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 Jorge L. Perez, Banking Commissioner, Department of Banking, 260 Constitution Plaza, Hartford, CT 06103-1800. Written comments will be considered only if they are received within ten days from the date of this bulletin.
STATE BANK ACTIVITY
Change of Branch Address
As previously reported on Bulletin 2767, The First Bank of Greenwich, Cos Cob, opened a full service branch office at 898 Summer Street, Stamford, CT on March 13, 2017. The City of Stamford has assigned the location a new street number. The branch is now known as 900 Summer Street, Stamford, CT.
STATE CREDIT UNION ACTIVITY
America's First Network Credit Union, Trumbull, CT, notified the Department of Banking that it will close its branch office located at 2900 West Truman Boulevard, Jefferson City, MO, on June 29, 2017.
CONSUMER CREDIT DIVISION ACTIVITY
Findings of Fact, Conclusions of Law and Order
On March 1, 2017, the Commissioner issued Findings of Fact, Conclusions of Law and Order (“Final Decision”) in the Matter of: Century Union Services, LLC
(NMLS # 907743) (“Century Union”), Everett, Massachusetts, and Robes Barboza (NMLS # 908878) (“Barboza”) (collectively, “Respondents”). The Final Decision was the result of an investigation by the Consumer Credit Division and an administrative hearing on the matters alleged in a Temporary Order to Cease and Desist, Order of Summary Suspension, Notice of Intent to Revoke Money Transmission License, Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing issued against Respondents by the Commissioner on October 24, 2016. The Final Decision revoked Century Union’s license to engage in the business of money transmission in Connecticut, ordered that Century Union cease and desist from engaging in an unsafe or unsound practice and engaging in fraud, intentional misrepresentations or gross negligence, and imposed a civil penalty of $200,000 upon Century Union. In addition, the Final Decision ordered that Barboza cease and desist from violating Section 36a-53a of the Connecticut General Statutes and imposed a civil penalty of $100,000 upon Barboza.
On March 1, 2017, the Commissioner entered into a Consent Order with Primary Capital Mortgage, LLC d/b/a Qualifi
(NMLS # 3076) (“Primary Capital Mortgage”), Atlanta, Georgia. The Commissioner alleged that Primary Capital Mortgage changed its name specified on its most recent filing with the Nationwide Multistate Licensing System and Registry (“NMLS”) and failed to file such name change with NMLS at least 30 calendar days prior to such change and, in connection with such name change, failed to provide a bond rider or endorsement, or addendum, as applicable, to the surety bond on file with the Commissioner that reflects the name change at least 30 calendar days prior to such change, in violation of Section 36a-490(b) of the Connecticut General Statutes. As part of the Consent Order, Primary Capital Mortgage paid $500 as a civil penalty.
SECURITIES AND BUSINESS INVESTMENTS DIVISION ACTIVITY
Banking Commissioner Reminds Exempt Reporting Advisors
of their Form ADV State Filing Obligations Post Dodd-Frank
In 2011, Congress passed the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”). Among other things, Dodd-Frank exempts from federal investment adviser registration those investment advisers who: 1) act as an investment adviser solely to one or more venture capital funds; or 2) act as an investment adviser solely to private funds and who have assets under management in the United States of less than $150 million (collectively, “ERAs”).
To clarify state requirements governing ERAs, on July 11, 2011, the Banking Commissioner issued an Order Governing Certain Investment Advisers Exempt from Federal Registration Following Passage of Dodd-Frank
(“2011 Order”). The 2011 Order exempted ERAs from state registration as long as they “make the reports required by SEC Rule 204-4 available to the Commissioner in electronic format once the IARD [Investment Adviser Registration Depository] system has been updated to accept such reports and relay them to affected states.”
In the five years since the passage of Dodd-Frank and the issuance of the 2011 Order, the federal reporting requirements for ERAs have been formalized, and the IARD system has been updated to accept filings made on behalf of ERAs subject to the 2011 Order. Moreover, the SEC has recently signaled that it may begin conducting books and records examinations of ERAs. Therefore, the Commissioner is now issuing this reminder to all investment advisers relying on the ERA exemption that they must complete key portions of Part IA of Form ADV in order to be considered compliant with the 2011 Order.
Investment advisers relying on the Connecticut ERA exemption should review their form filings and ensure that any deficiencies are corrected no later than June 30, 2017. Subsequent to June 30, 2017, if the Commissioner becomes aware of an ERA’s failure to make required filings, the Commissioner may pursue such enforcement measures as may be appropriate, including but not limited to administrative fines under Section 36b-27 of the Connecticut Uniform Securities Act.
Investment advisers relying on the state ERA exemption must complete the Form ADV items prescribed by the Securities and Exchange Commission. Currently, the requirements consist of Form ADV Items 1, 2, 3, 6, 7, 10 and 11 of Part IA, as well as corresponding schedules. Per federal requirements, new ERAs must file within 60 days of becoming an ERA. As a reminder, the filing requirements are set forth in 17 CFR 275.204-4.
Issued March, 2017.