| * * * * * * * * * * * * * * * IN THE MATTER OF: FINANCIAL PARTNERS LLC |
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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 promulgated under the Act (“Regulations”);
WHEREAS, the Commissioner, through the Securities and Business Investments Division (“Division”) of the Department of Banking, conducted an investigation pursuant to Sections 36b-8 and 36b-26(a) of the Act into the activities of Financial Partners LLC (“FP”), an applicant for investment adviser registration, and Douglas Kirk Landeen (“Landeen”), FP’s sole direct owner and managing member and an applicant for investment adviser agent registration, to determine if they, or either of them, had violated, were violating or were about to violate provisions of the Act, the Regulations or any order under the Act;
WHEREAS, on January 21, 2010, the Commissioner, acting pursuant to Section 36b-15 of the Act, as amended by Public Act 09-160, Section 36b-27(a) of the Act and Section 4-177 of the General Statutes of Connecticut issued a Notice of Intent to Deny Registration as an Investment Adviser and as an Investment Adviser Agent, Order to Cease and Desist and Notice of Right to Hearing against FP and Landeen (collectively “Notice”), which Notice is incorporated by reference herein;
WHEREAS, the Notice alleged that FP failed to fulfill the experience requirements set forth in Section 36b-31-7b of the Regulations and that such failure constitutes grounds for the denial of FP’s investment adviser registration pursuant to Section 36b-15 of the Act, as amended;
WHEREAS, the Notice alleged that Landeen filed a 2009 Form U-4 and a 2008 Form U-4 with the Commissioner and that Landeen’s response in the negative when asked on the 2009 Form U-4 and the 2008 Form U-4, “Have you ever: (a) been convicted of or pled guilty or nolo contendere (‘no contest’) in a domestic, foreign, or military court to any felony? (b) been charged with any felony?”, is a statement which was, in light of the circumstances under which it was made, false or misleading with respect to a material fact. Such false or misleading statement constitutes grounds for the denial of Landeen’s investment adviser agent registration pursuant to Sections 36b-15 of the Act, as amended. The filing of such a false or misleading statement with the Commissioner also constitutes a wilful violation of Section 36b-23 of the Act and a basis for an order to cease and desist against Landeen and an order denying Landeen’s registration as an investment adviser agent;
WHEREAS, the Notice alleged that Landeen’s failure to amend the 2009 Form U-4 and the 2008 Form U-4 to disclose his prior criminal conviction constitutes a wilful violation of Section 36b-31-14e of the Regulations and a basis for an order to cease and desist against Landeen and an order denying Landeen’s investment adviser agent registration under Section 36b-15(a)(2)(B) of the Act, as amended;
WHEREAS, the Notice alleged that the conduct of Landeen, a managing member and control person of FP, in wilful violation of Section 36b-23 of the Act and Section 36b-31-14e of the Regulations, constitutes a basis to deny FP’s investment adviser registration under Section 36b-15 of the Act, as amended, and a basis for an order to cease and desist against Landeen;
WHEREAS, FP and Landeen requested a hearing on the matters alleged in the Notice (“Hearing”);
WHEREAS, FP, Landeen and the Division requested continuances of the Hearing;
WHEREAS, the Hearing has been continued so that the parties may engage in settlement discussions;
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-33, 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-33, inclusive”;
WHEREAS, an administrative proceeding initiated under Section 36b-15 of the Act, as amended, and Section 36b-27(a) of the Act would constitute a “contested case” within the meaning of Section 4-166(2) 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 . . . provided for in subsection (a) . . . of this section, the commissioner may accept an agreement by any respondent named in such order . . . 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, FP, Landeen and the Commissioner now desire to resolve the matters alleged in the Notice without the need for further administrative proceedings;
AND WHEREAS, FP and Landeen agree that the Notice may be used in construing the terms of this Consent Order, and agree to the language in this Consent Order.
