DOB: Family Choice Mortgage Corporation Settlement Agreement

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IN THE MATTER OF:

FAMILY CHOICE MORTGAGE CORPORATION   

    ("FAMILY CHOICE MORTGAGE")

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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 (“Division”), conducted an examination pursuant to Section 36a-17 of the Connecticut General Statutes into the activities of Family Choice 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, Family Choice Mortgage is a corporation that is currently licensed as a first mortgage lender/broker under Part I(A) of Chapter 668 of the Connecticut General Statutes, “Nondepository First Mortgage Lenders, Brokers and Originators”, and a secondary mortgage lender/broker under Part I(B) of Chapter 668 of the Connecticut General Statutes, “Secondary Mortgage Lenders, Brokers and Originators”;

WHEREAS, as a result of the examination, the Commissioner alleges that Family Choice Mortgage employed or retained at least six (6) originators without registering them, in violation of Sections 36a-486(b) and 36a 511(b) of the Connecticut General Statutes;

WHEREAS, the Commissioner believes that the Commissioner’s allegations support the initiation of enforcement proceedings against Family Choice Mortgage, including proceedings to revoke Family Choice Mortgage’s licenses pursuant to Sections 36a-46(a) and 36a-517(a) of the Connecticut General Statutes, issue a cease and desist order against Family Choice Mortgage pursuant to Sections 36a-52(a), 36a-46(b) and 36a-517(b) of the Connecticut General Statutes, and impose a civil penalty of up to $100,000 per violation on Family Choice Mortgage pursuant to Sections 36a-50(a), 36a-46(b) and 36a-517(b) of the Connecticut General Statutes;

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 “[p]ursuant to subsection (c) of section 4-177 of the Connecticut General Statutes, unless precluded by law, any contested case may be resolved by . . . agreed settlement”;

WHEREAS, on December 18, 2007, Family Choice Mortgage made a contribution to the State Regulatory Registry LLC, a wholly-owned subsidiary of the Conference of State Bank Supervisors (“CSBS”), in the amount of Six Thousand Dollars ($6,000) to support the Nationwide Mortgage Licensing System, jointly sponsored by CSBS and the American Association of Residential Mortgage Regulators;

WHEREAS, Family Choice Mortgage and the Commissioner agree to voluntarily enter into this Settlement Agreement, and the Commissioner agrees that doing so is not precluded by law, and without Family Choice Mortgage admitting any allegations set forth herein, and solely for the purposes of obviating the need for formal administrative proceedings concerning the allegations described above;

WHEREAS, Family Choice Mortgage, through its execution of this Settlement Agreement, voluntarily agrees to waive any rights to a hearing upon the allegations contained in this Settlement Agreement, 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 Family Choice Mortgage based upon the allegations contained herein.

NOW THEREFORE, the Commissioner and Family Choice Mortgage enter into this Settlement Agreement as follows:

1. Family Choice Mortgage shall cease and desist from engaging in acts in violation of Sections 36a-486(b), 36a-511(b) of the Connecticut General Statutes; and
2. Nothing in this Settlement Agreement shall adversely affect the ability of Family Choice Mortgage to apply for, obtain or maintain licenses or renewal licenses under Part I of Chapter 668, Sections 36a-485 to 36a 534a, inclusive, of the Connecticut General Statutes, and to apply for, obtain or maintain registration of its originators from the Commissioner; 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 Family Choice Mortgage to enforce this Settlement Agreement, if the Commissioner determines that Family Choice Mortgage is not fully complying with any term or condition stated herein or if any representations made by Family Choice Mortgage and reflected herein are 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. 
4. Nothing in this Settlement Agreement shall be construed to limit or interfere with Family Choice Mortgage’ right to take any action or institute formal proceedings for the enforcement of this Settlement Agreement.

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 15th day of February 2008.             ________/s/_________
                                                       HOWARD F. PITKIN
                                                       Banking Commissioner

I, Jeffrey Lipes, state on behalf of Family Choice Mortgage Corporation that I have read the foregoing Settlement Agreement; that I know and fully understand its contents; that I am authorized to execute this Settlement Agreement on behalf of Family Choice Mortgage; that Family Choice Mortgage agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein; and that Family Choice Mortgage voluntarily agrees to enter into this Settlement Agreement, expressly waiving any right to a hearing on the matters described herein.

By: _____________/s/_____________
Jeffrey Lipes
President
Family Choice Mortgage Corporation
1155 Silas Deane Highway
Wethersfield, CT  06109

State of:  Connecticut

County of:  Hartford

On this the 12th day of February 2008, before me, Stephanie M. Skinner, the undersigned officer, personally appeared Jeffrey Lipes who acknowledged himself to be the President of Family Choice Mortgage Corporation, a corporation, and that he, as such President, being authorized so to do, executed the foregoing instrument for the purposes therein contained, by signing the name of the corporation by himself as Jeffrey Lipes, President of Family Choice Mortgage Corporation.

In witness whereof I hereunto set my hand.

_____________/s/____________
Notary Public
Date Commission Expires:  April 30, 2012


Administrative Orders and Settlements