The state Department of Banking has issued a $750,000 fine on shuttered East Hartford mortgage lender 1st Alliance Lending, finding that it used unlicensed loan originators and violated other state and federal lending laws.
As a part of its April 16 decision, the department also issued a second revocation of 1st Alliance’s state license, after initially revoking it in 2019 due to failure to post a performance bond.
The banking department wrapped up administrative hearings of the matter in Feb. 2020, but had delayed issuing the recent decision, citing the COVID-19 pandemic. 1st Alliance sued the department this past January over the delay, arguing the official decision — originally due that same month — was necessary for the company to appeal the department’s actions.
A judge dismissed that legal challenge in March, according to court records.
However, another 1st Alliance lawsuit, challenging its 2019 license revocation, is headed to the state Supreme Court, the docket shows.
In a statement Friday, Ross Garber, an attorney who is representing 1st Alliance, said the company was pleased the case is going in front of the state Supreme Court.
“There are incredibly important issues at stake,” Garber said. “Was it lawful for unelected bureaucrats at a Connecticut agency to shutter a national company with scores of Connecticut employees, when there was no prior notice of the Connecticut Banking Department’s unique interpretation of a technical legal provision and not a single consumer complaint”?”
It remains to be seen whether 1st Alliance will sue the banking department over the more recent revocation and fine.
Banking Commissioner Jorge L. Perez wrote in his decision against 1st Alliance this month that he was revoking the company’s license once more “in the event the Connecticut Supreme Court ultimately overturned the department’s October 4, 2019 revocation.”
Meanwhile, a lawsuit against 1st Alliance filed by the federal Consumer Financial Protection Bureau, citing some of the same violations as the state banking department, remains ongoing, court records show.