DOB: Hansmire, Kenneth et al - Consent Order

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

IN THE MATTER OF:


OVERTIME MARKETING, LLC

OVERTIME SPORTS
SOUTHEAST, LLC

OVERTIME SPORTS
SOUTHWEST, LLC

KENNETH HANSMIRE a/k/a
KENNETH P. HANSMIRE a/k/a
JAMES K. HANSMIRE a/k/a
JAMES K. PATTILLO a/k/a
KENNY P. HANSMIRE



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

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

CONSENT ORDER

DOCKET NO. CO-15-8110-S



 


I. PRELIMINARY STATEMENT

WHEREAS, the Banking Commissioner (“Commissioner”) is charged with the administration of Chapter 672a of the General Statutes of Connecticut, the Connecticut Uniform Securities Act (“Act”), and Sections 36b-31-2 to 36b-31-33, inclusive, of the Regulations of Connecticut State Agencies (“Regulations”) promulgated under the Act;

WHEREAS, the Commissioner, through the Securities and Business Investments Division (“Division”) of the Department of Banking, conducted an investigation pursuant to Section 36b-26(a) of the Act into the activities of Overtime Marketing, LLC, Overtime Sports Southeast, LLC, Overtime Sports Southwest, LLC and Kenneth Hansmire (collectively “Respondents”) to determine if they have violated, were violating or were about to violate provisions of the Act or Regulations (“Investigation”);

WHEREAS, as a result of the Investigation, on June 22, 2015, the Commissioner, acting pursuant to Section 36b-27 of the Act, issued an Order to Cease and Desist, Order to Make Restitution, Notice of Intent to Fine and Notice of Right to Hearing (collectively “Notice”) (Docket No. CRF-15-8110-S) against Respondents, which Notice is incorporated by reference herein;

WHEREAS, on July 8, 2015, Respondent Kenneth Hansmire requested a hearing on the matters alleged in the Notice on behalf of the Respondents;

WHEREAS, on July 17, 2015, the Commissioner issued a Notification of Hearing and Designation of Hearing Officer, wherein the Commissioner scheduled the hearing on the matters alleged in the Notice for September 1, 2015 (“Hearing”);

WHEREAS, on August 28, 2015, the designated Hearing Officer granted a continuance of the Hearing to October 20, 2015;

WHEREAS, Section 36b-31(a) of the Act provides, in relevant part, that “[t]he commissioner may from time to time make . . . such . . . orders as are necessary to carry out the provisions of sections 36b-2 to 36b-34, inclusive”;

WHEREAS, Section 36b-31(b) of the Act provides, in relevant part, that “[n]o . . . order may be made . . . unless the commissioner finds that the action is necessary or appropriate in the public interest or for the protection of investors and consistent with the purposes fairly intended by the policy and provisions of sections 36b-2 to 36b-34, inclusive”;

WHEREAS, an administrative proceeding initiated under Section 36b-27 of the Act would constitute a “contested case” within the meaning of Section 4-166(4) of the General Statutes of Connecticut;

WHEREAS, Section 36b-27(f) of the Act provides, in relevant part, that “[a]ny time after the issuance of an order or notice provided for in subsection (a) . . . (b) . . . or subdivision (1) of subsection (d) of this section, the commissioner may accept an agreement by any respondent named in such order or notice to enter into a written consent order in lieu of an adjudicative hearing”;

WHEREAS, Section 4-177(c) of the General Statutes of Connecticut 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, Respondents and the Commissioner now desire to resolve the matters alleged in the Notice without the need for further administrative proceedings;

WHEREAS, the Commissioner finds that the issuance of this Consent Order is necessary or appropriate in the public interest or for the protection of investors and consistent with the purposes fairly intended by the policy and provisions of the Act;

WHEREAS, Respondents acknowledge their obligation to pay full restitution to the investors referenced in paragraph 15 of the Notice;

WHEREAS, on August 21, 2015, Respondents filed with the Division a confidential sworn Summary Financial Statement, with related attachments (collectively, the “Financial Documentation”), which Financial Documentation is incorporated by reference herein, indicating that Respondents were currently financially unable to pay the restitutionary amount imposed pursuant to Section 36b-27(b) of the Act and referenced in the Notice;

AND WHEREAS, Respondents specifically assure the Commissioner that none of the violations alleged in the Notice shall occur in the future.

