093_SB1784enr

 
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 1        AN ACT concerning financial regulation.

 2        Be  it  enacted  by  the People of the State of Illinois,
 3    represented in the General Assembly:

 4        Section 1. Short title. This Act may be cited as the High
 5    Risk Home Loan Act.

 6        Section 5.   Purpose and  construction.  The  purpose  of
 7    this  Act  is  to  protect borrowers who enter into high risk
 8    home loans from abuse that occurs in the  credit  marketplace
 9    when  creditors and brokers are not sufficiently regulated in
10    Illinois.  This  Act  is  to  be  construed  as  a   borrower
11    protection  statute  for  all  purposes.  This  Act  shall be
12    liberally construed to effectuate its purpose.

13        Section 10.  Definitions. As used in this Act:
14        "Approved credit  counselor"  means  a  credit  counselor
15    approved by the Director of Financial Institutions.
16        "Borrower"  means a natural person who seeks or obtains a
17    high risk home loan.
18        "Commissioner" means the Commissioner of  the  Office  of
19    Banks and Real Estate.
20        "Department"    means   the   Department   of   Financial
21    Institutions.
22        "Director" means the Director of Financial Institutions.
23        "Good faith" means honesty in  fact  in  the  conduct  or
24    transaction concerned.
25        "High  risk  home loan" means a home equity loan in which
26    (i) at the time of origination, the  annual  percentage  rate
27    exceeds  by  more  than  6 percentage points in the case of a
28    first lien mortgage, or by more than 8 percentage  points  in
29    the  case  of  a  junior mortgage, the yield on U.S. Treasury
30    securities having comparable periods of maturity to the  loan
 
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 1    maturity  as  of  the  fifteenth day of the month immediately
 2    preceding the month in which the application for the loan  is
 3    received  by  the  lender  or  (ii) the total points and fees
 4    payable by the consumer at or before closing will exceed  the
 5    greater  of  5%  of  the  total loan amount or $800. The $800
 6    figure shall be adjusted annually on January 1 by the  annual
 7    percentage  change  in the Consumer Price Index for All Urban
 8    Consumers for  all  items  published  by  the  United  States
 9    Department of Labor. "High risk home loan" does not include a
10    loan  that is made primarily for a business purpose unrelated
11    to the residential real property securing the loan or  to  an
12    open-end  credit  plan  subject  to  12  CFR  226  (2000,  no
13    subsequent amendments or editions are included).
14        "Home   equity  loan"  means  any  loan  secured  by  the
15    borrower's primary residence where the proceeds are not  used
16    as purchase money for the residence.
17        "Lender"   means  a  natural  or  artificial  person  who
18    transfers, deals in, offers, or makes a high risk home  loan.
19    "Lender"  includes,  but  is  not  limited  to, creditors and
20    brokers who transfer, deal in, offer, or make high risk  home
21    loans.  "Lender"  does  not include purchasers, assignees, or
22    subsequent holders of high risk home loans.
23        "Office" means the Office of Banks and Real Estate.
24        "Points  and  fees"  means  all  items  required  to   be
25    disclosed  as  points  and fees under 12 CFR 226.32 (2000, no
26    subsequent amendments or editions included); the  premium  of
27    any  single  premium  credit  life, credit disability, credit
28    unemployment, or any other life or health insurance  that  is
29    financed   directly   or   indirectly   into  the  loan;  and
30    compensation  paid  directly  or  indirectly  to  a  mortgage
31    broker, including a broker that originates a loan in its  own
32    name in a table-funded transaction, not otherwise included in
33    12 CFR 226.4.
34        "Reasonable"  means  fair, proper, just, or prudent under
 
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 1    the circumstances.
 2        "Servicer" means any entity chartered under the  Illinois
 3    Banking  Act, the Savings Bank Act, the Illinois Credit Union
 4    Act, or the Illinois Savings and Loan Act  of  1985  and  any
 5    person  or  entity  licensed  under  the Residential Mortgage
 6    License Act of 1987, the Consumer Installment  Loan  Act,  or
 7    the  Sales  Finance  Agency  Act  who  is responsible for the
 8    collection or remittance for, or has the right or  obligation
 9    to  collect  or  remit  for,  any lender, note owner, or note
10    holder  or  for  a  licensee's  own  account,  of   payments,
11    interest,   principal,   and  trust  items  (such  as  hazard
12    insurance and  taxes  on  a  residential  mortgage  loan)  in
13    accordance  with  the terms of the residential mortgage loan,
14    including loan payment follow-up, delinquency loan follow-up,
15    loan analysis, and any notifications to the borrower that are
16    necessary to enable the borrower to keep the loan current and
17    in good standing.
18        "Total loan amount" has the same meaning as that term  is
19    given  in 12 CFR 226.32 and shall be calculated in accordance
20    with the Federal Reserve Board's Official Staff Commentary to
21    that regulation.

22        Section 15.  Ability to repay. A creditor or broker shall
23    not transfer, deal in, offer, or make a high risk  home  loan
24    if  the  creditor  or broker does not believe at the time the
25    loan is consummated that the borrower will be  able  to  make
26    the  scheduled  payments to repay the obligation based upon a
27    consideration of his or  her  current  and  expected  income,
28    current  obligations,  employment status, and other financial
29    resources (other than the borrower's equity in  the  dwelling
30    that  secures  repayment  of  the  loan). A borrower shall be
31    presumed to be able to repay the loan if,  at  the  time  the
32    loan  is  consummated,  or  at  the  time  of  the first rate
33    adjustment, in the case  of  a  lower  introductory  interest
 
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 1    rate,  the  borrower's scheduled monthly payments on the loan
 2    (including  principal,  interest,   taxes,   insurance,   and
 3    assessments),  combined  with  the scheduled payments for all
 4    other disclosed debts, do not exceed 50%  of  the  borrower's
 5    monthly gross income.

 6        Section  20.  Verification  of ability to repay loan. The
 7    lender shall verify the borrower's ability to repay the  loan
 8    in  the case of a high risk home loan. The verification shall
 9    require, at a minimum, the following:
10             (1)  That the borrower prepare  and  submit  to  the
11        lender  a personal income and expense statement in a form
12        prescribed by the Commissioner or the Director,  who  may
13        permit  the  use  of other forms such as the URLA (Fannie
14        Mae Form 1003 (10/92), available from  Fannie  Mae,  3900
15        Wisconsin  Avenue,  NW,  Washington, D.C. 20016-2892, and
16        Freddie Mac Form 85 (10/92), available from  Freddie  Mac
17        at  1101  Pennsylvania  Avenue,  NW,  Suite 950, P.O. Box
18        37347,  Washington,  D.C.   20077-0001,   no   subsequent
19        amendments  or  editions) and Transmittal Summary (Fannie
20        Mae Form 1077 (3/97), available  from  Fannie  Mae,  3900
21        Wisconsin  Avenue,  NW,  Washington, D.C. 20016-2892, and
22        Freddie Mac Form 1008 (3/97), available from Freddie  Mac
23        at  1101  Pennsylvania  Avenue,  NW,  Suite 950, P.O. Box
24        37347,  Washington,  D.C.   20077-0001,   no   subsequent
25        amendments or editions).
26             (2)  That the borrower's income is verified by means
27        of  tax  returns,  pay  stubs,  accounting statements, or
28        other prudent means.
29             (3)  That a credit report is obtained regarding  the
30        borrower.

31        Section 25.  Good faith dealings; fraudulent or deceptive
32    practices.  A  lender must act in good faith in all relations
 
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 1    with a borrower, including but not limited to,  transferring,
 2    dealing in, offering, or making a high risk home loan.
 3        No  lender  shall  employ fraudulent or deceptive acts or
 4    practices in the making of a high risk home  loan,  including
 5    deceptive marketing and sales efforts.

 6        Section  30.  Prepayment  penalty.  For  any loan that is
 7    subject to the provisions of this Act and is not  subject  to
 8    the  provisions  of  the Home Ownership and Equity Protection
 9    Act of 1994, no lender shall make a high risk home loan  that
10    includes  a penalty provision for payment made: (i) after the
11    expiration of the 36-month period following the date the loan
12    was made; or (ii) that is more than:
13             (1)  3% of the total loan amount if  the  prepayment
14        is  made  within  the first 12-month period following the
15        date the loan was made;
16             (2)  2% of the total loan amount if  the  prepayment
17        is  made  within the second 12-month period following the
18        date the loan was made; or
19             (3)  1% of the total loan amount if  the  prepayment
20        is  made  within  the third 12-month period following the
21        date the loan was made.

22        Section 40.  Pre-paid insurance products and  warranties.
23    No lender shall transfer, deal in, offer, or make a high risk
24    home  loan that finances a single premium credit life, credit
25    disability, credit unemployment, or any other life or  health
26    insurance,  directly  or indirectly. Insurance calculated and
27    paid on a  monthly  basis  shall  not  be  considered  to  be
28    financed by the lender.

29        Section  45.  Refinancing prohibited in certain cases. No
30    lender shall refinance any high risk  home  loan  where  such
31    refinancing  charges  additional  points  and  fees  within a
 
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 1    12-month period after the original loan agreement was signed,
 2    unless the refinancing results in a tangible net  benefit  to
 3    the borrower.

 4        Section  55.  Financing  of  points  and fees.  No lender
 5    shall transfer, deal in, offer, or make a high risk home loan
 6    that finances points and fees in excess of 6%  of  the  total
 7    loan amount.

 8        Section  60.  Payments  to  contractors.  No lender shall
 9    make a payment of any proceeds  of  a  high  risk  home  loan
10    directly  to  a  contractor under a home improvement contract
11    other than:
12             (1)  by  instrument  payable  to  the  borrower   or
13        payable jointly to the borrower and contractor; or
14             (2)  at   the   election   of  the  borrower,  by  a
15        third-party escrow agent in  accordance  with  the  terms
16        established  in a written agreement that is signed by the
17        borrower, the lender, and the contractor before the  date
18        of payment.

19        Section   65.  Negative  amortization.  No  lender  shall
20    transfer, deal in, offer, or make  a  high  risk  home  loan,
21    other  than  a  loan secured only by a reverse mortgage, with
22    terms under which the outstanding balance  will  increase  at
23    any  time  over  the  course  of the loan because the regular
24    periodic payments  do  not  cover  the  full  amount  of  the
25    interest   due,  unless  the  negative  amortization  is  the
26    consequence  of  a  temporary  forbearance  sought   by   the
27    borrower.

28        Section  70.  Negative  equity. No lender shall transfer,
29    deal in, offer, or make a high risk home loan where the  loan
30    amount exceeds the value of the property securing the loan.
 
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 1        Section   80.  Late  payment  fee.  A  lender  shall  not
 2    transfer, deal in, offer, or make a high risk home loan  that
 3    provides  for  a late payment fee, except under the following
 4    conditions:
 5             (1)  the late payment fee shall not be in excess  of
 6        5% of the amount of the payment past due;
 7             (2)  the late payment fee shall only be assessed for
 8        a payment past due for 15 days or more;
 9             (3)  the  late payment fee shall not be imposed more
10        than once with respect to a single late payment;
11             (4)  a  late  payment  fee  that  the   lender   has
12        collected  shall  be  reimbursed if the borrower presents
13        proof of having made a timely payment; and
14             (5)  a lender shall treat each payment as posted  on
15        the  same  business day as it was received by the lender,
16        servicer, or lender's agent or at the address provided to
17        the borrower by the lender, servicer, or  lender's  agent
18        for making payments.

19        Section   85.  Payment   compounding.   No  lender  shall
20    transfer, deal in, offer, or make a high risk home loan  that
21    includes  terms  under  which  more  than 2 periodic payments
22    required under the loan are consolidated and paid in  advance
23    from the loan proceeds provided to the borrower.

24        Section  90.  Call  provision.  No lender shall transfer,
25    deal in, offer, or make a high risk home loan that contains a
26    provision that permits the lender, in its sole discretion, to
27    accelerate the indebtedness,  provided  that  this  provision
28    does not prohibit acceleration of a loan in good faith due to
29    a  borrower's  failure  to abide by the material terms of the
30    loan.

31        Section 95.  Disclosure prior to making a high risk  home
 
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 1    loan.  A lender shall not transfer, deal in, offer, or make a
 2    high risk home loan unless the lender has given the following
 3    notice or a substantially similar notice in writing,  to  the
 4    borrower,  acknowledged in writing and signed by the borrower
 5    not later than the time the  notice  is  required  under  the
 6    notice provision contained in 12 CFR 226.31(c):
 7    NOTICE TO BORROWER
 8    YOU  SHOULD  BE AWARE THAT YOU MIGHT BE ABLE TO OBTAIN A LOAN
 9    AT A LOWER COST. YOU SHOULD  SHOP  AROUND  AND  COMPARE  LOAN
10    RATES  AND  FEES.  LOAN RATES AND CLOSING COSTS AND FEES VARY
11    BASED ON MANY FACTORS, INCLUDING YOUR PARTICULAR  CREDIT  AND
12    FINANCIAL   CIRCUMSTANCES,   YOUR   EMPLOYMENT  HISTORY,  THE
13    LOAN-TO-VALUE REQUESTED, AND THE TYPE OF PROPERTY  THAT  WILL
14    SECURE  YOUR  LOAN.  THE  LOAN  RATE AND FEES COULD ALSO VARY
15    BASED ON WHICH LENDER OR BROKER YOU SELECT. IF YOU ACCEPT THE
16    TERMS OF THIS LOAN, THE LENDER WILL HAVE A MORTGAGE  LIEN  ON
17    YOUR  HOME.  YOU  COULD  LOSE YOUR HOME AND ANY MONEY YOU PUT
18    INTO IT IF YOU DO NOT MEET YOUR PAYMENT OBLIGATIONS UNDER THE
19    LOAN. YOU SHOULD CONSULT AN ATTORNEY-AT-LAW AND  AN  APPROVED
20    CREDIT  COUNSELOR  OR  OTHER  EXPERIENCED  FINANCIAL  ADVISOR
21    REGARDING  THE RATE, FEES, AND PROVISIONS OF THIS LOAN BEFORE
22    YOU  PROCEED.  A  LIST  OF  APPROVED  CREDIT  COUNSELORS   IS
23    AVAILABLE  BY  CONTACTING  EITHER  THE ILLINOIS DEPARTMENT OF
24    FINANCIAL INSTITUTIONS OR THE ILLINOIS OFFICE  OF  BANKS  AND
25    REAL  ESTATE.  YOU  ARE  NOT  REQUIRED  TO COMPLETE THIS LOAN
26    AGREEMENT MERELY BECAUSE YOU HAVE RECEIVED THIS DISCLOSURE OR
27    HAVE SIGNED  A  LOAN  APPLICATION.  ALSO,  YOUR  PAYMENTS  ON
28    EXISTING  DEBTS CONTRIBUTE TO YOUR CREDIT RATINGS. YOU SHOULD
29    NOT ACCEPT ANY ADVICE TO IGNORE YOUR REGULAR PAYMENTS TO YOUR
30    EXISTING LENDERS.

31        Section 100.  Counseling prior to perfecting  foreclosure
32    proceedings.
33        (a)  If  a high risk home loan becomes delinquent by more
 
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 1    than 30 days, the servicer shall send a notice  advising  the
 2    borrower  that  he  or  she  may wish to seek approved credit
 3    counseling.
 4        (b)  The notice required in subsection (a)  shall,  at  a
 5    minimum, include the following language:
 6        "YOUR  LOAN IS OR WAS MORE THAN 30 DAYS PAST DUE. YOU MAY
 7    BE EXPERIENCING FINANCIAL DIFFICULTY. IT MAY BE IN YOUR  BEST
 8    INTEREST  TO  SEEK  APPROVED  CREDIT  COUNSELING.  A  LIST OF
 9    APPROVED CREDIT COUNSELORS MAY BE OBTAINED  FROM  EITHER  THE
10    ILLINOIS DEPARTMENT OF FINANCIAL INSTITUTIONS OR THE ILLINOIS
11    OFFICE OF BANKS AND REAL ESTATE."
12        (c)  If, within 15 days after mailing the notice provided
13    for  under  subsection  (b),  a lender, servicer, or lender's
14    agent is notified in writing by an approved credit  counselor
15    and   the  approved  credit  counselor  advises  the  lender,
16    servicer, or lender's agent  that  the  borrower  is  seeking
17    approved  credit  counseling,  then  the lender, servicer, or
18    lender's agent shall not institute legal action under Part 15
19    of Article XV of the Code of  Civil  Procedure  for  30  days
20    after the date of that notice. Only one such 30-day period of
21    forbearance is allowed under this Section per subject loan.
22        (d)  If,   within   the   30-day  period  provided  under
23    subsection (c), the lender, servicer, or lender's agent,  the
24    approved  credit  counselor, and the borrower agree to a debt
25    management plan, then the lender, servicer, or lender's agent
26    shall not institute legal action under Part 15 of Article  XV
27    of  the  Code  of  Civil  Procedure  for  as long as the debt
28    management plan is complied with by the borrower.
29        The agreed debt management plan must be  in  writing  and
30    signed  by  the  lender,  servicer,  or  lender's  agent, the
31    approved credit counselor, and the borrower. No  modification
32    of  an  approved debt management plan can be made without the
33    mutual agreement of the lender, servicer, or lender's  agent,
34    the approved credit counselor, and the borrower.
 
