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SunTrust Mortgage, Inc.

Order
Monday, November 21, 2011
Docket No. 11-102-B
File attachments: 
http://www.dfr.vermont.gov/sites/default/files/11-102-B_20150312091515.pdf
Docket No. 11-102-B

In Re: SunTrust Mortgage, Inc. Respondent


STIPULATION AND CONSENT ORDER

Background

1. Pursuant to 8 V.S.A. Chapters 1 and 73, the Commissioner of the Vermont Department of Banking, Insurance, Securities, and Health Care Administration (the "Department") is charged with administering and enforcing Vermont law as it pertains to licensed lenders in the State of Vermont.

2. SunTrust Mortgage, Inc. ("SunTrust") is a Virginia corporation with a principle place of business at 901 Semmes Avenue, Richmond, VA 23224

3. At all relevant times SunTrust held a license to act as a licensed lender in the State of Vermont.

4. The Department conducted an examination of SunTrust covering the period from July 1, 2009 through December 31, 2010 (the "Examination").

5. The Department has alleged that, between July 1, 2009 and December 31, 2010, on one or more occasions SunTrust did not issue a commitment letter in the form and content or within the time frame required by 9 V.S.A. §103 and Department Regulation B-98-1.

6. SunTrust has denied any intentional wrongdoing on its part.

7. The parties wish to resolve this matter without administrative or judicial proceedings.

8. SunTrust and the Department expressly agree to enter into this Stipulation and Consent Order in full and complete resolution of the alleged violations described in paragraph 5 and any other violations alleged in the Examination.

Stipulation and Agreement

SunTrust and the Department hereby stipulate and agree as follows:

9. SunTrust does not dispute that there is a factual basis for the allegations alleged in paragraph 5.

10. SunTrust shall pay an administrative penalty to the Department in the amount of $12,000.00, which payment shall be made on or before December 9, 2011.

11. Going forward, SunTrust shall issue commitment letters in the form and at the time required by 9 V.S.A. §103 and Department Regulation B-98-1.

12. SunTrust shall adopt policies and procedures to insure that SunTrust complies with the commitment letter requirements of9 V.S.A. §103 and Department Regulation B-98-1, and shall provide the Department with a copy of such policies and procedures by December 9, 2011.

13. In the event SunTrust fails to pay the administrative penalty or fails to provide the Department with a copy of its policies and procedures, both on or before December 9, 2011, the Commissioner may, upon request from the Banking Division of the Department, issue an Order suspending, revoking, or terminating any or all of SunTrust's licenses and imposing additional administrative penalties. The Department's failure to exercise this option shall not constitute a waiver of the right to exercise such option at any other time.

14. The Department shall retain continuing jurisdiction in this matter until SunTrust has complied with the terms and conditions of this Stipulation and Order.

15. This Stipulation and Order shall not prevent any person from pursuing any claim he or she may have against SunTrust, nor shall it be understood as determining whether any such claim may or may not exist in law or equity.

16. Nothing contained in this Stipulation and Order shall restrain or limit the Department in responding to and addressing any actual complaint filed with the Department involving SunTrust and the Department reserves the right to pursue restitution in connection with any complaint filed with the Department.

17. SunTrust knowingly and voluntarily waives any right it may have to judicial review by any court of these matters by way of suit, appeal, or extraordinary relief resulting from entry or enforcement of this Stipulation and Order.

ORDER

NOW THEREFORE, IT IS HEREBY ORDERED THAT:

18. SunTrust shall comply with all agreements, stipulations, and undertakings as recited above.

19. SunTrust shall pay an administrative penalty to the Department in the amount of $12,000.00, which payment shall be made on or before December 9, 2011.

20. On or before December 9, 2011 SunTrust shall provide the Department with a copy of its policies and procedures as required by paragraph 12.

21. In the event SunTrust fails to pay the administrative penalty or fails to provide the Department with a copy of its policies and procedures, both on or before December 9, 2011, the Commissioner may, upon request from the Banking Division of the Department, issue an Order suspending, revoking, or terminating any or all of SunTrust's licenses and may impose additional administrative penalties. The Department's failure to exercise this option shall not constitute a waiver of the right to exercise such option at any other time.

