The Department of Banking News Bulletin
Bulletin # 2307
Week Ending May 9, 2008
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, as amended by Public Act 07-14, 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.
Newtown Savings Bank
*Newtown High School Satellite
12 Berkshire Road
Sandy Hook, CT 06482
Castle Bank and Trust Co.
FROM: 852 East Main Street
Meriden, CT 06450
TO: 1295 East Main Street
Meriden, CT 06450
*special needs limited branch
Main Office Relocation
On May 9, 2008, pursuant to Section 36a-81 of the Connecticut General Statutes, Castle Bank and Trust Company, Meriden, requested approval to relocate its main office from 100 Hanover Street, Meriden, to 1295 East Main Street, Meriden.
CONSUMER CREDIT DIVISION ACTIVITY
Check Cashing Service License Activity
||Cargo Services Corporation
1762 Park Street
Hartford, CT 06106
SECURITIES AND BUSINESS INVESTMENTS DIVISION ACTIVITY
Stop Order Entered Denying Effectiveness
to Business Opportunity Registration
On May 5, 2008, following a hearing, the Banking Commissioner issued Findings of Fact, Conclusions of Law and a Stop Order Denying Effectiveness to a Business Opportunity Registration with respect to Blue Coast Financial Group, Inc. a/k/a Questar Financial. The respondent is located at 2929 North Power Road, Suite C100, Mesa, Arizona, and offers an arrangement whereby purchasers can start a business auditing workers compensation insurance premiums. The Commissioner's action had been preceded by a May 4, 2007 Notice of Intent to Issue Stop Order Denying Effectiveness to a Business Opportunity Registration and Notice of Right to Hearing alleging that the business opportunity registration was materially incomplete or contained materially false or misleading statements with respect to disciplinary events involving the seller’s principals and related entities, the risks factors involved in the arrangement and key background information. Shawn Hull, CEO of the respondent, was also the president of Taxback, LLC, against whom the Commissioner issued an Order to Cease and Desist and Notice of Intent to Fine on January 10, 2005, and Taxback Opportunities, LLC, which had been the subject of a January 10, 2005 Notice of Intent to Issue Stop Order Revoking Business Opportunity Registration and Notice of Intent to Fine. The allegations against Taxback, LLC and Taxback Opportunities, LLC had been resolved via a June 7, 2005 Consent Order involving both parties.
In entering the Stop Order, the Commissioner found that the respondent's disclosure document 1) falsely represented that Shawn Hull and Lindsay Hull, president of the respondent, were not subject to an October 12, 2007 Consent Order entered by the State of Washington when, in fact, both Shawn Hull and Lindsay Hull were named as respondents in the Washington action; 2) failed to disclose the Connecticut Order to Cease and Desist against Taxback, LLC and the June 7, 2005 Consent Order, characterizing the Commissioner's prior enforcement action as a "compliance letter"; 3) failed to disclose key risk factors in contravention of Section 36b-63(b)(27) of the Connecticut Business Opportunity Investment Act; and 4) failed to disclose the business experience of the seller's executive officers and supervisory personnel, including president Lindsay Hull's association with the franchisor Glove Lady, LLC, the business experience of director Shelee Loughmiller and background information on vice-president Brian Felderstein.
The Commissioner rejected the respondent's claim that the Commissioner was only authorized to issue a stop order denying effectiveness to a business opportunity registration when the business opportunity was already registered.
Stipulation and Agreement
On May 8, 2008, the Banking Commissioner entered into a Stipulation and Agreement with Ecosol Solar Technologies Inc., an issuer of securities located in Ottawa, Ontario, Canada. The Stipulation and Agreement recited that 1) legal counsel to Ecosol Solar Technologies Inc. had advised the department that the issuer had sold shares of its common stock to three Connecticut residents in two offerings, the first of which occurred between 2002 and 2004, and the second of which occurred in 2007; 2) the Connecticut investors involved were all employed in the securities industry and, according to the issuer, qualified as “accredited investors” within the meaning of Rule 501(a) under the Securities Act of 1933; and 3) the issuer had made curative private placement filings and remitted back fees for the offerings in question. In resolution of the matter, Ecosol Solar Technologies Inc. agreed to pay the department $750 as an administrative fine and to refrain from selling securities in or from Connecticut absent compliance with statutory filing requirements.
Stipulation and Agreement
On May 9, 2008, the Banking Commissioner entered into a Stipulation and Agreement with T. Richard Spoor, a sole proprietorship located at 184 Main Street, Lakeville, Connecticut. The Stipulation and Agreement alleged that, 1) following his 1997 retirement from a Clifton, New Jersey investment adviser, T. Richard Spoor transacted business as an investment adviser in Connecticut, providing financial planning services to clients in Connecticut and in other states; and 2) at the time such services were rendered, T. Richard Spoor was not registered as an investment adviser under the Connecticut Uniform Securities Act or the Investment Advisers Act of 1940. T. Richard Spoor has since become registered as an investment adviser with the Securities and Exchange Commission. Pursuant to the Stipulation and Agreement, T. Richard Spoor agreed to implement revised compliance procedures and to pay $6,900 to the department. Of that amount, $5,000 constituted an administrative fine and $1,900 represented reimbursement for past due investment advisory filing fees. In addition, T. Richard Spoor agreed to retain an independent consultant to review his internal procedures for compliance with regulatory requirements and make appropriate remedial recommendations.
Dated: Tuesday, May 13, 2008