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OAH
3-1005-19944-2 |
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Commerce
MO2702175 |
STATE
OF
OFFICE OF ADMINISTRATIVE HEARINGS
FOR THE DEPARTMENT OF COMMERCE
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In the Matter of Pierce |
FINDINGS OF FACT, CONCLUSIONS AND RECOMMENDATION |
This matter came on before
Administrative Law Judge Kathleen D. Sheehy on November 14, 2008, for a
prehearing conference at the Office of Administrative Hearings,
Christopher
M. Kaisershot, Assistant Attorney General,
STATEMENT OF ISSUES
Are
the Respondents’ mortgage originator’s license and notary public commission subject
to discipline because:
1. The Respondents made or caused to be
made, directly or indirectly, any false, deceptive, or misleading statements
about a borrower’s qualification for a residential loan, in violation of Minn.
Stat. §§ 45.027, subd. 7(a)(4); 58.12, subd. 1(b)(2)(iv)-(vi); 58.13, subd.
1(9); and 359.12 (2006);
2. The Respondents made or caused to be made
false, deceptive, or misleading statements concerning the disbursement of
mortgage loan settlement proceeds, in violation of Minn. Stat. §§ 45.027, subd.
7(a)(4); 58.12, subd. 1(b)(2)(iv)-(vi); 58.13, subd. 1(9); and 359.12 (2006);
and
3. The Respondents pleaded guilty or were
convicted of a felony or gross misdemeanor involving moral turpitude, in
violation of Minn. Stat. §§ 58.12, subd. 1(b)(2)(vi) and 359.12 (2006).
Based upon all of the files, records and proceedings herein, the Administrative Law Judge makes the following:
FINDINGS OF FACT
1.
On October 6, 2008, a copy of the Notice and Order for
Prehearing Conference was delivered via first class mail to Pierce Wellington
Mortgage Services, Michael Henderson, and Loren Lamoine Hanson at the last
known address on file with the Department.[1]
2.
The Respondents failed to appear at the prehearing
conference, did not obtain prior approval from the Administrative Law Judge to
be absent from the prehearing conference, did not file a Notice of Appearance,
and did not request a continuance or any other relief.
3.
The Notice and Order for Prehearing Conference contained the
following notice:
Respondents’ failure to appear at the prehearing conference . . . may
result in a finding that Respondents are in default, that the Department’s
allegations contained in the Statement of Charges may be accepted as true, and
that Respondents may be subject to discipline by the Commissioner, including
revocation, suspension, censure, or the imposition of civil penalties.
4.
The Notice and Order for Prehearing Conference also provided
that Pierce Wellington Mortgage Services must show cause why its mortgage
originator’s license should not be revoked or suspended, and Respondents must
show cause why they should not be subject to a civil penalty or debarment as
provided in Minn. Stat. §§ 45.027, subd. 6, and 58.12, subd. (a)(1) (2006).
5.
Because Respondents failed to appear at the prehearing
conference, they are in default.
6.
Pursuant to Minn. R. 1400.6000, the allegations contained in
the Notice and Order for Prehearing Conference are taken as true and
incorporated by reference into these Findings of Fact.
Based
upon the foregoing Findings of Fact, the Administrative Law Judge makes the
following:
CONCLUSIONS
1.
The Administrative Law Judge and the Commissioner of
Commerce are authorized to consider the charges against Respondents under Minn.
Stat. §§ 58.12, 45.027, subd. 1, 45.024, and 14.50.
2.
Respondents received due, proper, and timely notice of the
charges against them, and of the time and place of the prehearing
conference. This matter is, therefore,
properly before the Commissioner and the Administrative Law Judge.
3.
The Department has complied with all relevant procedural
legal requirements.
4.
Under Minn. R. 1400.6000, a contested case may be decided
adversely to a party who defaults. A
default occurs when a party fails to appear without the prior consent of the
judge at a prehearing conference. On
default, the allegations of and the issues set out in that Notice of and Order
for Hearing or other pleading may be taken as true or deemed proved without
further evidence.
5.