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 1        Upon  written notice to the lender, servicer, or lender's
 2    agent, the borrower may change approved credit counselors.
 3        (e)  If the borrower fails to comply with the agreed debt
 4    management plan,  then  nothing  in  this  Section  shall  be
 5    construed  to impair the legal right of the lender, servicer,
 6    or lender's agent to enforce the contract.

 7        Section 105.  Right to cure.
 8        (a)  Before an action is filed to  foreclose  or  collect
 9    money  due  pursuant to a high risk home loan or before other
10    action is taken to seize or transfer  ownership  of  property
11    subject  to  a  high  risk  home loan, the lender or lender's
12    assignee of the loan shall deliver to the borrower  a  notice
13    of  the  right to cure the default, informing the borrower of
14    all of the following:
15             (1)  The nature of the default.
16             (2)  The borrower's right to  cure  the  default  by
17        paying  the sum of money required, provided that a lender
18        or assignee shall accept  any  partial  payment  made  or
19        tendered  in  response  to  the  notice.  If  the  amount
20        necessary  to cure the default will change within 30 days
21        of the notice due to the application of a daily  interest
22        rate or the addition of late fees, as allowed by the Act,
23        the  notice  shall  give sufficient information to enable
24        the borrower to calculate the amount at any point  within
25        the 30-day period.
26             (3)  The  date  by  which  the borrower may cure the
27        default  to  avoid  a  court  action,  acceleration   and
28        initiation  of  foreclosure, or other action to seize the
29        property, which date shall not be less than 30 days after
30        the date the notice is delivered, and the name,  address,
31        and  telephone  number of a person to whom the payment or
32        tender shall be made.
33             (4)  That if the borrower does not cure the  default
 
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 1        by the date specified, the lender or assignee may file an
 2        action  for  money  due  or  take  steps to terminate the
 3        borrower's ownership in the property by requiring payment
 4        in full of the high  risk  home  loan  and  commencing  a
 5        foreclosure  proceeding  or  other  action  to  seize the
 6        property.
 7             (5)  The name, address, and telephone  number  of  a
 8        person  whom  the  borrower  may  contact if the borrower
 9        disagrees with the assertion that a default has  occurred
10        or  the  correctness  of  the  calculation  of the amount
11        required to cure the default.
12        (b)  If a lender or assignee  asserts  that  grounds  for
13    acceleration  exist  and  requires the payment in full of all
14    sums secured by the high risk  home  loan,  the  borrower  or
15    anyone authorized to act on the borrower's behalf may, at any
16    time before the title is transferred by means of foreclosure,
17    by  judicial  proceeding  and  sale, or other means, cure the
18    default, and reinstate the high risk home loan. Cure  of  the
19    default  shall reinstate the borrower to the same position as
20    if the default had not occurred and shall nullify, as of  the
21    date of the cure, an acceleration of any obligation under the
22    high risk home loan arising from the default.
23        (c)  To  cure  a  default  under this Section, a borrower
24    shall not be required to pay  any  charge,  fee,  or  penalty
25    attributable  to the exercise of the right to cure a default,
26    other than the fees specifically allowed by this  subsection.
27    The  borrower  shall  not  be  liable  for  any attorney fees
28    relating to the default that are incurred by  the  lender  or
29    assignee  prior  to  or during the 30-day period set forth in
30    subsection (a) of this Section, nor  for  any  such  fees  in
31    excess  of  $100  that are incurred by the lender or assignee
32    after the expiration of the  30-day  period  but  before  the
33    lender  or  assignee  files  a  foreclosure or other judicial
34    action or takes other action to seize or  transfer  ownership
 
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 1    of  the  real  estate.  After  the lender or assignee files a
 2    foreclosure or other judicial action or takes other action to
 3    seize or transfer ownership of the real estate, the  borrower
 4    shall  only  be  liable for attorney fees that are reasonable
 5    and actually incurred by the lender or assignee, based  on  a
 6    reasonable hourly rate and a reasonable number of hours.
 7        (d)  If a default is cured prior to the initiation of any
 8    action  to foreclose or to seize the residence, the lender or
 9    assignee shall not institute a proceeding or other action for
10    that default. If a default is cured after the  initiation  of
11    any  action,  the lender or assignee shall take such steps as
12    are necessary to terminate the action.
13        (e)  A lender or a lender's assignee of a high risk  home
14    loan  that  has  the  legal  right to foreclose shall use the
15    judicial foreclosure procedures provided by law.  In  such  a
16    proceeding,  the  borrower  may  assert the nonexistence of a
17    default and any other claim or defense  to  acceleration  and
18    foreclosure,  including  any  claim  or  defense  based  on a
19    violation of the Act, though no such claim or  defense  shall
20    be deemed a compulsory counterclaim.

21        Section 110.  Mortgage Awareness Program.
22        (a)  The  Mortgage  Awareness Program is a counseling and
23    educational component that must be provided by  the  Director
24    and the Commissioner.
25        (b)  The   core  curriculum  of  the  Mortgage  Awareness
26    Program shall include all of the following:
27             (1)  Explanation of the amount financed.
28             (2)  Explanation of the finance charge.
29             (3)  Explanation of the annual percentage rate.
30             (4)  Explanation of the total payments.
31             (5)  Explanation  of  the  loan   costs,   including
32        broker's  fees,  finance charges, points, and origination
33        fees.
 
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 1             (6)  Explanation of the right of rescission.
 2             (7)  Explanation of foreclosure procedures.
 3             (8)  Explanation of  the  significant  debt  ratios,
 4        including  total debt to income, loan debt to income, and
 5        loan debt to value of residence.
 6             (9)  Explanation of adjustable rate mortgage.
 7             (10)  Explanation of balloon payments.
 8             (11)  Explanation of credit options.
 9             (12)  Explanation of each item  that  appears  on  a
10        good faith estimate.
11             (13)  Explanation of pre-payment penalties.
12        (c)  Counseling   session   attendees   must  complete  a
13    personal income and expense statement, as well as  a  balance
14    sheet, on forms provided by the Commissioner or the Director.
15        (d)  Prior   to  signing  a  certificate  of  completion,
16    approved credit counselors shall privately discuss with  each
17    attendee  that  attendee's  income  and expense statement and
18    balance sheet, as well as the terms of any loan the  attendee
19    currently  has  or  may be contemplating, and provide a third
20    party review to establish the affordability of the loan.
21        (e)  Counseling  session  attendees  must  be   given   a
22    brochure  that  contains  information covered by the Mortgage
23    Awareness Program.
24        (f)  Any lender, prior to making a high risk  home  loan,
25    shall  inform  the  borrower  in  writing  of  the  right  to
26    participate in the Mortgage Awareness Program.
27        (g)  No lender shall offer less favorable loan terms to a
28    borrower  due  to  a borrower's participation in the Mortgage
29    Awareness Program.
30        (h)  Except as prohibited elsewhere in this Section,  the
31    borrower  may  waive  participation  in the program, provided
32    that the waiver occurs no less than 2 business days after the
33    day  that  the  borrower  receives  the  notice  required  by
34    subsection (f) of this Section and  that  the  waiver  is  in
 
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 1    writing  in  a  form  approved  by  the  Commissioner and the
 2    Director.

 3        Section 115.  Report of default and foreclosure rates  on
 4    conventional loans.
 5        (a)  On  or  before  October  1 and April 1 of each year,
 6    each servicer of Illinois residential  mortgage  loans  shall
 7    report  to  the  Commissioner or the Director the default and
 8    foreclosure  data  of  conventional  loans  for  the  6-month
 9    periods ending June 30 and December 31, respectively.
10        (b)  Each   servicer   shall   report    the    following
11    information:
12             (1)  The   average   quarterly   dollar   amount  of
13        conventional one to 4 family mortgage  loans  secured  by
14        Illinois real estate.
15             (2)  The  average  quarterly  number of conventional
16        one to 4 family mortgage loans secured by  Illinois  real
17        estate.
18             (3)  The   average   quarterly   dollar   amount  of
19        conventional one to 4 family mortgage  loans  secured  by
20        Illinois real estate that are in default over 90 days.
21             (4)  The  average  quarterly  number of conventional
22        one to 4 family mortgage loans secured by  Illinois  real
23        estate that are in default over 90 days.
24             (5)  The  dollar  amount of foreclosures on one to 4
25        family conventional loans completed during the  reporting
26        period.
27             (6)  The  number  of foreclosures on one to 4 family
28        conventional loans completed during the reporting period.
29             (7)  Whether any of the loans  where  a  foreclosure
30        was  completed were originated less than 18 months before
31        the completed foreclosure.
32             (8)  Whether any of the loans  where  a  foreclosure
33        was  completed had a note rate greater than 10% for first
 
SB1784 Enrolled            -15-      LRB093 10148 BDD 11571 b
 1        lien mortgage loans or greater than 12% in the case of  a
 2        junior lien.
 3        (c)  An officer of the servicer shall sign the form.

 4        Section 120. Review and analysis.
 5        (a)  The   Commissioner  or  Director  shall  review  and
 6    analyze  the  default  and  foreclosure  rate  data   reports
 7    submitted under Section 115.
 8        (b)  The  reports  and their analyses may be used for the
 9    following purposes:
10             (1)  In setting the scope of a  regularly  scheduled
11        examination.
12             (2)  In setting the scope of a special examination.
13             (3)  In  comparing  the  reported  information  of a
14        servicer.
15        (c)  The Commissioner or the Director may correspond with
16    a servicer to seek clarification of information contained  in
17    its  report and to gather additional data concerning loans in
18    default or loans in foreclosure.

19        Section 125.  Third party review of high risk home loans.
20        (a)  In the case of any high risk home loan, the borrower
21    shall be afforded the opportunity to seek independent  review
22    by  the  Office or the Department of the loan terms, in order
23    to determine affordability of  the  loan,  when  and  if  the
24    General  Assembly appropriates adequate funding to the Office
25    or the Department specifically for this Section.
26        (b)  The  Office  or  the  Department  shall  inform  the
27    borrower of the amount  the  borrower  has  available  for  a
28    monthly mortgage payment based upon the borrower's budget.
29        (c)  The  Office  or  the  Department  shall  review loan
30    information pertaining to  balloon  payments  and  adjustable
31    interest   rates  and  other  items  disclosed  by  the  loan
32    documents affecting amount of payment and  shall  inform  the
 
SB1784 Enrolled            -16-      LRB093 10148 BDD 11571 b
 1    borrower of such items.
 2        (d)  If,  based  upon the review, the borrower determines
 3    that the loan is not in his or her  best  economic  interest,
 4    the  reviewer  shall so notify the lender. This determination
 5    shall enable the borrower to withdraw from  the  contemplated
 6    loan with no financial penalty.

 7        Section 130.  Circumstances voiding mandatory arbitration
 8    provisions.  Without  regard  to whether a borrower is acting
 9    individually or on behalf of  others  similarly  situated,  a
10    mandatory  arbitration  provision  of  a  high risk home loan
11    agreement that  is  oppressive,  unfair,  unconscionable,  or
12    substantially  in derogation of the rights of the borrower is
13    void.

14        Section 135.  Remedies, enforcement, and  limitations  of
15    liability.
16        (a)  The remedies provided in this Act are cumulative and
17    apply to persons or entities subject to this Act.
18        (b)  Any  knowing  violation  of  this  Act constitutes a
19    violation  of  the  Consumer  Fraud  and  Deceptive  Business
20    Practices Act.
21        (c)  If any provision of an agreement  for  a  high  risk
22    home   loan   violates  this  Act,  then  that  provision  is
23    unenforceable against the borrower.
24        (d)(1)  Any natural or artificial person who purchases or
25    otherwise is assigned or subsequently holds a high risk  home
26    loan  shall be subject to all affirmative claims and defenses
27    with respect to the  loan  that  the  borrower  could  assert
28    against  the lender or broker of the loan, provided that this
29    item (d)(1) shall not apply if  the  purchaser,  assignee  or
30    holder  demonstrates  by a preponderance of the evidence that
31    it:
32             (A)  has in place, at  the  time  of  the  purchase,
 
SB1784 Enrolled            -17-      LRB093 10148 BDD 11571 b
 1        assignment  or  transfer  of  the  loans,  policies  that
 2        expressly prohibit its purchase, acceptance of assignment
 3        or holding of any high risk home loans;
 4             (B)  requires by contract that a seller, assignor or
 5        transferor  of  high  risk  home  loans to the purchaser,
 6        assignee or transferee represents  and  warrants  to  the
 7        purchaser,  assignee  or  transferee  that either (i) the
 8        seller, assignor or transferor will not sell,  assign  or
 9        transfer  any  high  risk  home  loans  to the purchaser,
10        assignee or transferee, or (ii) the seller,  assignor  or
11        transferor  is  a  beneficiary  of  a  representation and
12        warranty from a previous seller, assignor  or  transferor
13        to that effect; and
14             (C)  exercises  reasonable due diligence at the time
15        of the purchase, assignment or transfer of high risk home
16        loans, or within a reasonable period of  time  after  the
17        purchase,  assignment  or  transfer  of  such home loans,
18        which  is  intended  by  the   purchaser,   assignee   or
19        transferee   to   prevent   the  purchaser,  assignee  or
20        transferee  from  purchasing  or  taking  assignment   or
21        otherwise holding any high risk home loans, provided that
22        this  reasonable  due diligence requirement may be met by
23        sampling and need not require loan-by-loan review.
24        (2)  Limited  to  the  amount  required  to   reduce   or
25    extinguish  the borrower's liability under the high cost home
26    loan plus the amount required  to  recover  costs,  including
27    reasonable  attorney  fees,  a  borrower  acting  only  in an
28    individual capacity may assert claims that the borrower could
29    assert against a lender of the home loan against a subsequent
30    holder or assignee of the home loan as follows:
31             (A)  within 5 years of the closing date  of  a  high
32        risk  home  loan,  a  violation of this Act in connection
33        with the loan as an original action; and
34             (B)  at any time during the term of a high risk home
 
SB1784 Enrolled            -18-      LRB093 10148 BDD 11571 b
 1        loan, after an action to collect on the home loan  or  to
 2        foreclose  on  the  collateral securing the home loan has
 3        been initiated, or the debt arising from  the  home  loan
 4        has been accelerated, or the home loan has become 60 days
 5        in default, any defense, claim, counterclaim or action to
 6        enjoin  foreclosure  or  preserve or obtain possession of
 7        the home that secures the loan.
 8        (e)  In addition to the limitation of liability  afforded
 9    to   subsequent   purchasers,  assignees,  or  holders  under
10    subsection (d) of this Section, a  lender  and  a  subsequent
11    purchaser,  assignee, or holder of the high risk home loan is
12    not liable for a violation of this Act if:
13             (1)  within 30 days of the loan closing and prior to
14        receiving any notice from the borrower of the  violation,
15        the  lender  has  made  appropriate  restitution  to  the
16        borrower  and  appropriate  adjustments  are  made to the
17        loan; or
18             (2)  the violation was not intentional and  resulted
19        from  a  bona  fide  error  in  fact, notwithstanding the
20        maintenance of procedures  reasonably  adopted  to  avoid
21        such  errors,  and within 60 days of the discovery of the
22        violation and prior to  receiving  any  notice  from  the
23        borrower  of  the  violation, the borrower is notified of
24        the violation, appropriate restitution  is  made  to  the
25        borrower,  and  appropriate  adjustments  are made to the
26        loan.

27        Section 145.  Subterfuge prohibited. No lender, with  the
28    intent  to  avoid  the application or provisions of this Act,
29    shall (i) divide a loan transaction into  separate  parts  or
30    (ii) perform any other subterfuge.

31        Section  150.  Preemption  of  administrative  rules. Any
32    relevant administrative rule promulgated before the effective
 
SB1784 Enrolled            -19-      LRB093 10148 BDD 11571 b
 1    date  of  this  Act  by  the  Department  or  the  Office  is
 2    preempted.

 3        Section 153.  Reporting of violations. The Office and the
 4    Department must report to the Attorney General all violations
 5    of this Act of which they become aware.

 6        Section 155.  Rulemaking. The Office and  the  Department
 7    may  adopt  reasonable rules to implement and administer this
 8    Act.

 9        Section 160.  Judicial review. All  final  administrative
10    decisions  under  this  Act  are  subject  to judicial review
11    pursuant to the provisions of the Administrative  Review  Law
12    and any rules adopted pursuant thereto.

13        Section 165.  Waiver prohibited. There shall be no waiver
14    of  any  provision of this Act, except as explicitly provided
15    in subsection (h) of Section 110.

16        Section 170.  Superiority of Act. To the extent this  Act
17    conflicts  with any other Illinois State financial regulation
18    laws, except the Interest  Act,  this  Act  is  superior  and
19    supersedes  those  laws  for  the purposes of regulating high
20    risk home loans in Illinois.

