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SECURITIES AND BUSINESS INVESTMENTS DIVISION ACTIVITY
Order to Cease and Desist, Order to Make Restitution and Notice of Intent to Fine Issued

On January 9, 2014, the Banking Commissioner entered an Order to Cease and Desist, Order to Make Restitution and Notice of Intent to Fine (Docket No. CRF-13-8014-S) against Ulysses Partners, LLC, now or formerly of Norwalk, Connecticut, and James E. Neilsen, founder, chief financial officer and treasurer of Ulysses Partners, LLC.  Respondent Neilsen, a former broker-dealer agent, is also a Certified Public Accountant.

The action alleged that Ulysses Partners, LLC was in the business of marketing hedge funds to financial institutions for compensation.  According to the action, from approximately November 2005 through December 2010, to finance the business operations of Ulysses Partners, LLC, respondent Neilsen sold approximately $10 million of securities in the form of notes and investment agreements to Connecticut investors, the majority of whom were accounting clients of respondent Neilsen.  Respondent Neilsen allegedly represented to would-be investors that the investment would generate a high rate of return.  Investors, however, allegedly did not receive key disclosures concerning, among other things, the risks involved, how the offering proceeds would be used or that the securities were not registered under the Connecticut Uniform Securities Act.

The action further alleged that Ulysses Partners, LLC transacted business as an unregistered broker-dealer; that respondent Neilsen transacted business as an unregistered broker-dealer agent; that the respondents sold unregistered securities in violation of Section 36b-16 of the Connecticut Uniform Securities Act; and that the respondents violated the antifraud provisions of the Act.

Respondents Ulysses Partners, LLC and Neilsen were afforded an opportunity to request a hearing on the Order to Cease and Desist, Order to Make Restitution and Notice of Intent to Fine.

On December 23, 2013, the Commissioner entered into a Consent Order with Fairfield County Mortgage Company (NMLS # 116804) (“Fairfield County Mortgage”), Fairfield, Connecticut.  The Consent Order resolves allegations made by the Commissioner in a Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing issued on December 11, 2012 (“First Notice”) and in a Notice of Intent to Refuse to Renew Mortgage Broker License and Notice of Right to Hearing issued on June 25, 2013 (“Second Notice”).  The First Notice alleged that Fairfield County Mortgage failed to file certain annual and quarterly information required by mortgage call reports, in violation of Section 36a-534b(c)(3) of the 2012 Supplement to the General Statutes in effect prior to October 1, 2012, and Section 36a-534b(c)(3) of the 2012 Supplement to the General Statutes, as amended by Public Act 12-96.  The Second Notice alleged that Fairfield County Mortgage failed to have a designated qualified individual who was a Connecticut licensed mortgage loan originator, which constitutes sufficient grounds to refuse to renew Fairfield County Mortgage’s license to act as a mortgage broker in Connecticut for the 2013 licensing period, pursuant to Sections 36a 494(a)(1), subsections (a) and (b) of Section 36a-51, and Section 36a-489(a)(2)(A) of the Connecticut General Statutes.  In the Consent Order, the Commissioner further alleged that Fairfield County Mortgage subsequently failed to file certain other annual information required by mortgage call reports, in violation of Section 36a 534b(c)(3) of the Connecticut General Statutes.  As part of the Consent Order, Fairfield County Mortgage requested surrender of its mortgage broker license.

On January 2, 2014, the Commissioner entered into a Consent Order with Fairfield Connecticut Properties, LLC, Southbury, Connecticut, and Charles Wilson d/b/a CB Wilson (collectively, “Respondents”).  The Consent Order was based on an investigation by the Consumer Credit Division.  As a result of such investigation, on September 13, 2013, the Commissioner issued a Temporary Order to Cease and Desist, Order to Make Restitution, Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing against Respondents.  The Commissioner alleged that each Respondent engaged in debt negotiation in this state without obtaining the required license, in violation of Section 36a-671(b) of the Connecticut General Statutes.  As part of the Consent Order, Respondents were ordered to immediately cease and desist from violating Section 36a-671(b) of the Connecticut General Statutes, to repay fees to identified Connecticut residents in an identified amount, and to pay a $500 civil penalty.