By the Division of Banks

COMMONWEALTH OF MASSACHUSETTS

Suffolk, SS.

COMMISSIONER OF BANKS
MORTGAGE BROKER AND
MORTGAGE LOAN
ORIGINATOR LICENSING
Docket No. 2011-083

FINDINGS OF FACT AND
TEMPORARY ORDER TO
CEASE AND DESIST

In the Matter of
MORTGAGE DREAMS, LLC
Mortgage Broker License No. MB1511
Charlton, Massachusetts

and

Julie Ann Tremblay, Individually
Mortgage Loan Originator License No. MLO13150

and

Christopher M. Tremblay, Individually
Mortgage Loan Originator License No. MLO13152


The Commissioner of Banks ("Commissioner") having determined that MORTGAGE DREAMS, LLC ("Mortgage Dreams" or the "Company"), located at 451 Worcester Road, Charlton, Massachusetts, julie ann tremblay ("Julie Tremblay") and Christopher m. tremBlay, ("Christopher Tremblay") have engaged in, or are engaging in, or are about to engage in, acts or practices constituting violations of Massachusetts General Laws chapters 255E and 255F, and applicable regulations found at 209 CMR 42.00 and 209 CMR 41.00 et seq., hereby issues the following FINDINGS OF FACT AND TEMPORARY ORDER TO CEASE AND DESIST ("Temporary Order") pursuant to General Laws chapter 255E, section 7(b) and chapter 255F, section 11(a).

FINDINGS OF FACT

  1. 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 pursuant to Massachusetts General Laws chapter 255E, section 2 and its implementing regulation 209 CMR 42.00 et seq.
  2. The Division also 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 its implementing regulation 209 CMR 41.00 et seq.
  3. Mortgage Dreams is, and at all relevant times, has been a corporation conducting business in the Commonwealth of Massachusetts. Mortgage Dreams' main office is located at 451 Worcester Road, Charlton, Massachusetts.
  4. Mortgage Dreams is licensed by the Commissioner as a mortgage broker under Massachusetts General Laws chapter 255E, section 2. According to records maintained on file with the Division, and as recorded on the Nationwide Mortgage Licensing System ("NMLS"), the Commissioner initially issued a mortgage broker license, license number MB1511 to Mortgage Dreams to engage in the business of a mortgage broker on or about January 31, 2005. License number MB1511 authorized Mortgage Dreams to conduct the mortgage broker business from the Company's main office located at 451 Worcester Road, Charlton, Massachusetts.
  5. Julie Tremblay is and at all relevant times has been an owner and managing member of Mortgage Dreams. On July 5, 2011, while the Division was conducting an investigation regarding concerns related to the business practices of Mortgage Dreams, Julie Tremblay attempted to transfer her ownership interest in the Company to Christopher Tremblay. As of the date of this Temporary Order, the Division has not approved the transfer of ownership.
  6. Julie Tremblay is licensed by the Commissioner as a mortgage loan originator under Massachusetts General Laws chapter 255F, section 2. According to records maintained on file with the Division, and as recorded on the NMLS, the Commissioner initially issued a mortgage loan originator license, license number MLO13150, to Julie Tremblay to engage in the business of a mortgage loan originator on or about August 11, 2008.
  7. Christopher Tremblay is, and at all relevant times has been, an owner and managing member of Mortgage Dreams.
  8. Christopher Tremblay is licensed by the Commissioner as a mortgage loan originator under Massachusetts General Laws chapter 255F, section 2. According to records maintained on file with the Division, and as recorded on the NMLS, the Commissioner initially issued a mortgage loan originator license, license number MLO13152, to Christopher Tremblay to engage in the business of a mortgage loan originator on or about September 23, 2008.
  9. Mortgage lenders and mortgage brokers in Massachusetts are licensed and regulated under Massachusetts General Laws chapter 255E, which is administered and enforced by the Commissioner. Pursuant to Massachusetts General Laws chapter 255E, section 8, the Division is authorized to inspect the books, accounts, papers, records, and files of mortgage lenders and mortgage brokers transacting business in Massachusetts to determine compliance with the provisions of Massachusetts General Laws chapter 255E or any rule, or regulation issued thereunder, and with any law, rule, or regulation applicable to the conduct of the business of a mortgage lender and mortgage broker.
  10. On or about June 23, 2011, the Division received information regarding concerns related to the business practices of Mortgage Dreams and commenced an investigation of the Company.
  11. On July 18, 2011, as a result of concerns raised during the Division's investigation referenced above, the Division conducted an examination/inspection of the books, accounts, papers, records, and files maintained by Mortgage Dreams to evaluate the Company's compliance with the laws, regulations, and regulatory bulletins applicable to the conduct of a mortgage broker business in Massachusetts pursuant to Massachusetts General Laws chapter 255E, section 8 (the "2011 examination/inspection").
  12. The Division's Report of Examination/Inspection on Consumer Compliance (the "Report"), which was issued to Mortgage Dreams on the effective date of this Temporary Order, presented the findings of the 2011 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.

