DOB: Champion Credit Services - Temp CD-Sum Sus-NOI Rev-CD-CP

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IN THE MATTER OF:

CHAMPION CREDIT
SERVICES, LLC

    ("Respondent")

 



 

 
 
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TEMPORARY ORDER TO
CEASE AND DESIST

ORDER OF SUMMARY SUSPENSION

NOTICE OF INTENT TO REVOKE
DEBT NEGOTIATOR LICENSE

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 (ďCommissionerĒ) is charged with the administration of Sections 36a-671 to 36a-671d, inclusive, of the Connecticut General Statutes contained in Part II of Chapter 669 of the Connecticut General Statutes, ďDebt Adjusters and Debt NegotiationĒ.
 
Pursuant to the authority granted by Section 36a-17 of the Connecticut General Statutes, the Commissioner, through the Consumer Credit Division (ďDivisionĒ) 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 within the jurisdiction of the Commissioner.
 
Section 36a-17 of the Connecticut General Statutes provides, in pertinent part, that:

(a)  The commissioner, in the commissionerís 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. . . .
 
(c)  For the purpose of any investigation, [or] examination . . . the commissioner may . . . require written statements and require the production of any records which the commissioner deems relevant or material.  The commissioner may require that certified copies of any such records be provided to the commissioner at the commissionerís office.

(d)  Any person who is the subject of any such investigation, [or] examination . . . shall make its records available to the commissioner in readable form; . . . provide copies or computer printouts of records when so requested; furnish unrestricted access to all areas of its principal place of business or wherever records may be located; and otherwise cooperate with the commissioner. . . .

(f)  As used in this section, ďrecordsĒ includes, but is not limited to, books, papers, correspondence, memoranda, agreements, diaries, logs, notes, ledgers, journals, visual, audio, magnetic or electronic recordings, computer printouts and software, and any other documents.

Section 36a-51 of the Connecticut General Statutes provides, in pertinent 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.  The notice shall be deemed received by the licensee 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 . . . involved; (4) a short and plain statement of the matters asserted; and (5) a statement indicating that the licensee may file a written request for a hearing on the matters asserted within fourteen days of receipt of the notice.  If the commissioner finds that public health, safety or welfare imperatively requires emergency action, and incorporates a finding to that effect in the notice, the commissioner may order summary suspension of a license in accordance with subsection (c) of section 4-182 and require the licensee to take or refrain from taking such action as in the opinion of the commissioner will effectuate the purposes of this section, pending proceedings for . . . revocation . . . .

(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 does not request a hearing within the time specified in the notice or 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.

Section 36a-52 of the Connecticut General Statutes provides, in pertinent part, that:

(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, . . . 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 . . . 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.

(b)  If the commissioner finds that the public welfare requires immediate action, the commissioner may incorporate a finding to that effect in the notice sent in accordance with subsection (a) of this section and issue a temporary order requiring the person to cease and desist from the activity which constitutes such alleged violation and to take or refrain from taking such action as in the opinion of the commissioner will effectuate the purposes of this section.  Such temporary order shall become effective on receipt and, unless set aside or modified by a court, shall remain in effect until the effective date of a permanent order or dismissal of the matters asserted in the notice.

Section 36a-50(a) of the Connecticut General Statutes provides, in pertinent part, that:

(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, . . . 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 . . . 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, . . . the commissioner may, in the commissionerís 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 4-182(c) of the Connecticut General Statutes provides, in pertinent part, that:

If the agency finds that public health, safety or welfare imperatively requires emergency action, and incorporates a finding to that effect in its order, summary suspension of a license may be ordered pending proceedings for revocation or other action.  These proceedings shall be promptly instituted and determined.


II.  MATTERS ASSERTED

1.
Respondent is a Connecticut limited liability company with its place of business at 9 Mott Avenue, Suite 305, Norwalk, Connecticut.
2.
Respondent currently holds a license to engage or offer to engage in debt negotiation in Connecticut (No. 27910) under Section 36a-671 of the Connecticut General Statutes.
3.
On March 16, 2011, examiners from the Division attempted to conduct an examination of Respondent.  During such examination, Respondent failed to provide copies of specific files that the examiners required to be produced.
4.
On March 23, 2011, the Division sent a letter to Fernando Diaz, President of Respondent, requesting specific files and information that Respondent was to have ready for the examiners to review on March 30, 2011.  On March 30, 2011, the examiners arrived at the office of Respondent but were unable to gain access.
5.
On March 31, 2011, pursuant to Section 4-182(c) of the Connecticut General Statutes, the Division sent a letter to Respondent giving Respondent an opportunity to show compliance with all lawful requirements for the retention of its license to engage or offer to engage in debt netotiation in Connecticut.
6.
On April 12, 2011, examiners from the Division attempted to conduct another examination of Respondent.  During such examination, Respondent failed to provide the specific files and information that had been requested in its March 23, 2011 letter, as described in paragraph 4 above.
7.
By facsimiles dated April 21, 2011 and May 9, 2011, Respondent provided additional information to the Division.  To date, the Division has not received all of the files and information requested in its March 23, 2011 letter.
 

