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J.C.G. Check Cashing Corp. has entered into a Settlement Agreement with the Superintendent of Banks in lieu of a hearing to fine the licensee or revoke its license for certain violations of law.
Included in the Settlement Agreement is the payment of a fine of $25,000, an eighteen month moratorium on applications, and the filing of a criminal complaint by JCG within ten days.


December 20 , 2001

In the Matter of J.C.G. Check Cashing Corp., ("JCG")

AGREEMENT OF SETTLEMENT

A check casher licensed pursuant to
Article IX-A of the Banking Law

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Whereas, JCG submitted an application to the New York Banking Department (Department") for a new branch at 144-43 Farmers Boulevard in Jamaica N.Y. in April of 2001; and

Whereas, among the documentation contained in that application were letters from several businesses located in that area which indicated that they supported the establishment of a check cashing business at that location; and

Whereas, the Department has obtained information that some of these letters contained forged signatures; and

Whereas, these letters are an essential part of an application for a new check cashing license as they are required to satisfy, in part, the statutory criteria of community need; and

Whereas, the provisions of Article IX-A of the Banking Law state that an applicant for a check cashing license must possess such character and general fitness as will "command the confidence of the community" and will "warrant belief that the business will be operated honestly, fairly, and efficiently within the purposes of that Article", and

Whereas, the foregoing statutory criteria require that the management of a licensed check casher bear responsibility for the accuracy of all applications submitted to the Department; and

Whereas, the provisions of Section 373(2) of the Banking Law state, in part, that the Superintendent may revoke a check cashing license if, after notice and a hearing, it is found that (1) the licensee "has committed any fraud, engaged in any dishonest activities or made any misrepresentation"; or (2) the licensee "has made a false statement in the application for [a] license or failed to give a true reply to a question in such application"; or (3) there exists a ground or grounds "which would require or warrant the refusal of an application for the issuance of the license [by the Superintendent] if such an application were then before [her]"; and

Whereas, JCG’s President and sole stockholder, Jose Guzman, hired a consultant to prepare the application for a license for the Jamaica location and he has indicated that he utilized that consultant in the past for similar applications with no problems, as had other check cashers; and

Whereas, Mr. Guzman stated that he had no reason to independently verify the signatures on the "community need" letters because of the reputation of the consultant whom he hired to prepare this application; and

Whereas, the Department and JCG have agreed to settle this matter in lieu of the Department commencing a hearing to revoke JCG’s check cashing license.

Now, therefore, it is agreed as follows:

  1. JCG shall pay the Department a fine of $25,000, payable in five equal monthly installments, commencing upon the execution of this Agreement by both parties. All payments under this Agreement shall be made in the form of a wire transfer to the Department’s bank account. Wire instructions shall be given to JCG upon execution of this Agreement.
  2. JCG shall not submit to the Department any applications for additional check cashing locations or ordinary relocations for a period of eighteen months from the date this Settlement Agreement is executed by both parties. This moratorium shall not apply to applications for relocation of existing check cashing sites based on hardship or other extraordinary circumstances such extensive fire or flood damage.
  3. JCG may enter into a lease agreement with another licensed check casher for the latter to operate a check cashing business at 144-43 Farmers Boulevard in Jamaica subsequent to the Department’s approval of the other check casher’s application for a license for that location. The term of the lease agreement shall be for a term of at least three years and JCG shall not share in the profits or have any other interest, direct or indirect, in the operation of a check cashing business at that location by the other check casher.
  4. The provisions of this Agreement shall not bar, estop or otherwise prevent the Department, or any government agency, from taking any other action affecting JCG, provided that the Department shall not take any additional action against JCG with respect to matters which are the subject of this Agreement, provided further that the Department may take such additional action based upon any information not known by the Department on the date on which this Agreement becomes effective.
  5. JCG, without admitting or denying any violation of law or regulation, waives its right to a hearing with respect to the matters specified herein. JCG has entered into this Agreement freely and voluntarily and fully understands its terms and conditions.
  6. JCG shall, within 10 days of the execution of this Agreement, file a criminal complaint regarding the forged "community need" letters with the Office of the Queens District Attorney and shall fully cooperate with that Office in its investigation and prosecution of this matter.
  7. All communications regarding this Agreement shall be sent to:
  8. Paul Fazio
    Deputy Superintendent
    Licensed Financial Services Division
    New York State Banking Department
    Two Rector Street
    New York, N.Y. 10006

    Arthur Goldstein, Esq.
    Davidoff & Malito
    605 Third Avenue
    New York, N.Y. 10158 

    Jose Guzman
    J.C.G. Check Cashing Corporation
    146-15 Jamaica Avenue
    Jamaica, N.Y. 10158

  9. This Agreement shall become effective upon execution by both parties.

Agreed to: 

______________________
Jose Guzman
President, J.C.G. Check Cashing Corp. 
_____________________
Date
_______________________
Paul J. Fazio
Deputy Superintendent of Banks
New York State Banking Department
_____________________
Date

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