    A. Making False, Perjurious Statements to the Division

    a. Submitting False Information to the Division in Response to an Examination

  13. The Division's regulation 209 CMR 42.06 section 4(c) applicable to mortgage brokers states in part:

    An applicant shall submit information demonstrating that the Applicant possesses the character, reputation, integrity and fitness to engage in the business of a mortgage broker in an honest, fair, sound and efficient manner.

  14. Massachusetts General Laws, chapter 255F, section 15(j) states:

    It shall be a violation of this chapter for any person to: ... (j) make any false statement or knowingly and willfully make any omission of material fact in connection with any information or reports filed with a governmental agency or the Nationwide Mortgage Licensing System and Registry or in connection with any investigation conducted by the commissioner or another governmental agency.

  15. The Division's regulation 209 CMR 41.10(15) states:

    It is a prohibited act or practice for a Mortgage Loan Originator to make any false statement or knowingly and willfully make any omission of material fact in connection with any information or reports filed with a governmental agency or the Nationwide Mortgage Licensing System and Registry or in connection with any investigation conducted by the Commissioner or another governmental agency.

  16. The Division's regulation 209 CMR 42.12A(19) states:

    It is a prohibited act or practice for a mortgage broker or a mortgage lender to engage in conduct prohibited under 209 CMR 41.10.

  17. On April 1, 2010, 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 Mortgage Dreams to evaluate the Company's compliance with the laws and regulations applicable to the conduct of a mortgage broker business in Massachusetts (the "2010 examination/inspection").
  18. The Division's Report of Examination/Inspection (the "2010 Report"), issued to Mortgage Dreams on December 3, 2010, alleged significant failures to comply with applicable state and federal laws, rules and regulations governing the conduct of those engaged in the business of a mortgage broker.
  19. Mortgage Dreams was required to implement certain corrective actions to address the matters raised by the findings in the 2010 report. Christopher Tremblay and Julie Tremblay as owners and managing members of Mortgage Dreams were required to reimburse certain fees collected from Massachusetts consumers as identified in the 2010 Report. Additionally, Mortgage Dreams was required to conduct a review of all Massachusetts residential mortgage loans processed by the Company since June 18, 2008, and reimburse all consumers from whom any unearned fees were collected ("Corrective Action").
  20. The Corrective Action required Mortgage Dreams to submit evidence of all reimbursements issued. The evidence submitted to the Division was to include: the consumers' names, the dates the loans closed, the check numbers, the amount of the reimbursements, and certified mail receipts to illustrate the consumers' receipt of the reimbursements.
  21. On January 18, 2011, the Division received: a certification signed by both Julie Tremblay and Christopher Tremblay affirming that the 2010 Report had been read; an acknowledgement signed by both Christopher Tremblay and Julie Tremblay attesting that all Corrective Action that had been required would be implemented; and copies of checks dated January 9, 2011 which Mortgage Dreams represented had been mailed to Massachusetts consumers as required by the Corrective Action.
  22. The Division also received correspondence signed by Julie Tremblay and Christopher Tremblay indicating that certified mail receipts were attached pursuant to the requirements of the Corrective Action, however the Division had not been forwarded any certified mail receipts in the January 18, 2011 correspondence.
  23. On or about June 23, 2011, the Division became aware that Mortgage Dreams may not have complied with the Corrective Action as required, and as a result the Division commenced an investigation of the Company.
  24. Books and records reviewed by the Division's examiners indicate that despite representations made to the Division, Mortgage Dreams had not sent any consumer reimbursement checks as of January 18, 2011.
  25. A review of copies of certified mail receipts maintained by the Company indicated that the consumer checks had been mailed on January 28, 2011, ten days after the Division received a written response indicating that checks had been mailed. Five consumer checks had been returned to Mortgage Dreams as they had been undeliverable.
  26. The Division's examiners review of copies of seven checks maintained by the Company and provided to the Division's examiners for review, revealed that the "pay to the order of" section was completed in ink while the remainder of the check had been copied. Four of the seven checks reviewed by the Division's examiners also revealed that the dollar amount of the check on the copies had been completed in ink.
  27. The Division's examiners review of the five consumer checks that had been returned to the Company as undeliverable also revealed that there were several inconsistencies between the original checks that had been mailed to consumers and copies of checks that had been sent to the Division as evidence of compliance with the Corrective Action.
  28. During the examination/inspection, the Division's examiners requested bank statements with images of the consumer reimbursement checks that had been mailed by Mortgage Dreams. Julie Tremblay notified the Division's examiners that she was unable to produce any check images from the financial institution because the checks contained an incorrect account number and the institution had been required to manually process the checks, Julie Tremblay repeatedly informed examiners that the financial institution was unable to retrieve images of the checks.
  29. On or about July 26, 2011, the Division's examiners obtained copies of the consumer checks from the financial institution. Representatives of the financial institution notified the Division's examiners that copies of the consumer checks were in fact retrievable and provided the requested copies to the Division's examiners.
  30. The Division's examiners compared the check images received by the financial institution to the copies of the checks received by the Division on January 18, 2011. The review revealed inconsistencies in the "pay to the order" of section as well as certain "date sections."