22. This Order shall not prevent any person from pursuing any claim he or she may have against SunTrust.

23. Nothing contained in this Order shall restrain the Department from responding to and addressing any complaint involving SunTrust filed with the Department or shall preclude the Department from pursuing any other violation of law.

25. This Order shall not be construed as an adjudication of any violation of any Vermont law or federal law, except as specifically set forth herein.

Vermont State Employees Credit Union—Settlement Agreement

Order
Friday, October 5, 2012
Docket No. 12-021-B
File attachments: 
http://www.dfr.vermont.gov/sites/default/files/12-021-B_20150312091733.pdf

Docket Nos. 12-020-B, 12-021-B

In The Matter Of: Vermont State Employees Credit Union, Respondent

 

SETTLEMENT AGREEMENT

This Settlement Agreement (Agreement) is made by and between Vermont State Employees Credit Union (VSECU), a Vermont state-chartered credit union, and the Vermont Department of Financial Regulation (Department) (collectively the "Parties").

The Parties agree as follows:

1. VSECU filed a Petition for Declaratory Relief with the Department on June 18, 2012 (Department Docket No. 12-021-B) seeking that the Commissioner make certain declarations with respect to the application of 8 V.S.A. § 14103 to Vermont state chartered credit union advertising and marketing.

2. The Department served a Notice of Intent to Issue a Cease and Desist on VSECU on June 18, 2012 (Department Docket No. 12-020-B) with respect to the application of 8 V.S.A. § 14103 to VSECU's advertising and marketing.

3. The Parties agree they will both benefit from a mutual resolution of the above- referenced dockets.

4. Upon execution of this Settlement Agreement by both Parties and in consideration of the mutual promises in this Agreement it is further agreed:

a. VSECU will not describe itself as a "banking cooperative," banking co-op," "bank," "banking association," "trust company," or other similar sounding word or name in its advertising and marketing.

b. VSECU will discontinue use of the phrases referred to in 4.a above in its marketing and advertising material starting November 15, 2012. Further, VSECU agrees that it will stop efforts to associate VSECU with the phrases "banking cooperative" and "banking co-op."

c. The Department will not take regulatory action against VSECU under 8 V.S.A. § 14103 as long as VSECU refrains from referring to itself as a "banking cooperative," banking co-op, "bank," "banking association", "cooperative bank," "trust company," or other similar sounding word or name in any future advertisements or marketing materials. As more fully set forth below, VSECU is not prohibited from using the word "bank" or any derivative of the word "bank" to describe its services or to differentiate itself from a bank, e.g., by describing itself as a "banking alternative" or as an entity that is "redefining banking."

d. (i) For purposes of this subparagraph (d), the term "services" means soliciting, receiving or accepting money or its equivalent on deposit, extending loans and financing of any kind, escrow services, investment services, and money transfers of all kinds, including without limitation bill-paying and debit card services, Automated Clearing House transfers, and wire transfers.

(ii) For purposes of this subparagraph (d), the term "advertisements" is limited to advertisements ordinarily accessible by or directed to non-members and purchased and placed by or on behalf of VSECU in print, radio, internet/electronic and television media, hyperlink or search engine designated landing pages supporting electronic media, promotional material in any media, and pages on a website maintained by or on behalf of VSECU. The term "advertisements" as used in this subparagraph (d) does not include items used solely to promote the VSECU brand without reference to services as defined in this subparagraph (d). Such excluded items may include, by way of example only, gifts, premiums, and the display of VSECU's logo and slogans.

(iii) When VSECU uses the terms "bank" or "banking" or derivative terms or phrases in advertisements (as limited in this subparagraph (d)) in which VSECU refers to its services (as defined in this subparagraph (d)) it will disclose that it is a credit union. The disclosure that VSECU is a credit union will be clear and conspicuous so that reasonable consumers can read, see or hear and understand the information.

