Bulletin 2891 - July 19, 2019

State of Connecticut
Department of Banking

The Department of Banking News Bulletin

Bulletin # 2891 - Week Ending July 19, 2019

This bulletin constitutes the only official notification you will receive from this office concerning any of the following applications. Any observations you may have are solicited. Any comments should be in writing to Jorge L. Perez, Banking Commissioner, Department of Banking, 260 Constitution Plaza, Hartford, CT 06103-1800. Written comments will be considered only if they are received within ten business days from the date of this bulletin.

STATE BANK ACTIVITY

Change of Name

On July 15, 2019, the Commissioner approved the application of Collinsville Savings Society , Collinsville, Connecticut, to change its name to Collinsville Bank pursuant to Section 36a-82 of the Connecticut General Statutes.

CREDIT UNION ACTIVITY

Merger

On July 17, 2019,
America’s First Network Credit Union
(“AFNCU”), a Connecticut credit union, and
Connecticut Federal Credit Union
(“Connecticut Federal”), a federal credit union, filed an application pursuant to Section 36a-468a of the Connecticut General Statutes seeking approval to merge Connecticut Federal with and into AFNCU. As part of the application, AFNCU is proposing to expand its field of membership to include all select employee groups that make up Connecticut Federal’s field of membership.

CONSUMER CREDIT DIVISION ACTIVITY

Order of Summary Suspension, Temporary Order to Cease and Desist, Notice of Intent to Revoke Mortgage Loan Originator License, Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing

On July 8, 2019, the Commissioner issued an
Order of Summary Suspension, Temporary Order to Cease and Desist, Notice of Intent to Revoke Mortgage Loan Originator License, Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing (collectively, “Order”) in the Matter of:
John Vecchitto Jr
(“Respondent”), NMLS # 1127163. The Order was the result of an investigation by the Consumer Credit Division. The Commissioner alleges that: (1) Respondent’s fabrication of loan file documents constitutes directly or indirectly (i) employing a scheme, device or artifice to defraud or mislead borrowers or lenders or to defraud any person, in violation of Section 36a 498e(a)(1) of the Connecticut General Statutes, (ii) engaging in an unfair or deceptive practice, in violation of Section 36a-498e(a)(2) of the Connecticut General Statutes, and (iii) failing to comply with sections 36a-485 to 36a 498e, inclusive, in violation of Section 36a-498e(a)(8) of the Connecticut General Statutes; (2) Respondent’s conduct renders the Commissioner unable to continue to find that Respondent demonstrates character and general fitness so as to command the confidence of the community and to warrant a determination that Respondent will operate honestly, fairly and efficiently within the purposes of Sections 36a-485 to 36a 498e, inclusive, 36a-498h, 36a-534a and 36a-534b, of the Connecticut General Statutes; (3) Respondent’s fabrication of loan file documents constitutes (i) employing a scheme, device or artifice to defraud, in violation of Section 36a-53b(1) of the Connecticut General Statutes, (ii) making an untrue statement of a material fact or omitting to state a material fact necessary in order to make the statements made, in light of the circumstances under which they are made, not misleading, in violation of Section 36a-53b(2) of the Connecticut General Statutes, and (iii) engaging in an act, practice, or course of business which operates or would operate as a fraud or deceit upon a person, in violation of Section 36a 53b(3) of the Connecticut General Statutes; and (4) Respondent’s acts and conduct constitutes knowingly making a false statement with intent to defraud and for the purpose of influencing the action of a bank upon an application, advance, commitment, loan or extension of credit, and upon which such bank relies in taking such action, in violation of Section 36a-56 of the Connecticut General Statutes. The Commissioner found that the public safety and welfare imperatively required emergency action to summarily suspend Respondent’s mortgage loan originator license in Connecticut, and found that the public welfare required the issuance of a Temporary Order to Cease and Desist against Respondent. Respondent was afforded an opportunity to request a hearing with regard to the allegations set forth in the Order.

Consent Order

On July 9, 2019, the Commissioner entered into a Consent Order with Greenway Mortgage Funding Corp. d/b/a Emerald Home Loans (NMLS # 374480) (“Greenway”), Middletown, New Jersey. The Consent Order was based on an investigation by the Consumer Credit Division. As a result of such investigation, the Commissioner alleged that Greenway failed to file with the Nationwide Multistate Licensing System and Registry a change of its legal name or a fictitious name, namely the addition of its trade name “Emerald Home Loans”, at least 30 calendar days prior to such change and, in connection with such change, failed to provide a bond rider or endorsement, or addendum, as applicable, to the surety bond on file with the Commissioner, in violation of Section 36a-490(b)(2) of the Connecticut General Statutes. As part of the Consent Order, Greenway paid $500 as a civil penalty.

Amended and Restated Notice of Intent to Revoke Mortgage Lender License, Amended and Restated Notice of Intent to Issue Order to Cease and Desist, Amended and Restated Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing

On July 15, 2019, the Commissioner issued an
Amended and Restated Notice of Intent to Revoke Mortgage Lender License, Amended and Restated Notice of Intent to Issue Order to Cease and Desist, Amended and Restated Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing (collectively “Amended and Restated Notice”) in the Matter of:
1st Alliance Lending, LLC
, NMLS # 2819 (“Respondent”) East Hartford, Connecticut. In addition to those allegations included in the original Notice of Intent to Revoke Mortgage Lender License, Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing issued December 5, 2018 (“Notice”), the Amended and Restated Notice alleges that Respondent: (1) failed to provide Connecticut applicants the adverse action notices required by the Fair Credit Reporting Act, in violation of 15 USC Section 1681m(a); (2) required that Connecticut applicants submit documents verifying information related to the mortgage loan applications before providing Loan Estimates to such applicants, in violation of 12 CFR Section 1026.19(e)(2)(iii) and Section 36a-678(a) of the Connecticut General Statutes; (3) failed to identify unlicensed individuals as mortgage loan originators on the respective loan documents even though such individuals had primary responsibility for mortgage loan origination, in violation of 12 CFR Section 1026.36(g)(1)(ii) and Section 36a-678(a) of the Connecticut General Statutes; (4) made untrue statements of material fact or omitted to state a material fact necessary to make the statements not misleading or engaged in an act, practice or course of business that operated as a fraud or deceit on persons by holding out unlicensed individuals to potential borrowers as the individuals primarily responsible for mortgage loan origination and failing to disclose to potential borrowers that such persons were unlicensed to do so, and disclosing to investors, government agencies and regulators that the licensed mortgage loan originators were the individuals primarily responsible for the origination of the mortgage loans, in violation of Section 36a-53b of the Connecticut General Statutes; (5) made a false or misleading statement to the Department when it stated that employees were not informed of their terminations in writing, when in fact, Respondent provided Employee Termination Forms to employees informing them of their termination of employment, in violation of Section 36a-53a of the Connecticut General Statutes. The Amended and Restated Notice also amends language in allegations 1 through 3 of the original Notice from “at least five individuals” to “at least forty individuals”. Respondent was afforded an opportunity for a hearing with regard to the allegations set forth in the Amended and Restated Notice

Dated: Wednesday, July 24, 2019

Jorge L. Perez
Banking Commissioner