    b. Failure to Update NMLS Record Regarding the Occurrence of a Significant Event

  31. The Division's regulation at 209 CMR 42.12(1)(c) states, in part:
    1. A Licensee shall notify the Commissioner immediately, and in writing within one business day, of the occurrence of any of the following significant developments: ... (c) Receiving notification of the institution of license denial, cease and desist, suspension or revocation procedures, or other formal or informal regulatory action, in any state against the Licensee, and the reasons thereof.
  32. On November 9, 2009 and November 29, 2010, in executing the renewal applications for Mortgage Dreams for 2010 and 2011 on the NMLS, Julie Tremblay attested that all information and statements contained therein, were current, true, accurate and complete, and were made under the penalties of perjury.
  33. In executing the renewal applications, Julie Tremblay acknowledged that submitting any false or misleading information, or omitting pertinent or material information, could be grounds for an administrative action and/or criminal action.
  34. In executing the applications for renewal on the NMLS, Julie Tremblay acting on behalf of Mortgage Dreams attested that she would keep the information contained in the application form current and that she would file accurate supplementary information on a timely basis.
  35. Julie Tremblay has the capability to update Mortgage Dreams' information on the NMLS at any time.
  36. Julie Tremblay acting on behalf of Mortgage Dreams answered "no" to Disclosure Question C on both the 2010 and 2011 NMLS renewal applications which asks: "In the past 10 years, has any State or federal regulatory agency or foreign financial regulatory authority: (2) found the entity or a control affiliate to have been involved in a violation of a financial services-related regulation(s) or statute(s)? (3) found the entity or a control affiliate to have been a cause of a financial services-related business having its authorization to do business denied, suspended, revoked or restricted? (4) entered an order against the entity or a control affiliate in connection with a financial services-related activity? (5) denied, suspended, or revoked the entity's or a control affiliate's registration or license or otherwise, by order, prevented it from associating with a financial services-related business or restricted its activities?"
  37. On July 6, 2009, the New Hampshire Banking Department issued an Order to Show Cause, Case Number 08-126 ("Order to Show Cause") against Mortgage Dreams for failing to pay two exam bills and failing to file required financial statements within the time prescribed by statute. On September 25, 2009, the New Hampshire Banking Department issued a Default Judgment against Mortgage Dreams for failing to respond to the Order to Show Cause. The Default Judgment revoked Mortgage Dreams license in New Hampshire.
  38. On June 9, 2008, the Connecticut Department of Banking issued a Notice of Automatic Suspension, Notice of Intent to Revoke First and Secondary Mortgage Broker Licenses and Notice of Right to Hearing ("Notice of Intent to Revoke") for a failure to maintain a surety bond in Connecticut. On August 7, 2008, Mortgage Dreams entered into a Settlement Agreement with the Connecticut Department of Banking to resolve the matters addressed in Notice of Intent to Revoke by surrendering the Company's licenses in Connecticut.
  39. During the 2011 examination/inspection, in an email to the Division's examiner, Julie Tremblay indicated that the Department of Housing and Urban Development's Mortgagee Review Board has suspended Mortgage Dreams status briefly in 2010. The Division became aware that Mortgage Dreams' status had been suspended because the Company had failed to timely comply with the Department of Housing and Urban Development's annual recertification requirements.
  40. As of the date of this Temporary Order, Mortgage Dreams has failed to appropriately notify the Division of the events reference in Paragraphs 37 through 39, and update its answers to disclosure question (C) on the NMLS.

    c. Misrepresentation of Information on Mortgage Renewal Filing

  41. In executing the 2010 and 2011 renewal applications on the NMLS, Julie Tremblay acting on behalf of Mortgage Dreams attested that she would keep the information contained on the NMLS current and that she would file accurate supplementary information on a timely basis.
  42. Julie Tremblay answered "no" to the following question NMLS application which asks: "Will the entity occupy or share space with any person(s) engaged in financial services-related activity?"
  43. During the 2011 examination/inspection, the Division's examiners reviewed a business card for a business entity by the name of North-East Loan Modification which referenced an address 451 Worcester Road, Charlton, Massachusetts and a telephone number affiliated with Mortgage Dreams. Daniel Flamand was identified as the President of North-East Loan Modification. In addition, a search of the Yellow Pages revealed that North-East Loan Modification provides the following services: Modification, Making Home Affordable Modification, Loss Mitigation, and Loan Modification. The business location and telephone number advertised were Mortgage Dreams' main office address and telephone number.
  44. On Monday, July 25, 2011 the Division's examiners emailed the following questions to Mortgage Dreams: What is North-East Loan Modifications? Is this company active at your office location? Have any Loan Modifications been negotiated through North-East Loan Modifications? Is Daniel Flamand still President of this company?
  45. In response to the Division's inquiry, Christopher Tremblay responded by stating "Dan Flamand is working for Energy Gateway a World Energy company and to my knowledge does not do modifications."
  46. As of the date of this Temporary Order, Mortgage Dreams has failed to update its answer to question referenced Paragraph 42 of this Temporary Order on the NMLS.

