DOB: Allied Financial Services-Malik Final Decision

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IN THE MATTER OF:

ALLIED FINANCIAL
SERVICES, LLC

AYESHAH MALIK

    ("Respondents")

 
 
 
 
 
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FINDINGS OF FACT,

CONCLUSIONS OF LAW

AND

ORDER

FINDINGS OF FACT

 1.   On April 9, 2009, the Banking Commissioner issued a Temporary Order to Cease and Desist, Order of Summary Suspension, Notice of Intent to Revoke Mortgage Broker License, Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing (the “April 9, 2009 Notice”) against Allied Financial Services, LLC (“Allied”) and Ayeshah Malik (“Malik”) (Ex. 1).
 
 2. The April 9, 2009 Notice stated that Allied was a Connecticut limited liability company having its main office at 83 East Avenue, Suite 206, Norwalk, Connecticut (Ex. 1).
 
 3. The April 9, 2009 Notice also stated that Allied held a mortgage broker license (No. 11022) under Part 1 of Chapter 668, Sections 36a-485 to 36a-534c, inclusive, of the Connecticut General Statutes, “Mortgage Lenders, Correspondent Lenders, Brokers and Loan Originators” (Ex. 1).
 
 4. The April 9, 2009 Notice identified Malik as a member of Allied.  The April 9, 2009 Notice stated that Malik’s last known address was 34 Woodbrook Drive, Stamford, Connecticut. (Ex. 1)
 
 5. The April 9, 2009 Notice imposed a Temporary Order to Cease and Desist against Allied and Malik, and an Order of Summary Suspension against Allied (Ex. 1).
 
 6.
In addition, the April 9, 2009 Notice sought the following remedies:
 
a)
A Notice of Intent to Revoke Mortgage Broker License against Allied;
b) A Notice of Intent to Issue Cease and Desist Order against Allied and Malik; and
c) A Notice of Intent to Fine against Allied and Malik (Ex. 1)
 7. The April 9, 2009 Notice alleged that, during the course of an agency examination conducted on February 25, 2009, Allied, through Malik, failed to provide copies of certain loan files that examiners required to be produced, and failed to otherwise furnish the examiners with unrestricted access to Allied’s records.  The April 9, 2009 Notice stated that, in engaging in such conduct, Allied violated Sections 36a-17(d) and 36a-493(a) of the Connecticut General Statutes, and that therefore bases existed for (1) revoking Allied’s mortgage broker license under Sections 36a-494(a)(1), 36a-494(a)(1)(B), 36a-494(a)(1)(C) and 36a-51 of the Connecticut General Statutes; (2) issuing an order to cease and desist under Sections 36a-494(b) and 36a-52(a) of the Connecticut General Statutes; and (c) imposing a civil penalty under Sections 36a-494(b) and 36a-50(a) of the Connecticut General Statutes (Ex. 1).
 
 8. The April 9, 2009 Notice alleged that, during the course of an agency examination conducted on February 25, 2009, Allied, through Malik, failed to provide copies of certain loan files that examiners required to be produced, and failed to otherwise furnish the examiners with unrestricted access to Allied’s records.  The April 9, 2009 Notice stated that, in engaging in such conduct, Malik violated Section 36a-17(d) , and that therefore bases existed for (1) issuing an order to cease and desist against Malik under Sections 36a-494(b) and 36a-52(a) of the Connecticut General Statutes; and (2) imposing a civil penalty against Malik under Sections 36a-494(b) and 36a-50(a) of the Connecticut General Statutes (Ex. 1).
 
 9. The April 9, 2009 Notice alleged that, during the examination described above, (1) Malik stated to agency examiners that she had not originated any mortgage loans or taken any mortgage loan applications since 2006; and (2) during the examination, examiners reviewed a mortgage loan file containing a mortgage loan application signed by Malik on January 10, 2008 (Ex. 1).  The April 9, 2009 Notice stated that, in engaging in such conduct, Malik violated Section 36a-53a of the Connecticut General Statutes , and that therefore bases existed for (1) issuing an order to cease and desist against Malik under Section 36a-52(a) of the Connecticut General Statutes; and (2) imposing a civil penalty against Malik under Section 36a-50(a) of the Connecticut General Statutes (Ex. 1).
   
