By the Division of Banks


COMMONWEALTH OF MASSACHUSETTS

Suffolk, SS.

COMMISSIONER OF BANKS
MORTGAGE LOAN
ORIGINATOR LICENSING
Docket No. 2014-002

FINDINGS OF FACT AND
TEMPORARY ORDER TO
CEASE AND DESIST

In the Matter of

TIMOTHY S. STURTEVANT, Individually
Mortgage Loan Originator License No.: MLO06772

and

MASS MORTGAGE LOAN
Wareham, Massachusetts


The Commissioner of Banks (Commissioner) having determined that TIMOTHY S. STURTEVANT (Timothy Sturtevant), has engaged in, or is engaging in, or is about to engage in, acts or practices constituting violations of Massachusetts General Laws chapter 255F, and applicable regulations found at 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 255F, section 11(a). 

I. FINDINGS OF FACT

  1. The Division of Banks (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 at 209 CMR 42.00 et seq.
  2. The Division, through the Commissioner, also has jurisdiction over the licensing and regulation of persons and entities engaged in the business of a mortgage loan originator in Massachusetts pursuant to Massachusetts General Laws chapter 255F, section 2 and its implementing regulation at 209 CMR 41.00 et seq.
  3. Timothy Sturtevant 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 the Nationwide Multi State Licensing System & Registry (NMLS), the Commissioner initially issued a mortgage loan originator license, license number MLO6772, to Timothy Sturtevant to engage in the business of a mortgage loan originator on or about October 31, 2008.
  4. Timothy Sturtevant’s Massachusetts mortgage loan originator license expired as of January 1, 2011 because he failed to file a license renewal application for calendar year 2011.
  5. On January 26, 2011, Timothy Sturtevant re-applied for a Massachusetts mortgage loan originator license and such license was placed in an approved-conditional status on March 3, 2011 through October 3, 2011.  On October 3, 2011, Timothy Sturtevant’s Massachusetts mortgage loan originator license status was approved.
  6. The Division’s regulation at 209 CMR 41.06(3) notes that “when a relationship between the employing entity and licensed mortgage loan originator is terminated, the license shall become inactive and the mortgage loan originator shall not be authorized to engage in any residential mortgage loan origination activity unless and until the mortgage loan originator’s license has been re-assigned to another entity…”  Timothy Sturtevant’s Massachusetts mortgage loan originator license has been in an inactive status since September 24, 2013 because he has not been sponsored by an employing entity licensed in Massachusetts, through the NMLS. 

    A. Unlicensed Mortgage Lender and Mortgage Broker Activity

  7. Massachusetts General Laws chapter 255E, section 2 states in part:

    No person shall act as a mortgage broker or mortgage lender with respect to residential property unless first obtaining a license from the commissioner;

  8. Massachusetts General Laws Chapter 255E, section 1 defines a mortgage lender as:

    Any person engaged in the business of making loans, or issuing commitments for mortgage loans.

  9. Massachusetts General Laws chapter 255E, section 1 defines a mortgage broker as:

    Any person who for compensation or gain, or in the expectation of compensation or gain, directly or indirectly negotiates, places, assists in placement, finds or offers to negotiate, place, assist in placement or find mortgage loans on residential property for others.

  10. The Attorney General’s regulation 940 CMR 8.04 (1) states:

    It is an unfair or deceptive act or practice for a mortgage broker or lender to make any representation or statement of fact in an advertisement if the representation or statement is false or misleading or has the tendency or capacity to be misleading, or if the mortgage broker or lender does not have sufficient information upon which a reasonable belief in the truth of the representation or statement could be based.