(iv) Notwithstanding any other provision of this subparagraph (d), when VSECU uses the terms "bank" or "banking" or derivative terms or phrases in the text of hyperlinks or search engine designated links, it need not include the term "credit union" in the text of the link but VSECU will disclose on the landing page of those links that it is a credit union. The disclosure that VSECU is a credit union will be clear .and conspicuous so that reasonable consumers can read, see or hear and understand the information.

e. The credit union is not barred from using its registered tradename, "VSECU."

f. The Parties will, simultaneously with the execution of this agreement, execute a Stipulation and Consent Order in the form of Attachment A to this Agreement, closing dockets 12-020-B and 12-021-B.

g. The Department will, on execution of this Agreement, publish a bulletin in the form of Attachment B to this Agreement.

h. The Parties will, on execution of this Agreement, issue a joint press release in the form of Attachment C to this Agreement.

i. This Settlement Agreement and the attached exhibits represent the complete agreement between the Parties as to the subject matter of the above-referenced dockets and supersede all prior negotiations, agreements and understanding with respect to that subject matter. This agreement may only be amended by a written document duly executed by all Parties.

j. VSECU waives its statutory right to notice and a hearing before the Commissioner of the Department, or his designated appointee and all rights of appeal in any forum.

k. The failure by one party to require performance of any provision shall not affect that party's right to require performance at any time thereafter, nor shall a waiver of any breach or default of this Settlement Agreement constitute a waiver of any subsequent breach or default or a waiver of the provision itself. If any provision of this Settlement Agreement is held unenforceable, then such provision will be modified to reflect the parties' intention. All remaining provisions of this Contract shall remain in full force and effect. VSECU acknowledges and agrees that this Settlement Agreement is entered into freely and voluntarily and that except as set forth herein, no promise was made to induce the VSECU to enter into it. VSECU acknowledges that it has consulted with its attorney in this matter and that it has reviewed this Settlement Agreement and it understands all terms and obligations contained herein. The Parties further acknowledge and agree that this Settlement Agreement constitutes a valid Order of the Commissioner and the Parties agree to be fully bound by it.

l. The undersigned representative of VSECU affirms that he has taken all necessary steps to obtain the authority to bind VSECU to the obligations stated herein and has the authority to bind VSECU to the obligations stated herein.

5. This Settlement Agreement may be signed in counterparts.

Vermont State Employees Credit Union

Order
Friday, October 5, 2012
Docket No. 12-020-B
File attachments: 
http://www.dfr.vermont.gov/sites/default/files/12-020-B_20150312091627.pdf
Docket Nos. 12-020-B, 12-021-B

In The Matter Of: Vermont State Employees Credit Union, Respondent


STIPULATION AND CONSENT ORDER

Through their undersigned counsel, the Vermont State Employees Credit Union (VSECU), a Vermont state-chartered credit union, and the Vermont Department of Financial Regulation (Department) stipulate and agree as follows:

1. The Petition for Declaratory Relief filed with the Department on June 18, 2012 (Department Docket No. 12-021-B) is withdrawn and Docket 12-021-B is closed.

2. The Notice of Intent to Issue a Cease and Desist Order served on VSECU on June 18, 2012 (Department Docket No. 12-020-B) is withdrawn, together with all pending motions

and subpoenas filed or served by either party, the contested case in Docket 12-020-B is dismissed with prejudice and Docket 12-020-B is closed.

3. The Parties waive all rights to appeal the closing of the above dockets.

4. Each party is to bear its own costs.

IH Financial Licenses, Inc. and ITC Financial Licenses, Inc.

Order
Monday, July 9, 2012
Docket No. 12-027-B
File attachments: 
http://www.dfr.vermont.gov/sites/default/files/12-027-B_20150312091827.pdf
Docket No. 12-027-B

In Re: IH Financial Licenses, Inc. and ITC Financial Licenses, Inc., Respondents


STIPULATION AND CONSENT ORDER

Allegations

1. Pursuant to 8 V.S.A. Chapters 1 and 79, the Commissioner of the Vermont Department of Financial Regulation is charged with administering and enforcing Vermont law as it pertains to money transmitters in the State of Vermont.

