By the Division of Banks

COMMONWEALTH OF MASSACHUSETTS

Suffolk, SS.

COMMISSIONER OF BANKS
MORTGAGE BROKER AND
MORTGAGE LOAN
ORIGINATOR LICENSING
Docket No. 2009-141-CO

CONSENT ORDER


In the Matter of
FIRST INVESTORS MORTGAGE, INC.
Mortgage Broker License No. MB0063
Belmont, Massachusetts

and

JAMES G. BROWN, individually
Mortgage Loan Originator License No. MLO17945


WHEREAS, FIRST INVESTORS MORTGAGE, INC. ("First Investors" or the "Corporation") and JAMES G. BROWN ("James Brown") a formerly licensed mortgage broker under Massachusetts General Laws chapter 255E, section 2 and a formerly licensed mortgage loan originator under Massachusetts General Laws chapter 255F, section 2, respectively, have been advised of their right to Notice and Hearing pursuant to Massachusetts General Laws chapter 30A, section 10, and having waived those rights, entered into a STIPULATION AND CONSENT TO THE ISSUANCE OF A CONSENT ORDER ("Consent Agreement") with representatives of the Division of Banks ("Division") dated June 16, 2010, whereby, solely for the purpose of settling this matter and without admitting any allegations or implications of fact or the existence of any violations of applicable state and federal statutes or rules, First Investors and James Brown agree to the issuance of this CONSENT ORDER ("Consent Order") by the Commissioner of Banks ("Commissioner");

WHEREAS, the Division of Banks ("Division"), through the Commissioner, has jurisdiction over the licensing and regulation of those engaged in the business of a mortgage broker in Massachusetts pursuant to Massachusetts General Laws chapter 255E, section 2 and the Division's regulations 209 CMR 42.00 et seq.;

WHEREAS, the Division, through the Commissioner, has jurisdiction over the licensing and regulation of persons engaged in the business of a mortgage loan originator in Massachusetts pursuant to Massachusetts General Laws chapter 255F, section 2 and the Division's regulations 209 CMR 41.00 et seq.;

WHEREAS, at all relevant times, James Brown was the President and sole owner of First Investors;

WHEREAS, at all relevant times, James Brown performed as a mortgage loan originator on behalf of First Investors;

WHEREAS, On or about November 14, 2008, pursuant to the authority granted under Massachusetts General Laws chapter 255E, section 8, the Division commenced an examination/inspection of the books, accounts, papers, records, and files maintained by First Investors to evaluate the Corporation's compliance with the laws, regulations, and regulatory bulletins applicable to the conduct of a mortgage broker business in Massachusetts (the "examination/inspection");

WHEREAS, The Division's Report of Examination/Inspection (the "Report"), which was issued to First Investors on or about January 7, 2010, presented the findings of the examination/inspection and alleged significant failures to comply with applicable state and federal laws, rules, regulations, and regulatory bulletins governing the conduct of those engaged in the business of a mortgage broker in Massachusetts;

WHEREAS, on or about January 7, 2010, based upon the findings of the examination/inspection, the Division issued an ORDER TO SHOW CAUSE AND NOTICE OF RIGHT TO A HEARING (the "Order and Notice"), Docket No. 2009-141, against First Investors and James Brown, individually;

WHEREAS, First Investors voluntarily opted not to renew its Massachusetts mortgage broker license for the calendar year 2010;

WHEREAS, First Investors' mortgage broker license, MB0063, expired and was terminated as of January 1, 2010;

WHEREAS, James Brown voluntarily opted not to renew his Massachusetts mortgage loan originator license for the calendar year 2010;

WHEREAS, James Brown's mortgage loan originator license, MLO17945, expired and was terminated as of January 1, 2010;

WHEREAS, on or about January 28, 2010, First Investors and James Brown filed a Response to the Order and Notice, whereby First Investors and James Brown contested certain of the Division's findings as set forth in the Report and the Order and Notice. By the Response, First Investors and James Brown offered documents in response to the Division's findings and further reserved the right to proceed to an administrative hearing in accordance with Massachusetts General Laws chapter 30A.

WHEREAS, on March 25, 2010, James Brown appeared at the Division's offices for an informal conference to discuss the matters raised by the Order and Notice;

WHEREAS, the parties now seek to resolve by mutual agreement, the matters identified in the Order and Notice;

WHEREAS, without this Consent Order constituting an admission by First Investors or James Brown of any allegations made or implied by the provisions of the Order and Notice; solely for the purpose of settlement of all alleged violations without protracted administrative proceedings and judicial review, First Investors and James Brown hereby waive all rights to complete the hearing process relative to this proceeding and James Brown, individually, affirms that he is willing to take all necessary action as set forth in this Consent Order; and

WHEREAS, in recognition of the Division and James Brown having reached the following mutual agreement under this Consent Order to resolve the matters raised by the Order and Notice, the Commissioner has terminated the Order and Notice on this 16th day of June, 2010.

