DOB: 1st Continental Mortgage, Inc., Notice of Automatic Suspension, Notice of Intent to Revoke First Mortgage Broker License

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IN THE MATTER OF:

1st CONTINENTAL MORTGAGE, INC.

    ("Respondent")

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NOTICE OF AUTOMATIC SUSPENSION

NOTICE OF INTENT TO REVOKE
FIRST MORTGAGE BROKER LICENSE

AND

NOTICE OF RIGHT TO HEARING


I.  LEGAL AUTHORITY AND JURISDICTION

The Banking Commissioner (“Commissioner”) is charged with the administration of Part I(A) of Chapter 668, Sections 36a-485 to 36a-498a, inclusive, of the Connecticut General Statutes, “Nondepository First Mortgage Lenders, Brokers and Originators”.

Pursuant to the authority granted by Section 36a-17 of the Connecticut General Statutes, the Commissioner, through the Consumer Credit Division (“Division”) of the Department of Banking, has investigated the activities of Respondent to determine if it has violated, is violating or is about to violate the provisions of the Connecticut General Statutes. 

Section 36a-17(a) of the Connecticut General Statutes provides:
The commissioner, in the commissioner’s discretion, may make such public or private investigations or examinations within or outside this state, concerning any person subject to the jurisdiction of the commissioner, as the commissioner deems necessary to carry out the duties of the commissioner.
Section 36a-51(a) of the Connecticut General Statutes provides, in pertinent part, that:
The commissioner may . . . revoke . . . any license issued by the commissioner under any provision of the general statutes by sending a notice to the licensee by registered or certified mail, return receipt requested, or by any express delivery carrier that provides a dated delivery receipt.  The notice shall be deemed received by the licensee on the earlier of the date of actual receipt or seven days after mailing or sending.  Any such notice shall include:  (1) A statement of the time, place, and nature of the hearing; (2) a statement of the legal authority and jurisdiction under which the hearing is to be held; (3) a reference to the particular sections of the general statutes . . . involved; (4) a short and plain statement of the matters asserted; and (5) a statement indicating that the licensee may file a written request for a hearing on the matters asserted within fourteen days of receipt of the notice.
Section 36a-51(b) of the Connecticut General Statutes provides, in pertinent part, that:
If a hearing is requested within the time specified in the notice, the commissioner shall hold a hearing upon the matters asserted in the notice unless the licensee fails to appear at the hearing.  After the hearing, the commissioner shall . . . revoke . . . the license for any reason set forth in the applicable licensing provisions of the general statutes if the commissioner finds sufficient grounds exist for such . . . revocation . . . .  If the licensee does not request a hearing within the time specified in the notice or fails to appear at the hearing, the commissioner shall . . . revoke . . . the license.  No such license shall be . . . revoked except in accordance with the provisions of chapter 54.
Section 36a-492 of the Connecticut General Statutes provides, in pertinent part, that:
(a)  No such [first mortgage broker] license, and no renewal thereof, shall be granted unless the applicant has filed a bond with the commissioner written by a surety authorized to write such bonds in this state, in the sum of forty thousand dollars . . . .  The bond shall run concurrently with the period of the license granted to the applicant, and the aggregate liability under the bond shall not exceed the penal sum of the bond.
 
(b)  The surety company shall have the right to cancel the bond at any time by a written notice to the licensee stating the date cancellation shall take effect.  Such notice shall be sent by certified mail to the licensee at least thirty days prior to the date of cancellation.  A surety bond shall not be cancelled unless the surety company notifies the commissioner in writing not less than thirty days prior to the effective date of cancellation.  The commissioner shall automatically suspend the license on the date the cancellation takes effect, unless the surety bond has been replaced or renewed.  The commissioner shall give the licensee notice of the automatic suspension pending proceedings for revocation . . . and an opportunity for a hearing on such actions in accordance with section 36a-51.

II.  MATTERS ASSERTED

1.
Respondent is a Maryland corporation with an office at 1040 Bayview Drive, Suite 610, Ft. Lauderdale, Florida.
 
2.
Since May 30, 2000, Respondent has been licensed to act as a first mortgage broker in Connecticut pursuant to Section 36a-489 of the Connecticut General Statutes.  Respondent’s license to act as a first mortgage broker in Connecticut expires on September 30, 2006.
 
3.
On February 2, 2006, the Commissioner received notice from the Hartford Fire Insurance Company that bond number 14BSBAS5384, issued on behalf of Respondent, would be cancelled, effective on March 12, 2006.
 
4.
To date, Respondent has failed to file a new bond or a replacement bond with the Commissioner.
 
5.
On March 27, 2006, the Commissioner automatically suspended Respondent’s first mortgage broker license in Connecticut.
 