2. IH Financial Licenses, Inc. ("IHFL") is a South Dakota corporation with a principal place of business at 250 Williams Street, Atlanta, GA.

3. ITC Financial Licenses, Inc. ("ITC") is a South Dakota corporation with a principal place of business at 5617 Princeton Avenue, Columbus, GA.

4. IHFL and ITC are affiliated corporations and both are indirect wholly owned subsidiaries of InComm Holdings, Inc. ("InComm").

5. IHFL and ITC have represented that collectively they are licensed as money transmitters in 45 states and that they offer open loop prepaid cards in those states where they are licensed or are otherwise authorized to offer open loop prepaid cards.

6. At all relevant times neither IHFL nor ITC was licensed as a money transmitter in Vermont.

7. Open loop cards were sold or offered for sale in Vermont under one or more programs managed by IHFL or ITC.

8. On February 22, 2011, the Department had a telephone conversation with representatives of IHFL, ITC, and InComm regarding the sale of prepaid open loop cards in Vermont without a license. IHFL and ITC represented that the open loop cards were inadvertently distributed in Vermont by retailers that serve as authorized agents for IHFL and ITC in multiple jurisdictions. IHFL and ITC represented to the Department that all open loop prepaid cards would be removed from Vermont locations, that policies and procedures would be put in place to prevent the sale of open loop cards in Vermont, and that the companies would not sell open loop prepaid cards in Vermont until they were in compliance with Vermont law.

9. The policies and procedures that IHLF and ITC put in place were not completely effective to prevent the sale of open loop prepaid cards in Vermont.

10. During a series of on-site visits to Vermont retail stores in October 2011, the Department found several locations where IHFL or ITC open loop prepaid cards were offered for sale.

11. IHFL and ITC have since discovered and reported to the Department that despite their policies and procedures, certain authorized agents that operate their own distribution centers continued to distribute IHFL and ITC open loop cards in Vermont.

12. IHFL and ITC have represented to the Department that they have reviewed and revised their policies and procedures to prevent their prepaid open loop cards from being sold in Vermont.

13. At all times IHFL and ITC have cooperated with the Department.

14. The parties wish to resolve this matter without administrative or judicial proceedings.

15. IHFL, ITC, and the Department expressly agree to enter into this Stipulation and Consent Order in full and complete resolution of the alleged violations described herein.

Stipulation and Agreement

IHFL, ITC, and the Department hereby stipulate and agree as follows:

16. IHFL and ITC do not dispute that there is a factual basis for the Department's allegations in this Stipulation and Consent Order.

17. IHFL and ITC shall pay an administrative penalty to the Department in the total amount of $25,000.00, which payment shall be made on or before July 23, 2012. IHFL and ITC shall be jointly and severally liable for payment of the $25,000.00 administrative penalty.

18. Going forward, neither IHFL nor ITC shall sell open loop prepaid cards in Vermont without a Vermont money transmitter license.

19. IHFL and ITC shall adopt policies and procedures to insure that open loop prepaid cards are either not sold in Vermont or are sold in Vermont in full compliance with 8 V.S.A. Chapter 79.

20. The Department shall retain continuing jurisdiction in this matter until IHFL and ITC have complied with the terms and conditions of this Stipulation and Order.

21. This Stipulation and Order shall not prevent any person from pursuing any claim he or she may have against IHFL or ITC, nor shall it be understood as determining whether any such claim may or may not exist in law or equity.

22. Nothing contained in this Stipulation and Order shall restrain or limit the Department in responding to and addressing any actual complaint filed with the Department involving IHFL or ITC and the Department reserves the right to pursue restitution in connection with any complaint filed with the Department.

23. IHFL and ITC knowingly and voluntarily waive any right they may have to judicial review by any court of these matters by way of suit, appeal, or extraordinary relief resulting from entry or enforcement of this Stipulation and Order.

