1st Alliance Lending plans to cut up to 35 employees in Connecticut and terminate efforts to expand its East Hartford headquarters in order to prepare for an expected increase in regulatory costs.
"The regulatory environment in Connecticut has reached a breaking point. Our company was founded and has grown in Connecticut. We are extremely disappointed to have to look at other options," John DiIorio, 1st Alliance's CEO, said in a press release.
1st Alliance alleges that Connecticut Department of Banking staff members are pushing the company to pay a high price to settle a disagreement over the degree to which the company's employees need to be licensed as mortgage originators.
In addition, the company also alleges that it will be facing high costs because "recently, staff of the Connecticut Banking department disclosed to 1st Alliance an effort to require all Connecticut employees if they have any interaction whatsoever with a consumer."
The department declined to comment on any future actions it might take related to 1st Alliance or mortgage licensing regulation in Connecticut.
"Aside from a previous settlement with the company, the department has not issued any recent formal administrative action against 1st Alliance Lending LLC. Until such action is issued it is premature for us to comment on it," Kathleen Titsworth, banking outreach coordinator at the Connecticut Department of Banking, said in an email.
"The laws in Connecticut regarding mortgage licensing have not changed," she added.
The Connecticut Department of Banking's rules "do not require everyone who works in a mortgage company or who deals with mortgages to be licensed," Titsworth said.
"However, under federal and state
