DOB: Nafisa LLC - NOI CD-CP

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IN THE MATTER OF:

NAFISA LLC
  
   ("Respondent")

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NOTICE OF INTENT TO ISSUE
ORDER TO CEASE AND DESIST

NOTICE OF INTENT TO IMPOSE
CIVIL PENALTY

                      AND

NOTICE OF RIGHT TO HEARING


I.  LEGAL AUTHORITY AND JURISDICTION

The Banking Commissioner (“Commissioner”) is charged with the administration of Part IV of Chapter 668, Sections 36a-580 to 36a-589, inclusive, of the Connecticut General Statutes, “Check Cashing Services”, and Sections 36a-585-1, 36a-588-1, 36a-588-3 and 36a-588-4 of the Regulations of Connecticut State Agencies (“Regulations”).
 
Pursuant to the authority granted by Section 36a-17 of the Connecticut General Statutes, the Commissioner, through the Consumer Credit Division (“Division”) of the Department of Banking, has investigated the activities of Respondent to determine if it has violated, is violating or is about to violate the provisions of the Connecticut General Statutes and Regulations within the jurisdiction of the Commissioner.  Section 36a-17(a) of the Connecticut General Statutes states that:
The commissioner, in the commissioner’s discretion, may make such public or private investigations or examinations within or outside this state, concerning any person subject to the jurisdiction of the commissioner, as the commissioner deems necessary to carry out the duties of the commissioner.
Section 36a-52 of the Connecticut General Statutes provides, in pertinent part:
(a)  Whenever 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 . . . adopted . . . thereunder, the commissioner may send a notice to such person by registered or certified mail, return receipt requested, or by any express delivery carrier that provides a dated delivery receipt.  The notice shall be deemed received by the person on the earlier of the date of actual receipt, or seven days after mailing or sending.  Any such notice shall include:  (1) A statement of the time, place, and nature of the hearing; (2) a statement of the legal authority and jurisdiction under which the hearing is to be held; (3) a reference to the particular sections of the general statutes, [or] regulations . . . alleged to have been violated; (4) a short and plain statement of the matters asserted; and (5) a statement indicating that such person may file a written request for a hearing on the matters asserted within fourteen days of receipt of the notice.  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 person fails to appear at the hearing.  After the hearing, the commissioner shall determine whether an order to cease and desist should be issued against the person named in the notice.  If the person does not request a hearing within the time specified in the notice or 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.
Section 36a-50(a) of the Connecticut General Statutes provides, in pertinent part:
(1)  Whenever 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 . . . adopted . . . thereunder, the commissioner may send a notice to such person by registered or certified mail, return receipt requested, or by any express delivery carrier that provides a dated delivery receipt.  The notice shall be deemed received by the person on the earlier of the date of actual receipt or seven days after mailing or sending.  Any such notice shall include:  (A) A statement of the time, place, and nature of the hearing; (B) a statement of the legal authority and jurisdiction under which the hearing is to be held; (C) a reference to the particular sections of the general statutes, [or] regulations . . . alleged to have been violated; (D) a short and plain statement of the matters asserted; (E) the maximum penalty that may be imposed for such violation; and (F) a statement indicating that such person may file a written request for a hearing on the matters asserted within fourteen days of receipt of the notice.
(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, [or] regulation . . . 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 does not request a hearing within the time specified in the notice or 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 the provisions of chapter 54.
Section 36a-587(b) of the Connecticut General Statutes provides, in pertinent part:
Whenever it appears to the commissioner that any person has violated, is violating or is about to violate any of the provisions of sections 36a-580 to 36a-589, inclusive, or any regulation adopted pursuant to said sections . . . the commissioner may take action against such person . . . in accordance with sections 36a-50 and 36a-52.
 
II.  MATTERS ASSERTED
 
1.
Respondent is a Connecticut limited liability company with an office at 418 Main Street, Middletown, Connecticut (“Middletown Location”).
2.
At all time relevant hereto, Asafak Bhura was a member of Respondent.
3.
On June 25, 2010, as part of the Division’s investigation, an examiner from the Division visited the Middletown Location.  During such visit, Respondent cashed a money order in the amount of $18 for the examiner and charged a fee of $2 for such transaction.
4.
As part of its investigation, on July 6, 2010, the Division sent a letter to Respondent informing Respondent that it appeared to be engaged in the business of check cashing without a license at the Middletown Location and advised Respondent that it needed to immediately cease and desist from engaging in such activities without the required license.
5. On August 2, 2010, Mr. Bhura visited the Division in response to the July 6, 2010 letter, as more fully described in paragraph 4 above, at which time Mr. Bhura, on behalf of Respondent, verbally represented to the Division that Respondent did not want to obtain a license and that if it were to cash a check or money order, Respondent would only charge a fee of fifty cents or less.
6. On October 7, 2010, as part of its continuing investigation of Respondent, an examiner from the Division visited Respondent’s Middletown Location.  During such visit, Respondent cashed a money order in the amount of $23.81 for the examiner and charged a fee in the amount of $3.81 for such transaction.
7.
Respondent is not currently and has never been licensed pursuant to Section 36a-581(a) of the Connecticut General Statutes to operate a general facility or a limited facility at the Middletown Location, nor is Respondent eligible to claim an exemption from licensure.
 