 10. The April 9, 2009 Notice recited that, on April 9, 2009, it was sent by registered mail, return receipt requested, to Allied Financial Services, LLC c/o Zeba Mohib, Agent, 83 East Avenue, Suite 206, Norwalk Connecticut 06851 (Registered Mail No. RB027869020US) and Ayeshah Malik, 34 Woodbrook Drive, Stamford, Connecticut 06907 (Registered Mail No RB028036190US). (Ex. 1)
   
 11. Allied received the April 9, 2009 Notice on April 23, 2009 (Ex. 1).
  
 12. The April 9, 2009 Notice was delivered to Malik’s address, although the Date of Delivery was not completed on PS Form 3811 (Ex. 1).
 
 13. On April 17, 2009, Attorney L. Morris Glucksman, Patriot National Bank Building, 900 Bedford Street, 3rd, Floor, Stamford, Connecticut forwarded to the Department of Banking’s Consumer Credit Division a letter (Ex. 4).  The letter requested a hearing on the April 9, 2009 Notice and included an Appearance and Request for Hearing dated April 17, 2009 indicating that L. Morris Glucksman was entering an appearance on behalf of all Respondents with respect to the April 9, 2009 Notice (Ex. 4).  Ayeshah Malik was cc’d on the April 17, 2009 letter (Ex. 4).
 
 14. On April 21, 2009, the Banking Commissioner issued a Notification of Hearing and Designation of Hearing Officer appointing Attorney William Nahas Jr. as Hearing Officer with respect to the April 9, 2009 Notice and setting the hearing date for July 7, 2009.  The Notification of Hearing and Designation of Hearing Officer recited that the hearing was being held in accordance with a written request for hearing received on April 17, 2009 from L. Morris Glucksman, and indicated that the attorneys representing the Department were Doniel Kitt and Stacey L. Valerio (Ex. 5).
 
 15.  On April 21, 2009, the Notification of Hearing and Designation of Hearing Officer relating to the April 9, 2009 Notice was mailed to L. Morris Glucksman (Ex. 5).
 
 16. On June 22, 2009, the Banking Commissioner issued a Redesignation of Hearing Officer appointing Cynthia Antanaitis as Hearing Officer with respect to the July 7, 2009 hearing on the April 9, 2009 Notice (Ex. 6).
  
 17. On June 29, 2009, the Hearing Officer continued the hearing on the April 9, 2009 Notice to September 10, 2009 (Ex. 13).
  
 18. On August 31, 2009, counsel to the Department requested that the September 10, 2009 hearing on the April 9, 2009 Notice be continued (Ex. 13).
 
 19. On September 1, 2009, the Hearing Officer continued the September 10, 2009 hearing on the April 9, 2009 Notice to October 2, 2009 (Ex. 13).
 
 20. On September 4, 2009, counsel to the Department advised the Hearing Officer and counsel to the Respondents that one of the Department’s witnesses would not be available on October 2, 2009 (Ex. 13).
 
 21. On September 6, 2009, the Hearing Officer e-mailed counsel to the Department and counsel to the Respondents requesting alternative hearing dates for consideration (Ex. 13).
 
 22. On September 8, 2009, counsel to the Department e-mailed the Hearing Officer and counsel to the Respondents stating that a November 4, 2009 date would be acceptable to the Department (Ex. 13).
 
 23. On September 8, 2009, the Hearing Officer e-mailed counsel the Respondents and counsel to the Department asking if the November 4, 2009 date was also acceptable to the Respondents (Ex. 13).
 