II. CONSENT TO WAIVER OF PROCEDURAL RIGHTS

WHEREAS, Respondents, through their execution of this Consent Order, voluntarily waive the following rights with respect to the Notice:

1. To be afforded an opportunity for a hearing within the meaning of Section 36b-27 of the Act and Section 4-177(a) of the General Statutes of Connecticut;
2. To present evidence and argument and to otherwise avail themselves of Section 36b-27 of the Act and Section 4-177c(a) of the General Statutes of Connecticut;
3.
To present their position in a hearing in which each is represented by counsel;
4. To have a written record of the hearing made and a written decision issued by a hearing officer; and
5.
To seek judicial review of, or otherwise challenge or contest the matters described herein, including the validity of this Consent Order.

III.  ACKNOWLEDGEMENT OF THE COMMISSIONER'S ALLEGATIONS

WHEREAS, Respondents, through their execution of this Consent Order, acknowledge the Commissioner’s allegations that Respondents violated Sections 36b-16 and 36b-4(a) of the Act and Respondents Overtime Marketing, LLC, Overtime Sports Southeast, LLC and Overtime Sports Southwest, LLC each violated Section 36b-6(b) of the Act, and do not admit or deny these allegations, but agree that evidence exists from which the Commissioner could find facts to support the issuance of an order to cease and desist, an order to make restitution, and an order imposing an administrative fine per violation of the Act, or any regulation, rule or order adopted or issued under the Act against each of them[;]

WHEREAS, the Commissioner would have the authority to enter findings of fact and conclusions of law after granting Respondents an opportunity for a hearing;

AND WHEREAS, Respondents acknowledge the possible consequences of an administrative hearing and voluntarily agree to consent to the entry of the sanctions described below. 

IV.  CONSENT TO ENTRY OF SANCTIONS

WHEREAS, Respondents, through their execution of this Consent Order, consent to the Commissioner’s entry of a Consent Order imposing on them the following sanctions:

1. Respondents Overtime Marketing, LLC, Overtime Sports Southeast, LLC, and Overtime Sports Southwest, LLC shall cease and desist from directly or indirectly violating the provisions of the Act and the Regulations, including, without limitation, engaging in any activity in or from Connecticut that violates Sections 36b-16, 36b-4 or 36b-6(b) of the Act;
2. Respondent Hansmire shall cease and desist from directly or indirectly violating the provisions of the Act and the Regulations, including, without limitation, engaging in any activity in or from Connecticut that violates Sections 36b-16 or 36b-4 of the Act;
3. From the date this Consent Order is entered, Respondent Hansmire and any entity under his control is permanently barred from (a) transacting business in or from Connecticut as a broker-dealer, agent, investment adviser or investment adviser agent, as such terms are defined in the Act, and notwithstanding any definitional exclusion that might otherwise be available; (b) directly or indirectly soliciting or accepting funds for investment purposes from public or private investors in or from Connecticut; and (c) in connection with the recommendation, sale or purchase of securities in or from Connecticut, acting as a finder for compensation, or receiving referral fees or other remuneration, directly or indirectly for soliciting or otherwise procuring securities investors, customers or clients for any issuer, broker-dealer or investment adviser; and
4. Based on the contents of the Financial Documentation submitted to the Division, enforcement of the Order to Make Restitution contained in the Notice shall be temporarily stayed for three years from the date this Consent Order is entered by the Commissioner, provided that such stay shall no longer be in force and effect, and Respondents will be obligated to immediately pay restitution, if the Commissioner ascertains at any time that (a) any of the Respondents is able to pay restitution to affected investors; or (b) the Respondents failed to disclose any material asset, materially misstated the value of any asset or made any other material misstatement or omission in the Financial Documentation or any update to the Financial Documentation filed with the department.  For so long as the temporary stay referenced in this paragraph remains in effect, Respondents shall file with the agency at least annually updated financial documentation demonstrating their continuing eligibility for the relief provided in this paragraph and supplementing such filing with information on restitutionary payments, if any, made to affected investors by Respondents or by any other third party identified by the Respondents.  Each respondent, through such Respondent’s execution of this Consent Order, knowingly, wilfully and voluntarily waives such Respondent’s right to notice and an administrative hearing in conjunction with the implementation of this paragraph; provided, however, that, prior to invoking any enforcement measures contemplated by this paragraph, the Commissioner shall provide the affected Respondent with an informal opportunity to demonstrate its compliance with this Consent Order.