21        Section 175.  Severability.  The provisions of  this  Act
22    are severable under Section 1.31 of the Statute on Statutes.

23        Section  800.  The Deposit of State Moneys Act is amended
24    by changing Sections 11 and 11.1 as follows:

25        (15 ILCS 520/11) (from Ch. 130, par. 30)
26        Sec.  11.   Protection  of  public   deposits;   eligible
 
SB1784 Enrolled            -20-      LRB093 10148 BDD 11571 b
 1    collateral.
 2        (a)  For deposits not insured by an agency of the federal
 3    government,  the  State  Treasurer, in his or her discretion,
 4    may accept as collateral any  of  the  following  classes  of
 5    securities, provided there has been no default in the payment
 6    of principal or interest thereon:
 7             (1)  Bonds,  notes, or other securities constituting
 8        direct and general obligations of the United States,  the
 9        bonds, notes, or other securities constituting the direct
10        and  general  obligation of any agency or instrumentality
11        of the United States, the interest and principal of which
12        is unconditionally guaranteed by the United  States,  and
13        bonds,   notes,   or  other  securities  or  evidence  of
14        indebtedness constituting the obligation of a U.S. agency
15        or instrumentality.
16             (2)  Direct and  general  obligation  bonds  of  the
17        State  of  Illinois  or  of any other state of the United
18        States.
19             (3)  Revenue bonds of this State or  any  authority,
20        board, commission, or similar agency thereof.
21             (4)  Direct  and  general  obligation  bonds  of any
22        city, town, county, school district, or other taxing body
23        of any state, the debt service of which is  payable  from
24        general ad valorem taxes.
25             (5)  Revenue  bonds  of  any  city, town, county, or
26        school district of the State of Illinois.
27             (6)  Obligations issued, assumed, or  guaranteed  by
28        the  International  Finance Corporation, the principal of
29        which is not amortized during the life of the obligation,
30        but no such obligation shall be accepted at more than 90%
31        of its market value.
32             (7)  Illinois Affordable Housing Program Trust  Fund
33        Bonds  or  Notes as defined in and issued pursuant to the
34        Illinois Housing Development Act.
 
SB1784 Enrolled            -21-      LRB093 10148 BDD 11571 b
 1             (8)  In an amount equal to at least market value  of
 2        that  amount  of  funds deposited exceeding the insurance
 3        limitation provided  by  the  Federal  Deposit  Insurance
 4        Corporation  or  the National Credit Union Administration
 5        or other approved share  insurer:  (i)  securities,  (ii)
 6        mortgages,  (iii)  letters  of credit issued by a Federal
 7        Home Loan Bank, or (iv) loans covered by a State Guaranty
 8        under the Illinois Farm Development Act.
 9        (b)  The  State  Treasurer  may  establish  a  system  to
10    aggregate permissible securities received as collateral  from
11    financial  institutions  in a collateral pool to secure State
12    deposits of the institutions that have pledged securities  to
13    the pool.
14        (c)  The Treasurer may at any time declare any particular
15    security  ineligible  to  qualify  as collateral when, in the
16    Treasurer's judgment, it is deemed desirable to do so.
17        (d)  Notwithstanding any other provision of this Section,
18    as security the  State  Treasurer  may,  in  his  discretion,
19    accept  a  bond, executed by a company authorized to transact
20    the kinds of business described in clause (g) of Section 4 of
21    the Illinois Insurance Code, in an amount not less  than  the
22    amount  of  the  deposits  required  by  this  Section  to be
23    secured, payable to the State Treasurer for  the  benefit  of
24    the  People  of  the  State  of  Illinois,  in a form that is
25    acceptable to the State Treasurer.
26    (Source: P.A. 87-510; 87-575; 87-895; 88-93.)

27        (15 ILCS 520/11.1) (from Ch. 130, par. 30.1)
28        Sec. 11.1.  The  State  Treasurer  may,  in  his  or  her
29    discretion,  accept  as  security  for State deposits insured
30    certificates of deposit or share certificates issued  to  the
31    depository  institution  pledging  them  as  security and may
32    require security in the amount of 125% of the  value  of  the
33    State   deposit.    Such  certificate  of  deposit  or  share
 
SB1784 Enrolled            -22-      LRB093 10148 BDD 11571 b
 1    certificate shall:
 2        (1)  be fully insured by the  Federal  Deposit  Insurance
 3    Corporation,   the   Federal   Savings   and  Loan  Insurance
 4    Corporation or the National Credit Union Share Insurance Fund
 5    or issued by a depository institution which is  rated  within
 6    the  3 highest classifications established by at least one of
 7    the 2 standard rating services;
 8        (2)  be issued by a financial institution  having  assets
 9    of $15,000,000 $30,000,000 or more; and
10        (3)  be  issued  by either a savings and loan association
11    having a capital to asset ratio of at least  2%,  by  a  bank
12    having a capital to asset ratio of at least 6% or by a credit
13    union having a capital to asset ratio of at least 4%.
14        The depository institution shall effect the assignment of
15    the  certificate of deposit or share certificate to the State
16    Treasurer and shall agree, that in the event  the  issuer  of
17    the  certificate fails to maintain the capital to asset ratio
18    required by this Section,  such  certificate  of  deposit  or
19    share  certificate  shall  be replaced by additional suitable
20    security.
21    (Source: P.A. 85-803.)

22        Section 805.  The Public Funds Deposit Act is amended  by
23    changing Section 1 as follows:

24        (30 ILCS 225/1) (from Ch. 102, par. 34)
25        Sec.  1.  Deposits.  Any  treasurer or other custodian of
26    public funds may deposit such funds in  a  savings  and  loan
27    association,  savings bank, or State or national bank in this
28    State.  When such deposits become collected funds and are not
29    needed for immediate disbursement,  they  shall  be  invested
30    within  2  working  days  at prevailing rates or better.  The
31    treasurer or other custodian of public funds may require such
32    bank, savings  bank,  or  savings  and  loan  association  to
 
SB1784 Enrolled            -23-      LRB093 10148 BDD 11571 b
 1    deposit with him or her securities guaranteed by agencies and
 2    instrumentalities  of  the federal government equal in market
 3    value to the amount by which the funds deposited  exceed  the
 4    federally insured amount. Any treasurer or other custodian of
 5    public   funds  may  accept  as  security  for  public  funds
 6    deposited in such bank, savings bank,  or  savings  and  loan
 7    association  any  securities  or  other  eligible  collateral
 8    authorized  by  Sections  11 and 11.1 of the Deposit of State
 9    Moneys Act (15 ILCS 520/11 and 11.1)  or  Section  6  of  the
10    Public  Funds  Investment Act (30 ILCS 235/6). Such treasurer
11    or other custodian is authorized to enter into  an  agreement
12    with  any  such  bank,  savings  bank,  or  savings  and loan
13    association, with any federally insured financial institution
14    or trust company, or with any agency of the  U.S.  government
15    relating   to  the  deposit  of  such  securities.  Any  such
16    treasurer  or  other  custodian  shall  be  discharged   from
17    responsibility  for  any  funds  for  which securities are so
18    deposited with him or her, and the funds for which securities
19    are so deposited  shall  not  be  subject  to  any  otherwise
20    applicable limitation as to amount.
21        No  bank,  savings  bank, or savings and loan association
22    shall receive public funds  as  permitted  by  this  Section,
23    unless  it  has  complied  with  the requirements established
24    pursuant to Section 6 of the Public Funds Investment Act.
25    (Source: P.A. 91-211, eff. 7-20-99.)

26        Section 810.  The  State  Officers  and  Employees  Money
27    Disposition Act is amended by changing Section 2c as follows:

28        (30 ILCS 230/2c) (from Ch. 127, par. 173a)
29        Sec.   2c.   Every   such   officer,  board,  commission,
30    commissioner,  department,  institution,  arm  or  agency  is
31    authorized to demand and receive a  bond  and  securities  in
32    amount  and kind satisfactory to him from any bank or savings
 
SB1784 Enrolled            -24-      LRB093 10148 BDD 11571 b
 1    and loan association in which moneys held  by  such  officer,
 2    board, commission, commissioner, department, institution, arm
 3    or  agency  for or on behalf of the State of Illinois, may be
 4    on deposit, such securities to be held by the officer, board,
 5    commission, commissioner,  department,  institution,  arm  or
 6    agency  for the period that such moneys are so on deposit and
 7    then returned together with  interest,  dividends  and  other
 8    accruals  to  the  bank  or savings and loan association. The
 9    bond or undertaking and such securities shall be  conditioned
10    for the return of the moneys deposited in conformity with the
11    terms of the deposit.
12        Whenever  funds deposited with a bank or savings and loan
13    association exceed the amount of  federal  deposit  insurance
14    coverage,  a  bond,  or pledged securities, or other eligible
15    collateral shall be obtained. Only the types of securities or
16    other eligible collateral which the State Treasurer  may,  in
17    his  or her discretion, accept for amounts not insured by the
18    Federal Deposit Insurance Corporation or the Federal  Savings
19    and Loan Insurance Corporation under Section 11 of "An Act in
20    relation  to  State  moneys",  approved  June  28,  1919,  as
21    amended,  may  be  accepted as pledged securities. The market
22    value of the bond or pledged securities shall at all times be
23    equal to or greater than the uninsured portion of the deposit
24    unless the funds deposited are collateralized pursuant  to  a
25    system  established  by  the  State  Treasurer  to  aggregate
26    permissible  securities received as collateral from financial
27    institutions in a collateral pool to secure State deposits of
28    the institution that have pledged securities to the pool.
29        All securities deposited by a bank or  savings  and  loan
30    association under the provisions of this Section shall remain
31    the  property  of  the  depositary  and may be stamped by the
32    depositary  so  as  to  indicate  that  such  securities  are
33    deposited as collateral. Should the bank or savings and  loan
34    association  fail  or  refuse  to pay over the moneys, or any
 
SB1784 Enrolled            -25-      LRB093 10148 BDD 11571 b
 1    part  thereof,  deposited  with  it,  the   officer,   board,
 2    commission,  commissioner,  department,  institution,  arm or
 3    agency may sell such securities upon giving 5 days notice  to
 4    the  depositary  of his intention to so sell such securities.
 5    Such sale shall transfer absolute ownership of the securities
 6    so sold to the vendee thereof. The surplus, if any, over  the
 7    amount due to the State and the expenses of the sale shall be
 8    paid to the bank or savings and loan association. Actions may
 9    be brought in the name of the People of the State of Illinois
10    to  enforce  the  claims  of  the  State  with respect to any
11    securities  deposited  by  a  bank  or   savings   and   loan
12    association.
13        No  bank  or  savings  and loan association shall receive
14    public funds as permitted by  this  Section,  unless  it  has
15    complied   with  the  requirements  established  pursuant  to
16    Section 6 of "An  Act  relating  to  certain  investments  of
17    public  funds by public agencies", approved July 23, 1943, as
18    now or hereafter amended.
19    (Source: P.A. 85-257.)

20        Section 815.  The Public Funds Investment Act is  amended
21    by changing Section 6 as follows:

22        (30 ILCS 235/6) (from Ch. 85, par. 906)
23        Sec. 6. Report of financial institutions.
24        (a)  No bank shall receive any public funds unless it has
25    furnished  the  corporate  authorities  of  a  public  agency
26    submitting  a  deposit  with  copies  of  the  last two sworn
27    statements of resources and liabilities  which  the  bank  is
28    required  to  furnish  to  the Commissioner of Banks and Real
29    Estate or to the Comptroller  of  the  Currency.   Each  bank
30    designated  as  a  depository  for  public funds shall, while
31    acting as such depository, furnish the corporate  authorities
32    of a public agency with a copy of all statements of resources
 
SB1784 Enrolled            -26-      LRB093 10148 BDD 11571 b
 1    and  liabilities  which  it  is  required  to  furnish to the
 2    Commissioner of Banks and Real Estate or to  the  Comptroller
 3    of  the  Currency; provided, that if such funds or moneys are
 4    deposited in a bank, the amount  of  all  such  deposits  not
 5    collateralized  or  insured  by  an  agency  of  the  federal
 6    government  shall  not  exceed  75%  of the capital stock and
 7    surplus of such bank, and  the  corporate  authorities  of  a
 8    public  agency  submitting  a deposit shall not be discharged
 9    from responsibility for any funds or moneys deposited in  any
10    bank in excess of such limitation.
11        (b)  No  savings  bank  or  savings  and loan association
12    shall receive  public  funds  unless  it  has  furnished  the
13    corporate authorities of a public agency submitting a deposit
14    with  copies  of the last 2 sworn statements of resources and
15    liabilities which  the  savings  bank  or  savings  and  loan
16    association  is  required  to  furnish to the Commissioner of
17    Banks and  Real  Estate  or  the  Federal  Deposit  Insurance
18    Corporation.    Each   savings   bank  or  savings  and  loan
19    association designated  as  a  depository  for  public  funds
20    shall, while acting as such depository, furnish the corporate
21    authorities  of a public agency with a copy of all statements
22    of resources and liabilities which it is required to  furnish
23    to  the  Commissioner of Banks and Real Estate or the Federal
24    Deposit Insurance Corporation; provided, that if  such  funds
25    or moneys are deposited in a savings bank or savings and loan
26    association,   the   amount   of   all   such   deposits  not
27    collateralized  or  insured  by  an  agency  of  the  federal
28    government shall not exceed 75% of  the  net  worth  of  such
29    savings  bank  or  savings and loan association as defined by
30    the Federal Deposit Insurance Corporation, and the  corporate
31    authorities of a public agency submitting a deposit shall not
32    be  discharged  from  responsibility  for any funds or moneys
33    deposited in any savings bank or savings and loan association
34    in excess of such limitation.
 
SB1784 Enrolled            -27-      LRB093 10148 BDD 11571 b
 1        (c)  No credit union shall receive public funds unless it
 2    has furnished the corporate authorities of  a  public  agency
 3    submitting  a  share  deposit  with  copies  of  the last two
 4    reports of  examination  prepared  by  or  submitted  to  the
 5    Illinois Department of Financial Institutions or the National
 6    Credit Union Administration.  Each credit union designated as
 7    a  depository  for  public  funds shall, while acting as such
 8    depository, furnish the corporate  authorities  of  a  public
 9    agency  with a copy of all reports of examination prepared by
10    or  furnished  to  the  Illinois  Department   of   Financial
11    Institutions  or  the  National  Credit Union Administration;
12    provided that if such funds  or  moneys  are  invested  in  a
13    credit  union account, the amount of all such investments not
14    collateralized  or  insured  by  an  agency  of  the  federal
15    government or other approved share insurer shall  not  exceed
16    50%  of  the  unimpaired  capital  and surplus of such credit
17    union, which shall include  shares,  reserves  and  undivided
18    earnings  and  the  corporate  authorities of a public agency
19    making  an  investment   shall   not   be   discharged   from
20    responsibility  for  any funds or moneys invested in a credit
21    union in excess of such limitation.
22        (d)  Whenever a public agency deposits any  public  funds
23    in  a financial institution, the public agency may enter into
24    an agreement with the  financial  institution  requiring  any
25    funds   not   insured   by   the  Federal  Deposit  Insurance
26    Corporation or the National Credit  Union  Administration  or
27    other  approved  share insurer to be collateralized by any of
28    the following classes of securities, provided there has  been
29    no default in the payment of principal or interest thereon:
30             (1)  Bonds,  notes, or other securities constituting
31        direct and general obligations of the United States,  the
32        bonds, notes, or other securities constituting the direct
33        and  general  obligation of any agency or instrumentality
34        of the United States, the interest and principal of which
 
SB1784 Enrolled            -28-      LRB093 10148 BDD 11571 b
 1        is unconditionally guaranteed by the United  States,  and
 2        bonds,   notes,   or  other  securities  or  evidence  of
 3        indebtedness constituting the obligation of a U.S. agency
 4        or instrumentality.
 5             (2)  Direct and  general  obligation  bonds  of  the
 6        State  of  Illinois  or  of any other state of the United
 7        States.
 8             (3)  Revenue bonds of this State or  any  authority,
 9        board, commission, or similar agency thereof.
10             (4)  Direct  and  general  obligation  bonds  of any
11        city, town, county, school district, or other taxing body
12        of any state, the debt service of which is  payable  from
13        general ad valorem taxes.
14             (5)  Revenue  bonds  of  any  city, town, county, or
15        school district of the State of Illinois.
16             (6)  Obligations issued, assumed, or  guaranteed  by
17        the  International  Finance Corporation, the principal of
18        which is not amortized during the life of the obligation,
19        but no such obligation shall be accepted at more than 90%
20        of its market value.
21             (7)  Illinois Affordable Housing Program Trust  Fund
22        Bonds  or  Notes as defined in and issued pursuant to the
23        Illinois Housing Development Act.
24             (8)  In an amount equal to at least market value  of
25        that  amount  of  funds deposited exceeding the insurance
26        limitation provided  by  the  Federal  Deposit  Insurance
27        Corporation  or  the National Credit Union Administration
28        or other approved share  insurer:  (i)  securities,  (ii)
29        mortgages,  (iii)  letters  of credit issued by a Federal
30        Home Loan Bank, or (iv) loans covered by a State Guaranty
31        under the Illinois Farm Development Act.
32             (9)  Certificates of deposit or  share  certificates
33        issued  to  the  depository  institution pledging them as
34        security. The public agency may require security  in  the
 
