DOB: Maverick Funding Corp. - CO

* * * * * * * * * * * * * * * * * * *

IN THE MATTER OF:

MAVERICK FUNDING CORP.
NMLS # 7706

    ("Maverick Funding")

* * * * * * * * * * * * * * * * * * *

*
*
*
*
*
*
*
*
*
*

CONSENT ORDER        

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”;
 
WHEREAS, Maverick Funding is a New Jersey corporation with a main office located at 1160 Parsippany Boulevard, Suite B, Parsippany, New Jersey (“Main Office”) and with branch offices located at 300 Centerville Road, The Summit West, Suite 102, Warwick, Rhode Island, NMLS Branch # 1178 (“Centerville Road Branch”) and 120 Lavan Street, Suite 3, Warwick, Rhode Island, NMLS Branch # 198093 (“Lavan Street Branch”), all currently licensed as mortgage correspondent lenders under Part I of Chapter 668, Sections 36a-485 et seq., of the Connecticut General Statutes;
 
WHEREAS, the Commissioner, through the Consumer Credit Division (“Division”) of the Department of Banking, initiated an investigation pursuant to Sections 36a-17 and 36a-498f of the Connecticut General Statutes into license renewal requests filed by Maverick Funding in connection with the aforementioned offices to assess Maverick Funding’s qualifications for continued licensure, and into certain activities of Maverick Funding to determine if Maverick Funding had violated, was violating or was about to violate the provisions of the Connecticut General Statutes within the jurisdiction of the Commissioner;
 
WHEREAS, Maverick Funding presently has a pending application to obtain mortgage correspondent lender licensure for a branch office to be located at 1140 Parsippany Boulevard, 2nd Floor, Parsippany, New Jersey, NMLS # 365358;
 
WHEREAS, as a result of the Division’s investigation, the Commissioner alleges the following: 

1. The qualified individual designated by Maverick Funding for the Main Office did not complete either the education requirement or the national and state tests by April 1, 2010, in violation of Section 36a-488(a)(3) of the Connecticut General Statutes;
2. The individuals designated by Maverick Funding as branch managers for the Centerville Road Branch and Lavan Street Branch did not complete the state test by April 1, 2010, in violation of Section 36a-488(a)(3) of the Connecticut General Statutes;
3. Maverick Funding failed to promptly update the Nationwide Mortgage Licensing System and Registry (“NMLS”), or otherwise provide the Commissioner with information required by the MU1 and MU2 Forms pertaining to disclosure of certain civil and criminal matters and regulatory events, in violation of Section 36a-490(b) of the Connecticut General Statutes;
4.
In 2007, Maverick Funding filed a statement with the Commissioner that was, at the time and in the light of the circumstances under which it was made, false or misleading in a material respect, in violation of Section 36a-53a of the Connecticut General Statutes, when it answered “no” to the following disclosure question:  “Has the applicant, control person (member, partner, trustee, officer, director, or individual with a similar status or function) or owner of 10% or more of capital . . . (d) ever been a defendant in any litigation of any type (including suits under the State or Federal Truth in Lending Act) filed against the Applicant or any employee, officer or director thereof, in connection with the granting or brokering of mortgage loans?”
5. From at least November 2009 and through September 2010, Maverick Funding compensated unlicensed third-party lead generation service providers for mortgage brokering or mortgage loan origination, in violation of Section 36a-496 and subdivision (6) of Section 36a-498e of the Connecticut General Statutes;
6. From at least November 2009 through March 2010, Maverick Funding paid various mortgage brokers a volume-based incentive that was based on the volume of loans produced by the broker each month in violation of 24 CFR 3500.14, which, in turn, constitutes a violation of subdivision (8) of Section 36a-498e of the Connecticut General Statutes; and
7.
Maverick Funding paid an individual for unlicensed broker activity on at least two Connecticut loans made by Maverick on or about February 22, 2010 and March 17, 2010 in violation of Section 36a-496 and subdivision (6) of Section 36a-498e of the Connecticut General Statutes;
 
WHEREAS, the Commissioner believes that such allegations would support initiation of enforcement proceedings against Maverick Funding, including proceedings to revoke and/or refuse to renew Maverick Funding’s licenses pursuant to Section 36a-494(a) and subsections (a) and (b) of Section 36a-51 of the Connecticut General Statutes, issue a cease and desist order against Maverick Funding pursuant to Sections 36a-494(b) and 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 Maverick Funding, pursuant to Sections 36a-494(b) and 36a-50(a) of the Connecticut General Statutes;
 
WHEREAS, initiation of such enforcement proceedings would constitute a “contested case” within the meaning of Section 4-166(2) 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 consent order, unless precluded by law;
 
WHEREAS, Maverick Funding herein represents that it has, prior to the date this Consent Order is executed by Maverick Funding, updated its MU1 and MU2 Forms and otherwise has provided all required information pertaining to its licenses on NMLS and to the Commissioner;
 