  11. On or about December 23, 2013, the Division’s Consumer Assistance Unit received a complaint filed by a Massachusetts consumer regarding the activities of a company named Mass Mortgage Loan.
  12. The complaint identified Timothy Sturtevant as the loan officer in the mortgage transaction and Mass Mortgage Loan as the financial institution that was the subject of the complaint.
  13. The Division’s review of information available through the Massachusetts Secretary of the Commonwealth's Corporations Division ("Corporations Division") website indicates that Mass Mortgage Loan is not identified as a corporation or business entity that is or was organized in the Commonwealth.
  14. The Division's review of email correspondence provided in conjunction with the complaint indicated that Timothy Sturtevant identified himself as a mortgage loan originator in email communications to the consumer and included his NMLS mortgage loan originator number, and contact information including but not limited to, his direct dial number, cell phone number and fax number.  The email correspondence also included a reference to a website, www.massmortgageloan.com.
  15. The Division’s review of the website www.massmortgageloan.com identified Timothy Sturtevant as the owner of the domain and furthermore welcomed visitors to his website by stating the following  “My name is Tim Sturtevant and I want to thank you for taking the time to visit my website.”  The homepage further stated the following, “[f]or a free no-obligation consultation regarding your credit or any other mortgage or real estate questions, please don't hesitate to call me...”
  16. The website maintained by Timothy Sturtevant contained six tabs: “Home”, “What Others Say,” “Ask your Question,” “Home Buying Resources,” “Mortgage Calculators” and “Apply Online Now.”
  17. The Division’s review of the homepage revealed that it provided consumers with the option of prequalifying for a mortgage loan by supplying certain information.  The section, located at the bottom of the page states “pre-qualify now” and requires consumers to enter the following information: type of loan, loan amount, credit profile, total monthly expenses and total monthly income.
  18. The website’s homepage also encourages consumers to complete a mortgage loan application by stating the following, “Make sure you register to receive my Free Homebuying Guide and Insider Mortgage Reports, browse my Resources section, fill-out a FREE No-Obligation Secure Online Loan Application... I am here to help you with all your Mass home loan needs.”
  19. The Division’s review of the “What Others Say” page included six different reviews from individuals who had previously worked with Timothy Sturtevant during the mortgage loan process.  The reviews all described each of their experiences while working with Timothy Sturtevant and dated back to 2009 and through 2013.   
  20. The Division’s review of the “Apply Online Now” tab indicated that Mr. Sturtevant is currently soliciting and/or accepting mortgage loan applications from Massachusetts consumers through the website.  The page allows consumers to complete a “short loan application,” a “full loan application” or complete a loan application that consumers had previously started to complete.  Additionally, consumers have the ability to download a mortgage loan application and thereafter fax or mail the mortgage loan application to “Mass Mortgage Loan, ATTN: Tim Sturtevant.” The Division opted to download the mortgage loan application and upon reviewing it determined that it was the standard Uniform Residential Loan Application Form.  Downloaded Application attached as Exhibit 1
  21. The “Ask Your Question,” page includes an online form which consumers can complete and ask their mortgage related question.  The webform requires consumers to provide their first name and email address and includes the following statement “If you would like to speak with someone to ask your question, you can also reach us at our Wareham, Massachusetts Mortgage Office at 508-273-0422.”
  22. The Division’s review of the “Home Buying Resources” and “Mortgage Calculators” pages revealed information about home buying resources, mortgage calculators, insider mortgage reports and ways for consumers to improve their credit score. 
  23. The bottom of each page of the website identified Mass Mortgage Loan’s mailing address and email.  Additionally, Tim Sturtevant is identified as a loan origination officer and his Massachusetts Mortgage Loan Originator License, License No., “MLO 6772” is provided. 
  24. The Division’s records indicate that neither Mass Mortgage Loan nor Timothy Sturtevant have applied to the Division to obtain a license to operate as a mortgage lender and/or broker in the Commonwealth of Massachusetts.     
  25. As of the date of this Temporary Order, www.massmortgageloan.com, maintained by Timothy Sturtevant continues to be operational and consumers may still apply for a mortgage loan through the website.