SB1784 Enrolled            -29-      LRB093 10148 BDD 11571 b
 1        amount of 125% of the value of the public agency deposit.
 2        Such certificate of deposit or share certificate shall:
 3                  (i)  be  fully  insured  by the Federal Deposit
 4             Insurance Corporation, the Federal Savings and  Loan
 5             Insurance  Corporation, or the National Credit Union
 6             Share Insurance  Fund  or  issued  by  a  depository
 7             institution  which  is  rated  within  the 3 highest
 8             classifications established by at least one of the 2
 9             standard rating services;
10                  (ii)  be  issued  by  a  financial  institution
11             having assets of $15,000,000 or more; and
12                  (iii)  be issued by either a savings  and  loan
13             association  having  a  capital to asset ratio of at
14             least 2%, by a bank having a capital to asset  ratio
15             of at least 6% or by a credit union having a capital
16             to asset ratio of at least 4%.
17        The depository institution shall effect the assignment of
18    the certificate of deposit or share certificate to the public
19    agency  and  shall agree that, in the event the issuer of the
20    certificate fails to maintain  the  capital  to  asset  ratio
21    required  by  this  Section,  such  certificate of deposit or
22    share certificate shall be replaced  by  additional  suitable
23    security.
24        (e)  The public agency may accept a system established by
25    the  State  Treasurer  to  aggregate  permissible  securities
26    received  as  collateral  from  financial  institutions  in a
27    collateral pool to secure public deposits of the institutions
28    that have pledged securities to the pool.
29        (f)  The public  agency  may  at  any  time  declare  any
30    particular security ineligible to qualify as collateral when,
31    in the public agency's judgment, it is deemed desirable to do
32    so.
33        (g)  Notwithstanding any other provision of this Section,
34    as  security a public agency may, at its discretion, accept a
 
SB1784 Enrolled            -30-      LRB093 10148 BDD 11571 b
 1    bond, executed by a company authorized to transact the  kinds
 2    of  business  described  in  clause  (g)  of Section 4 of the
 3    Illinois Insurance Code, in  an  amount  not  less  than  the
 4    amount  of  the  deposits  required  by  this  Section  to be
 5    secured, payable to the public agency for the benefit of  the
 6    People  of  the  unit  of  government,  in  a  form  that  is
 7    acceptable   to  the  public  agency  securities,  mortgages,
 8    letters of credit issued by a  Federal  Home  Loan  Bank,  or
 9    loans  covered  by  a  State Guaranty under the Illinois Farm
10    Development Act in an amount equal to at least  market  value
11    of  that  amount  of  funds deposited exceeding the insurance
12    limitation  provided  by  the   Federal   Deposit   Insurance
13    Corporation  or  the  National Credit Union Administration or
14    other approved share insurer.
15        (h) (e)  Paragraphs (a), (b), (c), and (d), (e), (f), and
16    (g) of this  Section  do  not  apply  to  the  University  of
17    Illinois,   Southern   Illinois   University,  Chicago  State
18    University,  Eastern  Illinois  University,  Governors  State
19    University, Illinois State University, Northeastern  Illinois
20    University,  Northern  Illinois  University, Western Illinois
21    University,  the  Cooperative  Computer  Center  and   public
22    community colleges.
23    (Source: P.A. 91-324, eff. 1-1-00; 91-773, eff. 6-9-00.)

24        Section  820.   The  Illinois  Banking  Act is amended by
25    changing Sections 2, 5, and 17 and by adding Section 13.6  as
26    follows:

27        (205 ILCS 5/2) (from Ch. 17, par. 302)
28        Sec.  2.  General  definitions.   In this Act, unless the
29    context otherwise requires, the following words  and  phrases
30    shall have the following meanings:
31        "Accommodation  party" shall have the meaning ascribed to
32    that term in Section 3-419 of the Uniform Commercial Code.
 
SB1784 Enrolled            -31-      LRB093 10148 BDD 11571 b
 1        "Action" in the sense of a judicial  proceeding  includes
 2    recoupments, counterclaims, set-off, and any other proceeding
 3    in which rights are determined.
 4        "Affiliate  facility"  of  a  bank  means  a main banking
 5    premises or branch of another commonly owned bank.  The  main
 6    banking premises or any branch of a bank may be an "affiliate
 7    facility"  with  respect  to one or more other commonly owned
 8    banks.
 9        "Appropriate federal banking agency"  means  the  Federal
10    Deposit  Insurance  Corporation,  the Federal Reserve Bank of
11    Chicago, or  the  Federal  Reserve  Bank  of  St.  Louis,  as
12    determined by federal law.
13        "Bank"  means any person doing a banking business whether
14    subject to the laws of this or any other jurisdiction.
15        A "banking house", "branch",  "branch  bank"  or  "branch
16    office"  shall  mean any place of business of a bank at which
17    deposits are received, checks paid, or loans made, but  shall
18    not include any place at which only records thereof are made,
19    posted,  or  kept.  A place of business at which deposits are
20    received, checks paid, or loans made shall not be  deemed  to
21    be  a  branch,  branch bank, or branch office if the place of
22    business is adjacent to and connected with the  main  banking
23    premises,  or  if  it  is  separated  from  the  main banking
24    premises by not more than an alley; provided always that  (i)
25    if  the  place  of business is separated by an alley from the
26    main banking premises there is a connection between  the  two
27    by  public  or  private  way  or  by subterranean or overhead
28    passage, and (ii) if the place of business is in  a  building
29    not  wholly occupied by the bank, the place of business shall
30    not be within any office or room in which any other  business
31    or  service  of any kind or nature other than the business of
32    the bank is conducted or carried on. A place of  business  at
33    which deposits are received, checks paid, or loans made shall
34    not  be  deemed to be a branch, branch bank, or branch office
 
SB1784 Enrolled            -32-      LRB093 10148 BDD 11571 b
 1    (i) of any bank if the place is a  terminal  established  and
 2    maintained  in accordance with paragraph (17) of Section 5 of
 3    this Act, or (ii) of a  commonly  owned  bank  by  virtue  of
 4    transactions  conducted  at that place on behalf of the other
 5    commonly owned bank under paragraph (23) of Section 5 of this
 6    Act if the place is an affiliate facility with respect to the
 7    other bank.
 8        "Branch  of  an  out-of-state  bank"   means   a   branch
 9    established or maintained in Illinois by an out-of-state bank
10    as  a  result  of  a  merger between an Illinois bank and the
11    out-of-state bank that occurs on or after May  31,  1997,  or
12    any branch established by the out-of-state bank following the
13    merger.
14        "Bylaws"  means  the bylaws of a bank that are adopted by
15    the  bank's  board  of  directors  or  shareholders  for  the
16    regulation and management of the bank's affairs. If the  bank
17    operates  as  a  limited liability company, however, "bylaws"
18    means the operating agreement of the bank.
19        "Call report fee"  means  the  fee  to  be  paid  to  the
20    Commissioner  by each State bank pursuant to paragraph (a) of
21    subsection (3) of Section 48 of this Act.
22        "Capital" includes the aggregate of  outstanding  capital
23    stock and preferred stock.
24        "Cash  flow reserve account" means the account within the
25    books and records of  the  Commissioner  of  Banks  and  Real
26    Estate   used  to  record  funds  designated  to  maintain  a
27    reasonable Bank and Trust Company Fund operating  balance  to
28    meet agency obligations on a timely basis.
29        "Charter"   includes   the   original   charter  and  all
30    amendments thereto and articles of merger or consolidation.
31        "Commissioner" means the Commissioner of Banks  and  Real
32    Estate or a person authorized by the Commissioner, the Office
33    of  Banks  and  Real  Estate  Act,  or this Act to act in the
34    Commissioner's stead.
 
SB1784 Enrolled            -33-      LRB093 10148 BDD 11571 b
 1        "Commonly owned banks" means 2 or more  banks  that  each
 2    qualify as a bank subsidiary of the same bank holding company
 3    pursuant  to Section 18 of the Federal Deposit Insurance Act;
 4    "commonly owned bank" refers to one of a  group  of  commonly
 5    owned banks but only with respect to one or more of the other
 6    banks in the same group.
 7        "Community"  means  a city, village, or incorporated town
 8    and also includes the area served by the banking offices of a
 9    bank, but need not be limited or expanded to conform  to  the
10    geographic boundaries of units of local government.
11        "Company" means a corporation, limited liability company,
12    partnership,   business   trust,   association,   or  similar
13    organization and, unless specifically  excluded,  includes  a
14    "State bank" and a "bank".
15        "Consolidating bank" means a party to a consolidation.
16        "Consolidation"  takes  place  when 2 or more banks, or a
17    trust company and a bank, are extinguished and  by  the  same
18    process  a  new  bank  is created, taking over the assets and
19    assuming the  liabilities  of  the  banks  or  trust  company
20    passing out of existence.
21        "Continuing  bank"  means  a merging bank, the charter of
22    which becomes the charter of the resulting bank.
23        "Converting bank" means a State bank converting to become
24    a national bank, or a national bank converting  to  become  a
25    State bank.
26        "Converting   trust   company"   means  a  trust  company
27    converting to become a State bank.
28        "Court" means a court of competent jurisdiction.
29        "Director" means a member of the board of directors of  a
30    bank.  In  the  case  of  a manager-managed limited liability
31    company, however, "director" means a manager of the bank and,
32    in the case of a member-managed  limited  liability  company,
33    "director"  means  a  member of the bank. The term "director"
34    does not include an  advisory  director,  honorary  director,
 
SB1784 Enrolled            -34-      LRB093 10148 BDD 11571 b
 1    director  emeritus,  or  similar person, unless the person is
 2    otherwise performing functions similar to those of  a  member
 3    of the board of directors.
 4        "Eligible   depository   institution"  means  an  insured
 5    savings association that is in default,  an  insured  savings
 6    association that is in danger of default, a State or national
 7    bank  that  is in default or a State or national bank that is
 8    in danger of default, as those  terms  are  defined  in  this
 9    Section,  or a new bank as that term defined in Section 11(m)
10    of the Federal Deposit Insurance Act or a bridge bank as that
11    term is defined in  Section  11(n)  of  the  Federal  Deposit
12    Insurance Act or a new federal savings association authorized
13    under  Section  11(d)(2)(f)  of the Federal Deposit Insurance
14    Act.
15        "Fiduciary"    means    trustee,     agent,     executor,
16    administrator,  committee,  guardian  for  a  minor  or for a
17    person  under  legal   disability,   receiver,   trustee   in
18    bankruptcy,  assignee for creditors, or any holder of similar
19    position of trust.
20        "Financial institution" means a bank,  savings  and  loan
21    association, credit union, or any licensee under the Consumer
22    Installment Loan Act or the Sales Finance Agency Act and, for
23    purposes  of  Section  48.3,  any  proprietary network, funds
24    transfer corporation, or other  entity  providing  electronic
25    funds  transfer  services,  or  any  corporate fiduciary, its
26    subsidiaries,  affiliates,  parent  company,  or  contractual
27    service provider that is examined by the Commissioner.
28        "Foundation" means the Illinois Bank Examiners' Education
29    Foundation.
30        "General  obligation"  means  a  bond,  note,  debenture,
31    security, or other instrument evidencing an obligation of the
32    government entity that is the issuer that is supported by the
33    full available resources of the  issuer,  the  principal  and
34    interest of which is payable in whole or in part by taxation.
 
SB1784 Enrolled            -35-      LRB093 10148 BDD 11571 b
 1        "Guarantee" means an undertaking or promise to answer for
 2    payment  of  another's debt or performance of another's duty,
 3    liability, or  obligation  whether  "payment  guaranteed"  or
 4    "collection guaranteed".
 5        "In  danger of default" means a State or national bank, a
 6    federally  chartered  insured  savings  association   or   an
 7    Illinois  state  chartered  insured  savings association with
 8    respect to which the Commissioner or the appropriate  federal
 9    banking  agency  has  advised  the  Federal Deposit Insurance
10    Corporation that:
11             (1)  in the  opinion  of  the  Commissioner  or  the
12        appropriate federal banking agency,
13                  (A)  the  State  or  national  bank  or insured
14             savings association is not likely to be able to meet
15             the demands of  the  State  or  national  bank's  or
16             savings  association's  obligations  in  the  normal
17             course of business; and
18                  (B)  there  is  no reasonable prospect that the
19             State  or   national   bank   or   insured   savings
20             association  will  be  able to meet those demands or
21             pay those obligations without federal assistance; or
22             (2)  in the  opinion  of  the  Commissioner  or  the
23        appropriate federal banking agency,
24                  (A)  the  State  or  national  bank  or insured
25             savings association has incurred  or  is  likely  to
26             incur  losses that will deplete all or substantially
27             all of its capital; and
28                  (B)  there is no reasonable prospect  that  the
29             capital  of  the  State  or national bank or insured
30             savings  association  will  be  replenished  without
31             federal assistance.
32        "In default" means, with respect to a State  or  national
33    bank  or  an insured savings association, any adjudication or
34    other  official  determination  by  any  court  of  competent
 
SB1784 Enrolled            -36-      LRB093 10148 BDD 11571 b
 1    jurisdiction,  the  Commissioner,  the  appropriate   federal
 2    banking agency, or other public authority pursuant to which a
 3    conservator,  receiver, or other legal custodian is appointed
 4    for  a  State  or  national  bank  or  an   insured   savings
 5    association.
 6        "Insured  savings  association" means any federal savings
 7    association chartered under Section 5  of  the  federal  Home
 8    Owners'  Loan Act and any State savings association chartered
 9    under the  Illinois  Savings  and  Loan  Act  of  1985  or  a
10    predecessor  Illinois  statute,  the  deposits  of  which are
11    insured by the Federal Deposit  Insurance  Corporation.   The
12    term  also  includes  a  savings  bank organized or operating
13    under the Savings Bank Act.
14        "Insured  savings  association  in  recovery"  means   an
15    insured   savings   association   that  is  not  an  eligible
16    depository institution and that does  not  meet  the  minimum
17    capital  requirements  applicable with respect to the insured
18    savings association.
19        "Issuer" means for purposes of Section  33  every  person
20    who  shall  have  issued  or  proposed to issue any security;
21    except that (1) with  respect  to  certificates  of  deposit,
22    voting trust certificates, collateral-trust certificates, and
23    certificates  of  interest  or  shares  in  an unincorporated
24    investment trust not having a board of directors (or  persons
25    performing  similar  functions), "issuer" means the person or
26    persons performing  the  acts  and  assuming  the  duties  of
27    depositor or manager pursuant to the provisions of the trust,
28    agreement,  or  instrument  under  which  the  securities are
29    issued; (2) with respect to trusts other than those specified
30    in clause (1) above,  where  the  trustee  is  a  corporation
31    authorized  to  accept and execute trusts, "issuer" means the
32    entrusters, depositors, or creators  of  the  trust  and  any
33    manager  or  committee  charged with the general direction of
34    the affairs of the trust pursuant to the  provisions  of  the
 
SB1784 Enrolled            -37-      LRB093 10148 BDD 11571 b
 1    agreement  or  instrument  creating  the  trust; and (3) with
 2    respect to equipment trust certificates or  like  securities,
 3    "issuer"  means  the person to whom the equipment or property
 4    is or is to be leased or conditionally sold.
 5        "Letter of credit" and "customer" shall have the meanings
 6    ascribed to those terms  in  Section  5-102  of  the  Uniform
 7    Commercial Code.
 8        "Main  banking  premises"  means  the  location  that  is
 9    designated in a bank's charter as its main office.
10        "Maker  or  obligor" means for purposes of Section 33 the
11    issuer of a security, the promisor in a  debenture  or  other
12    debt security, or the mortgagor or grantor of a trust deed or
13    similar conveyance of a security interest in real or personal
14    property.
15        "Merged  bank"  means  a  merging  bank  that  is not the
16    continuing, resulting, or surviving bank in  a  consolidation
17    or merger.
18        "Merger" includes consolidation.
19        "Merging bank" means a party to a bank merger.
20        "Merging  trust company" means a trust company party to a
21    merger with a State bank.
22        "Mid-tier bank holding company" means a corporation  that
23    (a)  owns  100%  of the issued and outstanding shares of each
24    class  of  stock  of  a  State  bank,  (b)   has   no   other
25    subsidiaries,  and  (c)  100%  of  the issued and outstanding
26    shares of the corporation are owned by a parent bank  holding
27    company.
28        "Municipality"    means   any   municipality,   political
29    subdivision, school district, taxing district, or agency.
30        "National bank"  means  a  national  banking  association
31    located  in  this  State  and  after  May  31,  1997, means a
32    national banking association without regard to its location.
33        "Out-of-state bank" means a bank chartered under the laws
34    of a state other than Illinois, a  territory  of  the  United
 