WHEREAS, Maverick Funding herein further represents that it has updated its internal policies and procedures to ensure that it accurately reports and promptly updates information required to be disclosed on NMLS or otherwise required to be provided to the Commissioner, and to ensure that compensation is not paid to third parties for unlicensed mortgage broker or loan origination activity, or otherwise paid in violation of laws applicable to its business;
 
WHEREAS, the Commissioner and Maverick Funding acknowledge the possible consequences of formal administrative proceedings, and Maverick Funding voluntarily agrees to consent to the entry of the sanctions described below without admitting any liability nor admitting or denying any allegation contained herein and solely for the purpose of obviating the need for further formal administrative proceedings concerning the allegations contained herein;
 
WHEREAS, Maverick Funding acknowledges that this Consent Order is a public record;
 
AND WHEREAS, Maverick Funding, through its execution of this Consent Order, voluntarily agrees to waive its procedural rights, including a right to notice and an opportunity for hearing as it pertains to the allegations set forth herein, and voluntarily waives its right to seek judicial review or otherwise challenge or contest the validity of this Consent Order.


CONSENT TO ENTRY OF SANCTIONS

WHEREAS, Maverick Funding, through its execution of this Consent Order, consents to the Commissioner’s entry of a Consent Order imposing the following sanctions:

1.
Maverick Funding shall remit to the Department of Banking the sum of Forty-eight Thousand Five Hundred Dollars ($48,500) as a civil penalty.  Maverick Funding shall remit the civil penalty to the Department of Banking by cashier’s check, certified check or money order made payable to “Treasurer, State of Connecticut”, in accordance with the following schedule:
 
Twenty-four Thousand Two Hundred Fifty Dollars ($24,250) no later than the date this Consent Order is executed by Maverick Funding; and an additional
 
Twenty-four Thousand Two Hundred Fifty Dollars ($24,250) on or before May 31, 2011.
2.
Maverick Funding shall retain, at its own expense, an independent, unaffiliated third-party auditor or compliance firm (“Auditor”) to be approved by the Director of the Consumer Credit Division (“Director”) to conduct two semi-annual reviews of Maverick Funding’s compliance with all applicable Connecticut law.  Each review by the Auditor shall include, but shall not be limited to, an audit of all filings made by Maverick Funding to the Commissioner, either directly or through NMLS, and shall include an audit of all payments made to third parties by Maverick in connection with Connecticut loans made by Maverick Funding during a six-month calendar period (“Audit Period”), with the first such Audit Period commencing on February 1, 2011.  The Auditor shall commence each semi-annual audit promptly, and shall provide a written report of its findings to the Director with a copy to Maverick Funding no later than three (3) months following the close of an Audit Period.  The Director may require additional audits if the audits do not demonstrate such compliance to the satisfaction of the Commissioner.
 
 
CONSENT ORDER
 
 NOW THEREFORE, the Commissioner enters the following:

1.
The Sanctions set forth above be and are hereby entered;
2. Upon issuance of this Consent Order by the Commissioner, this matter will be resolved and the Commissioner will not take any future enforcement action against Maverick Funding based upon the allegations contained herein; provided that issuance of this Consent Order is without prejudice to the right of the Commissioner to take enforcement action against Maverick Funding based upon a violation of this Consent Order or the matters underlying its entry, if the Commissioner determines that compliance with the terms herein is not being observed or if any representation made by Maverick Funding and reflected herein is subsequently discovered to be untrue;
3. So long as this Consent Order is promptly disclosed by Maverick Funding on NMLS, nothing in the issuance of this Consent Order shall adversely affect the ability of Maverick Funding 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, provided all applicable legal requirements for such licensure are satisfied; and
4.
This Consent Order shall become final when issued.
 

Issued at Hartford, Connecticut
this 1st day of April 2011.                  ________/s/_________
                                                     Howard F. Pitkin
                                                     Banking Commissioner



I, Ralph S. Vitiello, state on behalf of Maverick Funding Corp., that I have read the foregoing Consent Order; that I know and fully understand its contents; that I am authorized to execute this Consent Order on behalf of Maverick Funding Corp.; that Maverick Funding Corp. agrees freely and without threat or coercion of any kind to comply with the sanctions entered and terms and conditions ordered herein; and that Maverick Funding voluntarily agrees to enter into this Consent Order, expressly waiving the procedural rights set forth herein as to the matters described herein.                                            


                                            By:  ________/s/_________
                                                   Name:  Ralph S. Vitiello
                                                   Title:  CEO
                                                   Maverick Funding Corp.


State of:  New Jersey

County of:  Morris


On this the 29th day of March 2011, before me, Catherine Cramer, the undersigned officer, personally appeared Ralph Vitiello who acknowledged himself to be the CEO of Maverick Funding Corp., a corporation that he as such CEO, being authorized so to do, executed the foregoing instrument for the purposes therein contained, by signing the name of the corporation by himself as CEO.

In witness whereof I hereunto set my hand.


                                         ________/s/_________
                                         Notary Public
                                         Date Commission Expires:  Feb. 26, 2012


Administrative Orders and Settlements