    d. Misrepresentation to the Division in a Mortgage Loan Originator filing

    i. Failure to update information regarding a Federal Tax Lien

  47. On November 29, 2010, in executing the application for her mortgage loan originator 2011 license renewal on the NMLS, Julie Tremblay attested that that all information and statements contained therein, were current, true, accurate and complete, and were made under the penalties of perjury.
  48. In executing the renewal application, Julie Tremblay acknowledged that submitting any false or misleading information, or omitting pertinent or material information, could be grounds for an administrative action and/or criminal action.
  49. In executing the renewal application, Julie Tremblay agreed that she would keep the information contained in the application form current and that she would file accurate supplementary information on a timely basis.
  50. Julie Tremblay has the capability to update her application information on the NMLS at any time.
  51. Julie Tremblay answered "no" to Disclosure Question 8(C) on the NMLS renewal application which asks: "Within the past 10 years: (C) Do you have any unsatisfied judgments or liens against you?"
  52. The Division's examiners review of public records at the Worcester County Registry of Deeds revealed that on April 20, 2010, a federal tax lien had been filed by the small business unit of the Internal Revenue Service against Julie Tremblay for unpaid taxes. The registry records indicate that the tax lien has not been released and the payment due to the Internal Revenue Service remains outstanding.
  53. As of the date of this Temporary Order, Julie Tremblay has failed to update her answer to disclosure question 8(C) on the NMLS.
  54. On November 29, 2010, in executing the application for his mortgage loan originator 2011 license renewal on the NMLS, Christopher Tremblay attested that that all information and statements contained therein, were current, true, accurate and complete, and were made under the penalties of perjury.
  55. In executing the renewal application, Christopher Tremblay acknowledged that submitting any false or misleading information, or omitting pertinent or material information, could be grounds for an administrative action and/or criminal action.
  56. In executing the renewal application, Christopher Tremblay agreed that he would keep the information contained in the application form current and that he would file accurate supplementary information on a timely basis.
  57. Christopher Tremblay has the capability to update his application information on the NMLS at any time.
  58. Christopher Tremblay answered "no" to Disclosure Question 8(C) on the NMLS renewal application which asks: "Within the past 10 years: (C) Do you have any unsatisfied judgments or liens against you?"
  59. The Division's examiners review of public records at the Worcester County Registry of Deeds revealed that on April 20, 2010, a federal tax lien had been filed by the small business unit of the Internal Revenue Service against Christopher Tremblay for unpaid taxes. The registry records indicate that the tax lien has not been released and the payment due to the Internal Revenue Service remains outstanding.
  60. As of the date of this Temporary Order, Christopher Tremblay has failed to update his answer to disclosure question 8(C) on the NMLS.

    ii. Failure to update information regarding other businesses

  61. In executing the 2011 mortgage loan originator renewal application on the NMLS, Christopher Tremblay attested that he would keep the information contained on the NMLS current and that he would file accurate supplementary information on a timely basis.
  62. Christopher Tremblay answered "yes" to the following question on the NMLS renewal application which asks: "Are you currently engaged in any other business either as a proprietor, partner, officer, director, employee, trustee, agent, or otherwise?" In completing the renewal application on the NMLS Christopher Tremblay indicated that he was the owner of a retail company, Luv Julz Inc.
  63. During the 2011 examination/inspection, Christopher Tremblay informed the Division's examiners that he was also the President of an energy company, Gateway Energy.
  64. As of the date of this Temporary Order, Christopher Tremblay has failed to update his update his MU2 form on the NMLS to reflect his affiliation with Gateway Energy.

    B. Unfair or Deceptive Acts and Practices

    a. Alteration and/or Manipulation of Mortgage Loan Related Documents

  65. The Division's regulation 209 CMR 42.12A(7) states:

    It is a prohibited act or practice for a mortgage broker or mortgage lender to sign a consumer's name to a mortgage loan application or mortgage loan documents on behalf of a consumer.

  66. Massachusetts General Laws chapter 93A, section 2(a) states:

    Unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce are hereby declared unlawful.

  67. The Attorney General's regulation 940 CMR 8.06(1) states, in part:

    It is an unfair or deceptive act or practice for a mortgage broker or lender to make any representation or statement of fact if the representation or statement is false or misleading or has the tendency or capacity to be misleading.

  68. The 2011 examination/inspection revealed that Mortgage Dreams manipulated and/or altered various mortgage loan related documents. Examples of this practice include, but are not limited to: signing mortgage loan related documents including but not limited to letters of explanation and disclosures on the borrowers' behalf; and preparing letters of explanations on behalf of borrowers.
  69. A review of the Books and records reviewed by the Division's examiners revealed that Mortgage Dreams consistently prepared letters of explanation on behalf of borrowers for transmittal to mortgage lenders.
  70. The practices referenced in the Paragraphs 68 and 69 above were observed in multiple loan files reviewed including, but not limited to, the following eight (8) loan transactions reviewed by the Division's examiners: Loan Nos.: 37736747, 37736820, 400002966, 400001190, 1007155048, 1021712, 400004664 and 37736989. The examiners specific findings are fully described in the Report and are incorporated herein by reference.
  71. Mortgage Dreams knew or should have known that the information reflected on the above referenced documents would have been relied upon in underwriting the mortgage loan by the mortgage lender or financial institution to which the mortgage loan applications were brokered by Mortgage Dreams.

