DOB: Hourglass Capital Group, LLC d/b/a Hourglass Mortgage, Settlement Agreement

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IN THE MATTER OF:

HOURGLASS CAPITAL GROUP, LLC
d/b/a HOURGLASS MORTGAGE

    ("Hourglass Capital Group")

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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-534c, inclusive, of the Connecticut General Statutes, “Mortgage Lenders, Correspondent Lenders, Brokers and Loan Originators”, and Sections 9 and 19 to 21, inclusive, of Public Act 09-209;
 
WHEREAS, Hourglass Capital Group is a Connecticut limited liability company that is licensed as a mortgage broker in Connecticut under Part I of Chapter 668, Sections 36a-485 et seq. of the Connecticut General Statutes;
 
WHEREAS, on July 16, 2009, 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 Hourglass Capital Group 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, as a result of such examination, the Commissioner alleges that Hourglass Capital Group paid, during the period of February 2009 through June 2009, a “Co-Broker Fee” to another mortgage broker for two (2) loans and failed to properly disclose such fees on the HUD-1 Settlement Statements in violation of Sections 36a-493(a)(6) of the Connecticut General Statutes and Sections 24 CFR 3500.14(a) and 24 CFR 3500.14(b), which are regulations applicable to the conduct of Hourglass Capital Group’s business;
 
WHEREAS, the Commissioner believes that such allegations would support initiation of enforcement proceedings against Hourglass Capital Group, including proceedings to revoke Hourglass Capital Group’s license pursuant to Section 36a-494(a) of the Connecticut General Statutes, as amended by Public Act 09-209, and subsections (a) and (b) of Section 36a-51 of the Connecticut General Statutes, issue a cease and desist order against Hourglass Capital Group pursuant to Section 36a-494(b) of the Connecticut General Statutes, as amended by Public Act 09-209, and Section 36a-52(a) of the Connecticut General Statutes, and impose a civil penalty of up to one hundred thousand dollars ($100,000) per violation on Hourglass Capital Group pursuant to Section 36a-494(b) of the Connecticut 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 Hourglass Capital Group acknowledge the possible consequences of formal administrative proceedings;
 
WHEREAS, Hourglass Capital Group agrees to voluntarily enter into this Settlement Agreement without admitting or denying that the conduct set forth herein was in violation of the Connecticut General Statutes and regulations applicable to the conduct of its business, and solely for the purposes of obviating the need for formal administrative proceedings concerning the conduct described above;
 
AND WHEREAS, Hourglass Capital Group, through its execution of this Settlement Agreement, voluntarily agrees to waive any rights to a hearing upon the conduct 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 Hourglass Capital Group enter into this Settlement Agreement as follows:

1. No later than the date this Settlement Agreement is executed by Hourglass Capital Group, Hourglass Capital Group shall remit to the Department of Banking, by cashier’s or certified check or money order made payable to “Treasurer, State of Connecticut”, the sum of Six Thousand Dollars ($6,000) as a civil penalty;
2. Upon entry of this Settlement Agreement, this matter will be resolved and the Commissioner will not take any future enforcement action against Hourglass Capital Group 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 Hourglass Capital Group based on the allegations contained herein if any representations made by Hourglass Capital Group in this Settlement Agreement are subsequently discovered to be untrue or if Hourglass Capital Group 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 Hourglass Capital Group 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;
4. Notwithstanding paragraph 2 herein, execution of this Settlement Agreement is without prejudice to the right of the Commissioner to take enforcement action against Hourglass Capital Group to enforce this Settlement Agreement if the Commissioner determines that Hourglass Capital Group 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 1st day of December 2009.           ________/s/_________
                                                     Howard F. Pitkin
                                                     Banking Commissioner



I, Craig M. Cooper, state on behalf of Hourglass Capital Group, LLC d/b/a Hourglass Mortgage, 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 Hourglass Capital Group, LLC d/b/a Hourglass Mortgage; that Hourglass Capital Group, LLC d/b/a Hourglass Mortgage agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein; and that Hourglass Capital Group, LLC d/b/a Hourglass Mortgage voluntarily agrees to enter into this Settlement Agreement, expressly waiving any right to a hearing on the matters described herein.                                            

                                            By:  ________/s/_________
                                                   Name:  Craig M. Cooper
                                                   Title:  Member
                                                   Hourglass Capital Group, LLC
                                                   d/b/a Hourglass Mortgage


State of:  Connecticut

County of:  Litchfield


On this the 30th day of November 2009, before me, Betsy A. Ross, the undersigned officer, personally appeared Craig M. Cooper who acknowledged himself to be the Member of Hourglass Capital Group, LLC d/b/a Hourglass Mortgage, a (member managed/manager managed) limited liability company that he, as such He, being authorized so to do, executed the foregoing instrument for the purposes therein contained, by signing the name of the limited liability company by himself as Member.

In witness whereof I hereunto set my hand.


                                         ________/s/_________
                                         Notary Public
                                         Date Commission Expires:  March 31, 2012


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