DOB: Chrysalis Funding of Connecticut, LLC - CO

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

IN THE MATTER OF:

CHRYSALIS FUNDING OF
CONNECTICUT, LLC
NMLS # 1253

      (Chrysalis")

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

 
*
*
*
*
*
*
*
*
*
*
*
*
*

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, Chrysalis is a Connecticut limited liability company that is currently licensed as a mortgage correspondent lender under Part I of Chapter 668, Sections 36a-485 et seq., of the Connecticut General Statutes;

WHEREAS, on June 8, 2012, the Commissioner, through the Consumer Credit Division (“Division”) of the Department of Banking, conducted an examination pursuant to Section 36a-17 of the 2012 Supplement to the General Statutes and Section 36a-498f of the Connecticut General Statutes into the activities of Chrysalis 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,
as a result of such examination, the Commissioner alleges that Chrysalis failed to:  (1) maintain minimum tangible net worth of fifty thousand dollars for the year ending December 31, 2011, in violation of Section 36a-488(a) of the 2012 Supplement to the Connecticut General Statutes, (2) ensure that the Nationwide Mortgage Licensing System and Registry (“NMLS”) unique identifiers of mortgage loan originators were stated on mortgage loan applications, in violation of Section 36a-498d of the Connecticut General Statutes, (3) submit timely and accurate mortgage call reports on NMLS, in violation of Section 36a-534b(c)(3) of the 2012 Supplement to the General Statutes, and (4) respond timely to inquiries by the Division, and otherwise cooperate with the Division, in violation of Section 36a-17(d) of the 2012 Supplement to the General Statutes and Section 36a-498f of the Connecticut General Statutes;
 
WHEREAS, the Commissioner believes that such allegations would support initiation of enforcement proceedings against Chrysalis, including proceedings to revoke Chrysalis’ license pursuant to Section 36a-494(a) and subsections (a) and (b) of Section 36a-51 of the 2012 Supplement to the General Statutes, issue a cease and desist order against Chrysalis pursuant to Section 36a-494(b) of the 2012 Supplement to the General Statutes, as amended by Public Act 12-96, and Section 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 Chrysalis 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 by Public Act 12-96;

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, both the Commissioner and Chrysalis acknowledge the possible consequences of formal administrative proceedings, and Chrysalis voluntarily agrees to consent to the entry of the sanctions described below without 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,
Chrysalis acknowledges that this Consent Order is a public record and is a reportable event for purposes of regulatory disclosure questions on NMLS;
 
WHEREAS, Chrysalis herein represents to the Commissioner that it currently has the minimum tangible net worth required by Section 36a-488(a) of the 2012 Supplement to the General Statutes, as amended by Public Act 12-96;
 
WHEREAS, Chrysalis herein represents to the Commissioner that it has filed all mortgage call reports required to be filed on NMLS through the date of its execution of this Consent Order, and that such reports are accurate;

WHEREAS, Chrysalis herein represents to the Commissioner that it has reviewed and updated its internal policies, procedures and controls for ensuring that the NMLS unique identifiers of mortgage loan originators are stated on mortgage loan applications, solicitations and advertisements, as required pursuant to Section 36a-498d of the 2012 Supplement to the General Statutes;
 
AND WHEREAS, Chrysalis, through its execution of this Consent Order, voluntarily agrees to waive its procedural rights, including a right to notice and an opportunity for a 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, Chrysalis, through its execution of this Consent Order, consents to the Commissioner’s entry of a Consent Order imposing the following sanctions:

1. No later than the date this Consent Order is executed by Chrysalis, Chrysalis 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; and
2. Chrysalis shall immediately cease and desist from:  (1) failing to maintain the required tangible net worth, in violation of Section 36a-488(a) of the 2012 Supplement to the Connecticut General Statutes, as amended, (2) failing to ensure that the NMLS unique identifiers of mortgage loan originators are stated on mortgage loan applications, in violation of Section 36a-498d of the Connecticut General Statutes, (3) failing to submit timely and accurate mortgage call reports on NMLS, in violation of Section 36a-534b(c)(3) of the 2012 Supplement to the General Statutes, and (4) failing to timely respond to inquiries by the Division, and otherwise cooperate with the Division, in violation of Section 36a-17(d) of the 2012 Supplement to the General Statutes and Section 36a 498f of the Connecticut General Statutes.


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 Respondents based upon the allegations contained in the Notice and set forth herein; provided that issuance of this Consent Order is without prejudice to the right of the Commissioner to take enforcement action against Respondents 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 Respondents and reflected herein is subsequently discovered to be untrue;
3. So long as this Consent Order is complied with and promptly disclosed by Chrysalis on NMLS, nothing in the issuance of this Consent Order shall adversely affect the ability of Chrysalis 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 legal requirements for such licensure or renewal licensure are satisfied; and
4.
This Consent Order shall become final when issued.
 


Issued at Hartford, Connecticut
this 6th day of February 2013.        ________/s/_________
                                                     Howard F. Pitkin
                                                     Banking Commissioner



I, Michael Russo, state on behalf of Chrysalis Funding of Connecticut, 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 Chrysalis Funding of Connecticut, LLC; that Chrysalis Funding of Connecticut, LLC agrees freely and without threat or coercion of any kind to comply with the sanctions entered herein; and that Chrysalis Funding of Connecticut, LLC 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:  
                                                        Title:  
                                                        Chrysalis Funding of Connecticut, LLC

State of:  Connecticut

County of:  New Haven


On this the 30th day of January 2013, before me, Al Ghiroli, the undersigned officer, personally appeared Michael Russo who acknowledged himself to be the Owner/Manager of Chrysalis Funding of Connecticut, LLC, a member managed/manager managed limited liability company and that he as such _________________________, 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 as Owner/Manager.

In witness whereof I hereunto set my hand.


                                                       _________/s/_________
                                                       Al Ghiroli
                                                       Commissioner of the Superior Court
 

 
 


Administrative Orders and Settlements