    C. Failure to Provide Notice Significant Event

  72. The Division's regulation 209 CMR 42.12(1)(j) states in part:

    A Licensee shall notify the Commissioner immediately, and in writing within one business day, of the occurrence of … (j) Existence of negative balances, exceeding $ 100, in any operating account at any time or the return of checks, exceeding $ 100, for insufficient funds.

  73. The 2011 examination/inspection revealed that Mortgage Dreams operating account had a negative balance exceeding $100 numerous times in September 2010 and continued to have a negative balance in April and May of 2011. In addition, the Division's examiners determined that during September 2010, at least four checks exceeding $100 were returned for insufficient funds.
  74. Mortgage Dreams failed to notify the Division of the events referenced in Paragraph 73 of this Temporary Order.

    D. Conducting Residential Mortgage Loan Business in Massachusetts with Unlicensed Mortgage Loan Originators

  75. Massachusetts General Laws chapter 255F, section 2(a), states, in part:

    No individual shall act as a mortgage loan originator with respect to any dwelling unless such person has first obtained a mortgage loan originator license from the commissioner or is exempt from the licensure requirement ... No person shall knowingly employ or retain a mortgage loan originator unless the mortgage loan originator is licensed under this chapter or is exempt from the licensure requirement.

  76. Massachusetts General Laws chapter 255F section 11(e) states:

    The commissioner may suspend, revoke or refuse to renew the license of the entity employing any licensed mortgage originator upon finding that: (i) the entity knew or reasonably should have known that the mortgage loan originator violated this chapter or any rule or regulation promulgated hereunder, or any other law applicable to the conduct of its business; (ii) the entity knew of any fact or condition which, if it had existed at the time of the original application for such license, would have warranted the commissioner in refusing to issue such license; or (iii) the mortgage loan originator committed any fraud, misappropriated funds or misrepresented any of the material particulars of a mortgage loan transaction approved by the entity.

  77. The Division's regulation 209 CMR 42.12A(17) states:

    It is a prohibited act or practice for a mortgage broker or a mortgage lender to conduct business with an individual who should be licensed as a mortgage loan originator under M.G.L. c. 255F, and who the mortgage broker or mortgage lender knows or should know is an unlicensed mortgage loan originator.

  78. Books and records reviewed by the Division's examiners during the 2011 examination/inspection revealed that at least one loan residential mortgage loan appeared to be originated by an unlicensed individual on behalf of Mortgage Dreams.

    E. Providing Mortgage Lender Disclosures to Consumers

  79. Books and records reviewed by the Division's examiners during the 2011 examination/inspection indicate that Mortgage Dreams routinely provided several mortgage lender disclosures to consumers to consumers in violation of and exceeding its authority under G. L. c. 255E.
  80. The mortgage lender disclosures include, but are not limited to, Notice of Credit Denial, Equal Credit Opportunity Notice, Notice to Applicant's of Right to Receive Copy of Appraisal Report, Servicing Disclosure, and Truth in Lending Disclosure.

    F. Loan Origination and Compensation Agreement

  81. The Division's regulation 209 CMR 42.12A(5) states in part:

    It is a prohibited act or practice for a mortgage broker to fail to provide to the consumer at the time of application the loan origination and compensation agreement required under 209 CMR 42.16. The content of the agreement shall strictly conform to 209 CMR 42.16 and include signatures and dates by the consumer(s) and the mortgage broker.

  82. The Division's regulation 209 CMR 42.09(1)(b) states, in part:

    Each mortgage broker ... shall retain for a minimum of three years after a mortgage loan is made the following: the original loan origination and compensation agreement as set out in 209 CMR 42.16.

  83. Books and records reviewed by the Division's examiners during the 2011 examination/inspection revealed that Mortgage Dreams failed to retain evidence of having provided the Loan Origination and Compensation Agreements in at least three loan files.

    G. Engaging in Prohibited Advertising Practices

  84. The Division's regulation 209 CMR 42.12A(4) states:

    It is a prohibited act or practice for a mortgage broker to advertise any interest rate or loan term described in 209 CMR 32.24(3)(a) in any media without the following statement: "We arrange but do not make loans". No advertisement by a mortgage broker in any media shall contain language which indicates or suggests that the mortgage broker will fund or approve a mortgage loan or guarantee any rate.

  85. Mortgage Dreams print and television advertisements included loan terms without including the statement, "We arrange but do not make loans."
  86. The Division's regulation 209 CMR 32.24 states:

    (a) Triggering Terms. If any of the following terms is set forth in an advertisement, the advertisement shall meet the requirements of 209 CMR 32.24(4)(b):

    1. The amount or percentage of any downpayment.

    2. The number of payments or period of repayment.

    3. The amount of any payment.

    4. The amount of any finance charge.

    (b) Additional Terms. An advertisement stating any of the terms in 209 CMR 32.24(4)(a) shall state the following terms, as applicable (an example of one or more typical extensions of credit with a statement of all the terms applicable to each may be used):

    1. The amount or percentage of the downpayment.

    2. The terms of repayment, which reflect the repayment obligations over the full term of the loan, including any balloon payment.

    3. The "annual percentage rate," using that term, and, if the rate may be increased after consummation, that fact.

  87. Mortgage Dreams' print and television advertisements set forth the percentage of a required downpayment but failed to include the additional disclosures required pursuant to 209 CMR 32.24(4)(b).