ORDER

NOW COME the parties in the above-captioned matter, the Division, First Investors, and James Brown, individually, and stipulate and agree as follows:

  1. Immediately upon the execution of this Consent Order, James Brown will refrain from taking a residential mortgage loan application, or offering or negotiating terms of a residential mortgage loan, or otherwise engaging in the mortgage loan originator business, as that term is defined under General Laws chapter 255F, section 1.
  2. Immediately upon the execution of this Consent Order, First Investors and James Brown will cease originating or accepting, either directly or indirectly, any Massachusetts residential mortgage loan applications, or otherwise engaging in the mortgage broker business, as that term is defined under General Laws chapter 255E, section 1.
  3. James Brown will refrain from submitting an application to obtain a mortgage loan originator license from the Commissioner for a period of twelve (12) months from December 31, 2009.
  4. To the extent that James Brown wishes to resume business as a mortgage loan originator at the expiration of the 12-month term as set forth above, James Brown shall be required to submit a completed application to obtain the relevant license from the Commissioner. Unless the Commissioner, in his sole discretion, agrees to accept such an application earlier, James Brown agrees not to submit such an application until the expiration of the 12-month term. The Commissioner shall have all of the discretion set forth within General Laws chapter 255F, section 4 and the Division's regulation 209 CMR 41.00 et seq. in determining whether to issue a license to James Brown to conduct the licensed business, provided however, that any such application shall not be denied on the basis of the Order and Notice.
  5. James Brown and/or First Investors will refrain from submitting an application to obtain a mortgage broker and/or mortgage lender license from the Commissioner for a period of thirty-six (36) months from December 31, 2009. The provisions of this Paragraph shall prohibit James Brown from taking an ownership position in an entity licensed under General Laws chapter 255E and from participating, in any manner, in the responsibilities or duties of a control person of such an entity, during the above referenced 36-month term. For the purposes of this Consent Order, "control" shall be defined as the power, directly or indirectly, to direct the management or policies of a company, whether through ownership of securities, by contract, or otherwise.
  6. Subject to the foregoing limitations, the provisions of this Consent Order shall not prohibit James Brown from employment in the mortgage industry, provided that James Brown does not engage in any activities for which a license is required pursuant to General Laws chapters 255F and/or 255E and the Division's regulations 209 CMR 41.00 et seq. and/or 209 CMR 42.00 et seq.
  7. To the extent that James Brown and/or First Investors wishes to resume or engage in business as a mortgage lender and/or mortgage broker at the expiration of the 36-month term as set forth above, First Investors and/or James Brown shall be required to submit a completed application to obtain the relevant license(s) from the Commissioner, unless the Commissioner, in his sole discretion, agrees to review such an application earlier. The Commissioner shall have all of the discretion set forth within General Laws chapter 255E, section 4, and the Division's regulation 209 CMR 42.00 et seq., in determining whether to issue a license to James Brown and/or First Investors to conduct the licensed business, provided however, that any such application shall not be denied on the basis of this Consent Order.
  8. James Brown shall reimburse the consumer identified in the Report for the full amount collected as an escrow waiver fee; a fee for services which the Corporation, as a mortgage broker, is prohibited from performing in a mortgage loan transaction.
  9. Within thirty (30) days of the effective date of this Consent Order, James Brown shall submit to the Division sufficient evidence to illustrate the consumer's receipt of the reimbursement set forth in Paragraph 8 of this Consent Order, including, but not limited to, the consumer's name, the check number, the amount of the reimbursement, and a certified mail receipt to illustrate the consumer's receipt of the reimbursement check.
  10. Within thirty (30) days of receipt of the relevant invoice from the Division, James Brown shall submit payment in full of the amount owed for the costs of the Division's examination/inspection as set forth in the relevant invoice issued to First Investors. The payment shall be made payable to the "Commonwealth of Massachusetts" and mailed to the Office of the Commissioner of Banks, Attn: Mortgage Broker Examination Unit, 1000 Washington Street, 10 th Floor, Boston, Massachusetts 02118.
  11. The provisions of this Consent Order shall not limit, estop, or otherwise prevent any other state agency or department, from taking any other action affecting First Investors or James Brown.
  12. This Consent Order shall become effective immediately upon the date of its issuance.
  13. In accordance with the terms of the Consent Agreement entered by James Brown and the Commissioner, First Investors and James Brown have waived all rights of appeal that they may have relative to the Order and Notice and this Consent Order or any of its provisions.
  14. The provisions of this Consent Order shall remain effective and enforceable except to the extent that, and until such time as, any provisions of this Consent Order shall have been modified, terminated, suspended, or set aside by the Commissioner or upon an order of a court of competent jurisdiction.
  15. This Consent Order and the Consent Agreement are the complete documents representing the resolution of this matter. There are no other agreements, promises, representations, or warranties other than those set forth in this Consent Order and the Consent Agreement.

BY ORDER AND DIRECTION OF THE COMMISSIONER OF BANKS.

Dated at Boston, Massachusetts, this 16th day of June, 2010

By: Steven L. Antonakes
Commissioner of Banks
Commonwealth of Massachusetts