 24. On September 15, 2009, counsel to the Department e-mailed counsel to the Respondents, with a cc to the Hearing Officer, asking if November 4, 2009 was an acceptable date (Ex. 13).
 
 25. On September 18, 2009, the Banking Commissioner issued a Notice of Intent to Revoke Mortgage Broker License, Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing (the “September 18, 2009 Notice”) against Allied alone (Ex. 7).
 
 26. The September 18, 2009 Notice recited that (1) the April 9, 2009 Notice had summarily suspended Allied’s license to act as a mortgage broker in Connecticut pending proceedings for revocation, and that, until the revocation proceedings had been determined, Allied was prohibited from doing business in Connecticut as a mortgage broker; and (2) From at least April 21 to June 15, 2009, Allied acted as a mortgage broker in Connecticut (Ex. 7).  The September 18, 2009 Notice stated that, in engaging in such conduct, Allied violated an order of the Commissioner, and that therefore bases existed for (1) a revocation action under Section 36a-51 of the Connecticut General Statutes; (2) issuing an order to cease and desist against Allied under Section 36a-52(a) of the Connecticut General Statutes; and (3) imposing a civil penalty against Allied under Section 36a-50(a) of the Connecticut General Statutes (Ex. 7).
 
 27. The September 18, 2009 Notice recited that, on September 18, 2009, it was sent by registered mail, return receipt requested, to Allied Financial Services, LLC c/o Zeba Mohib, Agent, 83 East Avenue, Suite 206, Norwalk Connecticut 06851 (Registered Mail No. RB028036447US) and L. Morris Glucksman, Patriot National Bank Building, 900 Bedford Street, 3rd Floor, Stamford, Connecticut 06901 (Registered Mail No RB028036478US) (Ex. 7).
 
 28. The September 18, 2009 Notice was delivered to Allied’s address, although the Date of Delivery was not completed on PS Form 3811 (Ex. 7).
  
 29. Online tracking records retrieved from the United States Postal Service website on September 28, 2009 indicate that Registered Mail No. RB028036447US was delivered to Allied on September 24, 2009 at 10:46 a.m. (Ex. 8).
  
 30. Attorney L. Morris Glucksman received the September 18, 2009 Notice on September 23, 2009 (Ex. 7).
   
31. On September 30, 2009, Attorney L. Morris Glucksman forwarded to the Department of Banking a letter (Ex. 9).  The letter requested a hearing on the September 18, 2009 Notice and included an Appearance and Request for Hearing dated September 30, 2009 indicating that L. Morris Glucksman was entering an appearance on behalf of Allied with respect to the September 18, 2009 Notice (Ex. 9).
     
32. On September 30, 2009, the Banking Commissioner issued a Notification of Hearing and Designation of Hearing Officer appointing Cynthia Antanaitis as Hearing Officer with respect to the September 18, 2009 Notice and setting the hearing date for November 4, 2009.  The Notification of Hearing and Designation of Hearing Officer recited that the hearing was being held in accordance with a written request for hearing received on September 29 [sic], 2009 from L. Morris Glucksman, and indicated that the attorneys representing the Department were Doniel Kitt and Stacey L. Valerio (Ex. 10).
   
33. On October 1, 2009, the Notification of Hearing and Designation of Hearing Officer relating to the September 18, 2009 Notice was mailed to L. Morris Glucksman (Ex. 10).
   
34. On October 1, 2009, writing in reference to the April 9, 2009 Notice and the related hearing, Respondents’ counsel advised the Hearing Officer by e-mail, with a cc to counsel to the Department, “The undersigned after discussions with Mr. Keitt [sic] has agreed, subject to your approval, to delay this hearing and consolidate the same with the hearing of a second complaint issued by the Department.  The date you had previously suggested was November 4, 2009 and after discussions with attorney Keitt [sic], such would be acceptable.” (Ex. 13)
   
35. On October 1, 2009, in an e-mail to both counsel to the Respondents and counsel to the Department, the Hearing Officer continued the hearing on the April 9, 2009 Notice to November 4, 2009, and consolidated that proceeding with the November 4, 2009 hearing on the September 18, 2009 Notice (Ex. 13).
   