    B. Engaging in Prohibited Acts and Practices

  26. The Division’s regulation at 209 CMR 41.10(7) applicable to mortgage loan originators states:

    It is a prohibited act or practice for a Mortgage Loan Originator to conduct business with or to assist, aid or abet a person in the conduct of business who should be licensed as a Mortgage Loan Originator under M.G.L. chapter 255F or a mortgage lender or mortgage broker under M.G.L. c. 255E, and which the Mortgage Loan Originator knows or should know is an unlicensed Mortgage Loan Originator, mortgage broker or mortgage lender.

  27. The Division’s regulation at 209 CMR 41.10(9) applicable to mortgage loan originators states:

    It is a prohibited act or practice for a Mortgage Loan Originator to engage in any unfair or deceptive practice toward any person.

  28. Based upon the Division’s investigation of the consumer complaint and the findings reflected in Paragraphs 11 through 24 of this Temporary Order, Timothy Sturtevant currently maintains a website which permits Massachusetts consumers to complete a mortgage loan application through Mass Mortgage Loan, an unlicensed mortgage lender and mortgage broker in the Commonwealth.

    C. Engaging in Unauthorized Mortgage Loan Originator Activity

  29. Massachusetts General Laws chapter 255F, section 4(a)(iii) states:

    The commissioner shall issue a mortgage loan originator license to an applicant therefore unless the applicant: (iii) has failed to demonstrate financial responsibility, character, reputation, integrity and general fitness such as to command the confidence of the community and to warrant a determination that such applicant will operate honestly, fairly, soundly and efficiently in the public interest, consistent with the purposes of this chapter...

  30. The Division’s regulation 209 CMR 41.06(3) states in part:

    When the relationship between the Employing Entity and the Mortgage Loan Originator is terminated, the license shall become inactive and the Mortgage Loan Originator shall not be authorized to engage in any residential mortgage loan origination activity unless and until the Mortgage Loan Originator's license has been re-assigned to another Entity and all Division procedures have been followed to re-assign and reactivate such license.

  31. Upon reviewing the documents provided in the consumer complaint referenced in Paragraph 11 of this Temporary Order, the Division discovered numerous emails from Timothy Sturtevant to the Massachusetts consumer.  The emails discussed the underwriting requirements of the consumer’s loan program, and were dated December 6, 2013.  These emails all contained a signature identifying Timothy Sturtevant as a loan officer for Mass Mortgage Loan.   
  32. The Division’s review of Mass Mortgage Loan’s website identifies Timothy Sturtevant as the Loan Origination Officer.  The website also directs consumers with any questions to contact the “Wareham, Massachusetts Mortgage Office.”
  33. The Division's licensing records indicate that as of September 24, 2013, Timothy Sturtevant has been in an "approved-inactive" status and he currently remains in that status.

    Misrepresentation to the Division in a Mortgage Loan Originator filing

    i. Failure to update information regarding other businesses

  34. 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.

  35. 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.

  36. The Division’s search of Timothy Sturtevant’s name on the Corporations Division’s website revealed that Timothy Sturtevant was the former President, Secretary, Treasurer and Director of Atlantic Coast Mortgage Corporation.  Atlantic Coast Mortgage Corporation was incorporated in the Commonwealth on or about April 23, 2007 and information reviewed on the Corporations Division's website indicates that Atlantic Coast Mortgage Corporation was dissolved by court order on or about June 18, 2012. 
  37. The Division’s review the Articles of Organization, indicated that the nature of the business to be conducted by Timothy Sturtevant and Atlantic Coast Mortgage Corporation was “residential and/or commercial mortgage brokerage activities.”  The principal office location of the Corporation was identified as a location in Wareham, Massachusetts, and was determined to be the same location as Mass Mortgage Loan’s Wareham office location.
  38. The Division’s records indicate that Atlantic Coast Mortgage Corporation has never applied to the Division to obtain a license to operate as a mortgage lender and/or broker in the Commonwealth of Massachusetts.     
  39. In executing his 2009, 2010, 2011 and 2012 mortgage loan originator renewal applications on NMLS, Timothy Sturtevant attested that the information and statements which were made as part of his application were current, true, accurate and complete and were made under the penalty of perjury, or un-sworn falsification to authorities, or similar provisions as provided by law.
  40. Timothy Sturtevant also attested that he would keep the information contained on the NMLS current and that he would file accurate supplementary information on a timely basis.
  41. For each renewal period identified in Paragraph 39 of this Temporary Order, Timothy Sturtevant answered "no" 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?” Additionally, Timothy Sturtevant failed to identify Atlantic Coast Mortgage Corporation in his employment history or in the “other business” section of the renewal applications.
  42. As of the date of this Temporary Order, Timothy Sturtevant has failed to update his update his NMLS record to reflect his affiliation with Atlantic Coast Mortgage Corporation.

