DOB: First Street Financial, Inc., Settlement Agreement

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IN THE MATTER OF:

FIRST STREET FINANCIAL, INC.

    ("First Street")

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SETTLEMENT AGREEMENT        

WHEREAS, the Banking Commissioner (“Commissioner”) is charged with the administration of Part I of Chapter 668, Sections 36a-485 to 36a-534a, inclusive, of the Connecticut General Statutes, “Mortgage Lenders, Brokers and Originators”;

WHEREAS, the Commissioner, through the Consumer Credit Division of the Department of Banking, conducted an investigation pursuant to Section 36a-17 of the Connecticut General Statutes into the activities of First Street to determine if it had violated, was violating or was about to violate the provisions of the Connecticut General Statutes within the jurisdiction of the Commissioner;
 
WHEREAS, on August 14, 2007, acting pursuant to Sections 36a-492(b) of the Connecticut General Statutes, and Sections 36a-494(a)(1)(C) and 36a-51(a) of the Connecticut General Statutes, as amended by Public Act 07-91, the Commissioner issued a Notice of Automatic Suspension, Notice of Intent to Revoke First Mortgage Lender/Broker License and Notice of Right to Hearing (collectively “Notice”) against First Street, which Notice is incorporated herein by reference;
 
WHEREAS, the Notice alleged that First Street, in violation of Section 36a-492(a) of the Connecticut General Statutes, failed to maintain a surety bond that runs concurrently with the period of the license granted to First Street to act as a first mortgage lender/broker from 310 Commerce, Suite 150, Irvine, California;
 
WHEREAS, on August 27, 2007, First Street received the Notice, and no request for a hearing was received by the Commissioner;
 
WHEREAS, on September 12, 2007, First Street specifically assured the Commissioner that it has not engaged in the business of a first mortgage lender/broker in Connecticut from 310 Commerce, Suite 150, Irvine, California, since June 15, 2007;
 
WHEREAS, Section 4-177(c) of the Connecticut General Statutes states, in pertinent part, that “[u]nless precluded by law, a contested case may be resolved by . . . agreed settlement”;
 
WHEREAS, Section 36a-1-55(a) of the Regulations of Connecticut State Agencies states, in pertinent part, that “unless precluded by law, any contested case may be resolved by . . . agreed settlement”;
 
WHEREAS, First Street agrees to voluntarily enter into this Settlement Agreement without admitting or denying any allegations contained in the Notice, and solely for the purpose of obviating the need for formal administrative proceedings concerning the allegation described above;
 
WHEREAS, First Street, through its execution of this Settlement Agreement, voluntarily agrees to waive any rights to a hearing upon the allegations contained in the Notice, and waives the right to seek judicial review or otherwise challenge or contest the validity of this Settlement Agreement;
 
AND WHEREAS, upon the entry of this Settlement Agreement, this matter will be resolved and the Commissioner will not take any future enforcement action against First Street based upon the allegations contained in the Notice.
 
NOW THEREFORE, the Commissioner and First Street enter into this Settlement Agreement as follows:

1. Prior to the date this Settlement Agreement is executed by the Commissioner, First Street will surrender its first mortgage lender/ broker license No. 16653 and secondary mortgage lender/broker license No. 16654 in Connecticut and cease engaging in the business of a first and secondary mortgage lender/broker in Connecticut from 310 Commerce, Suite 150, Irvine, California;
2. Nothing in this Settlement Agreement shall adversely affect the ability of First Street to apply for or obtain a license or renewal license under Part I of Chapter 668 of the Connecticut General Statutes in the future; and
3. Notwithstanding anything to the contrary in this Settlement Agreement, execution of this Settlement Agreement is without prejudice to the right of the Commissioner to take enforcement action against First Street to enforce this Settlement Agreement if the Commissioner determines that First Street is not fully complying with any term or condition stated herein or if any representation made by First Street and reflected herein is subsequently discovered to be untrue.  For purposes of this paragraph, a violation of this Settlement Agreement shall be deemed to be a violation of an order of the Commissioner.

IN WITNESS WHEREOF, the parties hereto have caused this Settlement Agreement to be executed by each of them or their duly authorized representatives on the dates hereinafter subscribed.


Dated at Hartford, Connecticut
this 30th day of October 2007.            ________/s/_________
                                                     Howard F. Pitkin
                                                     Banking Commissioner



I, Daniel L. Perl, state on behalf of First Street Financial, Inc., that I have read the foregoing Settlement Agreement; that I know and fully understand its content; that I am authorized to execute this Settlement Agreement on behalf of First Street Financial, Inc.; and that First Street Financial, Inc., agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein.

                                             By:  ________/s/_________
                                                   Daniel L. Perl, Chairman/CEO
                                                   First Street Financial, Inc.


State of:  California

County of:  Orange


On this the 26 day of October 2007, before me, Alex D. Martin, the undersigned officer, personally appeared Daniel L. Perl, who acknowledged himself to be the Chairman/CEO of First Street Financial, Inc., a California corporation, and that he, as such Chairman/CEO, being authorized so to do, executed the foregoing instrument for the purposes therein contained, by signing the name of the corporation by himself as Chairman/CEO.

In witness whereof I hereunto set my hand.

                                                   ________/s/_________
                                                   Notary Public
                                                   Date Commission Expires:  Feb. 12, 2011


Administrative Orders and Settlements