800 or via E-mail. Written comments will be considered only if they are received within ten days from the date of this bulletin.
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.
43 Prospect Hill Road
East Windsor, CT 06088
CONSUMER CREDIT DIVISION ACTIVITY
Check Cashing Service License Activity
Notice of Intent to Issue Order to Cease and Desist,
United Check Cashing
d/b/a Lanka Financial
689 Foxon Road
East Haven, CT 06513
Vasquez Check Cashing
399 Main Street
Danbury, CT 06810
Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing
On December 20, 2006, the Commissioner issued a 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: Mark L. Rhodes
a/k/a Mark L. Sadie
(“Respondent”) who was last employed as a loan originator by VIP Mortgage Corporation. The Notice alleges that Respondent made false statements concerning primary residence and income on loan applications taken from at least three borrowers with intent to defraud and for the purpose of influencing the action of a mortgage lender in violation of Section 36a-56 of the Connecticut General Statutes (“General Statutes”) and Section 36a-53(b) of the 2006 Supplement to the General Statutes (“Supplement”), and converted funds for mortgage brokerage services due his employers in violation of Section 36a-53(b) of the Supplement. The notice states that Respondent’s actions form the basis for the issuance of an order to cease and desist pursuant to Section 36a-52(a) of the General Statutes and to impose a civil penalty pursuant to Section 36a-50(a) of the General Statutes. The Notice also states that the Commissioner intends to impose a civil penalty upon Respondent not to exceed $600,000. The Respondent was afforded an opportunity to request a hearing with regard to the allegations set forth in the Notice. A copy of the Notice can be obtained from the department's website, www.ct.gov/dob
or by contacting the department's Legal Division.
NEW BANK ACTIVITY
On December 19, 2006, pursuant to Section 36a-70 of the Connecticut General Statutes, The Bank of Greenwich, Greenwich, was authorized to commence and transact the business of a Connecticut bank.
SECURITIES AND BUSINESS INVESTMENTS DIVISION ACTIVITY
Consent Order Conditioning Registration as Broker-dealer Issued
On December 20, 2006, the Commissioner entered a Consent Order Conditioning Registration as Broker-dealer with respect to Harrison Douglas, Inc., an applicant for broker-dealer registration under the Connecticut Uniform Securities Act. The firm is located at 3025 South Parker Road 801, Aurora, Colorado. The Consent Order was predicated, in part, on 1) a June 25, 2001 censure and fine imposed by the NASD against the firm and its president (No. C3A010023) for selling shares of an initial public offering to residents of a state where the offering was not registered and completing a false offering questionnaire for the lead underwriter; 3) a September 17, 2003 censure and fine imposed by the NASD against the firm and its president (No. C3A030028) for failing to exercise adequate supervisory controls by permitting the firm’s president to perform duties requiring registration while his registration status was inactive due to the president’s failure to complete required continuing education requirements; and 3) an April 30, 2004 order entered by the Commissioner denying the firm’s registration (Docket No. ND-2004-6925-S). The Consent Order embodied certain representations by the firm, to wit: 1) that the firm had made organizational changes to improve its handling of compliance and regulatory issues; and 2) that the firm was seeking Connecticut registration to enable it to service a long term client who had recently moved to Connecticut and whose status as an “accredited investor” the firm would ensure.
The Consent Order imposed various restrictions on the firm’s Connecticut securities activities. Specifically, the Consent Order provided that, for three years, the firm would 1) restrict its Connecticut securities business to no more than ten individuals or entities each of whom qualified as an “accredited investor” under Rule 501(a) of Regulation D; 2) restrict its Connecticut securities business to effecting transactions in securities listed on the New York Stock Exchange, the NASDAQ Global Select Market or the NASDAQ Global Market; securities issued by investment companies regulated under the Investment Company Act of 1940; and limited partnership interests where the subject offerings were registered or the subject of a perfected exemptive claim or claim of covered security status under the Connecticut Uniform Securities Act; and 3) not employ more than two agents at any one time to represent it in effecting securities transactions in or from Connecticut. The Consent Order also conditioned the firm’s registration on the firm engaging an outside party to conduct an annual compliance audit for three years; and on the firm’s providing quarterly reports to the agency for three years describing any complaints, actions or proceedings initiated by Connecticut customers.
Harrison Douglas, Inc. became registered as a broker-dealer under the Connecticut Uniform Securities Act on December 20, 2006.
Dated: Wednesday, December 27, 2006
Howard F. Pitkin