    H. Other Violations

  88. In addition to the violations specifically set forth in this Temporary Order, a Report of Examination/Inspection prepared as of July 18, 2011 and to be provided to Mortgage Dreams in conjunction with the issuance of this Temporary Order, describes other violations observed during the 2011 examination/inspection.

    CONCLUSIONS OF LAW

  89. Based upon the information contained in Paragraphs 1 through 88, Mortgage Dreams has failed to demonstrate and maintain the financial responsibility, character, reputation, integrity, and general fitness such as to command the confidence of the community and to warrant a determination that it will operate honestly, fairly, soundly and efficiently in the public interest, as a mortgage broker in violation of Massachusetts General Laws chapter 255E, section 4 and the Division's regulation 209 CMR 42.06(2)(c).
  90. Based upon the information contained in Paragraphs 1 through 88, Julie Tremblay, as owner and managing member of Mortgage Dreams has failed to demonstrate and maintain the financial responsibility, character, reputation, integrity, and general fitness such as to command the confidence of the community and to warrant a determination that she will operate honestly, fairly, soundly and efficiently in the public interest, as a mortgage loan originator in violation of Massachusetts General Laws chapter 255F, section 4 and the Division's regulation 209 CMR 41.04(2)(d).
  91. Based upon the information contained in Paragraphs 1 through 88, Christopher Tremblay, as owner and managing member of Mortgage Dreams has failed to demonstrate and maintain the financial responsibility, character, reputation, integrity, and general fitness such as to command the confidence of the community and to warrant a determination that he will operate honestly, fairly, soundly and efficiently in the public interest, as a mortgage loan originator in violation of Massachusetts General Laws chapter 255F, section 4 and the Division's regulation 209 CMR 41.04(2)(d).
  92. Based upon the information contained in Paragraphs 1 through 88, by making false statements and submitting information and reports that falsely represented that the Company had complied with provisions of Corrective Action imposed as a result of an examination, Mortgage Dreams, violated the Division's regulation 209 CMR 42.12A(19).
  93. Based upon the information contained in Paragraphs 1 through 88, by making false statements and submitting information and reports that falsely represented that Mortgage Dreams had complied with provisions of Corrective Action imposed as a result of an examination, Julie Tremblay and Christopher Tremblay in their capacity as the owners and managing members of Mortgage Dreams, violated Massachusetts General Laws chapter 255F, section 15(j), and the Division's regulation 209 CMR 41.10(15).
  94. Based upon the information contained in Paragraphs 1 through 88, by failing to update information on the NMLS and notify the Commissioner, in writing, within one business day, of the regulatory action taken against the Company by the New Hampshire Banking Department, the Connecticut Banking Department and the Department of Housing and Urban Development's Mortgagee Review Board, Mortgage Dreams violated the Division's regulation 209 CMR 42.12(1)(c).
  95. Based upon the information contained in Paragraphs 1 through 88, by omitting and thereafter failing to update the NMLS to reflect that Mortgage Dreams occupied space with an entity engaged in financial services-related activity, Julie Tremblay violated Massachusetts General Laws, chapter 255F, section 15(j) and the Division's regulation 209 CMR 41.10(15).
  96. Based upon the information contained in Paragraphs 1 through 88, by omitting and thereafter failing to update information on the NMLS to reflect that Mortgage Dreams occupied space with an entity engaged in financial services-related activity, Christopher Tremblay violated Massachusetts General Laws, chapter 255F, section 15(j) and the Division's regulation 209 CMR 41.10(15).
  97. Based upon the information contained in Paragraphs 1 through 88, by failing to disclose the existence of a federal tax lien on her mortgage loan originator license renewal application, Julie Tremblay violated Massachusetts General Laws, chapter 255F, section 15(j) and the Division's regulation 209 CMR 41.10(15).
  98. Based upon the information contained in Paragraphs 1 through 88, by failing to disclose the existence of a federal tax lien on his mortgage loan originator license renewal application, Christopher Tremblay violated Massachusetts General Laws, chapter 255F, section 15(j) and the Division's regulation 209 CMR 41.10(15).
  99. Based upon the information contained in Paragraphs 1 through 88, by failing to disclose his affiliation with other businesses on the NMLS, Christopher Tremblay violated Massachusetts General Laws, chapter 255F, section 15(j) and the Division's regulation 209 CMR 41.10(15).
  100. Based upon the information contained in Paragraphs 1 through 88, by signing consumers' names on mortgage loan documents, and preparing documents on behalf of consumers for transmittal to financial institutions, Mortgage Dreams violated the Division's regulation 209 CMR 42.12A(7) Massachusetts General Laws chapter 93A, section 2(a) and the Office of the Attorney General's implementing regulation 940 CMR 8.06(1).
