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STATE OF MAINE
OFFICE OF SECURITIES
121 STATE HOUSE STATION
AUGUSTA, ME 04333
David Elliot L'Hoir, PayDay Today! U.S.A.,
Inc. ans PayDay Today! U.S.A. Com, Inc.
Cease and Desist Order
FINDINGS OF FACTS AND CONCLUSIONS OF LAW
- David Elliot LíHoir (hereinafter referred to as "LíHoir") is the founder
and current President and Chief Executive Officer of PayDay Today! U.S.A.
Inc. and PayDay Today! U.S.A. Com, Inc. (hereinafter collectively referred
to as "PayDay"). PayDay is incorporated pursuant to the laws of the State
of Nevada. PayDay operates a chain of financial centers in Southern California
and has a national loan processing center in Fort Lauderdale, Florida. PayDay
operates through an internet website address at www.paydaytodayusa.com and
advertises itself as having retail-affiliated stores nationwide.
- PayDay is in the business of offering deferred deposit loans to consumers.
These loans are small, unsecured loans that require repayment within a relatively
short time period. In a PayDay loan transaction, the consumer provides PayDay
with a personal check and receives cash less the interest and fees charged
by PayDay. The check is then held for a scheduled period of time, generally
until the consumerís next payday, or a one or two-week period, hence the term
"payday" loan. PayDay consumers are charged annual fees that average 360%
of the debt principal.
- In or about March 2001, a Maine resident was solicited by telephone by LíHoir
to invest monies in PayDay.
- Shortly thereafter, this Maine resident received in the mail a package of
investment material relating to PayDay. In this material, LíHoir represented
that he was offering a "4% monthly return collateralized by receivable (Customer
Checks)" in return for a minimum investment in PayDay of $10,000. LíHoir further
represented that he was seeking investors in order to raise capital of $2,000,000
for PayDay. Pursuant to LíHoirís investment scheme, investors obtain a note
and retain the option of retiring this note provided that 90 daysí notice
- By letter dated March 15, 2001, the Maine resident who had been solicited
by LíHoir, wrote to the Securities Division to advise of LíHoirís solicitation
and provided the Securities Division with the package sent by LíHoir.
- As a result of becoming aware of this solicitation, the Securities Division
wrote to LíHoir by letter dated April 30, 2001 notifying him that, pursuant
to the Revised Maine Securities Act, 32 M.R.S.A. 10101 et seq. ("the Act"),
it is unlawful for anyone to sell or offer to sell any security in Maine unless
the security is registered, or the security or transaction is exempt from
registration under the Act. The Securities Division further notified LíHoir
that it is also unlawful under the Act to transact business in Maine as a
broker-dealer or sales representative unless licensed or exempt from licensing.
Furthermore, the Securities Division notified LíHoir that misrepresentations
and omissions of material fact made in connection with an offer and sale of
securities constitute fraud under the Act.
- In this letter, the Securities Division requested LíHoir to review his records
and provide the Securities Division with a list of all Maine residents with
whom LíHoir has had contact at any time in connection with the offer or sale
of PayDay notes.
- Furthermore, the Securities Division notified LíHoir that, until he complied
with Maine law, he should cease soliciting sales of PayDay notes.
- LíHoir has failed to respond to the Securities Divisionís letter dated April
30, 2001. In particular, LíHoir has failed to provide the Securities Division
with a list of all Maine residents with whom LíHoir has had contact in connection
with the offer or sale of PayDay notes or an assurance that he will cease
soliciting Maine residents for sales of PayDay notes.
- The solicitation and pooling of investorsí monies with the expectation that
the investors will receive a return on their monies as a result of investing
in PayDay constitutes an investment contract. An investment contract is a
security under 32 M.R.S.A. ß10501 (18).
- It is unlawful to offer or sell any security in Maine unless the security
is registered, is exempt from registration or is a federal covered security
under 32 M.R.S.A. ß10401.
- The Securities Division has no record that PayDay securities have been registered
for offer or sale in Maine. Furthermore, the Securities Division is not aware
of any applicable exemption from registration for which PayDay securities
might qualify, nor are the securities federal covered securities.
- It is unlawful for any person to transact business in Maine as a broker-dealer
in Maine unless the broker-dealer is licensed or exempt from licensing under
32 M.R.S.A. ß10301(2). The Securities Division has no record that either LíHoir
or PayDay is licensed as a broker-dealer in Maine.
- It is unlawful for any person to transact business in Maine as a sales representative
unless licensed or exempt from licensing under 32 M.R.S.A. ß10301 (2). The
Securities Division has no record that LíHoir is licensed as a sales representative
in Maine and it is not aware of any applicable exemption from licensing for
which he might qualify.
- For the reasons stated above, the Securities Administrator reasonably believes
that LíHoir and PayDay have engaged, are engaging or are about to engage in
any act or practice constituting violations of the Revised Maine Securities
- On September 18, 2001, the Securities Administrator issued a Notice of Intent
to Issue a Cease and Desist Order. The Notice gave the respondents thirty
(30) days to request a hearing on the matter. To date, no hearing has been
Now, therefore it is ORDERED that LíHoir and PayDay immediately CEASE AND DESIST
from violating any provisions of the Revised Maine Securities Act.
Pursuant to 32 M.R.S.A. ß 10708, this is a final order, entered after notice
and opportunity for hearing. Pursuant to 32 M.R.S.A. ß 10709, a party to this
order may obtain judicial review of the order in Kennebec County Superior Court
by filing a petition within thirty (30) calendar days after receipt of the order,
in accordance with 5 M.R.S.A. ß 1101 et sq. and Rule 80C of the Maine Rules
of Civil Procedure.
Christine A. Bruenn
Christine A. Bruenn