What is incidental or occasional? What if I occasionally pick up my dry cleaning or I occasionally go out to dinner?
Las Vegas, Nevada (PRWEB) January 15, 2009
The State of Nevada and the FID has issued a Stipulation and Order for Settlement to Dismiss All Claims and Parties on April 23, 2008 in the 8th Judicial District Court, case #A559176. The order shall completely release OneCap and any of its affiliates of any claims which could be brought against them. The Stipulation and Order supersedes the Original Cease and Desist Order and the First Amended Cease and Desist Order. All claims and all parties are dismissed in this action with prejudice.
On October 17, 2007 the State of Nevada and the FID issued and published an Order of Cease and Desist to OneCap and its affiliates. The order, which was delivered to Heidi Williams the qualified employee for OneCap on October 16, 2007 after 3pm in the afternoon, came as a complete surprise to the company. According to Ms. Williams the FID had come by the office of OneCap when she was out of town that meant there wasn't a qualified employee to answer questions or help review documents. The Order was posted on the State's website on October 16, 2007. "They never asked me for clarification on any of their findings before it was posted, and I was shocked when I read it. Isn't there any due process in this State?" commented Ms. Williams
The Review Journal ran an article in the morning paper on October 17, 2008. According to Vince Hesser, OneCap's president "The story also ran without comment from OneCap and both the Order and the article were littered with what we found to be erroneous information, false statements and groundless allegations. One example is listed where the State claimed they found a document stating that an individual wrote a check for $250,000 but that the loan documents showed an amount of only $25,000. The statement for this person's account shows that she had wanted to diversify her investment and had placed $25,000 in 10 different loans. If they had asked for clarification or had done proper due diligence, the matter wouldn't have been an issue." The Cease and Desist Order fined OneCap $130,000.
In the Order, OneCap is cited for contracting loans that were not secured by real property which violates statue NRS Chapter 675. This statute allows unsecured lending without any license if they are "isolated, incidental or occasional transactions". OneCap President Vince Hesser stated "The so called unsecured loans we contracted fall under the provision made in the statute as 'occasional transactions', we even went one step further and got pre-approval for those loans, in writing from the State." OneCap provided these documents to the FID to clarify the findings. The State filed an Amended Order to the original Cease and Desist and upped the fine to $180,000 citing the same findings.
OneCap, using the14th amendment as their platform, sued the State of Nevada. OneCap alleged that the state law that says a license is not required when the installment loans are "isolated, incidental or occasional transactions" is too vague, thus it violates the 14th amendment of due process, and can be applied discriminately. "What is incidental or occasional? What if I occasionally pick up my dry cleaning or I occasionally go out to dinner?" asked Mr. Hesser, "The writing is very ambiguous to say the least, and can be applied at the whim of the interpreter."
According to the Company, the State agreed because they offered to settle with OneCap without the costs and delays of a lengthy trial. The State and FID fully released OneCap and all its affiliates as long as OneCap paid a fine to cover investigative expenses and with the agreement that they will not solicit or fund any unsecured loans in the future until licensed under NRS 675. OneCap agreed to this in an effort to settle the issue.
Hesser stated that "The original order being published the way it was, without our due process rights to even respond to the allegations, led to what we felt was inaccurate reporting in the local newspaper. It resulted in hundreds of confused and panicked investors to flood the offices of OneCap with hostile and threatening phone calls, and it even led to a $60,000,000 loan transaction we were selling to an institutional investor, which would have paid back millions to the direct lenders, to be canceled."
For more information on OneCap go to http://www.onecap.com or contact customer relations at 702-948-8800.