  101. Based upon the information contained in Paragraphs 1 through 88, by failing to notify the Commissioner, in writing, within one business day, of the existence of negative balances and the return of multiple checks for insufficient funds in its operating account Mortgage Dreams violated the Division's regulation 209 CMR 42.12(1)(j).
  102. Based upon the information contained in Paragraphs 1 through 88, by engaging in residential mortgage business with at least one unlicensed individual who should be licensed as a mortgage loan originator under M.G.L. chapter 255F, Mortgage Dreams violated Massachusetts General Laws chapter 255F, section 2(a) and the Division's regulation 209 CMR 42.12A(17).
  103. Based upon the information contained in Paragraphs 1 through 88, by providing disclosures to consumers that only lenders are authorized to provide, Mortgage Dreams exceeded its authority in violation of Massachusetts General Laws chapter 255E, section 2.
  104. Based upon the information contained in Paragraphs 1 through 88, by failing to retain copies of the Loan Origination and Compensation Agreement provided to consumers, Mortgage Dreams violated the Division's regulation 209 CMR 42.12A(5) and 209 CMR 42.09(1)(b).
  105. Based upon the information contained in Paragraphs 1 through 88, by advertising interest rates and/or loan terms in the Company's advertisements, without including the statement, "We arrange but do not make loans," Mortgage Dreams violated the Division's regulation 209 CMR 42.12A(4).
  106. Based upon the information contained in Paragraphs 1 through 88, by failing to include required language in the Company's advertisements, when advertising certain credit terms, Mortgage Dreams violated the Division's regulations 209 CMR 32.24(4).
  107. Based upon the information contained in Paragraphs 1 through 88, the Commissioner has determined that:
    1. Mortgage Dreams has engaged in, is engaging in, or is about to engage in, acts or practices which warrant the belief that it is not operating honestly, fairly, soundly and efficiently in the public interest in violation of standards governing the licensing and conduct of a mortgage broker including, but not limited to, the provisions of Massachusetts General Laws chapter 255E, section 7 and the Division's regulations at 209 CMR 42.00 et seq.;
    2. Julie Tremblay, has engaged in, is engaging in, or is about to engage in, acts or practices which warrant the belief that she is not operating honestly, fairly, soundly and efficiently in the public interest in violation of standards governing the licensing and conduct of a mortgage loan originator including, but not limited to, the provisions of the Division's regulations at 209 CMR 41.00 et seq.;
    3. Christopher Tremblay, has engaged in, is engaging in, or is about to engage in, acts or practices which warrant the belief that he is not operating honestly, fairly, soundly and efficiently in the public interest in violation of standards governing the licensing and conduct of a mortgage loan originator including, but not limited to, the provisions of the Division's regulations at 209 CMR 41.00 et seq.;
    4. The public interest will be irreparably harmed by delay in issuing an ORDER TO CEASE AND DESIST to Mortgage Dreams, Julie Tremblay and Christopher Tremblay.
  108. Based upon the information contained in Paragraphs 1 through 88, had the facts and conditions found therein existed at the time of Mortgage Dreams' original mortgage broker license application, the Commissioner would have been warranted in refusing to issue such license. Further, the facts and conditions set forth in Paragraphs 1 through 88 present sufficient grounds for the revocation of Mortgage Dreams' mortgage broker license pursuant to Massachusetts General Laws chapter 255E, section 6 and the Division's regulations at, 42.07(2)(b), and 42.12A(20).
  109. Based upon the information contained in Paragraphs 1 through 88, had the facts and conditions found therein existed at the time of Julie Tremblay's original mortgage loan originator license application, the Commissioner would have been warranted in refusing to issue such license. Further, the facts and conditions set forth in Paragraphs 1 through 88, present sufficient grounds for the revocation of Julie Tremblay's mortgage loan originator license pursuant to Massachusetts General Laws chapter 255F, section 4 and the Division's regulation 209 CMR 41.05.
  110. Based upon the information contained in Paragraphs 1 through 88, had the facts and conditions found therein existed at the time of Christopher Tremblay's original mortgage loan originator license application, the Commissioner would have been warranted in refusing to issue such license. Further, the facts and conditions set forth in Paragraphs 1 through 88, present sufficient grounds for the revocation of Christopher Tremblay's mortgage loan originator license pursuant to Massachusetts General Laws chapter 255F, section 4 and the Division's regulation 209 CMR 41.05.

