Bulletin 3167 - November 1, 2024

State of Connecticut
Department of Banking

The Department of Banking News Bulletin

Bulletin # 3167 - Week Ending November 1, 2024

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 directed to Jorge L. Perez, Banking Commissioner. Written comments will be considered only if they are received within ten business days from the date of this bulletin.

CREDIT UNION ACTIVITY

DATE
: November 1, 2024

CREDIT UNION
: Mutual Security Credit Union

LOCATION
: 3690 Main Street, Bridgeport, CT

ACTIVITY-BRANCH TYPE
: Approved to Establish Branch

PROPOSED OPENING DATE
: April 1, 2025

CONSUMER CREDIT DIVISION ACTIVITY

Notice of Automatic Suspension, Notice of Intent to Revoke Mortgage Broker License, Notice of Intent to Issue Order to Cease and Desist and Notice of Intent to Impose Civil Penalty

On October 25, 2024, the Commissioner issued a Notice of Automatic Suspension, Notice of Intent to Revoke Mortgage Broker License, Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing (“Notice”) in the matter of:
Americay Mortgage Corporation
(NMLS # 1155) (“Americay”), Vernon, Connecticut and Christopher Jon Gilnack (NMLS # 40337) (“Gilnack”) (collectively, “Respondents”). The Notice was the result of the examination and investigation by the Consumer Credit Division. The Commissioner alleges in the Notice that: (1) Americay failed to file the Consent Orders dated March 10, 2016 and September 9, 2016 issued by the Commissioner (collectively “2016 Consent Orders”) on the Nationwide Multistate Licensing System and Registry (“NMLS”), in violation of Section 36a-490(c)(3) of the Connecticut General Statutes; (2) Americay failed to file accurate MCRs on NMLS, in violation of Section 36a 534b(c) of the Connecticut General Statutes and the 2016 Consent Orders; (3) Americay failed to maintain minimum tangible net worth of $50,000 required of mortgage broker licensees, in violation of Section 36a-488(a)(2) of the Connecticut General Statutes; (4) Americay failed to file with NMLS or otherwise notify the Commissioner of the decrease in its tangible net worth from the minimum amount required pursuant to Section 36a-488(a)(1)(A) of the Connecticut General Statutes not later than the requisite 15 days of its occurrence, in violation of Section 36a 490(c)(9) of the Connecticut General Statutes; (5) Americay failed to provide adverse action notices for at least one mortgage loan, in violation of 12 C.F.R. Section 1002.9(a)(1) of Regulation B (Equal Credit Opportunity Act), and Section 36a-498e(a)(7) of the Connecticut General Statutes in effect at such time and failed to maintain records of adverse action notices for such mortgage loan files, in violation of Section 36a-493(a) of the Connecticut General Statutes; (6) Americay failed to provide the required loan estimate disclosures in a timely manner in connection with at least five mortgage loans, in violation of 12 C.F.R. Section 1026.19(e)(1) of Regulation Z (Truth in Lending Act), Section 36a-678(a) of the Connecticut General Statutes and Section 36a-498e(a)(7) of the Connecticut General Statutes in effect at such time; (7) Americay advertised mortgage loans, including, but not limited to, via signage on its building, without the language required by mortgage broker licensees, in violation of Section 36a-497(a)(1) of the Connecticut General Statutes; (8) Americay failed to include its company NMLS unique identifier on business cards, in violation of Section 36a-498d(a)(2) of the Connecticut General Statutes; (9) Americay failed to disclose the APR and additional terms when advertising rates on its building, in violation of paragraphs (c) and (d) of 12 C.F.R. Section 1026.24 of Regulation Z (Truth in Lending Act), and Sections 36a-678(a) and 36a 498d(b)(3) of the Connecticut General Statutes; (10) Americay failed to pay the costs of its examination, in violation of Section 36a-65(c)(6) of the Connecticut General Statutes; (11) Americay failed to maintain a surety bond that runs concurrently with the period of its mortgage broker license, in
violation of Section 36a-492 of the 2024 Supplement to the General Statutes; (12) Americay failed to comply with sections 36a-485 to 36a-498e, inclusive, 36a-498h, 36a-534a and 36a-534b and failed to comply with provisions of Regulation Z and Regulation B, in violation of Section 36a 498e(a)(8) of the Connecticut General Statutes in effect at such time; and (13) the conduct of Americay fails to demonstrate that its financial responsibility, character and general fitness are such as to command the confidence of the community and to warrant a determination that Americay will operate honestly, fairly and efficiently within the purposes of Sections 36a-485 to 36a-498e, inclusive, 36a-498h, 36a 534a and 36a-534b, as required by Section 36a-489(a)(1)(C) of the Connecticut General Statutes. As a result of Americay’s failure to maintain a surety bond, Americay’s mortgage broker license in Connecticut was automatically suspended effective August 16, 2024, and such suspension remains in effect pending proceedings for revocation.