The Respondent is in default herein as a result of its
failure, without the prior consent of the Administrative Law Judge, to appear
at the prehearing conference.
6.
By making or causing to be made false, deceptive, or
misleading statements about a borrower’s qualifications for a residential loan,
the Respondents have engaged in an act or practice demonstrating that they are
untrustworthy, financially irresponsible, or otherwise incompetent or
unqualified to act under the authority or license granted by the commissioner,
as provided in Minn. Stat. § 45.027, subd. 7(a)(4); have violated a standard of
conduct or engaged in a fraudulent, coercive, deceptive, or dishonest act or
practice, and engaged in an act or
practice that demonstrates untrustworthiness, financial irresponsibility, or
incompetence, as provided in Minn. Stat. § 58.12, subd. 1(b)(2)(iv)-(v); and have
made false, deceptive, or misleading statements or representations in
connection with a residential loan transaction, as provided in Minn. Stat. § 58.13, subd. 1(9) (2006).
7.
By making or causing to be made false, deceptive, or
misleading statements concerning the disbursement of mortgage loan settlement
proceeds through creation of fraudulent invoices from a sham corporation, the
Respondents have engaged in an act or practice demonstrating that they are
untrustworthy, financially irresponsible, or otherwise incompetent or
unqualified to act under the authority or license granted by the commissioner,
as provided in Minn. Stat. § 45.027, subd. 7(a)(4); have violated a standard of
conduct or engaged in a fraudulent, coercive, deceptive, or dishonest act or
practice, and engaged in an act or
practice that demonstrates untrustworthiness, financial irresponsibility, or
incompetence, as provided in Minn. Stat. § 58.12, subd. 1(b)(2)(iv)-(v); and
have made false, deceptive, or misleading statements or representations in
connection with a residential loan transaction, as provided in Minn. Stat.
§ 58.13, subd. 1(9) (2006).
8.
By pleading guilty to one count of felony theft by swindle
and two counts of felony forgery, Respondents Henderson and Hanson were convicted
of crimes involving moral turpitude, in violation of Minn. Stat. §§ 58.12,
subd. 1(b)(2)(vi) and 359.12 (2006).
8.
Disciplinary action against the Respondents is in the public
interest.
Based upon the foregoing Conclusions, the Administrative Law Judge makes the following:
RECOMMENDATION
IT IS HEREBY
RECOMMENDED: that the Commissioner of the Department of Commerce take adverse
action against the Respondents’ mortgage originator’s license and notary
commission, censure Respondents, and/or impose a civil penalty upon Respondents.
Dated: November 17, 2008.
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s/Kathleen D. Sheehy |
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KATHLEEN D. SHEEHY |
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Administrative Law Judge |
Reported: Default (not recorded)
This
Report is a recommendation, not a final decision. The Commissioner of Commerce will make the
final decision after reviewing the record and may adopt, reject or modify these
Findings of Fact, Conclusions, and Recommendations. Under Minn. Stat. § 14.61, the Commissioner’s
decision shall not be made until this Report has been available to the parties
to the proceeding for at least ten (10) days.
An opportunity must be afforded to each party adversely affected by this
Report to file exceptions and present argument to the Commissioner. Parties should contact Emmanuel
Munson-Regala, Deputy Commissioner, Market Assurance Division, Minnesota
Department of Commerce,
If the Commissioner fails to issue a final decision within 90 days of the close of the record, this report will constitute the final agency decision under Minn. Stat. § 14.62, subd. 2a. The record closes upon the filing of exceptions to the report and the presentation of argument to the Commissioner, or upon the expiration of the deadline for doing so. The Commissioner must notify the parties and the Administrative Law Judge of the date on which the record closes. To comply with Minn. Stat. § 14.62, subd. 2a, the Commissioner must then return the record to the Administrative Law Judge within 10 working days to allow the Judge to determine the discipline to be imposed.
Under Minn. Stat. § 14.62, subd. 1, the agency is required to serve its final decision upon each party and the Administrative Law Judge by first class mail or as otherwise provided by law.