V.  CONSENT ORDER

NOW THEREFORE, the Commissioner enters the following:

1. The Sanctions set forth above be and are hereby entered;
2. Entry of this Consent Order by the Commissioner is without prejudice to the right of the Commissioner to take enforcement action against Respondents based upon a violation of this Consent Order if the Commissioner determines that compliance with the terms herein is not being observed or if any representation made by one or more of the Respondents and reflected herein is subsequently determined to be untrue;
3. Nothing in this Consent Order shall be construed as limiting the Commissioner’s ability to take enforcement action against Respondents based upon evidence of which the Division was unaware on the date hereof relating to a violation of the Act or any regulation or order under the Act; and
4. This Consent Order shall become final when entered.

So ordered at Hartford, Connecticut       ____/s/___________ 
this 16th day of September 2015.   Jorge L. Perez
    Banking Commissioner 



CONSENT TO ENTRY OF ORDER

I, Kenneth Hansmire, state that I have read the foregoing Consent Order; that I know and fully understand its contents; that I agree freely and without threat or coercion of any kind to comply with the terms and conditions stated herein; and that I consent to the entry of this Consent Order.     

 
______/s/______
Kenneth Hansmire



State of:  Texas
 
County of:  Comanche

On this the 10th day of September 2015, before me, the undersigned officer, personally appeared Kenneth Hansmire, known to me (or satisfactorily proven) to be the person whose name is subscribed to the within instrument and acknowledged that he executed the same for the purposes therein contained.
 
In witness whereof I hereunto set my hand.


____/s/________________________
Notary Public
Date Commission Expires: July 01, 2018


CONSENT TO ENTRY OF ORDER

I, Kenneth Hansmire, state on behalf of Overtime Marketing, 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 Overtime Marketing, LLC; that Overtime Marketing, LLC agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein; and that Overtime Marketing, LLC consents to the entry of this Consent Order.     

 
     Overtime Marketing, LLC
       
By: _____/s/____________
  Kenneth Hansmire
  Owner

 

State of:  Texas
 
County of:  Comanche
 
On this the 10th day of September 2015, before me, the undersigned officer, personally appeared Kenneth Hansmire, who acknowledged himself to be the Owner of Overtime Marketing, LLC and that he, as such Owner, being authorized so to do, executed the foregoing instrument for the purposes therein contained, by signing the name of the entity by himself as Owner.
 
In witness whereof I hereunto set my hand.

____/s/_________________________
Notary Public
Date Commission Expires: July 01, 2018


CONSENT TO ENTRY OF ORDER

I, Kenneth Hansmire, state on behalf of Overtime Sports Southeast, 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  Overtime Sports Southeast, LLC; that Overtime Sports Southeast, LLC agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein; and that Overtime Sports Southeast, LLC consents to the entry of this Consent Order.     

 
     Overtime Sports Southeast, LLC
       
By: _____/s/____________
  Kenneth Hansmire
  Owner

 

State of:  Texas
 
County of:  Comanche
 
On this the 10th day of September 2015, before me, the undersigned officer, personally appeared Kenneth Hansmire, who acknowledged himself to be the Owner of Overtime Sports Southeast, LLC and that he, as such Owner, being authorized so to do, executed the foregoing instrument for the purposes therein contained, by signing the name of the entity by himself as Owner.
 
In witness whereof I hereunto set my hand.

____/s/________________________
Notary Public
Date Commission Expires: July 01, 2018



CONSENT TO ENTRY OF ORDER

I, Kenneth Hansmire, state on behalf of Overtime Sports Southwest, 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  Overtime Sports Southwest, LLC; that Overtime Sports Southwest, LLC agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein; and that Overtime Sports Southwest, LLC consents to the entry of this Consent Order.     

 
     Overtime Sports Southwest, LLC
       
By: _____/s/__________________
  Kenneth Hansmire
  Owner

 

State of:  Texas
 
County of:  Comanche
 
On this the 10th day of September 2015, before me, the undersigned officer, personally appeared Kenneth Hansmire, who acknowledged himself to be the Owner of Overtime Sports Southwest, LLC, and that he, as such Owner, being authorized so to do, executed the foregoing instrument for the purposes therein contained, by signing the name of the entity by himself as Owner.
 
In witness whereof I hereunto set my hand.

____/s/________________________
Notary Public
Date Commission Expires: July 01, 2018



Administrative Orders and Settlements