36. On October 22, 2009, the Banking Commissioner issued an Order of Withdrawal of Order of Summary Suspension (the “Withdrawal Order”) (Ex. 2).  The Withdrawal Order withdrew the summary suspension order contained in the April 9, 2009 Notice, stating that (1) on September 24, 2009, Malik had delivered requested loan files to the Department; and (2) on October 14, 2009, Allied had furnished Department personnel with unrestricted access to Allied’s records (Ex. 2).
   
37. The Withdrawal Order stated that it had been mailed by certified mail, return receipt requested to L. Morris Glucksman, attorney for Allied, on October 22, 2009 (Certified Mail No. 70031680000085235666) (Ex. 2).
   
38. PS Form 3811 accompanying the mailing of the Withdrawal Order to L. Morris Glucksman was returned to the Department on October 27, 2009, and indicated that it had been received by L. Morris Glucksman on October 26, 2009 (Ex. 2).
   
39. On November 2, 2009, counsel to the Department e-mailed the Hearing Officer, with a cc to L. Morris Glucksman, stated that counsel for both the Department and for the Respondents were requesting a continuance of at least 30 days “so that the parties may continue settlement discussions.” (Ex. 13)
   
40. On November 2, 2009, the Hearing Officer continued the consolidated proceeding on the April 9, 2009 Notice and the September 18, 2009 Notice from November 4, 2009 to December 8, 2009 (Ex. 13).
   
41. In a letter dated December 7, 2009 to attorneys Don Kitt and L. Morris Glucksman, the Hearing Officer confirmed the joint request by counsel to the Respondents and counsel to the Department that the December 8, 2009 hearing be continued.  The consolidated hearing on the April 9, 2009 Notice and the September 18, 2009 Notice was continued to December 17, 2009.  In addition, the Hearing Officer noted that, on November 23, 2009, the Banking Commissioner had issued a Temporary Order to Cease and Desist, Order of Summary Suspension, Notice of Intent to Revoke Mortgage Broker License, Notice of Intent to Issue Order to Cease and Desist and Notice of Right to Hearing (the “Surety Bond Notice”) against Allied based exclusively on allegations that the respondent failed to maintain a surety bond.  The Surety Bond Notice contemplated that a hearing would be held on December 17, 2009, if a hearing were requested.  In her December 7, 2009 letter, the Hearing Officer consolidated the proceedings on the April 9, 2009 Notice, the September 18, 2009 Notice and the Surety Bond Notice (Ex. 11).
   
42. On December 16, 2009, counsel to the Department e-mailed the Hearing Officer, with a cc to Morris Glucksman, requesting a 30 to 45 day continuance on behalf of the Department and the Respondents (Ex. 13).  The e-mail included a December 15, 2009 e-mail from counsel to the Respondents concurring with the request (Ex. 13).
   
43. On December 16, 2009, the Hearing Officer continued the consolidated hearing on the April 9, 2009 Notice, the September 18, 2009 Notice and the Surety Bond Notice to February 18, 2010 (Ex. 13).
   
44. On February 16, 2010, the Hearing Officer continued the consolidated hearing on the April 9, 2009 Notice, the September 18, 2009 Notice and the Surety Bond Notice to April 8, 2010 (Ex. 13).
   
45. On April 5, 2010, stating that the Department was “in the midst of a legislative session”, counsel for the Department e-mailed counsel for the Respondents, with a copy to the Hearing Officer, requesting a 30 day continuance “to give us time to get past this period and to get back to developing terms for settlement” (Ex. 13).
   
46. On April 6, 2010, counsel to the Department forwarded to the Hearing Officer an April 5, 2010 e-mail from counsel to the Respondents acquiescing in the request for an additional continuance (Ex. 13).
   
