By the Division of Banks
COMMONWEALTH OF MASSACHUSETTS
COMMISSIONER OF BANKS
MORTGAGE BROKER AND
MORTGAGE LOAN ORIGINATOR
Docket No. 2013-020-CO
In the Matter of
MORTGAGE SECURITY, INC.
Mortgage Company License No.: MC20164.
Robert Pena, Individually
WHEREAS, MORTGAGE SECURITY, INC., (Mortgage Security or the Corporation) a licensed mortgage lender and mortgage broker under Massachusetts General Laws chapter 255E, section 2, and ROBERT PENA, President and 100% owner of Mortgage Security, 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 November 15, 2013 whereby, solely for the purpose of settling this matter, Mortgage Security and Robert Pena agree to the issuance of this CONSENT ORDER (Consent Order) by the Commissioner of Banks (Commissioner);
WHEREAS, the Division, through the Commissioner, has jurisdiction over the licensing and regulation of persons and entities engaged in the business of a mortgage lender and mortgage broker in Massachusetts pursuant to Massachusetts General Laws chapter 255E, section 2 and its implementing regulation 209 CMR 42.00 et seq.;
WHEREAS, the Division, through the Commissioner, 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;
WHEREAS, Mortgage Security, at all relevant times, has been a Massachusetts Corporation doing business in the Commonwealth with its main office located at 31 Teaticket Highway, Suite 2-7, East Falmouth, Massachusetts;
WHEREAS, Robert Pena, at all relevant times was the President and 100% owner of Mortgage Security and according to records maintained by the Division, identified himself as President and “control person,” of Mortgage Security;
WHEREAS, on, November 12, 2009, the Division issued an ORDER TO SHOW CAUSE AND NOTICE OF RIGHT TO A HEARING (Order and Notice), Docket No. 2009-125 against Mortgage Security based upon an examination of Mortgage Security which commenced on July 21, 2008;
WHEREAS, the parties resolved the matters identified in the Order and Notice pursuant to a Consent Order dated on June 16, 2011, (2011 Consent Order);
WHEREAS, on April 3, 2013, as a result of concerns raised by consumer complaints received by the Division, the Division commenced an inspection of Mortgage Security’s books and records, pursuant to Massachusetts General Laws chapter 255E, section 8, at the Corporation’s main office for the purpose of assessing the Corporation’s level of compliance with applicable Massachusetts statutes and regulations governing the conduct of those engaged in the business of a mortgage lender and broker in the Commonwealth (2013 Investigation). During the Investigation, the Division also assessed the Corporation's compliance with the 2011 Consent Order;
WHEREAS, on April 30, 2013, while the Division’s investigation was ongoing, the Division issued a Temporary Order to Cease and Desist Docket No. 2013-20 (Temporary Order) against Mortgage Security as a result of serious concerns raised during the course of the investigation;
WHEREAS, the Division thereafter issued a Report of Investigation (Report) detailing the findings of the 2013 Investigation;
WHEREAS, on or about May 13, 2013, Mortgage Security, through Robert Pena, filed a request to proceed to an administrative hearing in accordance with Massachusetts General Laws chapter 30A;
WHEREAS, on October 9, 2013, based upon additional information received by the Division from Massachusetts consumers, the Division filed a motion to modify the Temporary Order to incorporate a Notice of Intent to Revoke and Right to a Hearing (Notice of Intent);
WHEREAS, to date, the administrative hearing officer has not ruled on the Division’s motion to modify the Temporary Order;
WHEREAS, in recognition of the Division and Mortgage Security having reached the following mutual agreement under this Consent Order to resolve the matters raised by the Temporary Order, the Commissioner has terminated the Temporary Order on this __ day of November, 2013.
NOW COME the parties in the above-captioned matter, the Division, Mortgage Security, and Robert Pena and stipulate and agree as follows:
- Mortgage Security and any and all officers, directors, employees, or managers or their successors or assigns operating on behalf of Mortgage Security, will cease engaging in the activity of a mortgage lender and a mortgage broker in Massachusetts, as those terms are defined under General Laws chapter 255E, section 1.
- Mortgage Security’s mortgage lender and mortgage broker licenses are hereby revoked.
- Mortgage Security and any and all officers, directors, employees, or managers or their successors or assigns operating on behalf of Mortgage Security, will be prohibited from submitting an application to obtain a mortgage lender and/or a mortgage broker license or any other license from the Division at any time in the future.
- Robert Pena is prohibited from submitting an application to obtain a mortgage loan originator license, or any other license, from the Division at any time in the future.
- Robert Pena is prohibited 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. 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.
- Within ninety (90) days of the effective date of this Consent Order, Mortgage Security shall submit to the Division, full payment in the amount $12,210, owed for the costs of the Division’s 2013 investigation of Mortgage Security. The payment shall be made payable to the “Commonwealth of Massachusetts” and mailed to Division of Banks, Commonwealth of Massachusetts, P.O. Box 3952, Boston, Massachusetts 02241-3952, and the payments shall be made as follows:
- Within thirty (30) days of the effective date of this Consent Order, Mortgage Security shall submit a payment in the amount of $4,070;
- Within sixty (60) days of the effective date of this Consent Order, Mortgage Security shall submit a payment in the amount of $4,070; and
- Within ninety (90) days of the effective date of this Consent Order, Mortgage Security shall submit a final payment in the amount of $4,070.
- Mortgage Security agrees that, in the event that the Corporation fails to submit the payments set forth in this Consent Order in the amounts specified herein and in accordance with the applicable deadlines, the Division shall be authorized to submit a claim for such amounts against the mortgage lender and/or mortgage broker Massachusetts surety bonds maintained by Mortgage Security pursuant to the Division’s regulations 209 CMR 42.03(2)(a) and 209 CMR 42.06(2)(a).
- 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 Robert Pena and/or Mortgage Security, and/or any of its officers, directors, or managers.
- This Consent Order shall become effective immediately upon the date of its issuance.
- The provisions of this Consent Order shall be binding upon Mortgage Security and Robert Pena and its directors, officers, employees, agents, and their successors and assigns.
- In accordance with the terms of the Consent Agreement entered by Robert Pena, and the Commissioner, Mortgage Security and Robert Pena have waived all rights of appeal that they may have.
- 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.
- 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.
BY ORDER AND DIRECTION OF THE COMMISSIONER OF BANKS.
Dated at Boston, Massachusetts, this 15th day of November, 2013
David J. Cotney
Commissioner of Banks
Commonwealth of Massachusetts