 
III.  STATUTORY BASIS FOR REVOCATION
OF FIRST MORTGAGE BROKER LICENSE
 
Section 36a-489(a) of the Connecticut General Statutes provides, in pertinent part, that:
If the commissioner finds, upon the filing of an application for a [first mortgage broker] license, that the applicant meets the requirements of subsection (a) of section 36a-488, and that the financial responsibility, character, reputation, integrity and general fitness of the applicant and . . . of the officers, directors and principal employees if the applicant is a corporation, are such as to warrant belief that the business will be operated soundly and efficiently, in the public interest and consistent with the purposes of sections 36a-485 to 36a-498a, inclusive, the commissioner may thereupon issue the applicant the license.
Section 36a-494(a)(1) of the 2006 Supplement to the General Statutes provides, in pertinent part, that:
The commissioner may . . . revoke . . . any [first mortgage broker] license, in accordance with the provisions of section 36a-51, for any reason which would be sufficient grounds for the commissioner to deny an application for a license under sections 36a-485 to 36a-498a, inclusive, or if the commissioner finds that the licensee or any proprietor, director, officer, member, partner, shareholder, trustee, employee or agent of such licensee has . . . (C) violated any of the provisions of this title . . . . 
1.
Respondent’s failure to maintain a bond that runs concurrently with the period of its first mortgage broker license, as more fully described in paragraphs 2 through 4, inclusive, of the Matters Asserted, is a violation of Section 36a-492(a) of the Connecticut General Statutes, which requires that the Commissioner automatically suspend Respondent’s license to act as a first mortgage broker pursuant to Section 36a-492(b) of the Connecticut General Statutes, and constitutes grounds for the Commissioner to revoke Respondent’s license to act as a first mortgage broker pursuant to Section 36a-494(a)(1)(C) of the 2006 Supplement to the General Statutes.
  
2.
Respondent’s failure to maintain a bond that runs concurrently with the period of its first mortgage broker license, as more fully described in paragraphs 2 through 4, inclusive, of the Matters Asserted, in violation of Section 36a-492(a) of the Connecticut General Statutes, illustrates that the financial responsibility, character, reputation, integrity and general fitness of Respondent are not such as to warrant belief that its business will be operated soundly and efficiently, in the public interest and consistent with the purposes of Sections 36a-485 to 36a-498a, inclusive, of the Connecticut General Statutes, which constitutes an additional ground to revoke Respondent’s first mortgage broker license pursuant to Section 36a-494(a)(1) of the 2006 Supplement to the General Statutes.
 
 
IV.  NOTICE OF AUTOMATIC SUSPENSION, NOTICE OF INTENT TO REVOKE
FIRST MORTGAGE BROKER LICENSE AND NOTICE OF RIGHT TO HEARING

WHEREAS,
the Commissioner has reason to believe that Respondent has engaged in acts or conduct which, pursuant to Section 36a-492(b) of the Connecticut General Statutes, requires that the Commissioner automatically suspend Respondent’s license to act as a first mortgage broker in Connecticut, and constitutes sufficient grounds for the Commissioner to revoke its first mortgage broker license pursuant to Section 36a-494(a)(1) of the 2006 Supplement to the General Statutes;

AND WHEREAS, the Commissioner has reason to believe that Respondent lacks the financial responsibility, character, reputation, integrity and general fitness so as to warrant belief that Respondent’s business will be operated soundly and efficiently, in the public interest and consistent with the purposes of Sections 36a-485 to 36a-498a of the Connecticut General Statutes, which, pursuant to Section 36a-494(a)(1) of the 2006 Supplement to the General Statutes, constitutes grounds to revoke Respondent’s license to act as a first mortgage broker in Connecticut.

NOW THEREFORE, pursuant to the authority granted in Section 36a-492(b) of the Connecticut General Statutes, the Commissioner gives NOTICE that on March 27, 2006, the license of 1st Continental Mortgage, Inc., to act as a first mortgage broker in Connecticut was AUTOMATICALLY SUSPENDED pending proceedings for revocation.

FURTHER, notice is hereby given to Respondent that the Commissioner intends to REVOKE Respondent’s license to act as first mortgage broker in Connecticut, subject to its right to a hearing on the allegations set forth above.

A hearing will be granted to Respondent if a written request for a hearing is received by the Department of Banking, Legal Division, 260 Constitution Plaza, Hartford, Connecticut 06103-1800 within fourteen (14) days following its receipt of this Notice of Automatic Suspension, Notice of Intent to Revoke First Mortgage Broker License and Notice of Right to Hearing as set forth in Section 36a-51 of the Connecticut General Statutes.  This Notice of Automatic Suspension, Notice of Intent to Revoke First Mortgage Broker License and Notice of Right to Hearing shall be deemed received on the earlier of the date of actual receipt, or seven days after mailing or sending.  The enclosed Appearance and Request for Hearing Form must be completed and mailed to the above address.  If Respondent will not be represented by an attorney at the hearing, please complete the Appearance and Request for Hearing Form as “pro se”.  Once a written request for hearing is received, the Commissioner may issue a notification of hearing and designation of hearing officer that acknowledges receipt of a request for a hearing, designates a hearing officer and sets the date of the hearing in accordance with Section 4-177 of the Connecticut General Statutes and Section 36a-1-21 of the Regulations of Connecticut State Agencies.  If a hearing is requested, the hearing will be held on September 7, 2006, at 10 a.m., at the Department of Banking, 260 Constitution Plaza, Hartford, Connecticut.

The hearing will be held in accordance with the provisions of Chapter 54 of the Connecticut General Statutes, unless Respondent fails to appear at the requested hearing.  At such hearing, Respondent will have the right to appear and present evidence, rebuttal evidence and argument on all issues of fact and law to be considered by the Commissioner.

If Respondent does not request a hearing within the time prescribed, the Commissioner will issue an order revoking Respondent’s license to act as a first mortgage broker in Connecticut.
 
 
Dated at Hartford, Connecticut
this 20th day of June 2006.              ________/s/_________
                                                   John P. Burke
                                                   Banking Commissioner
 
 
 
CERTIFICATION
 
I hereby certify that on this 21st day of June 2006, the foregoing Notice of Automatic Suspension, Notice of Intent to Revoke First Mortgage Broker License and Notice of Right to Hearing was sent by registered mail, return receipt requested, to 1st Continental Mortgage, Inc., 1040 Bayview Drive, Suite 610, Ft. Lauderdale, Florida, 33304, registered mail no. RB027865408US.
 
 
 
                                                   ________/s/_________
                                                   Jesse B. Silverman
                                                   Prosecuting Attorney
 

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