47. On April 6, 2010, the Hearing Officer continued the consolidated proceeding to May 11, 2010 (Ex. 13).
   
48. On May 7, 2010, counsel for the Department e-mailed the Hearing Officer requesting an additional 45 day continuance.  Included with the e-mail was a May 7, 2010 e-mail from counsel to the Respondents to the Department’s counsel acquiescing to the postponement (Ex. 13).
   
49. On May 7, 2010, the Hearing Officer continued the consolidated proceeding to June 23, 2010 (Ex. 13).
   
50. On June 22, 2010, counsel to the Department requested a further continuance to July 16, 2010.  Included with the e-mail was a June 22, 2010 e-mail from Respondents’ counsel to Doniel Kitt asking that Attorney Kitt consent to a “final postponement.” (Ex. 13)
   
51. On June 22, 2010, the Hearing Officer e-mailed counsel to the Department and counsel to the Respondents granting a final continuance to July 12, 2010 (Ex. 12).
   
52. On July 9, 2010 at 9:53 a.m., counsel for the Respondents e-mailed Department attorney Stacey Valerio, stating, “[w]ithout your advice as to what is unacceptable or any alternative [settlement] language, I am unsure how we negotiate from here.  Your help would be appreciated” (Ex. 14).  Department attorney Doniel Kitt was not copied in on the e-mail (Ex. 14)
   
53. On July 9, 2010 at 10:13 a.m., attorney Valerio e-mailed counsel to the Respondents, with a copy to Department attorney Doniel Kitt, stating:  “I’d be happy to discuss the substance of our opposition to the changes further with you today, am and available to do so until 2pm.  Please give me a call at your convenience.” (Ex. 14)
   
54. On July 12, 2010 at 8:16 a.m., counsel for the Respondents e-mailed Department attorney Doniel Kitt, with a copy to the Hearing Officer, stating:  “As stated in our last communications and my last E-mail to you, it was my understanding that there was agreement with the parties.  Since my clients had communicated with you directly I had no knowledge of the terms of such understanding.  I therefore did not expect there to be a hearing this week in the above matter.  My clients read my last correspondence with your office on Friday and believed that no hearing would be necessary.  Despite my efforts to contact them over the weekend, I was unable to do so and therefore since I have no understanding with my clients as to their availability, I will not be in attendance this morning.” (Ex. 14)  Although the Hearing Officer was copied in on the e-mail, Department attorney Stacey Valerio was not (Ex. 14).
   
55. On July 12, 2010 at 9:12 a.m., Department attorney Stacey Valerio e-mailed the Hearing Officer, with copies to Respondents’ counsel and Department attorney Doniel Kitt, stating, “  Attorney Glucksman both received and read my email from Friday, as he thereafter contacted me by phone (I expressed a willingness to discuss the reasons for our opposition to the changes that had been proposed on the draft settlement agreement).  We spoke, were unable to negotiate further, and Attorney Glucksman indicated to me he would be at the hearing at 10am Monday.”
   
56. On July 12, 2010 at 9:21 a.m., the Hearing Officer e-mailed Department attorney Valerio, with copies to Respondents’ counsel and Department attorney Kitt, stating that the hearing would go forward at 10:00 a.m. as scheduled based upon Attorney Valerio’s e-mail and the July 9, 2010 e-mail to respondent’s counsel advising him as to the unacceptability of the settlement changes (Ex. 14).
   
57. On July 12, 2010 at 10:14 a.m., a hearing was held at the Department of Banking (tr. p. 4).
   
58. Respondents did not withdraw their request for a hearing on the April 9, 2010 Notice or the September 18, 2010 Notice.
   
59. Neither the Respondents nor their legal counsel appeared at the hearing.
   
60. During the hearing, Attorney Stacey Valerio stated that, on Friday, July 9, 2010, she had spoken by telephone to Attorney Glucksman who indicated he would be coming to the hearing on July 12, 2010 (tr. p. 17).
   