SB1784 Enrolled            -38-      LRB093 10148 BDD 11571 b
 1    States, or the District of Columbia.
 2        "Parent bank holding company" means a corporation that is
 3    a  bank  holding  company  as  that  term  is  defined in the
 4    Illinois Bank Holding Company Act of 1957 and  owns  100%  of
 5    the  issued and outstanding shares of a mid-tier bank holding
 6    company.
 7        "Person"  means  an  individual,   corporation,   limited
 8    liability company, partnership, joint venture, trust, estate,
 9    or unincorporated association.
10        "Public  agency" means the State of Illinois, the various
11    counties,  townships,   cities,   towns,   villages,   school
12    districts,   educational   service   regions,   special  road
13    districts, public water  supply  districts,  fire  protection
14    districts,   drainage   districts,   levee  districts,  sewer
15    districts, housing authorities, the Illinois Bank  Examiners'
16    Education  Foundation,  the  Chicago  Park  District, and all
17    other political corporations or subdivisions of the State  of
18    Illinois,  whether  now  or hereafter created, whether herein
19    specifically mentioned or not, and  shall  also  include  any
20    other  state  or  any political corporation or subdivision of
21    another state.
22        "Public funds" or "public money" means current  operating
23    funds,  special  funds, interest and sinking funds, and funds
24    of any kind or character belonging to, in the custody of,  or
25    subject  to the control or regulation of the United States or
26    a public agency.  "Public  funds"  or  "public  money"  shall
27    include  funds  held  by  any  of  the  officers,  agents, or
28    employees of the United States or of a public agency  in  the
29    course  of  their official duties and, with respect to public
30    money of the United  States,  shall  include  Postal  Savings
31    funds.
32        "Published" means, unless the context requires otherwise,
33    the  publishing  of  the  notice or instrument referred to in
34    some newspaper of general circulation  in  the  community  in
 
SB1784 Enrolled            -39-      LRB093 10148 BDD 11571 b
 1    which  the  bank  is  located  at  least once each week for 3
 2    successive weeks.  Publishing shall be accomplished  by,  and
 3    at  the  expense  of,  the  bank  required to publish.  Where
 4    publishing  is  required,  the  bank  shall  submit  to   the
 5    Commissioner   that   evidence  of  the  publication  as  the
 6    Commissioner shall deem appropriate.
 7        "Qualified  financial  contract"   means   any   security
 8    contract,  commodity  contract,  forward  contract, including
 9    spot  and  forward  foreign  exchange  contracts,  repurchase
10    agreement, swap agreement, and  any  similar  agreement,  any
11    option  to  enter  into  any  such  agreement,  including any
12    combination of the foregoing, and any  master  agreement  for
13    such  agreements.  A  master  agreement,  together  with  all
14    supplements  thereto,  shall  be  treated  as  one  qualified
15    financial  contract.   The  contract,  option,  agreement, or
16    combination of contracts, options,  or  agreements  shall  be
17    reflected  upon  the books, accounts, or records of the bank,
18    or a party to the contract shall provide documentary evidence
19    of such agreement.
20        "Recorded" means the filing or recording of the notice or
21    instrument referred to in the office of the Recorder  of  the
22    county wherein the bank is located.
23        "Resulting  bank"  means the bank resulting from a merger
24    or conversion.
25        "Securities" means stocks, bonds, debentures,  notes,  or
26    other similar obligations.
27        "Stand-by  letter  of  credit"  means  a letter of credit
28    under  which  drafts  are  payable  upon  the  condition  the
29    customer has defaulted in performance of a  duty,  liability,
30    or obligation.
31        "State  bank"  means  any  banking corporation that has a
32    banking charter issued by the Commissioner under this Act.
33        "State Banking Board" means the State  Banking  Board  of
34    Illinois.
 
SB1784 Enrolled            -40-      LRB093 10148 BDD 11571 b
 1        "Subsidiary"  with respect to a specified company means a
 2    company that is controlled by  the  specified  company.   For
 3    purposes of paragraphs (8) and (12) of Section 5 of this Act,
 4    "control"  means  the  exercise  of operational or managerial
 5    control of  a  corporation  by  the  bank,  either  alone  or
 6    together with other affiliates of the bank.
 7        "Surplus"  means  the  aggregate  of  (i) amounts paid in
 8    excess of the par value of capital stock and preferred stock;
 9    (ii) amounts contributed other than  for  capital  stock  and
10    preferred  stock  and  allocated  to the surplus account; and
11    (iii) amounts transferred from undivided profits.
12        "Tier 1 Capital" and "Tier 2 Capital" have  the  meanings
13    assigned  to  those  terms in regulations promulgated for the
14    appropriate federal banking agency of a state bank, as  those
15    regulations are now or hereafter amended.
16        "Trust  company"  means  a  limited  liability company or
17    corporation incorporated in this State  for  the  purpose  of
18    accepting and executing trusts.
19        "Undivided  profits"  means  undistributed  earnings less
20    discretionary transfers to surplus.
21        "Unimpaired capital  and  unimpaired  surplus",  for  the
22    purposes  of paragraph (21) of Section 5 and Sections 32, 33,
23    34, 35.1, 35.2, and 47 of this Act means the sum of the state
24    bank's Tier 1 Capital and Tier  2  Capital  plus  such  other
25    shareholder  equity  as  may be included by regulation of the
26    Commissioner.   Unimpaired  capital  and  unimpaired  surplus
27    shall be calculated on the basis of  the  date  of  the  last
28    quarterly  call  report filed with the Commissioner preceding
29    the date of the transaction  for  which  the  calculation  is
30    made,  provided  that: (i) when a material event occurs after
31    the date of the last quarterly call  report  filed  with  the
32    Commissioner  that reduces or increases the bank's unimpaired
33    capital and unimpaired surplus  by  10%  or  more,  then  the
34    unimpaired capital and unimpaired surplus shall be calculated
 
SB1784 Enrolled            -41-      LRB093 10148 BDD 11571 b
 1    from  the  date  of  the  material  event  for  a transaction
 2    conducted after the date of the material event; and  (ii)  if
 3    the  Commissioner determines for safety and soundness reasons
 4    that a state bank should  calculate  unimpaired  capital  and
 5    unimpaired  surplus  more  frequently  than  provided by this
 6    paragraph, the Commissioner may by written notice direct  the
 7    bank  to  calculate unimpaired capital and unimpaired surplus
 8    at a more frequent interval.  In the case  of  a  state  bank
 9    newly  chartered  under  Section 13 or a state bank resulting
10    from a merger, consolidation, or conversion under Sections 21
11    through 26 for which no preceding quarterly call  report  has
12    been  filed  with  the  Commissioner,  unimpaired capital and
13    unimpaired surplus shall be calculated for the first calendar
14    quarter on the basis of the effective date  of  the  charter,
15    merger, consolidation, or conversion.
16    (Source: P.A. 92-483, eff. 8-23-01.)

17        (205 ILCS 5/5) (from Ch. 17, par. 311)
18        Sec.  5.  General  corporate  powers.   A  bank organized
19    under this Act or subject hereto shall be  a  body  corporate
20    and  politic  and  shall, without specific mention thereof in
21    the charter, have all the powers conferred by  this  Act  and
22    the following additional general corporate powers:
23        (1)  To  sue  and  be  sued,  complain, and defend in its
24    corporate name.
25        (2)  To have a corporate seal, which may  be  altered  at
26    pleasure,  and  to  use the same by causing it or a facsimile
27    thereof  to  be  impressed  or  affixed  or  in  any   manner
28    reproduced, provided that the affixing of a corporate seal to
29    an  instrument shall not give the instrument additional force
30    or effect, or change the construction thereof, and the use of
31    a corporate seal is not mandatory.
32        (3)  To  make,  alter,  amend,  and  repeal  bylaws,  not
33    inconsistent  with  its  charter  or  with   law,   for   the
 
SB1784 Enrolled            -42-      LRB093 10148 BDD 11571 b
 1    administration  of  the affairs of the bank. If this Act does
 2    not  provide  specific  guidance  in  matters  of   corporate
 3    governance, the provisions of the Business Corporation Act of
 4    1983  may  be  used  if so provided in the bylaws, and if the
 5    bank is a limited liability company, the  provisions  of  the
 6    Limited Liability Company Act shall be used.
 7        (4)  To  elect  or appoint and remove officers and agents
 8    of  the  bank  and  define  their  duties   and   fix   their
 9    compensation.
10        (5)  To   adopt   and  operate  reasonable  bonus  plans,
11    profit-sharing plans, stock-bonus plans, stock-option  plans,
12    pension  plans and similar incentive plans for its directors,
13    officers and employees.
14        (5.1)  To manage, operate and administer a fund  for  the
15    investment of funds by a public agency or agencies, including
16    any  unit  of  local  government  or  school district, or any
17    person.  The fund for a public agency  shall  invest  in  the
18    same   type  of  investments  and  be  subject  to  the  same
19    limitations provided for the investment of public funds.  The
20    fund for public agencies shall  maintain  a  separate  ledger
21    showing  the  amount  of investment for each public agency in
22    the fund. "Public funds" and "public agency" as used in  this
23    Section shall have the meanings ascribed to them in Section 1
24    of the Public Funds Investment Act.
25        (6)  To  make reasonable donations for the public welfare
26    or  for  charitable,  scientific,  religious  or  educational
27    purposes.
28        (7)  To borrow or incur an obligation; and to pledge  its
29    assets:
30             (a)  to secure its borrowings, its lease of personal
31        or real property or its other nondeposit obligations;
32             (b)  to  enable  it  to act as agent for the sale of
33        obligations of the United States;
34             (c)  to secure  deposits  of  public  money  of  the
 
SB1784 Enrolled            -43-      LRB093 10148 BDD 11571 b
 1        United  States,  whenever  required  by  the  laws of the
 2        United  States,  including  without  being  limited   to,
 3        revenues and funds the deposit of which is subject to the
 4        control  or regulation of the United States or any of its
 5        officers, agents, or employees and Postal Savings funds;
 6             (d)  to secure deposits of public money of any state
 7        or of any political corporation  or  subdivision  thereof
 8        including,  without  being limited to, revenues and funds
 9        the deposit  of  which  is  subject  to  the  control  or
10        regulation  of  any state or of any political corporation
11        or subdivisions thereof or  of  any  of  their  officers,
12        agents, or employees;
13             (e)  to  secure  deposits of money whenever required
14        by the National Bankruptcy Act;
15             (f)  (blank); and
16             (g)  to  secure  trust  funds  commingled  with  the
17        bank's  funds,  whether  deposited  by  the  bank  or  an
18        affiliate of the bank, pursuant to  Section  2-8  of  the
19        Corporate Fiduciary Act.
20        (8)  To  own, possess, and carry as assets all or part of
21    the real estate necessary in or with which to do its  banking
22    business, either directly or indirectly through the ownership
23    of  all  or part of the capital stock, shares or interests in
24    any corporation, association, trust engaged  in  holding  any
25    part  or  parts  or all of the bank premises, engaged in such
26    business and in conducting a safe  deposit  business  in  the
27    premises or part of them, or engaged in any activity that the
28    bank  is  permitted  to  conduct  in a subsidiary pursuant to
29    paragraph (12) of this Section 5.
30        (9)  To own, possess, and  carry  as  assets  other  real
31    estate  to which it may obtain title in the collection of its
32    debts or that was  formerly  used  as  a  part  of  the  bank
33    premises,  but  title  to  any  real  estate except as herein
34    permitted shall not be retained by the bank, either  directly
 
SB1784 Enrolled            -44-      LRB093 10148 BDD 11571 b
 1    or  by  or  through  a subsidiary, as permitted by subsection
 2    (12) of this Section for a total period of more than 10 years
 3    after acquiring title, either directly or indirectly.
 4        (10)  To do any act, including the acquisition of  stock,
 5    necessary  to  obtain  insurance  of  its  deposits,  or part
 6    thereof, and any act necessary to obtain a guaranty, in whole
 7    or in part, of any of its loans or investments by the  United
 8    States  or  any agency thereof, and any act necessary to sell
 9    or otherwise dispose of any of its loans  or  investments  to
10    the  United  States or any agency thereof, and to acquire and
11    hold membership in the Federal Reserve System.
12        (11)  Notwithstanding any other provisions of this Act or
13    any other law, to do any act and to own, possess,  and  carry
14    as assets property of the character, including stock, that is
15    at  the  time authorized or permitted to national banks by an
16    Act of Congress, but subject always to the  same  limitations
17    and  restrictions  as are applicable to national banks by the
18    pertinent federal law and subject to applicable provisions of
19    the Financial Institutions Insurance Sales Law.
20        (12)  To own, possess, and carry as assets stock  of  one
21    or  more corporations that is, or are, engaged in one or more
22    of the following businesses:
23             (a)  holding  title  to  and  administering   assets
24        acquired  as a result of the collection or liquidating of
25        loans, investments, or discounts; or
26             (b)  holding title  to  and  administering  personal
27        property  acquired  by  the  bank, directly or indirectly
28        through a subsidiary,  for  the  purpose  of  leasing  to
29        others,  provided  the lease or leases and the investment
30        of the bank, directly or through a  subsidiary,  in  that
31        personal  property  otherwise comply with Section 35.1 of
32        this Act; or
33             (c)  carrying  on  or  administering  any   of   the
34        activities  excepting  the  receipt  of  deposits  or the
 
SB1784 Enrolled            -45-      LRB093 10148 BDD 11571 b
 1        payment of checks or other  orders  for  the  payment  of
 2        money  in  which  a  bank  may  engage in carrying on its
 3        general banking business; provided, however, that nothing
 4        contained in this paragraph (c) shall be deemed to permit
 5        a bank organized under this Act or subject hereto to  do,
 6        either directly or indirectly through any subsidiary, any
 7        act,  including  the making of any loan or investment, or
 8        to own, possess, or carry as assets any property that  if
 9        done by or owned, possessed, or carried by the State bank
10        would  be  in violation of or prohibited by any provision
11        of this Act.
12        The provisions of this subsection (12) shall not apply to
13    and shall not be deemed to limit the powers of a  State  bank
14    with  respect  to  the ownership, possession, and carrying of
15    stock that a State bank is  permitted  to  own,  possess,  or
16    carry under this Act.
17        Any  bank  intending to establish a subsidiary under this
18    subsection (12) shall give written notice to the Commissioner
19    60 days prior to the subsidiary's commencing of business  or,
20    as the case may be, prior to acquiring stock in a corporation
21    that  has  already  commenced  business.  After receiving the
22    notice, the Commissioner may waive or reduce the  balance  of
23    the  60  day notice period.  The Commissioner may specify the
24    form of the notice and may promulgate rules  and  regulations
25    to administer this subsection (12).
26        (13)  To   accept  for  payment  at  a  future  date  not
27    exceeding one year from the date of acceptance, drafts  drawn
28    upon  it  by  its customers; and to issue, advise, or confirm
29    letters of credit authorizing the  holders  thereof  to  draw
30    drafts upon it or its correspondents.
31        (14)  To  own and lease personal property acquired by the
32    bank at the request of a  prospective  lessee  and  upon  the
33    agreement  of  that  person  to  lease  the personal property
34    provided that the lease, the agreement with respect  thereto,
 
SB1784 Enrolled            -46-      LRB093 10148 BDD 11571 b
 1    and  the amount of the investment of the bank in the property
 2    comply with Section 35.1 of this Act.
 3        (15) (a)  To establish and maintain, in addition  to  the
 4        main  banking  premises,  branches  offering  any banking
 5        services permitted at the  main  banking  premises  of  a
 6        State bank.
 7             (b)  To  establish and maintain, after May 31, 1997,
 8        branches in another state that may conduct  any  activity
 9        in  that  state  that  is authorized or permitted for any
10        bank that has a banking charter  issued  by  that  state,
11        subject to the same limitations and restrictions that are
12        applicable to banks chartered by that state.
13        (16)  (Blank).
14        (17)  To  establish and maintain terminals, as authorized
15    by the Electronic Fund Transfer Act.
16        (18)  To establish and maintain temporary service  booths
17    at  any  International  Fair  held  in  this  State  which is
18    approved by the United States Department of Commerce, for the
19    duration of the international fair for the  sole  purpose  of
20    providing  a  convenient place for foreign trade customers at
21    the fair to exchange  their  home  countries'  currency  into
22    United  States currency or the converse. This power shall not
23    be construed  as  establishing  a  new  place  or  change  of
24    location for the bank providing the service booth.
25        (19)  To  indemnify  its  officers, directors, employees,
26    and agents, as authorized for corporations under Section 8.75
27    of the Business Corporation Act of 1983.
28        (20)  To own, possess, and carry as assets stock  of,  or
29    be  or  become  a member of, any corporation, mutual company,
30    association, trust, or other entity  formed  exclusively  for
31    the  purpose  of providing directors' and officers' liability
32    and bankers' blanket bond insurance or reinsurance to and for
33    the benefit of the stockholders, members,  or  beneficiaries,
34    or  their assets or businesses, or their officers, directors,
 
