The Department of Banking News Bulletin
Bulletin # 2771
Week Ending March 31, 2017
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
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, address how the establishment of the branch will be consistent with safe and sound banking practices and promote the public convenience and advantage. 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.
Savings institute Bank & Trust
FROM: 971 Poquonnock Road
Groton, CT 06340
TO: 996 Poquonnock Road
Groton, CT 06340
No Objection to
Branch Relocation -
Royal Bank of Scotland plc
600 Washington Boulevard
Stamford, CT 06901
International Trade and Investment Corporation
On March 30, 2017, the Commissioner approved the application of WorldBusiness Capital, Inc. to operate as an international trade and investment corporation pursuant to Section 36a-636a of the Connecticut General Statutes. This is the first license issued by the Department of Banking under this newly created license.
SECURITIES AND BUSINESS INVESTMENTS DIVISION ACTIVITY
On March 27, 2017, the Commissioner entered a Consent Order (No. CO-17-8313-S)
with respect to attorney Peter David Hershman
. Hershman had been the subject of an August 19, 2016 Order to Cease and Desist, Order to Provide Disgorgement, Notice of Intent to Fine and Notice of Right to Hearing (Docket No. CDF-16-8313-S), and had had a business relationship with Essex Financial Services, Inc. ("EFS") (CRD No. 127549) and John William Rafal (CRD No. 809031), founder of that firm. Hershman had also been the subject of a June 26, 2015 Consent Order (No. CO-15-8222) alleging that Hershman, with the express or implied authorization of EFS, solicited at least one investment advisory client on behalf of EFS on a compensated basis, and, in so doing, transacted business as an unregistered investment adviser agent in violation of Section 36b-6(c) of the Connecticut Uniform Securities Act.
The August 19, 2016 action had alleged that, at all times prior to the entry of the Consent Order, Hershman led the Commissioner to believe that Hershman was no longer in possession of any money or compensation relating to advisory referrals. The August 19, 2016 action was based on new evidence, undisclosed to the agency by Hershman, and obtained from the Securities and Exchange Commission. That evidence indicated that, in April 2013, on the same day that Hershman issued a referral fee refund to EFS, Rafal issued a check in the same amount to Hershmanís law firm, a check that Hershman deposited into an account he controlled. Taking it upon himself to pay Hershman, Rafal also issued to Hershman a check for a billed amount that EFS had not paid; Hershman also deposited that check. Despite Hershmanís receipt of the payments, Hershman allegedly did nothing to dispel the Commissionerís impression that Hershman was no longer in possession of any referral-based money or compensation. Accordingly, the August 19, 2016 action alleged that Hershman violated Section 36b-23 of the Connecticut Uniform Securities Act by making materially misleading statements or omissions, and that Hershman engaged in dishonest or unethical practices in the securities business.
Respondent Hershman had requested a hearing on the allegations in the August 19, 2016 action. The March 27, 2017 Consent Order resolved the matter without further proceedings. In January, 2017, the SEC imposed a securities industry bar on Hershman and ordered, among other things, that Hershman pay $49,760 in disgorgement (representing fees received from Rafal).
The March 27, 2017 Consent Order fined Hershman $8,500 and directed him to cease and desist from regulatory violations.
Dated: Tuesday, April 4, 2017
Jorge L. Perez