61. During the hearing, Attorney Doniel Kitt stated that the following issues were before the Hearing Officer:  (1) pursuant to the April 9, 2009 Notice, whether an order to cease and desist should issue against Allied and Malik, whether Allied’s mortgage broker license should be revoked and/or whether a civil penalty should be issued against Allied and Malik (tr. p. 6); and (2) pursuant to the September 18, 2009 Notice, whether Allied’s mortgage broker license should be revoked, whether an order to cease and desist should issue against Allied and/or whether a civil penalty should be assessed against Allied (tr. p. 9).
   
62. During the hearing, Attorney Doniel Kitt noted that, on March 26, 2010, the matters alleged in the November 23, 2009 Surety Bond Notice had been settled since Allied had filed a replacement surety bond.  Therefore, the matters alleged in the Surety Bond Notice would not be considered by the Hearing Officer (tr. pp. 11-12).
   
63. During the hearing, counsel for the Department presented the following arguments with respect to the relief requested:  (1) although Respondents ultimately provided Department staff with access to their records, such production was not done in a timely manner; and (2) Allied engaged in mortgage brokerage activity while its license was under suspension by the Department (tr. p. 13).
   
64. The Department requested a default ruling against Respondents in light of their failure to appear (tr. p. 13).
   
65. During the hearing, counsel for the Department stated that the Department had “no financial statements to indicate any economic hardship at this time that would mean that they [Respondents] would be incapable of paying the maximum fine or close thereto” (tr. p. 20).
   
66. Aside from the content of the April 9, 2009 Notice and the September 18, 2009 Notice and arguments made by Department counsel during the hearing, there was no evidence presented bearing on the amount of the civil penalty, if any, to be imposed against Respondents.

CONCLUSIONS OF LAW

1.    The Commissioner has jurisdiction over the licensing and regulation of mortgage brokers pursuant to Part 1 of Chapter 668, Sections 36a-485 to 36a-534c, inclusive, of the Connecticut General Statutes, “Mortgage Lenders, Correspondent Lenders, Brokers and Loan Originators.”
 
2.   The April 9, 2009 Notice and the September 18, 2009 Notice issued by the Commissioner comported with the requirements of Section 4-177(b) of Chapter 54 of the Connecticut General Statutes.
 
3.    The Commissioner complied with the requirements of Section 4-182(c) of Chapter 54 of the Connecticut General Statutes.
 
4.    The April 9, 2009 Notice and the September 18, 2009 Notice complied with the notice requirements of Sections 36a-50(a) [civil penalty], 36a-51(a) [revocation proceeding] and 36a-52(a) [cease and desist order] of the Connecticut General Statutes.
  
5.   The Respondents, through their attorney, received notice that the consolidated hearing on the April 9, 2009 Notice and the September 18, 2009 Notice had been continued to July 12, 2010.
   
6.    Section 4-177(c) of Chapter 54 of the Connecticut General Statutes provides, in part, that:  “Unless precluded by law, a contested case may be resolved by . . . the default of a party.”
   
7.    Section 36a-51 of the Connecticut General Statutes provides, in part, that:

(a) The commissioner may . . . revoke . . . any license issued by the commissioner under any provision of the general statutes by sending a notice to the licensee by registered or certified mail, return receipt requested, or by any express delivery carrier that provides a dated delivery receipt . . (b) If a hearing is requested within the time specified in the notice, the commissioner shall hold a hearing upon the matters asserted in the notice unless the licensee fails to appear at the hearing.  After the hearing, the commissioner shall . . . revoke . . . the license for any reason set forth in the applicable licensing provisions of the general statutes if the commissioner finds sufficient grounds exist for such . . . revocation . . . If the licensee . . . fails to appear at the hearing, the commissioner shall . . . revoke . . . the license.  No such license shall be . . . revoked except in accordance with the provisions of chapter 54.”  (Emphasis supplied)

8.    The express terms of Section 36a-51(a) of the Connecticut General Statutes require that the Commissioner revoke Respondent Allied’s mortgage broker license given Respondent Allied’s failure to appear at the hearing.
 