SB1784 Enrolled            -47-      LRB093 10148 BDD 11571 b
 1    employees, or agents, and not to or for the  benefit  of  any
 2    other person or entity or the public generally.
 3        (21)  To  make debt or equity investments in corporations
 4    or projects, whether for profit or not for  profit,  designed
 5    to  promote the development of the community and its welfare,
 6    provided that  the  aggregate  investment  in  all  of  these
 7    corporations and in all of these projects does not exceed 10%
 8    of  the unimpaired capital and unimpaired surplus of the bank
 9    and  provided  that  this  limitation  shall  not  apply   to
10    creditworthy  loans  by  the  bank  to  those corporations or
11    projects.  Upon written application to  the  Commissioner,  a
12    bank  may make an investment that would, when aggregated with
13    all other such investments,  exceed  10%  of  the  unimpaired
14    capital  and unimpaired surplus of the bank. The Commissioner
15    may approve the investment if he is of the opinion and  finds
16    that the proposed investment will not have a material adverse
17    effect on the safety and soundness of the bank.
18        (22)  To own, possess, and carry as assets the stock of a
19    corporation engaged in the ownership or operation of a travel
20    agency  or  to  operate  a  travel  agency  as  a part of its
21    business.
22        (23)  With respect to affiliate facilities:
23             (a)  to conduct at affiliate facilities for  and  on
24        behalf  of  another commonly owned bank, if so authorized
25        by the other bank, all transactions that the  other  bank
26        is authorized or permitted to perform; and
27             (b)  to  authorize  a commonly owned bank to conduct
28        for and on behalf of it any of  the  transactions  it  is
29        authorized  or  permitted  to  perform  at  one  or  more
30        affiliate facilities.
31        Any  bank intending to conduct or to authorize a commonly
32    owned bank to conduct at an affiliate  facility  any  of  the
33    transactions  specified  in  this  paragraph  (23) shall give
34    written notice to the Commissioner at least  30  days  before
 
SB1784 Enrolled            -48-      LRB093 10148 BDD 11571 b
 1    any such transaction is conducted at the affiliate facility.
 2        (24)  To  act  as  the agent for any fire, life, or other
 3    insurance company authorized by the  State  of  Illinois,  by
 4    soliciting  and  selling insurance and collecting premiums on
 5    policies issued by such company; and to receive for  services
 6    so  rendered  such  fees or commissions as may be agreed upon
 7    between the bank and the insurance company for which  it  may
 8    act  as  agent; provided, however, that no such bank shall in
 9    any case assume or guarantee the payment of  any  premium  on
10    insurance   policies   issued   through  its  agency  by  its
11    principal; and provided further,  that  the  bank  shall  not
12    guarantee  the  truth  of any statement made by an assured in
13    filing his application for insurance.
14        (25)  Notwithstanding any other provisions of this Act or
15    any other law, to offer any product or service that is at the
16    time  authorized  or  permitted  to   any   insured   savings
17    association  or out-of-state bank by applicable law, provided
18    that powers conferred only by this subsection (25):
19             (a)  shall always be subject to the same limitations
20        and restrictions  that  are  applicable  to  the  insured
21        savings  association or out-of-state bank for the product
22        or service by such applicable law;
23             (b)  shall be subject to  applicable  provisions  of
24        the Financial Institutions Insurance Sales Law;
25             (c)  shall not include the right to own or conduct a
26        real  estate brokerage business for which a license would
27        be required under the laws of this State; and
28             (d)  shall  not  be   construed   to   include   the
29        establishment  or maintenance of a branch, nor shall they
30        be construed to limit the establishment or maintenance of
31        a branch pursuant to subsection (11).
32        Not less than 30 days before  engaging  in  any  activity
33    under  the authority of this subsection, a bank shall provide
34    written notice to the Commissioner of its intent to engage in
 
SB1784 Enrolled            -49-      LRB093 10148 BDD 11571 b
 1    the activity.  The notice shall indicate the specific federal
 2    or state law, rule, regulation, or  interpretation  the  bank
 3    intends to use as authority to engage in the activity.
 4    (Source: P.A.  91-330,  eff.  7-29-99;  91-849, eff. 6-22-00;
 5    92-483, eff. 8-23-01; 92-811, eff. 8-21-02.)

 6        (205 ILCS 5/13.6 new)
 7        Sec. 13.6. Banks as limited liability companies.
 8        (a) A bank  may  be  organized  as  a  limited  liability
 9    company,  may  convert to a limited liability company, or may
10    merge with and into a limited  liability  company  under  the
11    applicable  laws  of  this  State  and  of the United States,
12    including any rules promulgated thereunder. A bank  organized
13    as  a  limited  liability  company  shall  be  subject to the
14    provisions of the Limited Liability Company Act  in  addition
15    to  this  Act,  provided  that  if a provision of the Limited
16    Liability Company Act conflicts with a provision of this  Act
17    or  with  any rule of the Commissioner, the provision of this
18    Act or the rule of the Commissioner shall apply.
19        (b) Any filing required to  be  made  under  the  Limited
20    Liability  Company  Act  shall  be  made exclusively with the
21    Commissioner,  and  the  Commissioner   shall   possess   the
22    exclusive  authority to regulate the bank as provided in this
23    Act.
24        (c) Any organization as, conversion to, and  merger  with
25    or  into  a limited liability company shall be subject to the
26    prior approval of the Commissioner.
27        (d) A bank that is a limited liability company  shall  be
28    subject  to  all  of  the  provisions of this Act in the same
29    manner as a bank that is organized in stock form.
30        (e) The Commissioner may promulgate rules to ensure  that
31    a  bank  that is a limited liability company (i) is operating
32    in a safe and  sound  manner  and  (ii)  is  subject  to  the
33    Commissioner's authority in the same manner as a bank that is
 
SB1784 Enrolled            -50-      LRB093 10148 BDD 11571 b
 1    organized in stock form.

 2        (205 ILCS 5/17) (from Ch. 17, par. 324)
 3        Sec. 17.  Changes in charter.
 4        (a)  By  compliance  with  the  provisions  of this Act a
 5    State bank may:
 6             (1)  (blank);
 7             (2)  increase, decrease or change its capital stock,
 8        whether issued or unissued,  provided  that  in  no  case
 9        shall  the  capital be diminished to the prejudice of its
10        creditors;
11             (3)  provide for  authorized  but  unissued  capital
12        stock  reserved  for  issuance  for  one  or  more of the
13        purposes provided for in subsection  (5)  of  Section  14
14        hereof;
15             (4)  authorize   preferred   stock,   or   increase,
16        decrease   or  change  the  preferences,  qualifications,
17        limitations, restrictions or special or  relative  rights
18        of  its  preferred  stock, whether issued or unissued, or
19        delegate authority to its board of directors as  provided
20        in  subsection  (d),  provided  that in no case shall the
21        capital be diminished to the prejudice of its creditors;
22             (5)  increase, decrease or change the par  value  of
23        its  shares  of  its  capital  stock  or preferred stock,
24        whether issued or unissued, or delegate authority to  its
25        board of directors as provided in subsection (d);
26             (6)  (blank);
27             (7)  eliminate cumulative voting rights under all or
28        specified   circumstances,  or  eliminate  voting  rights
29        entirely, as to any class or classes or series  of  stock
30        of  the  bank  pursuant  to  paragraph (3) of Section 15,
31        provided that one class of shares or series thereof shall
32        always have voting in respect to all matters in the bank,
33        and provided further that the proposal to eliminate  such
 
SB1784 Enrolled            -51-      LRB093 10148 BDD 11571 b
 1        voting rights receives the approval of the holders of 70%
 2        of  the  outstanding  shares of stock entitled to vote as
 3        provided in paragraph  (7)  of  subsection  (b)  of  this
 4        Section 17;
 5             (8)  increase, decrease, or change its capital stock
 6        or  preferred  stock, whether issued or unissued, for the
 7        purpose of eliminating fractional shares or avoiding  the
 8        issuance  of  fractional shares, provided that in no case
 9        shall the capital be diminished to the prejudice  of  its
10        creditors; or
11             (9)  make such other change in its charter as may be
12        authorized in this Act.
13        (b)  To  effect  a  change  or  changes in a State bank's
14    charter as provided for in this Section 17:
15             (1)  The board of directors shall adopt a resolution
16        setting forth the proposed amendment and  directing  that
17        it  be  submitted to a vote at a meeting of stockholders,
18        which may be either an annual or special meeting.
19             (2)  If the meeting is a special meeting, written or
20        printed notice setting forth the  proposed  amendment  or
21        summary  thereof  shall  be  given to each stockholder of
22        record entitled to vote at such meeting at least 30  days
23        before  such  meeting  and in the manner provided in this
24        Act for the giving of notice of meetings of stockholders.
25             (3)  At  such  special  meeting,  a  vote   of   the
26        stockholders  entitled  to  vote  shall  be  taken on the
27        proposed amendment.  Except as provided in paragraph  (7)
28        of  this  subsection (b), the proposed amendment shall be
29        adopted  upon  receiving  the  affirmative  vote  of  the
30        holders of at least two-thirds of the outstanding  shares
31        of stock entitled to vote at such meeting, unless holders
32        of  preferred  stock  are  entitled to vote as a class in
33        respect thereof, in which event  the  proposed  amendment
34        shall  be  adopted upon receiving the affirmative vote of
 
SB1784 Enrolled            -52-      LRB093 10148 BDD 11571 b
 1        the holders of at least  two-thirds  of  the  outstanding
 2        shares  of  each  class  of  shares entitled to vote as a
 3        class in respect thereof and  of  the  total  outstanding
 4        shares  entitled  to vote at such meeting.  Any number of
 5        amendments may be submitted to the stockholders and voted
 6        upon by them  at  one  meeting.   A  certificate  of  the
 7        amendment, or amendments, verified by the president, or a
 8        vice-president,   or   the   cashier,   shall   be  filed
 9        immediately in the office of the Commissioner.
10             (4)  At any annual meeting without a  resolution  of
11        the  board  of  directors  and without a notice and prior
12        publication, as hereinabove provided, a proposition for a
13        change in the bank's charter  as  provided  for  in  this
14        Section 17 may be submitted to a vote of the stockholders
15        entitled  to  vote  at the annual meeting, except that no
16        proposition for authorized  but  unissued  capital  stock
17        reserved  for  issuance  for  one or more of the purposes
18        provided for in subsection (5) of Section 14 hereof shall
19        be submitted without complying  with  the  provisions  of
20        said subsection.  The proposed amendment shall be adopted
21        upon  receiving the affirmative vote of the holders of at
22        least two-thirds  of  the  outstanding  shares  of  stock
23        entitled  to  vote  at  such  meeting,  unless holders of
24        preferred stock are  entitled  to  vote  as  a  class  in
25        respect  thereof,  in  which event the proposed amendment
26        shall be adopted upon receiving the affirmative  vote  of
27        the  holders  of  at  least two-thirds of the outstanding
28        shares of each class of shares  entitled  to  vote  as  a
29        class in respect thereof and the total outstanding shares
30        entitled  to  vote at such meeting.  A certificate of the
31        amendment, or amendments, verified by the president, or a
32        vice-president or cashier, shall be filed immediately  in
33        the office of the Commissioner.
34             (5)  If an amendment or amendments shall be approved
 
SB1784 Enrolled            -53-      LRB093 10148 BDD 11571 b
 1        in   writing   by  the  Commissioner,  the  amendment  or
 2        amendments  so  adopted  and   so   approved   shall   be
 3        accomplished   in   accordance   with  the  vote  of  the
 4        stockholders.  The Commissioner may impose such terms and
 5        conditions on the approval of the amendment or amendments
 6        as he deems necessary or appropriate.   The  Commissioner
 7        shall revoke such approval in the event such amendment or
 8        amendments are not effected within one year from the date
 9        of  the  issuance  of  the Commissioner's certificate and
10        written approval except for transactions permitted  under
11        subsection (5) of Section 14 of this Act.
12             (6)  No  amendment  or amendments shall affect suits
13        in which the bank  is  a  party,  nor  affect  causes  of
14        action,  nor  affect rights of persons in any particular,
15        nor shall actions brought against such bank by its former
16        name be abated by a change of name.
17             (7)  A proposal to amend the  charter  to  eliminate
18        cumulative   voting   rights   under   all  or  specified
19        circumstances, or to eliminate voting rights entirely, as
20        to any class or classes or series or  stock  of  a  bank,
21        pursuant to paragraph (3) of Section 15 and paragraph (7)
22        of  subsection  (a)  of this Section 17, shall be adopted
23        only upon such proposal receiving  the  approval  of  the
24        holders  of  70%  of  the  outstanding  shares  of  stock
25        entitled  to  vote  at  the meeting where the proposal is
26        presented for approval, unless holders of preferred stock
27        are entitled to vote as a class in  respect  thereof,  in
28        which  event the proposed amendment shall be adopted upon
29        receiving the approval of  the  holders  of  70%  of  the
30        outstanding  shares  of  each class of shares entitled to
31        vote as a class in  respect  thereof  and  of  the  total
32        outstanding  shares entitled to vote at the meeting where
33        the proposal is presented for approval.  The proposal  to
34        amend  the  charter pursuant to this paragraph (7) may be
 
SB1784 Enrolled            -54-      LRB093 10148 BDD 11571 b
 1        voted upon at the annual meeting or a special meeting.
 2             (8)  Written or printed notice  of  a  stockholders'
 3        meeting  to  vote  on a proposal to increase, decrease or
 4        change the capital stock or preferred stock  pursuant  to
 5        paragraph (8) of subsection (a) of this Section 17 and to
 6        eliminate  fractional  shares  or  avoid  the issuance of
 7        fractional shares shall be given to each  stockholder  of
 8        record  entitled  to vote at the meeting at least 30 days
 9        before the meeting and in the manner provided in this Act
10        for the giving of notice of meetings of stockholders, and
11        shall include all of the following information:
12                  (A)  A statement of the purpose of the proposed
13             reverse stock split.
14                  (B)  A statement of the amount of consideration
15             being offered for the bank's stock.
16                  (C)  A statement that the  bank  considers  the
17             transaction   fair   to   the  stockholders,  and  a
18             statement of the  material  facts  upon  which  this
19             belief is based.
20                  (D)  A  statement  that the bank has secured an
21             opinion from a  third  party  with  respect  to  the
22             fairness,  from  a  financial  point of view, of the
23             consideration  to  be   paid,   the   identity   and
24             qualifications  of  the  third  party, how the third
25             party was selected, and  any  material  relationship
26             between the third party and the bank.
27                  (E)  A  summary  of  the  opinion including the
28             basis  for  and  the  methods  of  arriving  at  the
29             findings and any limitation imposed by the  bank  in
30             arriving  at  fair  value and a statement making the
31             opinion available for reviewing or  copying  by  any
32             stockholder.
33                  (F)  A  statement  that  objecting stockholders
34             will be entitled to the fair value of  those  shares
 
SB1784 Enrolled            -55-      LRB093 10148 BDD 11571 b
 1             that  are  voted against the charter amendment, if a
 2             proper  demand  is  made  on  the   bank   and   the
 3             requirements  are  satisfied  as  specified  in this
 4             Section.
 5    If a stockholder shall file with the bank, prior to or at the
 6    meeting  of  stockholders  at  which  the  proposed   charter
 7    amendment  is submitted to a vote, a written objection to the
 8    proposed charter  amendment  and  shall  not  vote  in  favor
 9    thereof,  and  if  the  stockholder,  within  20  days  after
10    receiving  written  notice  of the date the charter amendment
11    was accomplished pursuant to paragraph (5) of subsection  (a)
12    of this Section 17, shall make written demand on the bank for
13    payment  of  the fair value of the stockholder's shares as of
14    the day prior to  the  date  on  which  the  vote  was  taken
15    approving  the  charter  amendment, the bank shall pay to the
16    stockholder,   upon   surrender   of   the   certificate   or
17    certificates representing the stock, the fair value  thereof.
18    The  demand  shall  state  the  number of shares owned by the
19    objecting stockholder.  The bank shall provide written notice
20    of the date on which the charter amendment  was  accomplished
21    to  all  stockholders  who  have  filed written objections in
22    order that the objecting stockholders may know when they must
23    file written demand if they choose to do so.  Any stockholder
24    failing to make demand within  the  20-day  period  shall  be
25    conclusively  presumed  to  have  consented  to  the  charter
26    amendment and shall be bound by the terms thereof.  If within
27    30  days  after  the  date  on  which a charter amendment was
28    accomplished the value of the shares is agreed  upon  between
29    the  objecting  stockholders  and  the bank, payment therefor
30    shall be made within 90 days after  the  date  on  which  the
31    charter amendment was accomplished, upon the surrender of the
32    stockholder's  certificate  or  certificates representing the
33    shares. Upon  payment  of  the  agreed  value  the  objecting
34    stockholder shall cease to have any interest in the shares or
 