    ORDER TO CEASE AND DESIST

  111. After taking into consideration the FINDINGS OF FACT and CONCLUSIONS OF LAW stated herein, it is hereby:
  112. ORDERED that Mortgage Dreams and any and all officers, members, managers, employees, independent contractors, or agents, operating on behalf of Mortgage Dreams, and their successors or assigns, shall immediately cease engaging in the activities of: (a) a mortgage broker, as those activities are defined under Massachusetts General Laws chapter 255E, section 1, and (b) a mortgage loan originator, as those activities are defined under Massachusetts General Laws chapter 255F, section 1, relative to any residential property in Massachusetts, not otherwise expressly permitted by the terms of this Temporary Order. Therefore, Mortgage Dreams is ordered to immediately cease soliciting or accepting, either directly or indirectly, any residential mortgage loan applications from consumers for residential property located in Massachusetts.
  113. IT IS FURTHER ORDERED that Julie Tremblay shall immediately cease engaging in the activities of a mortgage loan originator, as those activities are defined under Massachusetts General Laws chapter 255F, section 1, relative to any residential property in Massachusetts. Therefore, Julie Tremblay is ordered to immediately cease soliciting, accepting, or further originating, either directly or indirectly, any residential mortgage loan applications from consumers for residential property located in Massachusetts.
  114. IT IS FURTHER ORDERED that Christopher Tremblay shall immediately cease engaging in the activities of a mortgage loan originator, as those activities are defined under Massachusetts General Laws chapter 255F, section 1, relative to any residential property in Massachusetts. Therefore, Christopher Tremblay is ordered to immediately cease soliciting, accepting, or further originating, either directly or indirectly, any residential mortgage loan applications from consumers for residential property located in Massachusetts.
  115. IT IS FURTHER ORDERED Mortgage Dreams, shall immediately place any fees previously collected from Massachusetts consumers relative to any pending mortgage loan applications in a separate escrow account maintained at a federally insured bank.
  116. IT IS FURTHER ORDERED that Mortgage Dreams shall immediately place with one or more qualified broker(s) or lender(s), as appropriate based on the status of the application and with no loss to applicants, all of its pending Massachusetts residential mortgage loan applications. Mortgage Dreams shall obtain the prior approval of the Commissioner before placing such applications to the qualified broker(s) or lender(s).
  117. IT IS FURTHER ORDERED that Mortgage Dreams shall submit to the Commissioner a detailed record, prepared as of the date of submission, of all of the Company's pending residential mortgage loan applications on property located in Massachusetts. The records to be produced shall be submitted to the Commissioner within five (5) days of the effective date of this Temporary Order and shall include all information on file, regarding the Company's open application list, including but not necessarily limited to, the following:

    All information on file as of the date of submission regarding Mortgage Dreams' open application list as a mortgage broker, including but not limited to, the following: The names of all individuals from whom Mortgage Dreams has accepted an application for a residential mortgage loan; the applicants' addresses and telephone numbers; the amount of all prepaid loan fees submitted by the customer; the amount of each loan; application status (i.e. filed, submitted to lenders, cleared to close, etc.); scheduled closing dates; rate lock status; and a list identifying the applicable broker or lender with whom the applicants' application was placed. The latter list should include telephone numbers of contact persons familiar with the Company's submitted loans.

  118. Mortgage Dreams shall immediately secure all pending residential mortgage loan application files and, to the extent that any original documents must be forwarded to the relevant mortgage lender(s) and or mortgage broker(s) pursuant to Paragraph 116 of this Temporary Order, a copy of such document, correspondence, or paper relating to the mortgage loan shall be retained in Mortgage Dreams' books and records and shall be available to the Commissioner, in their entirety, upon request.
  119. IT IS FURTHER ORDERED that, within twenty (20) days of the effective date of this Temporary Order, Mortgage Dreams shall submit a payment of two thousand ($2,000) dollars in satisfaction of a civil assessment collected in consideration of the Company's conducting business with an unlicensed mortgage loan originator. Such civil assessment is imposed pursuant to Massachusetts General Laws chapter 255F, section 11(b). The Company shall remit payment pursuant to this Paragraph of the Temporary Order for the amounts due, payable to the "Commonwealth of Massachusetts," to the Office of the Commissioner of Banks, 1000 Washington Street, 10th Floor, Boston, Massachusetts 02118-6400.
  120. IT IS FURTHER ORDERED that Mortgage Dreams shall submit payment of all costs associated with the examination/inspection of the aforementioned matter as set forth in the relevant invoice issued to Mortgage Dreams. The payment shall be made payable to the "Commonwealth of Massachusetts" and mailed to Division of Banks, Commonwealth of Massachusetts, 1000 Washington Street, 10 th Floor, Boston Massachusetts 02118-6400 within 30 days of receipt of the invoice.
  121. IT IS FURTHER ORDERED that this Temporary Order shall become effective immediately and shall remain in effect unless set aside, limited, or suspended by the Commissioner or upon court order after review under Massachusetts General Laws chapter 30A.
  122. IT IS FURTHER ORDERED that this Temporary Order shall not be construed as approving any act, practice, or conduct not specifically set forth herein which was, is, or may be in violation of relevant state or federal laws and regulations.
  123. IT IS FURTHER ORDERED that the civil assessment imposed on Mortgage Dreams as referenced in this Temporary Order are subject to review as provided in Massachusetts General Laws chapter 30A. Accordingly, Mortgage Dreams may request a hearing to contest said civil assessment and administrative penalty. Such request for a hearing must be filed in writing within 30 days of Mortgage Dreams' receipt of this Temporary Order. If the Company fails to request a hearing within the prescribed time frame pursuant to this Paragraph, the aforementioned civil assessment and administrative penalty shall be deemed final and binding and shall be due and owing to the Commonwealth.
  124. IT IS FURTHER ORDERED that a hearing will be scheduled on this matter to determine whether or not such Temporary Order shall become permanent and final only upon receipt of a written request for such a hearing from Mortgage Dreams, Julie Tremblay and Christopher Tremblay within twenty (20) days of the effective date of this Temporary Order. If no hearing is requested within this twenty (20) day period, this Temporary Order shall become permanent and final until it is modified or vacated by the Commissioner.

BY ORDER AND DIRECTION OF THE COMMISSIONER OF BANKS.

Dated at Boston, Massachusetts, this 6th day of September, 2011

By:
David J. Cotney
Commissioner of Banks
Commonwealth of Massachusetts