The Commissioner also alleges in the Notice that: (1) Gilnack failed to file the 2016 Consent Orders on NMLS, in violation of Section 36a-490(c)(3) of the Connecticut General Statutes; (2) Gilnack failed to include his NMLS unique identifier on business cards, in violation of Section 36a-498d(a)(3) of the Connecticut General Statutes; and (3) Gilnack failed to establish, enforce and maintain policies and procedures reasonably designed to achieve compliance with subsection (a) of Section 36a-498e of the Connecticut General Statutes in effect at such time, in violation of Section 36a 498e(b) of the Connecticut General Statutes in effect at such time. Respondents were afforded an opportunity to request a hearing with regard to the allegations set forth in the Notice.

Order of Summary Suspension, Temporary Order to Cease and Desist, Order to Make Restitution, Order to Provide Disgorgement, Notice of Intent to Revoke and Refuse to Renew Money Transmission License, Notice of Intent to Issue Order to Cease and Desist and Notice of Intent to Impose Civil Penalty

On October 25, 2024, the Commissioner issued an Order of Summary Suspension, Temporary Order to Cease and Desist, Order to Make Restitution, Order to Provide Disgorgement, Notice of Intent to Revoke and Refuse to Renew Money Transmission License, Notice of Intent to Issue Order to Cease and Desist and Notice of Intent to Impose Civil Penalty and Notice of Right to Hearin g (collectively, “Order and Notice”) in the matter of:
Coinme Inc d/b/a Coinme
(NMLS # 1185542) (“Respondent”), Seattle, Washington. The Order and Notice was the result of the examination and investigation by the Consumer Credit Division. The Commissioner alleges that: (1) Respondent failed to maintain the minimum tangible net worth required of money transmission licensees, in violation of Sections 36a-600(d) and 36a-604(c) of the Connecticut General Statutes; (2) Respondent engaged an entity to perform functions constituting money transmission activities in this state, which entity did not obtain and maintain a money transmission license, in violation of Section 36a-608(a) of the Connecticut General Statutes, causing Respondent to be engaged in unsafe or unsound practices within the meaning of Section 36a-608(a) of the Connecticut General Statutes; (3) Respondent failed to establish, enforce and maintain policies and procedures for supervising employees, agents and office operations that are reasonably designed to achieve compliance with applicable money transmission laws and regulations, in violation of Sections 36a 606a and 36a-607(c)(10) of the Connecticut General Statutes; (4) the totality of Respondent’s conduct is likely to otherwise materially prejudice the interests of Connecticut consumers, and cause Respondent to be engaged in unsafe or unsound practices within the meaning of Section 36a-608(a) of the Connecticut General Statutes; and (5) the totality of Respondent’s conduct causes the Commissioner unable to find that Respondent’s financial condition is sound, its business will be conducted honestly, fairly, equitably, carefully and efficiently within the purposes and intent of Sections 36a-595 to 36a-612, inclusive, of the Connecticut General Statutes, in a manner commanding the confidence and trust of the community. As part of the Order to Make Restitution, Respondent was ordered to refund all sums lost by Connecticut consumers as result of scams. As part of the Order to Provide Disgorgement, Respondent was ordered to disgorge to the Department all fees received as a result of engaging in unsafe or unsound practices within the meaning of Section 36a-608(a) of the Connecticut General Statutes. Respondent was afforded an opportunity to request a hearing with regard to the allegations set forth in the Order and Notice.

Consent Order

On October 31, 2024, the Commissioner entered into a Consent Order with Roadrunner Account Services, LLC (NMLS # 1758660) (“Roadrunner”), Irving, Texas. The Consent Order was based on an investigation by the Consumer Credit Division. As a result of such investigation, the Commissioner alleged that since October 2022, Roadrunner has engaged in the business of a sales finance company in Connecticut without a license, in violation of Section 36a-536 of the Connecticut General Statutes, by receiving payments of principal and interest from Connecticut retail buyers under retail installment contracts or installment loan contracts. As part of the Consent Order, Roadrunner paid $10,000 as a civil penalty and $800 as back licensing fees.

Dated: Tuesday, November 5, 2024

Jorge L. Perez
Banking Commissioner