DOB: Custom Mortgage Solutions, Inc., d/b/a CMS Lending, Settlement Agreement and Withdrawal of Notice of Automatic Suspension

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IN THE MATTER OF:

CUSTOM MORTGAGE SOLUTIONS,
INC., d/b/a CMS LENDING

    ("CUSTOM MORTGAGE")

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SETTLEMENT AGREEMENT

AND

WITHDRAWAL OF NOTICE OF
AUTOMATIC SUSPENSION      

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 Custom Mortgage 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 November 16, 2007, acting pursuant to Section 36a-492(b) of the Connecticut General Statutes and Sections 36a-494(a)(1)(C) and 36a-51 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 Custom Mortgage, which Notice is incorporated herein by reference;
 
WHEREAS, the Notice alleges that Custom Mortgage, 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 Custom Mortgage to act as a first mortgage lender/broker in Connecticut from 1886 Greentree Road, Cherry Hill, New Jersey;
 
WHEREAS, on November 26, 2007, Custom Mortgage received the Notice;
 
WHEREAS, on December 10, 2007, Custom Mortgage filed with the Commissioner a replacement bond numbered LPM80909163, issued by Fidelity and Deposit Company Maryland;
 
WHEREAS, on December 10, 2007, Custom Mortgage requested a hearing on the matters alleged in the Notice, which is currently scheduled for January 17, 2008;
 
WHEREAS, on December 11, 2007, Custom Mortgage specifically assured the Commissioner that it has not engaged in the business of a first mortgage lender/broker in Connecticut since the expiration of its surety bond for 1886 Greentree Road, Cherry Hill, New Jersey, on November 12, 2007;
 
WHEREAS, Section 4-177(c) of the Connecticut General Statutes and Section 36a-1-55(a) of the Regulations of Connecticut State Agencies provide that a contested case may be resolved by agreed settlement, unless precluded by law;
 
WHEREAS, Custom Mortgage agrees to voluntarily enter into this Settlement Agreement and Withdrawal of Notice of Automatic Suspension (“Settlement Agreement and Withdrawal”) solely for the purpose of obviating the need for formal administrative proceedings concerning the allegation described above;
 
WHEREAS, Custom Mortgage, through its execution of this Settlement Agreement and Withdrawal, voluntarily agrees to waive any rights to a hearing upon the allegation contained in the Notice, and waives the right to seek judicial review or otherwise challenge or contest the validity of this Settlement Agreement and Withdrawal;
 
AND WHEREAS, upon the entry of this Settlement Agreement and Withdrawal, this matter will be resolved and the Commissioner will not take any future enforcement action against Custom Mortgage based upon the allegation contained in the Notice.
 
NOW THEREFORE, the Commissioner and Custom Mortgage enter into this Settlement Agreement and Withdrawal as follows:

1. Custom Mortgage shall cease and desist from violating Section 36a-492(a) of the Connecticut General Statutes and agrees to maintain surety bonds that run concurrently with any license issued to Custom Mortgage under Part I(A) of Chapter 668 of the Connecticut General Statutes;
2. Nothing in this Settlement Agreement and Withdrawal shall adversely affect the ability of Custom Mortgage to apply for or obtain a license or renewal license under Part I of Chapter 668 of the Connecticut General Statutes in the future;
3. The Notice of Automatic Suspension of the license of Custom Mortgage Solutions, Inc., d/b/a CMS Lending to engage in the business of a first mortgage lender/broker in Connecticut from 1886 Greentree Road, Cherry Hill, New Jersey, on November 16, 2007, is hereby WITHDRAWN; and
4. Notwithstanding anything to the contrary in this Settlement Agreement and Withdrawal, execution of this Settlement Agreement and Withdrawal is without prejudice to the right of the Commissioner to take enforcement action against Custom Mortgage to enforce this Settlement Agreement and Withdrawal if the Commissioner determines that Custom Mortgager is not fully complying with any term or condition stated herein or if any representation made by Custom Mortgage and reflected herein is subsequently discovered to be untrue.  For purposes of this paragraph, a violation of this Settlement Agreement and Withdrawal shall be deemed to be a violation of an order of the Commissioner.

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


Dated at Hartford, Connecticut
this 8th day of January 2008.              ________/s/_________
                                                     Howard F. Pitkin
                                                     Banking Commissioner



I, Charles Arena, state on behalf of Custom Mortgage Solutions, Inc., d/b/a CMS Lending that I have read the foregoing Settlement Agreement and Withdrawal; that I know and fully understand its contents; that I am authorized to execute this Settlement Agreement and Withdrawal on behalf of Custom Mortgage Solutions, Inc., d/b/a CMS Lending; and that Custom Mortgage Solutions, Inc., d/b/a CMS Lending agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein.

                                             By:  ________/s/_________
                                                   Charles Arena
                                                   President/CEO
                                                   Custom Mortgage Solutions, Inc.
                                                   d/b/a CMS Lending


State of:  New Jersey

County of:  Camden


On this the 7 day of January 2008, before me, Steven Turkheimer, the undersigned officer, personally appeared Charles Arena, who acknowledged himself to be the President/CEO of Custom Mortgage Solutions, Inc., d/b/a CMS Lending, a corporation, and that he, as such President/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 President/CEO.
 
In witness whereof I hereunto set my hand.


                                                   ________/s/_________
                                                   Notary Public
                                                   Date Commission Expires:  6-26-2010


Administrative Orders and Settlements