III.  STATUTORY BASIS FOR REVOCATION OF DEBT NEGOTIATOR LICENSE,
ORDER TO CEASE AND DESIST AND IMPOSITION OF CIVIL PENALTY

Section 36a-671a(a) of the Connecticut General Statutes, as amended by Public Act 11-216, provides, in pertinent part, that:

The commissioner may . . . revoke . . . any license or take any other action, in accordance with the provisions of section 36a-51, . . . for any reason that would be sufficient grounds for the commissioner to deny application for a license under sections 36a-671 to 36a-671d, inclusive, or section 41 of . . . [public act 11-216] or if the commissioner finds that the licensee or any proprietor, director, officer, member, partner, shareholder, trustee, employee or agent of such licensee has done any of the following:  . . . (3) violated any of the provisions of sections 36a-671 to 36a-671d, inclusive, . . . or any other law or regulation applicable to the conduct of its business . . . .

Respondentís conduct, as more fully described in paragraphs 3 through 7, inclusive, of the Matters Asserted, constitutes a violation of Section 36a-17(d) of the Connecticut General Statutes, which is a law applicable to the conduct of Respondentís business.  Such conduct constitutes sufficient grounds for the Commissioner to revoke Respondentís license to engage or offer to engage in debt negotiation in Connecticut pursuant to Sections 36a-671a(a) and 36a-51 of the Connecticut General Statutes, and forms the basis to issue an order to cease and desist pursuant to Section 36a-52(a) of the Connecticut General Statutes, and to impose a civil penalty 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 not to exceed Thirty Thousand Dollars ($30,000), subject to Respondentís right to a hearing on the allegations set forth above.


IV.  FINDINGS AND STATUTORY BASIS FOR TEMPORARY ORDER
TO CEASE AND DESIST AND ORDER OF SUMMARY SUSPENSION

The Commissioner finds that public safety and welfare imperatively require emergency action to summarily suspend Respondentís license to engage or offer to engage in debt negotiation in Connecticut under Section 4-182(c) of the Connecticut General Statutes and finds that public welfare requires immediate action to issue a temporary order requiring Respondent to cease and desist from violating the law under Section 36a-52(b) of the Connecticut General Statutes, in that Respondentís failure to produce records to the Commissioner impedes the Commissionerís ability to carry out his duties to examine Respondentís activities in order to determine whether the business is being operated soundly and efficiently, in the public interest and consistent with the purposes of section 36a-671 to 36a-671d, inclusive, of the Connecticut General Statutes, and therefore adversely effects the public.


V.  TEMPORARY ORDER TO CEASE AND DESIST,
ORDER OF SUMMARY SUSPENSION, NOTICE OF INTENT
TO REVOKE DEBT NEGOTIATOR LICENSE, 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 constitutes sufficient grounds for the Commissioner to revoke Respondentís license to engage or offer to engage in debt negotiation in Connecticut pursuant to Sections 36a-671a(a) and 36a-51 of the Connecticut General Statutes, and forms a basis to issue an order to cease and desist against Respondent pursuant to Section 36a-52(a) of the Connecticut General Statutes and to impose a civil penalty upon Respondent pursuant to Section 36a-50(a) of the Connecticut General Statutes;
 
AND WHEREAS, the Commissioner has made the findings required under Sections 4-182(c) and 36a-52(b) of the Connecticut General Statutes.
 
THE COMMISSIONER THEREFORE ORDERS, pursuant to the authority granted in Section 36a-52(b) of the Connecticut General Statutes, that Champion Credit Services, LLC immediately CEASE AND DESIST from further violations of Section 36a-17(d) of the Connecticut General Statutes.  This Temporary Order shall become effective upon receipt by Champion Credit Services, LLC, and, unless set aside or modified by a court, shall remain in effect until the effective date of a permanent order or dismissal of the matters asserted in this Temporary Order.
 
THE COMMISSIONER FURTHER ORDERS, pursuant to the authority granted in Sections 36a-51(a) and 4-182(c) of the Connecticut General Statutes, that the license of Champion Credit Services, LLC to engage or offer to engage in debt negotiation in Connecticut be and is hereby SUMMARILY SUSPENDED pending proceedings for revocation.
 
FURTHER, notice is hereby given to Respondent that the Commissioner intends to REVOKE Respondentís license to engage or offer to engage in debt negotiation in Connecticut, issue an order requiring Respondent to CEASE AND DESIST from violating Section 36a-17(d) of the Connecticut General Statutes, and impose a CIVIL PENALTY upon Respondent as set forth herein, subject to Respondentís 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 Respondentís receipt of this Temporary Order to Cease and Desist, Order of Summary Suspension, Notice of Intent to Revoke Debt Negotiator License, 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 subsections (a) and (b) of Section 36a-51 and Sections 36a-52(a) and 36a-50(a) of the Connecticut General Statutes.  This Temporary Order to Cease and Desist, Order of Summary Suspension, Notice of Intent to Revoke Debt Negotiator License, 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 ďpro seĒ.  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 presiding 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 August 24, 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 revoking Respondentís license to engage or offer to engage in debt negotiation in Connecticut, issue an order that Respondent cease and desist from violating Section 36a-17(d) of the Connecticut General Statutes, and may order a civil penalty not to exceed Thirty Thousand Dollars ($30,000) be imposed upon Respondent.


So ordered at Hartford, Connecticut
this 20th of July 2011.                                 ________/s/_________
                                                               Howard F. Pitkin
                                                               Banking Commissioner


CERTIFICATION

I hereby certify that on this 21st day of July 2011, the foregoing Temporary Order to Cease and Desist, Order of Summary Suspension, Notice of Intent to Revoke Debt Negotiator License, 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 Champion Credit Services, LLC, Attention:  Fernando Diaz, 9 Mott Avenue, Suite 305, Norwalk, Connecticut 06850, registered mail no. RB028020606US; and via facsimile.

                                                              ________/s/_________
                                                              Doniel Kitt
                                                              Prosecuting Attorney
 


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