9.    Subject to a respondent’s right to request a hearing on the matters alleged, Section 36a-52(a) of the Connecticut General Statutes authorizes the Commissioner to issue a cease and desist order where it appears to the commissioner that any person has violated, is violating or is about to violate any provision of the general statutes within the jurisdiction of the commissioner, or any regulation, rule or order adopted or issued thereunder . . . . ” Section 36a-52(a) also provides, in part, that:  “If the person . . . fails to appear at the hearing, the commissioner shall issue an order to cease and desist against the person.  No such order shall be issued except in accordance with the provisions of chapter 54.”   (Emphasis added)
 
10.    The express terms of Section 36a-52(a) of the Connecticut General Statutes require that the Commissioner issue a cease and desist order against the Respondents given the Respondents’ failure to appear at the hearing.
   
11.    Subject to a respondent’s right to request a hearing on the matters alleged, Section 36a-50(a) of the Connecticut General Statutes authorizes the Commissioner to issue a notice of intent to impose a civil penalty of up to $100,000 per violation where the commissioner finds as the result of an investigation that any person has violated any provision of the general statutes within the jurisdiction of the commissioner, or any regulation, rule or order adopted or issued thereunder . . . . ”

Subdivisions (2) and (3) of subsection (a) of Section 36a-50 provide that:

(2) If a hearing is requested within the time specified in the notice, the commissioner shall hold a hearing upon the matters asserted in the notice unless such person fails to appear at the hearing.  After the hearing, if the commissioner finds that the person has violated any such provision, regulation, rule or order, the commissioner may, in the commissioner’s discretion and in addition to any other remedy authorized by law, order that a civil penalty not exceeding one hundred thousand dollars per violation be imposed upon such person.  If such person . . . fails to appear at the hearing, the commissioner may, as the facts require, order that a civil penalty not exceeding one hundred thousand dollars per violation be imposed upon such person.  (3) Each action undertaken by the commissioner under this subsection shall be in accordance with chapter 54.”  (Emphasis added)

12.    Section 36a-1-31(b) of the Regulations of Connecticut State Agencies provides that:  “When a party fails to appear at a scheduled hearing, the allegations against the party may be deemed admitted.  Without further proceedings or notice to the party, the presiding officer shall submit to the commissioner a proposed final decision containing the relief sought in the notice, provided the presiding officer may, if deemed necessary, receive evidence from the department, as part of the record, concerning the appropriateness of the amount of any civil penalty, fine or restitution sought in the notice.  The commissioner shall issue a final decision in accordance with section 4-180 of the Connecticut General Statutes and section 36a-1-52 of the Regulations of Connecticut State Agencies.”
 
13.    In accordance with Section 36a-1-31(b) of the Regulations of Connecticut State Agencies, the factual and legal allegations against the Respondents which were contained in the April 9, 2009 Notice and the September 18, 2009 Notice are deemed admitted and adopted in the Findings of Fact and Conclusions of Law herein contained.
 
14.    Accordingly, the Hearing Officer, deeming it necessary, received evidence from the Department as part of the record solely concerning the appropriateness of the civil penalty sought in the April 9, 2009 Notice and the September 18, 2009 Notice.
 
15.    The Commissioner finds that Respondents Allied violated Sections 36a-17(d) and 36a-493(a) of the Connecticut General Statutes, and Respondent Malik violated Section 36a-17(d) of the Connecticut General Statutes, by failing to provide copies of certain loan files that examiners required to be produced during the course of an examination conducted on February 25, 2009 and by failing to otherwise furnish examiners with unrestricted access to Allied’s records during that examination.  The fact that the loan files were produced over six months later on September 24, 2009 and unrestricted access was granted by Allied almost eight months later on October 14, 2009 is not a significant mitigating factor.
   