    CONCLUSIONS OF LAW

  43. Based upon the information contained in Paragraphs 1 through 42 by negotiating, placing, assisting in placement, finding or offering to negotiate, place, assist in placement or finding mortgage loans on residential property for others with the expectation of compensation or gain, without obtaining a mortgage broker and/or mortgage lender license, Timothy Sturtevant has violated Massachusetts General Laws chapter 255E, section 2 and the Division's regulation 209 CMR 42.00 et seq.
  44. Based upon the information contained in Paragraphs 1 through 42, by maintaining a website  that contained false or misleading language or had the tendency to be false or misleading, Timothy Sturtevant has violated the Attorney General’s regulation 940 CMR 8.04(1).
  45. Based upon the information contained in Paragraphs 1 through 42, by maintaining a website  that permitted Massachusetts consumers to complete a mortgage loan application through Mass Mortgage Loan, an entity that Timothy Sturtevant knew was  an unlicensed mortgage lender and mortgage broker, Timothy Sturtevant has violated the Division’s regulation 209 CMR 41.10(7).
  46. Based upon the information contained in Paragraphs 1 through 42, by maintaining a website  that permitted Massachusetts consumers to complete a mortgage loan application through Mass Mortgage Loan, an unlicensed mortgage lender and mortgage broker, Timothy Sturtevant has violated the Division’s regulation 209 CMR 41.10(9).
  47. Based upon the information contained in Paragraphs 1 through 42, Timothy Sturtevant has failed to demonstrate and maintain the character, reputation, integrity, and general fitness that would warrant the belief that Timothy Sturtevant, as a licensed mortgage loan originator will act honestly, fairly, and soundly in the public interest in violation of Massachusetts General Laws chapter 255F, section 4 and the Division's regulations 209 CMR 41.04(2)(d).
  48. Based upon the information contained in Paragraphs 1 through 42, by acting in the capacity of a mortgage loan originator while in an inactive status, Timothy Sturtevant has violated Massachusetts General Laws chapter 255F, section 4(b) and the Division’s regulation 209 CMR 41.06(3).
  49. Based upon the information contained in Paragraphs 1 through 42, by failing to disclose his affiliation with Atlantic Mortgage Corporation on the NMLS, Timothy Sturtevant violated Massachusetts General Laws, chapter 255F, section 15(j) and the Division's regulation 209 CMR 41.10(15).
  50. Based upon the information contained in Paragraphs 1 through 42, the public interest will be harmed by delay in issuing an Order to Cease and Desist under General Laws chapter 255F, section 11(a) because, upon information and belief, Timothy Sturtevant continues to operate a website which permit Massachusetts consumers to apply for a mortgage loan while Timothy Sturtevant does maintain the appropriate license in Massachusetts.  
  51. Based upon the information contained in Paragraphs 1 through 42, the Commissioner has determined that:
    1. Timothy Sturtevant 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 loan originator including, but not limited to, the provisions of the Division’s regulations at 209 CMR 41.00 et seq.; and
    2. The public interest will be irreparably harmed by delay in issuing an ORDER TO CEASE AND DESIST to Timothy Sturtevant.
  52. Based upon the information contained in Paragraphs 1 through 42, had the facts and conditions found therein existed at the time of Timothy Sturtevant’s original mortgage loan originator license application, the Commissioner would have been warranted in refusing to issue such license. 