II. CONSENT TO WAIVER OF PROCEDURAL RIGHTS
WHEREAS, FP and Landeen, through their execution of this Consent Order, voluntarily waive the following rights:
| 1. | To be afforded notice and an opportunity for a hearing within the meaning of Section 36b-15 of the Act, as amended, Section 36b-27(a) 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-15 of the Act, as amended, Section 36b-27(a) of the Act and Section 4-177c(a) of the General Statutes of Connecticut; |
| 3. | To present their position in a hearing in which they are 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, FP and Landeen, through their execution of this Consent Order, acknowledge the following allegations of the Commissioner, without admitting or denying them, yet admit sufficient evidence exists for the Commissioner to enter an order denying FP’s registration as an investment adviser in Connecticut, and an order to cease and desist against Landeen and an order denying Landeen’s registration as an investment adviser agent under the Act:
| 1. | The entry 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; |
| 2. | FP’s failure to fulfill the experience requirements set forth in Section 36b-31-7b of the Regulations constitutes grounds for the denial of FP’s investment adviser registration pursuant to Section 36b-15 of the Act, as amended; |
| 3. | The conduct of Landeen, a managing member and control person of FP, in wilful violation of Section 36b-23 of the Act and Section 36b-31-14e of the Regulations, constitutes a basis to deny FP’s investment adviser registration under Section 36b-15 of the Act, as amended, and a basis for an order to cease and desist against Landeen; and |
| 4. | Landeen’s filing of a false or misleading statement constitutes grounds for the denial of Landeen’s investment adviser agent registration pursuant to Sections 36b-15(a)(2)(A) of the Act, as amended. The filing of such a false or misleading statement with the Commissioner also constitutes a wilful violation of Section 36b-23 of the Act and a wilful violation of Section 36b 31-14e of the Regulations and a basis for an order to cease and desist against Landeen and an order denying Landeen’s investment adviser agent registration under Section 36b-15(a)(2)(B) of the Act, as amended. |
WHEREAS, the Commissioner would have the authority to enter findings of fact and conclusions of law after granting FP and Landeen an opportunity for a hearing;
AND WHEREAS, FP and Landeen 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 SANCTIONSWHEREAS, FP and Landeen, through their execution of this Consent Order, consents [sic] to the Commissioner’s entry of a Consent Order imposing the following sanctions:
| 1. | FP shall withdraw its application for registration as an investment adviser in Connecticut that it filed with the Commissioner on April 24, 2009; |
| 2. | Landeen shall withdraw his application for registration as an investment adviser agent of FP in Connecticut that he filed with the Commissioner on October 27, 2009; |
| 3. | For a period of ten (10) years commencing on the date this Consent Order is entered by the Commissioner, Landeen is barred from 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; |
| 4. | Nothing in this Consent Order shall preclude Landeen, upon a showing of good cause, from applying in writing for relief from the provisions of paragraph 3 of Section IV of this Consent Order after seven (7) years have elapsed from the entry of this Consent Order. Landeen shall include with any such application a written submission stating that Landeen has not been the subject of any financial services industry complaints, actions or proceedings since the entry of this Consent Order and that he has at all times been in compliance with this Consent Order. The grant of such relief shall be in the sole discretion of the Division Director; and |
| 5. | Landeen shall cease and desist from engaging in conduct constituting or which would constitute a violation of the Act or any regulation or order under the Act. |
AND WHEREAS, FP and Landeen specifically assure the Commissioner that none of the violations alleged in the Notice or this Consent Order shall occur in the future.
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 FP and/or Landeen 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; and |
| 3. | This Consent Order shall become final when entered. |
| Dated at Hartford, Connecticut, | _______/s/_________ | |
| this 7th day of May 2010. | Howard F. Pitkin | |
| Banking Commissioner |
CONSENT TO ENTRY OF ORDER
I, Douglas Kirk Landeen, state on behalf of Financial Partners 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 Financial Partners LLC; that Financial Partners LLC agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein; and that Financial Partners LLC consents to the entry of this Consent Order, expressly waiving any right to a hearing on the matters described herein.
| Financial Partners LLC | |
| By: | ______/s/__________________ |
| Douglas Kirk Landeen | |
| Managing Member |
State of: Connecticut
County of: Hartford W. Hartford
On this the 5 day of May 2010, before me, January E. Roman, the undersigned officer, personally appeared Douglas Kirk Landeen, who acknowledged himself to be the Managing Member of Financial Partners LLC, a limited liability company, and that he, as such Managing Member, 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 Managing Member.
In witness whereof I hereunto set my hand.
_________/s/______________________________
Notary Public/Commissioner of the Superior Court
Date Commission Expires: March 31, 2014
CONSENT TO ENTRY OF ORDER
I, Douglas Kirk Landeen, 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, expressly waiving any right to a hearing on the matters described herein.
| ______/s/__________________ | |
| Douglas Kirk Landeen | |
State of: Connecticut
County of: Hartford W. Hartford
On this the 5 day of May 2010, before me, January E. Roman, the undersigned officer, personally appeared Douglas Kirk Landeen, 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/Commissioner of the Superior Court
Date Commission Expires: March 31, 2014