ORDER

NOW THEREFORE, IT IS HEREBY ORDERED THAT:

24. IHFL and ITC shall comply with all agreements, stipulations, and undertakings as recited above.

25. IHFL and ITC, jointly and severally, shall pay an administrative penalty to the Department in the total amount of $25,000.00, which payment shall be made on or before July 23, 2012. IHFL and ITC shall be jointly and severally liable for payment of the $25,000.00 administrative penalty.

26. This Order shall not prevent any person from pursuing any claim he or she may have against IHFL or ITC.

27. Nothing contained in this Order shall restrain the Department from responding to and addressing any complaint involving IHFL or ITC filed with the Department or shall preclude the Department from pursuing any other violation of law.

28. This Order shall not be construed as an adjudication of any violation of any Vermont law or federal law, except as specifically set forth herein.

Amended Order Removing The Directors, Officers and Committee Members of Border Lodge Credit Union

Order
Friday, December 21, 2012
Docket No. 12-050-B (Amended)
File attachments: 
http://www.dfr.vermont.gov/sites/default/files/12-050-B-Amended_20150312092047.pdf
 

DOCKET NO. 12-050-B

IN RE: BORDER LODGE CREDIT UNION

AMENDED ORDER REMOVING THE DIRECTORS, OFFICERS AND COMMITTEE MEMBERS OF BORDER LODGE CREDIT UNION

Pursuant to 8 V.S.A. § 3070l(a)(5). this order removes all directors, officers, and committee members of Border Lodge Credit Union ("Border Lodge"). This Order is amended to correct the service list, and specifically the service address of Mr. Laurie McMullen.

Background

On November 30, 2012, the Commissioner seized Border Lodge with an Ex Parte Order for Conservatorship and Order for Related Matters, ("Conservatorship Order''), pursuant to 8 V.S.A. § 36103(a)(l) and (5). The Commissioner found that there was an immediate threat to the assets and depositors of Border Lodge, and took possession and control of the business and all assets of Border Lodge. Pursuant to 8 V.S.A. § 36103(f), the Commissioner, as conservator. assumed all the powers of the members, directors, officers, and committees of Border Lodge. In addition, the National Credit Union Administration Board, ("NCUA'') was appointed liquidating agent of Border Lodge.

Pursuant to 8 V.S.A. § 30701(a)(5), the Commissioner may remove any person who knowingly: violates this title or a lawful regulation or order issued under it; engaged in or participated in any materially unsafe or unsound practice in connection with a credit union; or engaged in any act, omission, or practice which is a breach of fiduciary duty to the credit union.

The Commissioner's Letter and Notice of Proposed Order dated September 25, 2012 ("Commissioner's Letter") received by Ms. Debra Kinney and the directors of Border Lodge stated that there were concerns about unsafe or unsound practices in connection with Border Lodge. The Commissioner's Letter also notified Ms. Kinney and the directors of Border Lodge that the credit union had failed to provide monthly account reconciliation reports as required under Vermont law. Despite these warnings, no corrective action was taken on behalf of Border Lodge.

Notice of Hearing Rights

Pursuant to 8 V.S.A. § 3070l(c) and (d), any party served in this matter has 30 days to request that the Commissioner hold a hearing. A sen·ice list is attached to this order. If no hearing is requested, this order becomes final at the end of the 30 day period. The hearing on this order shall be private unless the Commissioner determines that a public hearing is necessary to protect the public interest.

ORDER

It is therefore ORDERED that:

1. The following persons are removed as directors and/or officers of Border Lodge: Terrence Decker, Elizabeth Graves, Debra Kinney, James Kinney, Kenneth LaPlume, Laurie McMullen and Linda Montague.

2. All committee members and committees of Border Lodge are removed and terminated.

3. If no hearing is requested, this removal order shall become final and effective within 30 days of service of this order.

4. All other terms and conditions of the Conservatorship Order remain unchanged and in full force and effect, including the authority of the NCUA as liquidating agent.

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