ORDERS:
FINAL ORDER AND DECISION
STATEMENT
OF THE CASE
The
above-captioned matter is before this Court pursuant to S.C. Code Ann. §
40-58-55(A) (Supp. 2005) for a contested case hearing. In this matter, Petitioner
Kevin Allen challenges the decision of Respondent South Carolina Department of
Consumer Affairs (Department) to deny his application for a mortgage loan
originator’s license. The Department denied Petitioner’s application because,
in reviewing his application, it discovered that he had been convicted of two
counts of employment security fraud in 1998. After timely notice to the
parties, a hearing of this case was held on January 12, 2006, at the South
Carolina Administrative Law Court in Columbia, South Carolina. Based upon the
evidence presented at the hearing, I find that Petitioner’s application for a
mortgage loan originator’s license should be granted.
FINDINGS
OF FACT
Having
carefully considered all testimony, exhibits, and arguments presented at the
hearing of this matter, and taking into account the credibility and accuracy of
the evidence, I make the following Findings of Fact by a preponderance of the
evidence:
1. On
August 5, 2005, Petitioner Kevin Allen submitted an application for a mortgage
loan originator’s license to the Department. Among other things, the
application contained the following question regarding Petitioner’s criminal
history:
Have you ever been
convicted of a felony or of an offense involving breach of trust, moral
turpitude or dishonest dealings within the past ten years? Provide details
about the offense, including conviction date, court, penalty and attach a
certified copy of the Criminal Docket Sheet and the Presentence Investigation
Report.
(Resp’t Ex. # 1,
at 2.) In response to this question, Petitioner checked the box marked “NO”
and did not provide any further information regarding his criminal record. At
the close of the application, Petitioner also signed a sworn statement
acknowledging that “all information contained herein is true, current and
correct” and that he understood “that giving false information constitutes
cause for denial or revocation of the application.” (Resp’t Ex. # 1, at 2.)
2. In
reviewing Petitioner’s application, the Department obtained a copy of
Petitioner’s criminal record from the South Carolina Law Enforcement Division
(SLED). Petitioner’s record indicated that he had been convicted of two counts
of employment security fraud in August 1998. Based upon this record, the
Department denied Petitioner’s application for a mortgage loan originator’s
license by a letter dated August 12, 2005, because Petitioner had, in fact,
been convicted of a crime involving fraud within ten years of the date of his
application. (Resp’t Ex. # 3.) Petitioner now challenges this denial before
this Court.
3. Petitioner
has been employed as a loan officer in the residential mortgage lending
industry since May 2001 and has built a successful career in the industry. In
particular, during his employment as a loan officer over the course of the past
four years, Petitioner has not received any complaints regarding his lending
activities from either his clients or his employers and has not been the
subject of any disciplinary actions by licensing or other regulatory agencies.
4. At
the hearing of this matter, Petitioner testified that he had provided accurate
and truthful information regarding his criminal record on his license
application, as he understood the question at the time he completed the
application. Specifically, Petitioner explained that he understood the
question relating to criminal convictions as applying not to the technical date
on which the criminal charges were resolved, but the date on which the
underlying criminal activity took place. Accordingly, he did not indicate on
the application that he had any qualifying convictions within the past ten
years, because, while he had been convicted of employment security fraud in
1998, the underlying incidents had actually occurred in 1995, more than ten
years prior to the date on which he filed his license application. Further, while
he forthrightly acknowledged the criminality of the behavior that led to his
convictions for employment security fraud, Petitioner explained that the crimes,
which stemmed from his cashing of two weekly unemployment checks after he had
secured gainful employment, resulted from his mistaken belief that he could
continue to accept unemployment checks during the two-week period between the
date on which he began working at his new job and the date on which he received
his first paycheck at the new job. Petitioner made restitution for the checks
he improperly cashed and accepts full responsibility for his actions.
CONCLUSIONS
OF LAW
Based
upon the foregoing Findings of Fact, I conclude the following as a matter of
law:
1. This
Court has jurisdiction over this contested case proceeding pursuant to S.C.
Code Ann. § 37-6-414 (Supp. 2005), S.C. Code Ann. § 40-58-55(A) (Supp. 2005),
and S.C. Code Ann. § 1-23-600(B) (Supp. 2005).
2. In
presiding over this contested case, this Court serves as the finder of fact and
makes a de novo determination regarding the licensing matters at issue. See S.C. Code Ann. § 1-23-600(B) (Supp. 2005); Marlboro Park Hosp. v.
S.C. Dep’t of Health & Envtl. Control, 358 S.C. 573, 577-79, 595 S.E.2d
851, 853-54 (Ct. App. 2004); Brown v. S.C. Dep’t of Health & Envtl.
Control, 348 S.C. 507, 512, 560 S.E.2d 410, 413 (2002).
3. In
order to be licensed as a mortgage loan originator, an applicant must be at
least eighteen years of age and must have at least six months of experience in
residential mortgage lending or complete eight hours of continuing education
within ninety days of employment. S.C. Code Ann. § 40-58-50(D) (Supp. 2005).
Further, before issuing a license to a mortgage loan originator, the licensing
authority must find that the applicant’s “financial responsibility, experience,
character, and general fitness . . . are such as to command the confidence of
the community and to warrant belief that the business may be operated honestly,
fairly, and efficiently according to the purposes of this chapter [i.e.,
Chapter 58 of Title 40, which pertains to the licensing of mortgage loan
brokers].” S.C. Code Ann. § 40-58-60(A) (Supp. 2005). In determining whether
an applicant has the requisite character and fitness to be licensed as a
mortgage loan originator, the licensing authority may consider such factors as
whether the applicant has “(1) violated a provision of this chapter or an order
of the [D]epartment; (2) withheld material information in connection with an
application for a license or its renewal, or made a material misstatement in
connection with the application; [or] (3) been convicted of a felony or of an
offense involving breach of trust, moral turpitude, fraud, or dishonest dealing
within the past ten years.” See S.C. Code Ann. § 40-58-55(A).
4. In
the case at hand, Petitioner has been convicted of a crime involving fraud
within the past ten years and Petitioner did fail to provide material
information regarding his convictions on his application. Nevertheless, when
such failings are balanced against Petitioner’s unblemished four-year track
record as a successful mortgage loan officer and the mitigating circumstances
surrounding his criminal offenses, I find that Petitioner does possess the
financial responsibility, experience, character, and general fitness necessary
to secure licensure as a mortgage loan originator.
ORDER
Based
upon the Findings of Fact and Conclusions of Law stated above,
IT
IS HEREBY ORDERED that the Department shall GRANT Petitioner’s
application for licensure as a mortgage loan originator.
AND
IT IS SO ORDERED.
______________________________
JOHN D.
GEATHERS
Administrative
Law Judge
1205 Pendleton
Street, Suite 224
Columbia, South
Carolina 29201-3731
February 1, 2006
Columbia, South Carolina |