DOB: Bayou Technologies Inc-Cannady, Steven-Consent

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IN THE MATTER OF:

BAYOU TECHNOLOGIES, INC.
("Bayou")

STEVEN O. CANADY
("Canady")

    (collectively "Respondents")

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CONSENT ORDER

DOCKET NO. CF-2007-7331-S

I. PRELIMINARY STATEMENT

WHEREAS, the Banking Commissioner (“Commissioner”) is charged with the administration of Chapter 672a of the Connecticut General Statutes, the Connecticut Uniform Securities Act (“Act”), and Sections 36b-31-2 et seq., of the Regulations of Connecticut State Agencies promulgated under the Act (“Regulations”);
 
WHEREAS, the Commissioner, through the Securities and Business Investments Division of the Department of Banking, conducted an investigation pursuant to Section 36b-26(a) of the Act into the activities of Respondents to determine whether they had violated, were violating or were about to violate any provisions of the Act or Regulations (“Investigation”);
 
WHEREAS, on June 15, 2007, as a result of the Investigation, the Commissioner, acting pursuant to Section 36b-27(a) of the Act, as amended by Public Act 07-91, and Section 36b-27(d)(1) of the Act, prior to October 1, 2003, issued an Order to Cease and Desist, Notice of Intent to Fine (“Fine Notice”) and Notice of Right to Hearing (collectively “Notice”) against Respondents, which Notice is incorporated by reference herein;
 
WHEREAS, the Notice alleges that:  (1) Respondents offered and sold at least 60,000 shares of Bayou stock to at least two Connecticut investors, absent registration, in violation of Section 36b-16 of the Act; (2) Canady acted as an agent of issuer on three occasions, absent registration, in violation of Section 36b-6(a) of the Act; and (3) Bayou employed Canady as an agent of issuer, absent registration, in violation of Section 36b-6(b) of the Act;
 
WHEREAS, the Fine Notice stated that the Commissioner intended to impose a fine against Respondents; that a hearing would be held on August 8, 2007, on the matters alleged in the Fine Notice; and that if Respondents failed to appear at the hearing the Commissioner may order that a maximum fine of Two Hundred Twenty Thousand Dollars ($220,000) be imposed upon each Respondent;
 
WHEREAS, on July 13, 2007, Respondents requested a hearing on the matters alleged in the Notice, which is currently scheduled for March 27, 2008;
 
WHEREAS, Section 36b-27(f) of the 2008 Supplement to the General Statutes provides, in relevant part, that “[a]ny time after the issuance of an order or notice provided for in subsection (a) . . . or subdivision (1) of subsection (d) of this section, the commissioner may accept an agreement by any respondent named in such order or notice to enter into a written consent order in lieu of an adjudicative hearing”;
 
WHEREAS, Section 36b-31(a) of the Act provides, in relevant part, that “[t]he commissioner may from time to time make . . . such . . . orders as are necessary to carry out the provisions of sections 36b-2 to 36b-33, inclusive”;
 
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 consent order unless precluded by law;
 
WHEREAS, Respondents specifically assure the Commissioner that each and every Connecticut investor who invested in unregistered Bayou stock, whether or not specifically included in the Notice, has been offered rescission;
 
WHEREAS, Respondents and the Commissioner now desire to resolve the matters alleged in the Notice and agree to the language in this Consent Order;
 
WHEREAS, Respondents agree that the Notice may be used in construing the terms of this Consent Order and agree to the language in this Consent Order.


CONSENT TO WAIVER OF PROCEDURAL RIGHTS

WHEREAS, Respondents, through their execution of this Consent Order, voluntarily waive the following rights:

1. To be afforded an opportunity for a hearing within the meaning of Sections 36b-27(a) and 36b-27(d)(2) of the 2008 Supplement to the General Statutes and Section 4-177c(a) of the Connecticut General Statutes; 
2. To present evidence and argument and to otherwise avail themselves of Sections 36b-27(a) and 36b-27(d)(2) of the 2008 Supplement to the General Statutes and Section 4-177c(a) of the Connecticut General Statutes;
3. To present their position in a hearing in which they may be represented by counsel;
4. To have a written record of the hearing, a proposed final decision by a presiding officer, and a final decision by the Commissioner; and
5.
To seek judicial review of, or otherwise challenge or contest the matters described herein, including the validity of this Consent Order.
 

