DOB: Prime Capital Lenders, LLC, Settlement Agreement

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IN THE MATTER OF:

PRIME CAPITAL LENDERS, LLC

    ("Prime Capital")

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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 et seq., 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 examination pursuant to Section 36a-17 of the Connecticut General Statutes into the activities of Prime Capital 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, Prime Capital is a Connecticut limited liability company that is currently licensed as a mortgage broker under Part I of Chapter 668, Sections 36a-485 et seq. of the Connecticut General Statutes;
 
WHEREAS, as a result of such examination, the Commissioner alleges that Prime Capital employed or retained, during the period of May 2007 through May 2008, one (1) individual as a loan originator without registering him, in violation of Sections 36a-486(b) of the Connecticut General Statutes;
 
WHEREAS, the Commissioner believes that such allegations would support initiation of enforcement proceedings against Prime Capital, including proceedings to revoke and/or refuse to renew Prime Capital’s license pursuant to Section 36a-494(a) of the 2008 Supplement to the Connecticut General Statutes, as amended by Public Acts 07-91, 07-156, and 08-176, and Section 36a-51 of the 2008 Supplement to the General Statutes, issue a cease and desist order against Prime Capital pursuant to Section 36a-494(b) of the 2008 Supplement to the General Statutes, as amended by Public Acts 07-91, 07-156, and 08-176, and Section 36a-52(a) of the 2008 Supplement to the General Statutes, and impose a civil penalty of up to one hundred thousand dollars ($100,000) per violation on Prime Capital pursuant to Section 36a-494(b) of the 2008 Supplement to the General Statutes, as amended, and Section 36a-50(a) of the Connecticut General Statutes;
 
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, both the Commissioner and Prime Capital acknowledge the possible consequences of formal administrative proceedings;
 
WHEREAS, Prime Capital agrees to voluntarily enter into this Settlement Agreement without admitting or denying any allegations set forth herein, and solely for the purposes of obviating the need for formal administrative proceedings concerning the allegations described above;
 
WHEREAS, Prime Capital herein represents to the Commissioner that it has reviewed and updated its internal policies, procedures and controls for assessing whether an individual engaged in mortgage-related activity with Prime Capital requires licensure from the Commissioner under Part I of Chapter 668, Sections 36a-485 et seq., of the Connecticut General Statutes, including but not limited to, licensure as originators under Section 36a-486(b) of the 2008 Supplement of the General Statutes, as amended;
 
WHEREAS, in connection with this settlement, Prime Capital was provided the option to pay a civil penalty in the amount of One Thousand Dollars ($1,000) in settlement of the allegations contained herein;
 
WHEREAS, the State of Connecticut is a participant in the Nationwide Mortgage Licensing System and Registry (“NMLS&R”), jointly developed by the Conference of State Bank Supervisors (“CSBS”) and the American Association of Residential Mortgage Regulators to establish a unified and modern system of mortgage licensing and registration, and is committed to the success of NMLS&R;
 
WHEREAS, Prime Capital herein represents to the Commissioner that Prime Capital has filed an application with the NMLS&R to obtain a loan originator license under Section 36a-486(b) of the 2008 Supplement of the General Statutes, as amended by Public Acts 07-156 and 08-176 for the individual alleged to be an unregistered loan originator in violation of Sections 36a-486(b) of the Connecticut General Statutes;
 
WHEREAS, in connection with this settlement, Prime Capital was provided an alternative option to make a voluntary contribution in the amount of One Thousand Dollars ($1,000) to the State Regulatory Registry LLC (“SRR”), a wholly-owned subsidiary of the CSBS, to support the NMLS&R;
 
WHEREAS, Prime Capital elected to make a voluntary contribution to SRR in lieu of a civil penalty;
 
AND WHEREAS, Prime Capital, 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;
 
NOW THEREFORE, the Commissioner and Prime Capital enter into this Settlement Agreement as follows:

1. No later than the date this Settlement Agreement is executed by Prime Capital, Prime Capital shall make a voluntary contribution by cashier’s check, certified check or money order in the amount of One Thousand Dollars ($1,000) to SRR to support NMLS&R;
2. Upon entry of this Settlement Agreement, this matter will be resolved and the Commissioner will not take any future enforcement action against Prime Capital based upon the allegations contained herein; provided that entry of this Settlement Agreement is without prejudice to the right of the Commissioner to take enforcement action against Prime Capital based on the allegations contained herein if any representations made by Prime Capital in this Settlement Agreement are subsequently discovered to be untrue or if Prime Capital is not fully complying with any term or condition stated herein;
3. Nothing in the entry of this Settlement Agreement shall adversely affect the ability of Prime Capital to apply for or obtain licenses or renewal licenses under Part I of Chapter 668, Sections 36a-485 et seq., of the Connecticut General Statutes, and to apply for or obtain licensure of its originators from the Commissioner;
4. 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 Prime Capital to enforce this Settlement Agreement if the Commissioner determines that Prime Capital is not fully complying with any term or condition stated herein.  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 4th day of February 2009.            ________/s/_________
                                                     Howard F. Pitkin
                                                     Banking Commissioner



I, John Kealey, state on behalf of Prime Capital Lenders, LLC, 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 Prime Capital Lenders, LLC; that Prime Capital Lenders, LLC agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein; and that Prime Capital Lenders, LLC voluntarily agrees to enter into this Settlement Agreement, expressly waiving any right to a hearing on the matters described herein.                                         

                                            By:  ________/s/_________
                                                   Name:  John Kealey
                                                   Title:  Vice President / Member
                                                   Prime Capital Lenders, LLC


State of:  CT

County of:  New Haven


On this the 30 day of January 2009, before me, Mary Louise Nuzzo, the undersigned officer, personally appeared John Kealey who acknowledged himself/herself to be the Vice President of Prime Capital Lenders, LLC, a limited liability company, and that he/she, as such Vice President, being authorized so to do, executed the foregoing instrument for the purposes therein contained, by signing the name of the corporation by himself/herself as Vice President.

In witness whereof I hereunto set my hand.


                                         ________/s/_________
                                         Notary Public
                                         Date Commission Expires:  8/31/2013


Administrative Orders and Settlements