Issued and entered this 22nd day of December 2003 by John R. Schoonmaker, Special Deputy Commissioner

FINAL DECISION

The Administrative Law Judge issued a Proposal for Decision dated November 6, 2003. He recommended that the Commissioner find that the Petitioner’s application for an investment adviser registration was properly denied.

Laurence F. Mohn, President of the Petitioner, filed a letter dated November 17, 2003, in which he raised objections to the Proposal for Decision. These will be considered exceptions for purposes of this decision.

The factual findings in the PFD are in accordance with the preponderance of the evidence and the conclusions of law are supported by reasoned opinion. The PFD is attached, adopted, and made part of this final decision.

Briefly, the exceptions and reasons for not acting upon them are as follows:

1. The Commissioner should consider the Petitioner and Mohn Asset Management innocent of the charges brought by the Securities and Exchange Commission until proven guilty. However, in this matter, the underlying charges are not addressed. Instead, the denial of application is based upon the injunction issued against Moen Asset Management. Moreover, the "innocent until proven guilty" criminal standard does not apply in a contested case concerning an application for a license. Generally, in contested cases under the Administrative Procedures Act, such as this case, the applicant has the burden of proof and the burden of going forward. Bunch v Secretary of State, 239 Mich App 204, 216 (1999).
   
2. The injunction allows the defendants to engage in business as investment advisers, so should not be a basis for denying the Petitioner's application for an investment adviser registration. However, the injunction preliminarily restrained and enjoined the defendants from several activities connected with the purchase or sale of securities. As broadly provided in MCL 451.604(a)(1)(D), the Commissioner may deny a registration where an officer or person in control of the investment adviser, "Is permanently or temporarily enjoined by any court of competent jurisdiction from engaging in or continuing any conduct our practice involving any aspect of the securities or commodity contracts business;…”
   
3. The Commissioner should have allowed to the Petitioner to withdraw the application and deal with the issues only after the SEC charges are resolved. However, the Petitioner requested this contested case and the Commissioner was required to grant the request. It is fully within the Commissioner's discretion to bring this matter to completion at this time through the contested case process.
   

II
ORDER

Therefore, it is ORDERED that the denial of the Petitioner's application for an investment adviser registration is affirmed.