ACKNOWLEDGEMENT OF THE COMMISSIONER’S ALLEGATIONS

WHEREAS, Respondents, through their execution of this Consent Order, acknowledge that the Commissioner has made the following allegations, without admitting or denying them:

1. Respondents offered and sold securities absent registration in violation of Section 36b-16 of the Act;
2. Canady violated Section 36b-6(a) of the Act by acting as an agent of issuer absent registration on three occasions; and
3. Bayou violated Section 36b-6(b) of the Act by employing Canady as an agent of issuer absent registration on three occasions.

WHEREAS, the Commissioner would have the authority to enter findings of fact and conclusions of law after granting Respondents an opportunity for a hearing;
 
WHEREAS, the entry of this Consent Order is necessary or appropriate in the public interest or for the protection of investors and consistent with the purposes fairly intended by the policy and provisions of the Act;
 
WHEREAS, Respondents acknowledge the possible consequences of an administrative hearing and voluntarily agree to consent to the entry of the sanctions described below.


CONSENT TO ENTRY OF SANCTIONS

WHEREAS, Respondents, through their execution of this Consent Order, consent to the Commissioner’s entry of a Consent Order imposing on them the following sanctions:

1. The Order to Cease and Desist set forth in the Notice shall become permanent; and
2. No later than the date this Consent Order is issued by the Commissioner, Bayou shall remit to the Department of Banking, by cashier’s or certified check or money order made payable to the “Treasurer, State of Connecticut”, the sum of Ten Thousand Dollars ($10,000) as an administrative fine;

AND WHEREAS, Respondents specifically assure the Commissioner that none of the violations alleged in the Notice shall occur in the future.
 

CONSENT ORDER

NOW THEREFORE, the Commissioner enters the following:

1. The Sanctions set forth above be and are hereby entered;
2. Entry of this Consent Order by the Commissioner is without prejudice to the right of the Commissioner to take enforcement action against Bayou, its officers, agents, representatives and employees, and Canady, based upon a violation of this Consent Order or the matters underlying its entry, if the Commissioner determines that compliance with the terms herein is not being observed or if any representations made by Respondents and reflected herein are subsequently discovered to be untrue; and
3. This Consent Order shall become final when issued.



Issued at Hartford, Connecticut
this 3rd day of April 2008.                     ________/s/_________
                                                       Howard F. Pitkin
                                                       Banking Commissioner


CONSENT TO ENTRY OF ORDER

I, Steven O. Canady, state on behalf of Bayou Technologies, Inc., that I have read the foregoing Consent Order; that I know and fully understand its contents; that I am authorized to execute this Consent Order on behalf of Bayou Technologies, Inc.; that Bayou Technologies, Inc., agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein; and that Bayou Technologies, Inc., voluntarily consents to the issuance of this Consent Order, expressly waiving any right to a hearing on the matters described herein.


 ____________/s/_____________
 Steven O. Canady
 President
 Bayou Technologies, Inc.

State of:  Georgia

County of:  Dekalb

On this the 2 day of April 2008, before me, Roosevelt Watt, II, the undersigned officer, personally appeared Steven O. Canady, who acknowledged himself to be the President of Bayou Technologies, Inc., 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 President.

In witness whereof I hereunto set my hand.


 ________/s/_________
 Notary Public
 Date Commission Expires:  09 Mar 2012



CONSENT TO ENTRY OF ORDER

I, Steven O. Canady, being duly sworn, state that I have read the foregoing Consent Order; that I know and fully understand its contents; that I agree freely and without threat or coercion of any kind to comply with the terms and conditions stated herein; and that I voluntarily consent to the issuance of this Consent Order, expressly waiving any right to a hearing on the matters described herein.


                                                       ___________/s/____________
Steven O. Canady

State of:  Georgia

County of:  Dekalb

On this the 2 day of April 2008, before me, Roosevelt Watt, II, the undersigned officer, personally appeared Steven O. Canady, known to me (or satisfactorily proven) to be the person whose name Steven O. Canady subscribed to the within instrument and acknowledged that he executed the same for the purposes therein contained.

In witness whereof I hereunto set my hand.


 ________/s/_________
 Notary Public
 Date Commission Expires:  09 Mar 2012


 


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