    ORDER TO CEASE AND DESIST

  53. After taking into consideration the FINDINGS OF FACT and CONCLUSIONS OF LAW stated herein, it is hereby:
  54. ORDERED that Timothy Sturtevant, Mass Mortgage Loan and any and all officers, members, managers, employees, independent contractors, or agents, operating on behalf of Mass Mortgage Loan, and their successors or assigns, shall immediately cease engaging in the activities of a mortgage broker and/or mortgage lender, as those activities are defined under Massachusetts General Laws chapter 255E, section 1, relative to any residential property in Massachusetts.  Therefore, Mass Mortgage Loan 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.
  55. IT IS FURTHER ORDERED that Timothy Sturtevant 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, not otherwise expressly permitted by the terms of this Temporary Order.  Therefore, Timothy Sturtevant is ordered to immediately cease taking, offering or negotiating terms of a residential mortgage loan from consumers for residential property located in Massachusetts. 
  56. IT IS FURTHER ORDERED that Timothy Sturtevant 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.
  57. IT IS FURTHER ORDERED that Timothy Sturtevant 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.  Timothy Sturtevant shall obtain the prior approval of the Commissioner before placing such applications to the qualified broker(s) or lender(s).
  58. IT IS FURTHER ORDERED that Timothy Sturtevant and Mass Mortgage Loan shall submit to the Commissioner a detailed record, prepared as of the date of submission, of all of the 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 Timothy Sturtevant and Mass Mortgage Loan’s open application list, including but not necessarily limited to, the following:
    1. All information on file as of the date of submission regarding Timothy Sturtevant and Mass Mortgage Loan’s open application list as a mortgage broker and/or mortgage lender and mortgage loan originator including but not limited to, the following: The names of all individuals from whom Timothy Sturtevant and Mass Mortgage Loan 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 Timothy Sturtevant and Mass Mortgage Loan submitted loans.
  59. Timothy Sturtevant 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 57 of this Temporary Order, a copy of such document, correspondence, or paper relating to the mortgage loan shall be retained in Timothy Sturtevant’s books and records and shall be available to the Commissioner, in their entirety, upon request.
  60. IT IS FURTHER ORDERED that Timothy Sturtevant and Mass Mortgage Loan shall submit to the Commissioner a detailed record, of all of the residential mortgage loan applications originated by him or brokered by Mass Mortgage Loan 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 Timothy Sturtevant and Mass Mortgage Loan’s application list, including but not necessarily limited to, the following:
    1. All information on file as of the date of submission regarding Timothy Sturtevant and Mass Mortgage Loan’s application list as a mortgage broker and/or mortgage lender and mortgage loan originator including but not limited to, the following: The names of all individuals from whom Timothy Sturtevant and Mass Mortgage Loan 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; final application status (i.e. filed, submitted to lenders, cleared to close, denied etc.); closing dates, if applicable; 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 Timothy Sturtevant and Mass Mortgage Loan submitted loans.
  61. Timothy Sturtevant shall submit payment of all costs associated with the investigation/inspection of the aforementioned matter as set forth in the relevant invoice issued to Timothy Sturtevant.  The payment shall be made payable to the “Commonwealth of Massachusetts” and mailed to Division of Banks, Commonwealth of Massachusetts, 1000 Washington Street, 10th Floor, Boston Massachusetts 02118-6400 within 30 days of receipt of the invoice.
  62. 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.
  63. 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. 
  64. 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 Timothy Sturtevant 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 3rd day of February, 2014

David J. Cotney
Commissioner of Banks
Commonwealth of Massachusetts

This Temporary Order to Cease and Desist was terminated on May 19, 2014 pursuant to a Consent Order