 
III.  STATUTORY BASIS FOR ORDER TO CEASE AND DESIST
AND IMPOSITION OF CIVIL PENALTY
 
Section 36a-581(a) of the Connecticut General Statutes provides:
Except as provided for in section 36a-580, no person shall engage in the business of cashing checks, drafts or money orders for consideration without obtaining a license to operate a general facility or a license to operate a limited facility for each location where such business is to be conducted.
Section 36a-2(38) of the Connecticut General Statutes defines “licensee” to mean:
[A]ny person who is licensed or required to be licensed pursuant to the applicable provisions of . . . [Title 36a].
Section 36a-585 of the Connecticut to the General Statutes states, in relevant part:
The commissioner shall, by regulation adopted in accordance with the provisions of chapter 54, establish the maximum fees which may be charged by a licensee for cashing a check, draft or money order drawn on a depository institution.  No check cashing licensee shall charge any sum in excess of that established by such regulation or one dollar, whichever is greater.
Section 36a-585-1(a) of the Regulations of Connecticut State Agencies states:
No check cashing service licensed under Section 36a-581 of the Connecticut General Statutes shall charge or collect in fees, charges or otherwise for cashing a check, draft or money order drawn on a depository institution, a sum exceeding two percent of the item.
Section 36a-53a of the Connecticut General Statutes provides:
No person shall make or cause to be made orally or in any document filed with the commissioner or in any proceeding, investigation or examination under this title, any statement which is, at the time and in the light of the circumstances under which it is made, false or misleading in any material respect.
1.
Respondent’s engaging in the business of cashing checks, drafts and money orders for consideration without licensure for a general facility or limited facility, as more fully described in paragraphs 3, 6 and 7 of the Matters Asserted, constitutes a violation of Section 36a-581(a) of the Connecticut General Statutes, which forms the basis for the issuance of an order to cease and desist against Respondent pursuant to Sections 36a-587(b) and 36a-52(a) of the Connecticut General Statutes, and an order imposing civil penalty upon Respondent pursuant to Sections 36a-587(b) and 36a-50(a) of the Connecticut General Statutes.  Section 36a-50(a) of the Connecticut General Statutes authorizes the Commissioner to impose a civil penalty upon Respondent in an amount not to exceed One Hundred Thousand Dollars ($100,000) per violation.  The Commissioner intends to impose a civil penalty upon Respondent in an amount not to exceed Three Thousand Dollars ($3,000), subject to Respondent’s right to a hearing on the allegations set forth above.
2.
Respondent’s continuing to engage in the business of cashing checks, drafts and money orders for consideration with fees in excess of fifty cents without licensure for a general facility or limited facility after Respondent stated that if it continued such activity, it would charge fifty cents or less, as more fully described in paragraphs 4 through 6, inclusive, of the Matters Asserted, constitutes a further violation of Section 36a-581(a) of the 2010 Supplement to the General Statutes, which forms the basis for the issuance of an order to cease and desist against Respondent pursuant to Sections 36a-587(b) and 36a-52(a) of the Connecticut General Statutes, and an order imposing civil penalty upon Respondent pursuant to Sections 36a-587(b) and 36a-50(a) of the Connecticut General Statutes.  Section 36a-50(a) of the Connecticut General Statutes authorizes the Commissioner to impose a civil penalty upon Respondent in an amount not to exceed One Hundred Thousand Dollars ($100,000) per violation.  The Commissioner intends to impose a civil penalty upon Respondent in an amount not to exceed Three Thousand Dollars ($3,000), subject to Respondent’s right to a hearing on the allegations set forth above.
3.
Respondent’s charging of a fee in excess of two-percent for cashing money orders, as more fully described in paragraphs 3 and 6 of the Matters Asserted, constitutes a violation of Section 36a-585 of the Connecticut General Statutes and Section 36a-585-1(a) of the Regulations of Connecticut State Agencies, which forms the basis for the issuance of an order to cease and desist against Respondent pursuant to Section 36a-52(a) of the Connecticut General Statutes, and an order imposing civil penalty upon Respondent pursuant to Section 36a-50(a) of the Connecticut General Statutes.  Section 36a-50(a) of the Connecticut General Statutes authorizes the Commissioner to impose a civil penalty upon Respondent in an amount not to exceed One Hundred Thousand Dollars ($100,000) per violation.  The Commissioner intends to impose a civil penalty upon Respondent in an amount not to exceed Three Thousand Dollars ($3,000), subject to Respondent’s right to a hearing on the allegations set forth above.
4.
Mr. Bhura’s statement, made on behalf Respondent, that Respondent would not cash checks or money orders and charge a fee in excess of fifty cents, as more fully described in paragraph 5 of the Matters Asserted, when in fact it continued to charge in excess of fifty cents, as more fully described in paragraph 6 of the Matters Asserted, constitutes making orally to the Commissioner in an investigation a statement which is, at the time and in the light of the circumstances under which it is made, false or misleading in a material respect, in violation of Section 36a-53a of the Connecticut General Statutes, which forms the basis for the issuance of an order to cease and desist against Respondent pursuant to Section 36a-52(a) of the Connecticut General Statutes, and an order imposing civil penalty upon Respondent pursuant to Section 36a-50(a) of the Connecticut General Statutes.  Section 36a-50(a) of the Connecticut General Statutes authorizes the Commissioner to impose a civil penalty upon Respondent in an amount not to exceed One Hundred Thousand Dollars ($100,000) per violation.  The Commissioner intends to impose a civil penalty upon Respondent in an amount not to exceed Three Thousand Dollars ($3,000), subject to Respondent’s right to a hearing on the allegations set forth above.
 