SB1784 Enrolled            -56-      LRB093 10148 BDD 11571 b
 1    in   the  bank.   If  within  such  period  of  30  days  the
 2    stockholder and the bank do not so agree, then the  objecting
 3    stockholder  may,  within 60 days after the expiration of the
 4    30-day period, file a complaint in the circuit  court  asking
 5    for  a  finding  and  determination  of the fair value of the
 6    shares, and shall be entitled to judgment  against  the  bank
 7    for  the  amount of the fair value as of the day prior to the
 8    date on which  the  vote  was  taken  approving  the  charter
 9    amendment  with interest thereon to the date of the judgment.
10    The practice, procedure and judgment shall be governed by the
11    Civil Practice Law. The judgment shall be payable  only  upon
12    and  simultaneously  with  the  surrender  to the bank of the
13    certificate or certificates representing  the  shares.   Upon
14    payment  of  the  judgment,  the  objecting stockholder shall
15    cease to have any interest in the shares or  the  bank.   The
16    shares  may  be held and disposed of by the bank.  Unless the
17    objecting stockholder shall file such  complaint  within  the
18    time herein limited, the stockholder and all persons claiming
19    under  the stockholder shall be conclusively presumed to have
20    approved and ratified the charter  amendment,  and  shall  be
21    bound  by  the  terms  thereof.  The  right  of  an objecting
22    stockholder to be paid the fair value  of  the  stockholder's
23    shares  of  stock  as herein provided shall cease if and when
24    the bank shall abandon the charter amendment.
25        (c)  The  purchase  and  holding  and  later  resale   of
26    treasury  stock of a state bank pursuant to the provisions of
27    subsection (6) of Section 14 may be  accomplished  without  a
28    change  in its charter reflecting any decrease or increase in
29    capital stock.
30        (d)  A State bank may amend its charter for  the  purpose
31    of  authorizing  its  board  of  directors to issue preferred
32    stock; to increase, decrease, or  change  the  par  value  of
33    shares of its preferred stock, whether issued or unissued; or
34    to   increase,   decrease,   or   change   the   preferences,
 
SB1784 Enrolled            -57-      LRB093 10148 BDD 11571 b
 1    qualifications,  limitations,  restrictions,  or  special  or
 2    relative  rights  of  its  preferred stock, whether issued or
 3    unissued; provided that in  no  case  shall  the  capital  be
 4    diminished  to  the  prejudice  of  the  bank's creditors. An
 5    amendment to the bank's charter granting such authority shall
 6    establish  ranges,  limits,  or  restrictions  that  must  be
 7    observed when the board exercises the  discretion  authorized
 8    by the amendment.
 9        Once  such  an  amendment  is  adopted  and  approved  as
10    provided  in  this  subsection, and without further action by
11    the bank's stockholders, the board may exercise its delegated
12    authority by adopting a  resolution  specifying  the  actions
13    that  it  is  taking with respect to the preferred stock. The
14    board may fully exercise its delegated authority through  one
15    resolution or it may exercise its delegated authority through
16    a  series  of  resolutions, provided that the board's actions
17    remain at all  times  within  the  ranges,  limitations,  and
18    restrictions   specified  in  the  amendment  to  the  bank's
19    charter.
20        A resolution adopted by the board  under  this  authority
21    shall  be  submitted  to  the  Commissioner for approval. The
22    Commissioner shall  approve  the  resolution,  or  state  any
23    objections  to  the  resolution,  within  30  days  after the
24    receipt of  the  resolution  adopted  by  the  board.  If  no
25    objections are specified by the Commissioner within that time
26    frame,  the  resolution  will be deemed to be approved by the
27    Commissioner.  Once  approved,  the   resolution   shall   be
28    incorporated  as  an  addendum  to the bank's charter and the
29    board may proceed to effect the  changes  set  forth  in  the
30    resolution.
31    (Source: P.A. 91-322, eff. 1-1-00; 92-483, eff. 8-23-01.)

32        Section 825.  The Savings Bank Act is amended by changing
33    Sections  1007.55  and 1008 and by adding Section 1007.125 as
 
SB1784 Enrolled            -58-      LRB093 10148 BDD 11571 b
 1    follows:

 2        (205 ILCS 205/1007.55) (from Ch. 17, par. 7301-7.55)
 3        Sec. 1007.55.  "Director" means any director, trustee, or
 4    other person performing similar functions with respect to any
 5    organization whether incorporated or unincorporated.  In  the
 6    case of a manager-managed limited liability company, however,
 7    "director"  means  a  manager of the savings bank, and in the
 8    case  of  a   member-managed   limited   liability   company,
 9    "director"  means  a  member  of  the  savings bank. The term
10    "director" does not include an  advisory  director,  honorary
11    director,  director  emeritus,  or similar person, unless the
12    person is otherwise performing functions similar to those  of
13    a director.

14        (205 ILCS 205/1007.125 new)
15        Sec.  1007.125.  "Bylaws"  means  the bylaws of a savings
16    bank  that  are  adopted  by  the  savings  bank's  board  of
17    directors or shareholders for the regulation  and  management
18    of  the  savings bank's affairs. If the savings bank operates
19    as a limited liability company, however, "bylaws"  means  the
20    operating agreement of the savings bank.
21    (Source: P.A. 86-1213.)

22        (205 ILCS 205/1008) (from Ch. 17, par. 7301-8)
23        Sec. 1008. General corporate powers.
24        (a)  A  savings  bank operating under this Act shall be a
25    body corporate and politic and shall have all of  the  powers
26    conferred  by  this  Act  including,  but not limited to, the
27    following powers:
28             (1)  To sue and be sued, complain, and defend in its
29        corporate name and to have a common seal,  which  it  may
30        alter or renew at pleasure.
31             (2)  To  obtain  and maintain insurance by a deposit
 
SB1784 Enrolled            -59-      LRB093 10148 BDD 11571 b
 1        insurance corporation as defined in this Act.
 2             (3)  To act as a fiscal agent for the United States,
 3        the State of Illinois or any department, branch, arm,  or
 4        agency  of  the  State or any unit of local government or
 5        school district in the State, when  duly  designated  for
 6        that   purpose,   and  as  agent  to  perform  reasonable
 7        functions as may be required of it.
 8             (4)  To  become  a  member  of  or  deal  with   any
 9        corporation  or  agency of the United States or the State
10        of Illinois, to the extent that  the  agency  assists  in
11        furthering  or facilitating its purposes or powers and to
12        that end to  purchase  stock  or  securities  thereof  or
13        deposit  money  therewith,  and  to comply with any other
14        conditions of membership or credit.
15             (5)  To make donations in reasonable amounts for the
16        public welfare or for charitable, scientific,  religious,
17        or educational purposes.
18             (6)  To  adopt  and  operate  reasonable  insurance,
19        bonus,  profit sharing, and retirement plans for officers
20        and  employees  and  for  directors  including,  but  not
21        limited to, advisory, honorary, and  emeritus  directors,
22        who are not officers or employees.
23             (7)  To  reject  any  application for membership; to
24        retire  deposit  accounts  by  enforced   retirement   as
25        provided  in  this  Act  and the bylaws; and to limit the
26        issuance of, or payments on, deposit  accounts,  subject,
27        however, to contractual obligations.
28             (8)  To  purchase  stock in service corporations and
29        to invest in any form  of  indebtedness  of  any  service
30        corporation   as   defined   in   this  Act,  subject  to
31        regulations of the Commissioner.
32             (9)  To  purchase  stock  of  a  corporation   whose
33        principal purpose is to operate a safe deposit company or
34        escrow service company.
 
SB1784 Enrolled            -60-      LRB093 10148 BDD 11571 b
 1             (10)  To   exercise  all  the  powers  necessary  to
 2        qualify as a trustee or custodian under federal or  State
 3        law,  provided  that  the authority to accept and execute
 4        trusts is subject to  the  provisions  of  the  Corporate
 5        Fiduciary  Act and to the supervision of those activities
 6        by the Commissioner.
 7             (11)  (Blank).
 8             (12)  To establish, maintain, and operate  terminals
 9        as authorized by the Electronic Fund Transfer Act.
10             (13)  To pledge its assets:
11                  (A)  to  enable it to act as agent for the sale
12             of obligations of the United States;
13                  (B)  to secure deposits;
14                  (C)  to  secure  deposits  of  money   whenever
15             required by the National Bankruptcy Act;
16                  (D)  (blank); and
17                  (E)  to  secure trust funds commingled with the
18             savings  bank's  funds,  whether  deposited  by  the
19             savings bank or an affiliate of the savings bank, as
20             required  under  Section  2-8   of   the   Corporate
21             Fiduciary Act.
22             (14)  To  accept for payment at a future date not to
23        exceed one year from the date of acceptance, drafts drawn
24        upon it by  its  customers;  and  to  issue,  advise,  or
25        confirm  letters of credit authorizing holders thereof to
26        draw drafts upon it or its correspondents.
27             (15)  Subject   to   the    regulations    of    the
28        Commissioner, to own and lease personal property acquired
29        by  the  savings  bank  at  the  request of a prospective
30        lessee and, upon the agreement of that person,  to  lease
31        the personal property.
32             (16)  To  establish  temporary service booths at any
33        International Fair in this State that is approved by  the
34        United  States Department of Commerce for the duration of
 
SB1784 Enrolled            -61-      LRB093 10148 BDD 11571 b
 1        the international fair for the  purpose  of  providing  a
 2        convenient  place for foreign trade customers to exchange
 3        their  home  countries'  currency  into   United   States
 4        currency  or the converse.  To provide temporary periodic
 5        service to persons residing in a bona fide nursing  home,
 6        senior  citizens'  retirement  home,  or  long-term  care
 7        facility.    These  powers  shall  not  be  construed  as
 8        establishing a new place or change of  location  for  the
 9        savings bank providing the service booth.
10             (17)  To    indemnify   its   officers,   directors,
11        employees, and agents,  as  authorized  for  corporations
12        under  Section  8.75  of the Business Corporations Act of
13        1983.
14             (18)  To provide data processing services to  others
15        on a for-profit basis.
16             (19)  To   utilize   any  electronic  technology  to
17        provide customers with home banking services.
18             (20)  Subject   to   the    regulations    of    the
19        Commissioner,  to  enter  into  an  agreement to act as a
20        surety.
21             (21)  Subject   to   the    regulations    of    the
22        Commissioner,   to  issue  credit  cards,  extend  credit
23        therewith, and otherwise  engage  in  or  participate  in
24        credit card operations.
25             (22)  To  purchase  for  its  own  account shares of
26        stock of a bankers' bank, described in  Section  13(b)(1)
27        of  the  Illinois  Banking  Act,  on  the  same terms and
28        conditions as a bank may purchase  such  shares.   In  no
29        event  shall  the  total  amount  of such stock held by a
30        savings bank in such bankers'  bank  exceed  10%  of  its
31        capital  and surplus (including undivided profits) and in
32        no event shall a savings bank acquire more than 5% of any
33        class of voting securities of such bankers' bank.
34             (23)  With respect to affiliate facilities:
 
SB1784 Enrolled            -62-      LRB093 10148 BDD 11571 b
 1                  (A)  to conduct at affiliate facilities any  of
 2             the  following transactions for and on behalf of any
 3             affiliated depository institution, if so  authorized
 4             by  the affiliate or affiliates: receiving deposits;
 5             renewing  deposits;  cashing  and  issuing   checks,
 6             drafts,  money  orders, travelers checks, or similar
 7             instruments; changing money; receiving  payments  on
 8             existing  indebtedness;  and  conducting ministerial
 9             functions  with  respect   to   loan   applications,
10             servicing   loans,   and   providing   loan  account
11             information; and
12                  (B)  to  authorize  an  affiliated   depository
13             institution  to conduct for and on behalf of it, any
14             of the transactions listed in this subsection at one
15             or more affiliate facilities.
16             A savings bank intending to conduct or to  authorize
17        an  affiliated  depository  institution  to conduct at an
18        affiliate facility any of the transactions  specified  in
19        this   subsection   shall  give  written  notice  to  the
20        Commissioner at least 30 days before any such transaction
21        is conducted at an affiliate facility.  All conduct under
22        this subsection shall be on terms  consistent  with  safe
23        and sound banking practices and applicable law.
24             (24)  Subject   to  Article  XLIV  of  the  Illinois
25        Insurance Code, to act as the agent for any  fire,  life,
26        or  other  insurance  company  authorized by the State of
27        Illinois,  by  soliciting  and  selling   insurance   and
28        collecting  premiums  on policies issued by such company;
29        and may receive for services so  rendered  such  fees  or
30        commissions  as  may  be  agreed  upon  between  the said
31        savings bank and the insurance company for which  it  may
32        act  as  agent;  provided,  however, that no such savings
33        bank shall in any case assume or guarantee the payment of
34        any premium on  insurance  policies  issued  through  its
 
SB1784 Enrolled            -63-      LRB093 10148 BDD 11571 b
 1        agency  by  its principal; and provided further, that the
 2        savings  bank  shall  not  guarantee  the  truth  of  any
 3        statement made by an assured in  filing  his  application
 4        for insurance.
 5             (25)  To  become  a  member of the Federal Home Loan
 6        Bank  and  to  have  the  powers  granted  to  a  savings
 7        association organized under the Illinois Savings and Loan
 8        Act of 1985 or the laws of the United States, subject  to
 9        regulations of the Commissioner.
10             (26)  To offer any product or service that is at the
11        time authorized or permitted to a bank by applicable law,
12        but   subject   always   to   the  same  limitations  and
13        restrictions that are applicable  to  the  bank  for  the
14        product  or service by such applicable law and subject to
15        the applicable provisions of the  Financial  Institutions
16        Insurance Sales Law and rules of the Commissioner.
17        (b)  If  this  Act  or the regulations adopted under this
18    Act fail to provide specific guidance in matters of corporate
19    governance, the provisions of the Business Corporation Act of
20    1983 may be used,  or  if  the  savings  bank  is  a  limited
21    liability  company,  the  provisions of the Limited Liability
22    Company shall be used.
23        (c)  A  savings  bank  may  be  organized  as  a  limited
24    liability  company,  may  convert  to  a  limited   liability
25    company,  or  may  merge  with  and  into a limited liability
26    company, under the applicable laws of this State and  of  the
27    United  States, including any rules promulgated thereunder. A
28    savings bank organized as a limited liability  company  shall
29    be subject to the provisions of the Limited Liability Company
30    Act  in addition to this Act, provided that if a provision of
31    the Limited Liability Company Act conflicts with a  provision
32    of  this  Act  or  with  any  rule  of  the Commissioner, the
33    provision of this Act or the rule of the  Commissioner  shall
34    apply.
 
SB1784 Enrolled            -64-      LRB093 10148 BDD 11571 b
 1        Any   filing  required  to  be  made  under  the  Limited
 2    Liability Company Act shall  be  made  exclusively  with  the
 3    Commissioner,   and   the   Commissioner  shall  possess  the
 4    exclusive authority to regulate the savings bank as  provided
 5    in this Act.
 6        Any  organization  as,  conversion to, and merger with or
 7    into a limited liability company  shall  be  subject  to  the
 8    prior approval of the Commissioner.
 9        A  savings bank that is a limited liability company shall
10    be subject to all of the provisions of this Act in  the  same
11    manner as a savings bank that is organized in stock form.
12        The  Commissioner  may  promulgate rules to ensure that a
13    savings bank that is  a  limited  liability  company  (i)  is
14    operating  in  a safe and sound manner and (ii) is subject to
15    the Commissioner's authority in the same manner as a  savings
16    bank that is organized in stock form.
17    (Source:  P.A.  91-97,  eff.  7-9-99;  91-357,  eff. 7-29-99;
18    92-483, eff. 8-23-01.)

