Opinion ID: 1931243
Heading Depth: 3
Heading Rank: 3

Heading: Substantial Evidence Bearing on Morgan's Civil Penalty

Text: Morgan appeals the Division's imposition of $34,000 in civil fines. Section ง 13-410 authorizes the Division to recover up to $1,000 in fines per violation from a first time violator of the Consumer Protection Act. The Division concedes that the fines should be reduced to $32,000, because the case only involves thirty-two of Morgan's appraisals. It defends the remaining $32,000 as an appropriate fine based on the factors that ง 13-410(d) mandates that the Division consider. Section 13-410(d) provides as follows:  Factors affecting penalty amount. โ The Consumer Protection Division shall consider the following in setting the amount of the penalty imposed in an administrative proceeding: (1) The severity of the violation for which the penalty is assessed; (2) The good faith of the violator; (3) Any history of prior violations; (4) Whether the amount of the penalty will achieve the desired deterrent purpose; and (5) Whether the issuance of a cease and desist order, including restitution, is insufficient for the protection of consumers. The Division considered the statutory factors and concluded that: (1) the violations were severe because Morgan exploited a vulnerable group of consumers and hurt communities by increasing defaults and foreclosures; (2) Morgan lacked good faith, as he intentionally misled consumers; (3) he was a first time violator; (4) high penalties were necessary for deterrence, because Morgan was motivated by financial gain; and (5) restitution would not be sufficient to protect consumers. We apply the substantial evidence test, as the Division's application of the statute's factors to the facts is a mixed question of law and fact. See Vann, 382 Md. at 296, 855 A.2d at 319. The Circuit Court affirmed the Division's Order. Substantial evidence existed to support the Division's decision to impose the full $1,000 per violation.