 
IV.  NOTICE OF INTENT TO ISSUE ORDER TO CEASE AND DESIST,
NOTICE OF INTENT TO IMPOSE CIVIL PENALTY
AND NOTICE OF RIGHT TO HEARING
 
WHEREAS, the Commissioner has reason to believe that Respondent has engaged in acts or conduct which forms the basis to issue an order to cease and desist against Respondent pursuant to Sections 36a-587(b) and 36a-52(a) of the Connecticut General Statutes, and an order imposing civil penalty upon Respondent pursuant to Sections 36a-587(b) and 36a-50(a) of the Connecticut General Statutes.
 
NOW THEREFORE, notice is hereby given to Respondent that the Commissioner intends to issue an order requiring Respondent to CEASE AND DESIST from engaging in the business of cashing checks, drafts or money orders for consideration without a license, in violation of Section 36a-581(a) of the Connecticut General Statutes; charging fees in connection with such activity in excess of that allowed by Section 36a-585 of the Connecticut General Statutes and Section 36a-585-1(a) of the Regulations of Connecticut State Agencies; and making false and misleading statements to the Commissioner, in violation of Section 36a-53a of the Connecticut General Statutes, and that the Commissioner intends to impose a CIVIL PENALTY upon Respondent as set forth herein, subject to Respondent’s right to a hearing on the allegations set forth above.
 
A hearing will be granted to Respondent if a written request for a hearing is received by the Department of Banking, Consumer Credit Division, 260 Constitution Plaza, Hartford, Connecticut 06103-1800, within fourteen (14) days following its receipt of this Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing as set forth in Sections 36a-52(a) and 36a-50 of the Connecticut General Statutes.  This Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing shall be deemed received on the earlier of the date of actual receipt, or seven days after mailing or sending.  The enclosed Appearance and Request for Hearing Form must be completed and mailed to the above address. If Respondent will not be represented by an attorney at the hearing, please complete the Appearance and Request for Hearing Form as “pro se”.  Once a written request for a hearing is received, the Commissioner may issue a notification of hearing and designation of hearing officer that acknowledges receipt of a request for a hearing, designates a hearing officer and sets the date of the hearing in accordance with Section 4-177 of the Connecticut General Statutes and Section 36a-1-21 of the Regulations of Connecticut State Agencies.  If a hearing is requested, the hearing will be held on April 12, 2011, at 10 a.m. at the Department of Banking, 260 Constitution Plaza, Hartford, Connecticut.
 
The hearing will be held in accordance with the provisions of Chapter 54 of the Connecticut General Statutes, unless Respondent fails to appear at the requested hearing.  At such hearing, Respondent will have the right to appear and present evidence, rebuttal evidence and argument on all issues of fact and law to be considered by the Commissioner.
 
If Respondent does not request a hearing within the time prescribed, the Commissioner will issue an order that Respondent cease and desist from violating Sections 36a-581(a), 36a-585 and 36a-53a of the Connecticut General Statutes and Section 36a-585-1(a) of the Regulations of Connecticut State Agencies and may order that a civil penalty not to exceed Twelve Thousand Dollars ($12,000) be imposed upon Respondent.
 
 
Issued at Hartford, Connecticut
this 4th day of March 2011.              ________/s/_________
                                                   Howard F. Pitkin
                                                   Banking Commissioner
 
 
CERTIFICATION
 
I hereby certify that on this 7th day of March 2011, the foregoing Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing was sent by registered mail, return receipt requested to  Nafisa LLC, Attention:  Asafak Bhura, Member, 418 Main Street, Middletown, Connecticut 06457, registered mail no. RB028037601US.
 
 
                                                   ________/s/_________
                                                   Doniel Kitt
                                                   Prosecuting Attorney
 

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