DOB: Palomar Bancorp, Inc., Settlement Agreement

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IN THE MATTER OF:

PALOMAR BANCORP, INC.

    ("Palomar Bancorp")

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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, 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 Palomar Bancorp 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 December 22, 2009, the Commissioner, acting pursuant to Section 36a-492 of the Connecticut General Statutes, as amended by Public Acts 09-208 and 09-209, Section 36a-52(b) of the Connecticut General Statutes, Sections 36a-494(a)(1) and 36a-494(a)(1)(C) of the Connecticut General Statutes, as amended by Public Act 09-209, subsections (a) and (b) of Section 36a-51 of the Connecticut General Statutes, Section 36a-494(b) of the Connecticut, as amended by Public Act 09-209, and Section 36a-52(a) of the Connecticut General Statutes, issued a Notice of Automatic Suspension, Temporary Order to Cease and Desist, Notice of Intent to Revoke Mortgage Broker License, Notice of Intent to Issue Order to Cease and Desist and Notice of Right to Hearing (collectively “Notice”) against Palomar Bancorp, which Notice is incorporated by reference herein;
 
WHEREAS, the Notice alleged that Palomar Bancorp, in violation of Section 36a-492 of the Connecticut General Statutes, as amended, failed to maintain a surety bond that runs concurrently with the period of the license granted to Palomar Bancorp to act as a mortgage broker in Connecticut from 1947 Camino Vida Roble, Suite 215, Carlsbad, California.  Such failure to maintain a surety bond constitutes sufficient grounds for the Commissioner to revoke Palomar Bancorp’s license to act as a mortgage broker in Connecticut from 1947 Camino Vida Roble, Suite 215, Carlsbad, California, pursuant to Sections 36a-494(a)(1) and 36a-494(a)(1)(C) of the Connecticut General Statutes, as amended, and subsections (a) and (b) of Section 36a-51 of the Connecticut General Statutes, and forms a basis to issue an order to cease and desist against Palomar Bancorp pursuant to Section 36a-494(b) of the Connecticut General Statutes, as amended, and Section 36a-52(a) of the Connecticut General Statutes;
 
WHEREAS, on December 30, 2009, Palomar Bancorp received the Notice, and no request for a hearing was received by the Commissioner;
 
WHEREAS, on January 1, 2010, Palomar Bancorp’s license was marked “Terminated – Expired” on the Nationwide Mortgage Licensing System (“NMLS”);
 
WHEREAS, by e-mail dated January 22, 2010, Palomar Bancorp specifically assured the Commissioner that Palomar Bancorp has not done any business in Connecticut since December 2008;
 
WHEREAS, by e-mail dated January 22, 2010, Palomar Bancorp represented that in July 2009, Palomar Bancorp attempted to surrender it license on NMLS;
 
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, Palomar Bancorp agrees to voluntarily enter into this Settlement Agreement without admitting or denying any allegations contained in the Notice and set forth herein, and solely for the purpose of obviating the need for formal administrative proceedings concerning the allegation described above;
 
WHEREAS, Palomar Bancorp, through its execution of this Settlement Agreement, voluntarily agrees to waive any rights to a hearing upon the allegations contained in the Notice and 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 Palomar Bancorp based upon the allegations contained in the Notice.
 
NOW THEREFORE, the Commissioner and Palomar Bancorp enter into this Settlement Agreement as follows:

1. Prior to the date this Settlement Agreement is executed by the Commissioner, Palomar Bancorp will cease acting as a mortgage broker in Connecticut from 1947 Camino Vida Roble, Suite 215, Carlsbad, California;
2. Upon entry of this Settlement Agreement, this matter will be resolved and the Commissioner will not take any future enforcement action against Palomar Bancorp 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 Palomar Bancorp based on the allegations contained herein if any representations made by Palomar Bancorp in this Settlement Agreement are subsequently discovered to be untrue or if Palomar Bancorp 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 Palomar Bancorp to apply for or obtain a license or renewal license under Part I of Chapter 668, Sections 36a-485 et seq., of the Connecticut General Statutes in the future; and
4. Notwithstanding paragraph 2 herein, execution of this Settlement Agreement is without prejudice to the right of the Commissioner to take enforcement action against Palomar Bancorp to enforce this Settlement Agreement if the Commissioner determines that Palomar Bancorp 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 24th day of February 2010.           ________/s/_________
                                                     Howard F. Pitkin
                                                     Banking Commissioner



I, Vincent Nowicki, state on behalf of Palomar Bancorp, Inc., 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 Palomar Bancorp, Inc.; and that Palomar Bancorp, Inc., agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein.                                           

                                            By:  ________/s/_________
                                                   Name:  Vincent Nowicki
                                                   Title:  President
                                                   Palomar Bancorp, Inc.


State of:  California

County of:  San Diego


On this the 15 day of February 2010, before me, Juliana Soares, the undersigned officer, personally appeared Vincent Nowicki, who acknowledged himself to be the President of Palomar Bancorp, 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:  02/13/13


Administrative Orders and Settlements