16.   The Commissioner finds that Respondent Allied violated an order of the Commissioner in that, from at least April 21, 2009 to June 15, 2009, Allied transacted business as a mortgage broker in Connecticut while its license was under summary suspension.  Such conduct forms the basis for a civil penalty to be assessed against Allied under Section 36a-50(a) of the Connecticut General Statutes.
   
17. During the course of an agency examination conducted on February 25, 2009, Respondent Malik violated Section 36a-53a of the Connecticut General Statutes by making materially false or misleading statements to agency examiners concerning her mortgage loan activities conducted since 2006, as more fully described in paragraph 9 of the Findings of Fact herein contained.
   
18. The Commissioner finds that, in light of the Respondents’ violations as more fully set forth in paragraphs 15, 16 and 17 of these Conclusions of Law, the facts require the imposition of a fine against Respondents.  The Connecticut Supreme Court has stated that “[t]he assessment of civil penalties is a fact-specific and broadly discretionary determination.”  Rocque v. Light Sources, Inc., 275 Conn. 420, 450 (2005).  Although the Commissioner finds that the imposition of a fine is warranted, based upon the record and the matters alleged in the April 9, 2009 Notice and the September 18, 2009 Notice, the facts do not require the imposition of the maximum fine against Respondents.

ORDER

Having read the record, I hereby ORDER, pursuant to Sections 36a-50(a), 36a-51(a), 36a-52(a), and 36a-494(a)(1) of the Connecticut General Statutes that:
 
1.    Respondent Allied Financial Services, LLC’s mortgage broker license is hereby REVOKED;
  
2.    Respondent Allied Financial Services, LLC shall CEASE AND DESIST from violating Sections 36a-17(d) and 36a-493(a) of the Connecticut General Statutes or any order issued against it by the Commissioner;
   
3.    A civil penalty of twenty five thousand dollars ($25,000) shall be imposed against Allied Financial Services, LLC, such civil penalty to be remitted to the Department of Banking by cashier’s check, certified check or money order, made payable to “Treasurer, State of Connecticut”, no later than 45 days from the date this Order is mailed;
 
4.    Respondent Ayeshah Malik shall CEASE AND DESIST from violating Sections 36a-17(d) and 36a-53a of the Connecticut General Statutes;
   
5.    A civil penalty of fifteen thousand dollars ($15,000) shall be imposed against Respondent Ayeshah Malik, such civil penalty to be remitted to the Department of Banking by cashier’s check, certified check or money order, made payable to “Treasurer, State of Connecticut”, no later than 45 days from the date this Order is mailed;
   
6. In accordance with Section 36a-52(b) of the Connecticut General Statutes, the Temporary Order to Cease and Desist contained in the April 9, 2009 Notice shall no longer be in effect upon entry of the Permanent Order to Cease and Desist herein contained; and
   
7. This Order shall become effective when mailed.



So ordered at Hartford, Connecticut     ______/s/___________ 
this 23rd day of August, 2010. Howard F. Pitkin 
  Banking Commissioner


This Order was sent by certified mail,
return receipt requested, to Respondents
and to Respondents’ last known
counsel of record on August 23, 2010.


Allied Financial Services, LLC
c/o Zeba Mohib, Agent
83 East Avenue, Suite 206
Norwalk, Connecticut  06851
Certified Mail No. 7003 1010 0000 4562 0720

Ayeshah Malik
34 Woodbrook Drive
Stamford, Connecticut  06907
Certified Mail No. 7003 1010 0000 4562 0737

L. Morris Glucksman, Esq.
Patriot National Bank Building
900 Bedford Street, 3rd, Floor
Stamford, Connecticut  06901
Certified Mail No. 7003 1010 0000 4562 0744


Administrative Orders and Settlements