DOB: CSA-Credit Solutions-Denial

July 22, 2010
 
CERTIFIED MAIL
 

CSA – Credit Solutions of America, Inc.
12700 Park Central Drive, 21st Floor
Dallas, TX 75251
 
Attention:  Ms. Puja Patel, Manager of Licensing, Compliance & Risk
 
Re:  Denial of Debt Negotiation License
 
Dear Sir or Madam:
 
On October 1, 2009, CSA – Credit Solutions of America, Inc., d/b/a Credit Solutions of America d/b/a Credit Solutions d/b/a CSA (“CSA”) filed a Main Office Application for Debt Negotiation License (“Application”) seeking to obtain a debt negotiation license in Connecticut.  Pursuant to Section 36a-671(d) of the 2010 Supplement to the General Statutes, I hereby deny the license for the reason set forth below.
 
Section 36a-671(d)(1) of the 2010 Supplement to the General Statutes requires me to find, among other things, that the financial responsibility, character, reputation, integrity and general fitness of the applicant and officers, directors and principal employees, if the applicant is a corporation, are such as to warrant belief that the business will be operated soundly and efficiently, in the public interest and consistent with the purposes of Sections 36a-671 to 36a-671d, inclusive.  If I am unable to make such findings, then I am prohibited from issuing such license and shall notify the applicant of the reasons for such denial.
 
As part of the Application, CSA responded “yes” to the following Disclosure Questions, which state, in pertinent part:
Has (or does) the Applicant, . . . or any officer, director, trustee, principal employee or shareholder owning ten percent or more of outstanding stock of the applicant (if the applicant is a corporation): . . .
(e) ever been the subject of actions (cease and desist orders, consent orders, injunctions, license suspensions or revocations, etc.) by any state or federal regulatory agency? . . .
(g) ever been the subject of proceedings in:  bankruptcy, receivership, assignment for the benefit of creditors; consumer-initiated litigation or arbitration filed in connection with a financial services-related business; or any litigation that, according to generally accepted accounting principles, is deemed significant to financial health and would be required to be referenced in an annual audited financial statement, report to shareholders, or similar documents?
Pursuant to the authority granted to me by Section 36a-17 of the Connecticut General Statutes, I have reviewed the documents that were submitted by CSA detailing events or proceedings related to Disclosure Questions (e) and (g).  That review revealed that on April 10, 2007, CSA entered into an Assurance of Discontinuance with the South Carolina Department of Consumer Affairs in which CSA pledged, among other actions, not to violate the South Carolina Consumer Credit Counseling Act (“Act”), S.C. Code Ann. 37-7-101 et seq. (Supp. 2008).  On August 31, 2009, CSA consented to the issuance of an Order by Brandolyn Thomas Pinkston, Administrator, South Carolina Department of Consumer Affairs, against CSA, which ordered CSA to, among other things, cease and desist from violating the Act, the South Carolina Consumer Protection Code, S.C. Code Ann. 37-1-101 et seq. (as amended) and the regulations promulgated thereunder, which included “engaging in credit counseling services as defined by the Act, including, but not limited to, contracting with South Carolina consumers for  the provision of credit counseling services unless and until such time as the licenses required by the Act are obtained”.
 
My review also revealed that on January 3, 2007, the State of Wisconsin, Department of Financial Institutions, Division of Banking issued an order (“2007 Order”) against CSA.  The 2007 Order required CSA to “cease conducting or attempting to conduct adjustment service company business with Wisconsin residents”.  On April 21, 2008, CSA consented to an Order issued by Michael J. Mach, Administrator, Wisconsin Department of Financial Institutions, Division of Banking dated April 29, 2008, issued against CSA in which it was found that CSA had contracted with 306 new clients since the 2007 Order was issued without obtaining the required license in violation of Section 218.02(2)(a)1., Stats., in violation of the 2007 Order.
 
Based upon the above, I am unable to find that the financial responsibility, character, reputation, integrity and general fitness of CSA and its officers, directors and principal employees are such as to warrant belief that the business will be operated soundly and efficiently, in the public interest and consistent with the purposes of sections 36a-671 to 36a-671d, inclusive.
 
For the reason stated above, I am unable to issue CSA – Credit Solutions of America, Inc., d/b/a Credit Solutions of America d/b/a Credit Solutions d/b/a CSA a debt negotiation license.
 
Very truly yours,
 
Howard F. Pitkin
Banking Commissioner
 
HFP/DK/td
 
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