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IN THE MATTER OF:
SOUND MORTGAGE, LLC
NMLS # 71423
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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, Sound Mortgage is a Connecticut limited liability company that is currently licensed as a mortgage broker under Part I of Chapter 668, Sections 36a-485 et seq., of the Connecticut General Statutes;
WHEREAS, the Commissioner, through the Consumer Credit Division of the Department of Banking, investigated pursuant to the authority granted by Section 36a-17(a) of the 2012 Supplement to the General Statutes, as amended by Public Act 12-96, and Section 36a-498f of the Connecticut General Statutes, the activities of Sound Mortgage to determine if it had violated, was violating, or was about to violate the provisions of the Connecticut General Statutes within the jurisdiction of the Commissioner;
WHEREAS, on October 26, 2012, as a result of the investigation, the Commissioner, acting pursuant to Sections 36a-494(b) of the 2012 Supplement to the General Statutes, as amended by Public Act 12-96, Section 36a-52(a) of the Connecticut General Statutes and Section 36a-50(a) of the Connecticut General Statutes, as amended by Public Act 12-96, issued a Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing (“Notice”) against Sound Mortgage, which Notice is incorporated herein by reference;
WHEREAS, the Commissioner alleged in the Notice that Sound Mortgage failed to file its fourth quarter mortgage call report that was due on February 14, 2012, its standard financial condition report for 2011 that was due on March 30, 2012, its first quarter mortgage call report that was due on May 15, 2012, and its second quarter mortgage call report that was due on August 14, 2012, all in violation of Section 36a-534b(c)(3) of the 2012 Supplement to the General Statutes and/or Section 36a-534b(c)(3) of the 2012 Supplement to the General Statutes, as amended by Public Act 12-96, which such violations form the basis to issue an order to cease and desist pursuant to Section 36a-494(b) of the 2012 Supplement to the General Statutes, as amended, and Section 36a-52(a) of the Connecticut General Statutes, and to impose a civil penalty pursuant to Section 36a-494(b) of the 2012 Supplement to the General Statutes, as amended, and Section 36a-50(a) of the Connecticut General Statutes, as amended;
WHEREAS, on October 31, 2012, the Notice was sent by certified mail, return receipt requested to Sound Mortgage (Certified Mail No. 70112000000247315935);
WHEREAS, on November 3, 2012, Sound Mortgage received the Notice, and on November 5, 2012, Sound Mortgage requested a hearing, which hearing is currently scheduled for December 18, 2012;
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, the Commissioner and Sound Mortgage now desire to resolve the matters alleged in the Notice and set forth herein;
WHEREAS, the Notice contained a scrivener error in the first paragraph of Section III, insofar as the quoted statutory provision was not accurate. Rather than amend the Notice at this juncture, corrected language is provided herein and is expressly incorporated into the Notice by reference:
Section 36a-534b(c)(3) of the 2012 Supplement to the General Statutes, in effect prior to October 1, 2012, provided, in pertinent part, that:
Each mortgage lender, mortgage correspondent lender, [or] mortgage broker . . . licensee shall submit to the system reports of condition that shall be in such form and shall contain such information as the system may require.
WHEREAS, Sound Mortgage admits that it had not filed the reports described in the Notice and set forth herein, on their respective due dates, and acknowledges that this Consent Order is a public record and is a reportable event for purposes of the regulatory disclosure questions on the Nationwide Mortgage Licensing System and Registry (“NMLS”), as applicable;
WHEREAS, Sound Mortgage voluntarily agrees to consent to the entry of the sanction described below, solely for the purpose of obviating the need for further formal administrative proceedings concerning the allegations contained in the Notice and set forth herein;
WHEREAS, Sound Mortgage herein represents to the Commissioner that it has reviewed and updated its internal policies, procedures and controls for timely and accurately filing required reports with the Commissioner through NMLS as required or as otherwise permitted under Part I of Chapter 668, Sections 36a-485 et seq., of the Connecticut General Statutes;
WHEREAS, Sound Mortgage agrees that the Notice may be used in construing the terms of this Consent Order and agrees to the language of this Consent Order;
AND WHEREAS, Sound Mortgage, through execution of this Consent Order, voluntarily agrees to waive any applicable procedural rights, including a right to a hearing as it pertains to the allegations contained in the Notice and 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 SANCTION
WHEREAS, Sound Mortgage through its execution of this Consent Order, consents to the Commissioner’s entry of a Consent Order imposing the following sanction:
No later than the date this Consent Order is executed by Sound Mortgage, Sound Mortgage shall remit to the Department of Banking by cashier’s check, certified check or money order made payable to “Treasurer, State of Connecticut”, the sum of Two Thousand Five Hundred Dollars ($2,500) as a civil penalty.
NOW THEREFORE, the Commissioner enters the following:
||The Sanction set forth above be and is hereby entered;|
||No later than the date this Consent Order is executed by Sound Mortgage, Sound Mortgage shall have satisfactorily filed on NMLS all mortgage call reports required to date, and also expressly including the 3rd quarter mortgage call report due November 14, 2012. In the future, Sound Mortgage shall timely and accurately file all required reports on NMLS or as otherwise permitted under Part I of Chapter 668 of the Connecticut General Statutes in connection with its current, and any future license issued to Sound Mortgage;|
||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 Sound Mortgage based upon the allegations set forth in the Notice and contained herein; provided that issuance of this Consent Order is without prejudice to the right of the Commissioner to take enforcement action against Sound Mortgage 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 Sound Mortgage and reflected herein is subsequently discovered to be untrue;|
So long as this Consent Order is promptly disclosed by Sound Mortgage and its control persons on NMLS, as applicable, nothing in the issuance of this Consent Order shall adversely affect the ability of Sound Mortgage 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 license are satisfied; and
This Consent Order shall become final when issued.
Issued at Hartford, Connecticut
this 10th day of December 2012. ________/s/_________
Howard F. Pitkin
I, Thatcher Zuse, state on behalf of Sound Mortgage, LLC, 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 Sound Mortgage, LLC; that Sound Mortgage LLC agrees freely and without threat or coercion of any kind to comply with the sanction entered and terms and conditions ordered herein; and that Sound Mortgage voluntarily agrees to enter into this Consent Order, expressly waiving the procedural rights set forth herein as to the matters described herein.
Name: Thatcher Zuse
Sound Mortgage, LLC
State of: Connecticut
County of: New Haven
On this the 6 day of December 2012, before me, Mary Ellen Filanowski, the undersigned officer, personally appeared Thatcher Zuse who acknowledged himself/herself to be the Owner/Principal of Sound Mortgage, LLC, a limited liability company, and that he/she as such Owner/Principal, being authorized so to do, executed the foregoing instrument for the purposes therein contained, by signing the name of the limited liability company by himself/herself as Owner/Principal.
In witness whereof I hereunto set my hand.
Date Commission Expires: 8/31/2015
Administrative Orders and Settlements