DOB: News Bulletin 2418 - June 25, 2010

The Department of Banking News Bulletin 

Bulletin # 2418
Week Ending June 25, 2010

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
Branch Activity
 
Section 36a-145 of the Connecticut General Statutes requires certain applications 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
6/23/10
The Connecticut Bankd and Trust
  Company, Hartford
114 Woodland Street
Hartford, CT  06105
opening
date
6/24/10
 
The Savings Bank of Danbury
Danbury
325 Main Street South
Southbury, CT  06488
approved
 
 
Consent Order
 
On May 17, 2010, the Federal Deposit Insurance Corporation (“FDIC”), with the concurrence of the Banking Commissioner, issued a Consent Order against The First Bank of Greenwich.  The order may be viewed on the FDIC’s website.
 

SECURITIES AND BUSINESS INVESTMENTS DIVISION ACTIVITY
Consent Order
 
On June 23, 2010, the Commissioner entered a Consent Order with respect to David P. Petruzzi, an applicant for broker-dealer agent registration under the Connecticut Uniform Securities Act.  The Consent Order recited that, in connection with its review of the application, the Division obtained evidence that, on July 24, 2008, the State of Connecticut Insurance Department had issued a Complaint, Stipulation and Final Order against David Petruzzi.  The Insurance Department action had placed all of David Petruzzi’s insurance licenses on probation for one year and had fined David Petruzzi $500 following allegations that Petruzzi endorsed an unsuitable insurance policy to an elderly Connecticut resident and misrepresented himself by signing the related insurance application as the applicant’s “trusted relative, friend or financial advisor.”
 
The Consent Order precluded Petruzzi, for twenty-four months, from 1) applying for registration or transacting business as an agent, investment adviser agent, broker-dealer or investment adviser in Connecticut; 2) supervising any broker-dealer agents with respect to securities business conducted in or from Connecticut; and 3) acting as a finder for compensation, receiving or splitting commissions or receiving referral fees in connection with the offer, sale or purchase of securities in Connecticut.  The twenty-four month period would run from the date of Petruzzi’s application for agent registration and would conclude on November 1, 2011.
 

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

On June 24, 2010, the Commissioner entered an Order to Cease and Desist, Notice of Intent to Fine and Notice of Right to Hearing against Grosvenor Partners, Ltd. a/k/a Aster Associates, a limited partnership located at 223 Coral Lane, Palm Beach, Florida.  The respondent’s general partner is Mayfair Ventures, G.P.  Frank J. Avellino is the general partner of Mayfair Ventures, G.P.  The action alleged that, commencing in June 1995, Grosvenor Partners, Ltd. violated the antifraud provisions in Section 36b-4(a) of the Connecticut Uniform Securities by failing to make key disclosures to investors, including the fact that Frank J. Avellino had been the subject of a 1992 Order of Preliminary Injunction and Other Equitable Relief on Consent procured by the Securities and Exchange Commission (Securities and Exchange Commission v. Avellino & Bienes et al., No. 92-CF-8314 (S.D.N.Y)).   The SEC action had alleged that Frank Avellino guaranteed that investors could achieve a return of between 13.5% and 20% by investing monies with Bernard L. Madoff.  The June 24, 2010 Order to Cease and Desist and Notice of Intent to Fine also alleged that the respondent failed to tell at least one Connecticut investor that all of the investor’s funds would be placed with Bernard Madoff.  In addition, the action alleged that, the respondent’s offering of limited partnership interests violated Section 36b-16 of the Act, notwithstanding a prior Rule 506 exemptive filing, since the offering did not meet the criteria for an exemption under Rule 506.  Grosvenor Partners, Ltd. was afforded an opportunity to request a hearing on the Order to Cease and Desist and Notice of Intent to Fine.

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

On June 24, 2010, the Commissioner entered an Order to Cease and Desist, Notice of Intent to Fine and Notice of Right to Hearing against S&E Investment Group, a general partnership having its principal office at 670 Tennis Club Drive, Fort Lauderdale, Florida.  The action alleged that, from at least July 1993 forward, the respondent sold unregistered partnership interests to at least one Connecticut investor, notwithstanding the investor’s lack of experience in financial and business matters.  The interests were purportedly sold absent registration under Section 36b-16 of the Connecticut Uniform Securities Act to investors who would take no active role in partnership management.  The action also alleged that the respondent violated the antifraud provisions in Section 36b-4(a) of the Act by failing to make material disclosures to investors, including disclosures regarding risk, how investor funds would be invested and financial information on the respondent.   S&E Investment Group was afforded an opportunity to request a hearing on the Order to Cease and Desist and Notice of Intent to Fine.
 

       Dated:  Tuesday, June 29, 2010
 
 
       Howard F. Pitkin
       Banking Commissioner