19        Section 830.  The Residential  Mortgage  License  Act  of
20    1987 is amended by changing Sections 1-4, 2-4, 2-6, 3-2, 3-5,
21    and 4-5 and by adding Sections 4-8.1, 4-8.2, and Article 7 as
22    follows:

23        (205 ILCS 635/1-4) (from Ch. 17, par. 2321-4)
24        Sec. 1-4.  Definitions.
25        (a)  "Residential  real  property"  or  "residential real
26    estate" shall  mean  real  property  located  in  this  State
27    improved  by  a one-to-four family dwelling used or occupied,
28    wholly or partly, as the home or residence  of  one  or  more
29    persons   and  may  refer,  subject  to  regulations  of  the
30    Commissioner, to unimproved real property  upon  which  those
31    kinds dwellings are to be constructed.
32        (b)  "Making  a  residential mortgage loan" or "funding a
 
SB1784 Enrolled            -65-      LRB093 10148 BDD 11571 b
 1    residential mortgage loan" shall  mean  for  compensation  or
 2    gain,  either  directly  or  indirectly,  advancing  funds or
 3    making a commitment to advance funds to a loan applicant  for
 4    a residential mortgage loan.
 5        (c)  "Soliciting,  processing,  placing, or negotiating a
 6    residential mortgage loan" shall  mean  for  compensation  or
 7    gain, either directly or indirectly, accepting or offering to
 8    accept  an  application  for  a  residential  mortgage  loan,
 9    assisting  or  offering  to  assist  in  the processing of an
10    application for a residential mortgage loan on  behalf  of  a
11    borrower,  or  negotiating or offering to negotiate the terms
12    or conditions of a residential mortgage loan with a lender on
13    behalf of a borrower  including,  but  not  limited  to,  the
14    submission  of  credit  packages for the approval of lenders,
15    the  preparation  of  residential   mortgage   loan   closing
16    documents, including a closing in the name of a broker.
17        (d)  "Exempt person or entity" shall mean the following:
18             (1) (i)  Any banking organization or foreign banking
19        corporation  licensed  by  the  Illinois  Commissioner of
20        Banks and Real Estate or the United States Comptroller of
21        the Currency to transact business in this State; (ii) any
22        national  bank,  federally  chartered  savings  and  loan
23        association, federal savings bank, federal credit  union;
24        (iii)  any  pension  trust,  bank  trust,  or  bank trust
25        company; (iv) any savings and loan  association,  savings
26        bank, or credit union organized under the laws of this or
27        any  other  state;  (v) any Illinois Consumer Installment
28        Loan Act licensee; (vi) any insurance company  authorized
29        to  transact  business  in  this  State; (vii) any entity
30        engaged solely in commercial mortgage lending; (viii) any
31        service corporation of a savings and loan association  or
32        savings  bank  organized  under the laws of this State or
33        the service corporation of a federally chartered  savings
34        and loan association or savings bank having its principal
 
SB1784 Enrolled            -66-      LRB093 10148 BDD 11571 b
 1        place  of  business  in  this State, other than a service
 2        corporation licensed or entitled to reciprocity under the
 3        Real Estate License Act of 2000; or (ix) any  first  tier
 4        subsidiary  of  a  bank,  the  charter of which is issued
 5        under  the  Illinois  Banking   Act   by   the   Illinois
 6        Commissioner  of Banks and Real Estate, or the first tier
 7        subsidiary of a  bank  chartered  by  the  United  States
 8        Comptroller  of  the  Currency and that has its principal
 9        place of business in this State, provided that the  first
10        tier  subsidiary  is  regularly  examined by the Illinois
11        Commissioner of Banks and Real Estate or the  Comptroller
12        of  the Currency, or a consumer compliance examination is
13        regularly conducted by the Federal Reserve Board.
14             (1.5)  Any employee of a person or entity  mentioned
15        in item (1) of this subsection.
16             (2)  Any  person  or  entity  that  either (i) has a
17        physical presence in Illinois or (ii) does not  originate
18        mortgage  loans in the ordinary course of business making
19        or acquiring residential mortgage loans with his  or  her
20        or  its  own  funds  for his or her or its own investment
21        without intent to make, acquire, or resell more  than  10
22        residential mortgage loans in any one calendar year.
23             (3)  Any  person employed by a licensee to assist in
24        the performance of the activities regulated by  this  Act
25        who is compensated in any manner by only one licensee.
26             (4)  Any person licensed pursuant to the Real Estate
27        License  Act  of  2000, who engages only in the taking of
28        applications and  credit  and  appraisal  information  to
29        forward  to a licensee or an exempt entity under this Act
30        and who is compensated by either a licensee or an  exempt
31        entity  under  this Act, but is not compensated by either
32        the buyer (applicant) or the seller.
33             (5)  Any individual,  corporation,  partnership,  or
34        other   entity  that  originates,  services,  or  brokers
 
SB1784 Enrolled            -67-      LRB093 10148 BDD 11571 b
 1        residential  mortgage  loans,  as  these  activities  are
 2        defined in  this  Act,  and  who  or  which  receives  no
 3        compensation   for   those  activities,  subject  to  the
 4        Commissioner's regulations with regard to the nature  and
 5        amount of compensation.
 6             (6)  A  person who prepares supporting documentation
 7        for a residential mortgage loan application  taken  by  a
 8        licensee  and performs  ministerial functions pursuant to
 9        specific  instructions  of  the  licensee   who   neither
10        requires  nor permits the preparer to exercise his or her
11        discretion or judgment; provided that  this  activity  is
12        engaged  in  pursuant  to  a  binding,  written agreement
13        between the licensee and the preparer that:
14                  (A)  holds the licensee fully  accountable  for
15             the preparer's action; and
16                  (B)  otherwise  meets  the requirements of this
17             Section  and  this  Act,  does  not  undermine   the
18             purposes  of  this  Act,  and  is  approved  by  the
19             Commissioner.
20        (e)  "Licensee"  or "residential mortgage licensee" shall
21    mean a person, partnership, association, corporation, or  any
22    other entity who or which is licensed pursuant to this Act to
23    engage in the activities regulated by this Act.
24        (f)  "Mortgage loan" "residential mortgage loan" or "home
25    mortgage loan" shall mean a loan to or for the benefit of any
26    natural  person  made  primarily  for  personal,  family,  or
27    household  use,  primarily  secured  by  either a mortgage on
28    residential real property or certificates of stock  or  other
29    evidence  of  ownership  interests  in and proprietary leases
30    from,  corporations,  partnerships,  or   limited   liability
31    companies  formed for the purpose of cooperative ownership of
32    residential real property, all located in Illinois.
33        (g)  "Lender"  shall  mean   any   person,   partnership,
34    association,  corporation,  or  any  other  entity who either
 
SB1784 Enrolled            -68-      LRB093 10148 BDD 11571 b
 1    lends or invests money in residential mortgage loans.
 2        (h)  "Ultimate equitable owner" shall mean a person  who,
 3    directly   or  indirectly,  owns  or  controls  an  ownership
 4    interest  in  a  corporation,  foreign   corporation,   alien
 5    business  organization,  trust, or any other form of business
 6    organization  regardless  of  whether  the  person  owns   or
 7    controls  the  ownership interest through one or more persons
 8    or  one  or  more  proxies,  powers  of  attorney,  nominees,
 9    corporations, associations, partnerships, trusts, joint stock
10    companies, or other entities or devices, or  any  combination
11    thereof.
12        (i)  "Residential  mortgage  financing transaction" shall
13    mean the negotiation, acquisition, sale, or  arrangement  for
14    or  the  offer to negotiate, acquire, sell, or arrange for, a
15    residential  mortgage  loan  or  residential  mortgage   loan
16    commitment.
17        (j)  "Personal  residence  address"  shall  mean a street
18    address and shall not include a post office box number.
19        (k)  "Residential mortgage loan commitment" shall mean  a
20    contract for residential mortgage loan financing.
21        (l)  "Party   to   a   residential   mortgage   financing
22    transaction" shall mean a borrower, lender, or loan broker in
23    a residential mortgage financing transaction.
24        (m)  "Payments"  shall  mean payment of all or any of the
25    following: principal, interest and escrow reserves for taxes,
26    insurance and other related reserves, and  reimbursement  for
27    lender advances.
28        (n)  "Commissioner"  shall mean the Commissioner of Banks
29    and Real Estate or a person authorized by  the  Commissioner,
30    the  Office  of Banks and Real Estate Act, or this Act to act
31    in the Commissioner's stead.
32        (o)  "Loan   brokering",   "brokering",   or   "brokerage
33    service" shall mean the act of helping to obtain from another
34    entity, for a borrower, a loan secured  by  residential  real
 
SB1784 Enrolled            -69-      LRB093 10148 BDD 11571 b
 1    estate  situated  in  Illinois  or  assisting  a  borrower in
 2    obtaining a loan secured by residential real estate  situated
 3    in  Illinois in return for consideration to be paid by either
 4    the borrower or the lender including,  but  not  limited  to,
 5    contracting for the delivery of residential mortgage loans to
 6    a  third party lender and soliciting, processing, placing, or
 7    negotiating residential mortgage loans.
 8        (p)  "Loan broker"  or  "broker"  shall  mean  a  person,
 9    partnership,  association,  corporation, or limited liability
10    company,   other   than    those    persons,    partnerships,
11    associations,  corporations,  or  limited liability companies
12    exempted from licensing pursuant to Section  1-4,  subsection
13    (d),  of  this  Act, who performs the activities described in
14    subsections (c) and (o) of this Section.
15        (q)  "Servicing" shall mean the collection or  remittance
16    for  or  the  right or obligation to collect or remit for any
17    lender,  noteowner,  noteholder,  or  for  a  licensee's  own
18    account, of payments, interests, principal, and  trust  items
19    such  as hazard insurance and taxes on a residential mortgage
20    loan in accordance with the terms of the residential mortgage
21    loan; and includes loan payment follow-up,  delinquency  loan
22    follow-up,   loan  analysis  and  any  notifications  to  the
23    borrower that are necessary to enable the  borrower  to  keep
24    the loan current and in good standing.
25        (r)  "Full service office" shall mean office and staff in
26    Illinois    reasonably   adequate   to   handle   efficiently
27    communications, questions, and other matters relating to  any
28    application  for,  or  an  existing  home mortgage secured by
29    residential real estate situated in Illinois with respect  to
30    which   the   licensee  is  brokering,  funding  originating,
31    purchasing, or servicing.  The management  and  operation  of
32    each  full  service  office  must  include observance of good
33    business practices such as adequate, organized, and  accurate
34    books  and  records;  ample  phone  lines, hours of business,
 
SB1784 Enrolled            -70-      LRB093 10148 BDD 11571 b
 1    staff training and supervision, and provision for a mechanism
 2    to resolve consumer inquiries, complaints, and problems.  The
 3    Commissioner shall issue regulations  with  regard  to  these
 4    requirements  and  shall  include an evaluation of compliance
 5    with this Section in his or her periodic examination of  each
 6    licensee.
 7        (s)  "Purchasing" shall mean the purchase of conventional
 8    or  government-insured  mortgage loans secured by residential
 9    real estate situated in Illinois from either  the  lender  or
10    from the secondary market.
11        (t)  "Borrower" shall mean the person or persons who seek
12    the services of a loan broker, originator, or lender.
13        (u)  "Originating"  shall mean the issuing of commitments
14    for and funding of residential mortgage loans.
15        (v)  "Loan brokerage  agreement"  shall  mean  a  written
16    agreement  in  which  a  broker  or  loan broker agrees to do
17    either of the following:
18             (1)  obtain a  residential  mortgage  loan  for  the
19        borrower   or   assist   the   borrower  in  obtaining  a
20        residential mortgage loan; or
21             (2)  consider making a residential mortgage loan  to
22        the borrower.
23        (w)  "Advertisement"    shall   mean   the   attempt   by
24    publication,  dissemination,  or   circulation   to   induce,
25    directly   or   indirectly,   any  person  to  enter  into  a
26    residential mortgage loan agreement or  residential  mortgage
27    loan  brokerage  agreement  relative to a mortgage secured by
28    residential real estate situated in Illinois.
29        (x)  "Residential  Mortgage   Board"   shall   mean   the
30    Residential  Mortgage  Board  created  in Section 1-5 of this
31    Act.
32        (y)  "Government-insured mortgage loan"  shall  mean  any
33    mortgage loan made on the security of residential real estate
34    insured by the Department of Housing and Urban Development or
 
SB1784 Enrolled            -71-      LRB093 10148 BDD 11571 b
 1    Farmers  Home  Loan  Administration,  or  guaranteed  by  the
 2    Veterans Administration.
 3        (z)  "Annual  audit"  shall mean a certified audit of the
 4    licensee's books and records and systems of internal  control
 5    performed by a certified public accountant in accordance with
 6    generally   accepted   accounting  principles  and  generally
 7    accepted auditing standards.
 8        (aa)  "Financial institution" shall mean  a  savings  and
 9    loan  association,  savings  bank,  credit  union,  or a bank
10    organized under the laws of Illinois or a  savings  and  loan
11    association,  savings  bank, credit union or a bank organized
12    under the laws of the  United  States  and  headquartered  in
13    Illinois.
14        (bb)  "Escrow agent" shall mean a third party, individual
15    or  entity  charged with the fiduciary obligation for holding
16    escrow funds on a residential  mortgage  loan  pending  final
17    payout  of  those  funds  in accordance with the terms of the
18    residential mortgage loan.
19        (cc)  "Net worth" shall have the meaning ascribed thereto
20    in Section 3-5 of this Act.
21        (dd)  "Affiliate" shall mean:
22             (1)  any  entity  that  directly  controls   or   is
23        controlled  by the licensee and any other company that is
24        directly affecting activities regulated by this Act  that
25        is controlled by the company that controls the licensee;
26             (2)  any entity:
27                  (A)  that    is    controlled,    directly   or
28             indirectly, by a trust or otherwise, by or  for  the
29             benefit   of   shareholders   who   beneficially  or
30             otherwise control, directly or indirectly, by  trust
31             or  otherwise,  the  licensee  or  any  company that
32             controls the licensee; or
33                  (B)  a majority of the directors or trustees of
34             which constitute a majority of the  persons  holding
 
SB1784 Enrolled            -72-      LRB093 10148 BDD 11571 b
 1             any  such  office  with  the licensee or any company
 2             that controls the licensee;
 3             (3)  any company, including a real estate investment
 4        trust, that is sponsored and  advised  on  a  contractual
 5        basis  by  the licensee or any subsidiary or affiliate of
 6        the licensee.
 7        The Commissioner may define by rule  and  regulation  any
 8    terms   used   in  this  Act  for  the  efficient  and  clear
 9    administration of this Act.
10        (ee)  "First  tier  subsidiary"  shall  be   defined   by
11    regulation  incorporating  the comparable definitions used by
12    the Office  of  the  Comptroller  of  the  Currency  and  the
13    Illinois Commissioner of Banks and Real Estate.
14        (ff)  "Gross   delinquency   rate"   means  the  quotient
15    determined by dividing (1) the  sum  of  (i)  the  number  of
16    government-insured   residential  mortgage  loans  funded  or
17    purchased by a licensee in the preceding calendar  year  that
18    are   delinquent   and   (ii)   the  number  of  conventional
19    residential  mortgage  loans  funded  or  purchased  by   the
20    licensee  in  the preceding calendar year that are delinquent
21    by (2) the  sum  of  (i)  the  number  of  government-insured
22    residential   mortgage  loans  funded  or  purchased  by  the
23    licensee in the preceding calendar year and (ii)  the  number
24    of   conventional   residential   mortgage  loans  funded  or
25    purchased by the licensee in the preceding calendar year.
26        (gg)  "Delinquency rate factor" means the factor  set  by
27    rule  of  the  Commissioner that is multiplied by the average
28    gross delinquency rate of licensees, determined annually  for
29    the  immediately  preceding calendar year, for the purpose of
30    determining  which  licensees  shall  be  examined   by   the
31    Commissioner  pursuant  to  subsection  (b) of Section 4-8 of
32    this Act.
33        (hh) "Loan originator" means any natural person who,  for
34    compensation  or  in  the expectation of compensation, either
 
SB1784 Enrolled            -73-      LRB093 10148 BDD 11571 b
 1    directly or  indirectly  makes,  offers  to  make,  solicits,
 2    places, or negotiates a residential mortgage loan.
 3    (Source: P.A. 90-772, eff. 1-1-99; 91-245, eff. 12-31-99.)

 4        (205 ILCS 635/2-4) (from Ch. 17, par. 2322-4)
 5        Sec.  2-4.   Averments of Licensee.  Each application for
 6    license or for the renewal of a license shall be  accompanied
 7    by the following averments stating that the applicant:
 8        (a)  Will  maintain  at  least  one  full  service office
 9    within the State of Illinois pursuant to Section 3-4 of  this
10    Act;
11        (b)  Will  maintain staff reasonably adequate to meet the
12    requirements of Section 3-4 of this Act;
13        (c)  Will keep  and  maintain  for  36  months  the  same
14    written  records  as  required  by  the  federal Equal Credit
15    Opportunity  Act,  and  any  other  information  required  by
16    regulations of the Commissioner regarding any  home  mortgage
17    in  the  course  of  the  conduct of its residential mortgage
18    business;
19        (d)  Will file  with  the  Commissioner,  when  due,  any
20    report  or  reports which it is required to file under any of
21    the provisions of this Act;
22        (e)  Will not engage, whether as principal or  agent,  in
23    the  practice  of rejecting residential mortgage applications
24    without reasonable cause, or  varying  terms  or  application
25    procedures  without  reasonable  cause, for home mortgages on
26    real estate within any  specific  geographic  area  from  the
27    terms or procedures generally provided by the licensee within
28    other geographic areas of the State;
29        (f)  Will   not   engage   in  fraudulent  home  mortgage
30    underwriting practices;
31        (g)  Will  not  make   payment,   whether   directly   or
32    indirectly,  of  any kind to any in house or fee appraiser of
33    any government or private money lending agency with which  an
 
SB1784 Enrolled            -74-      LRB093 10148 BDD 11571 b
 1    application  for  a  home  mortgage  has  been  filed for the
 2    purpose  of  influencing  the  independent  judgment  of  the
 3    appraiser with respect to the value of any real estate  which
 4    is to be covered by such home mortgage;
 5        (h)  Has  filed  tax  returns (State and Federal) for the
 6    past 3 years or filed with the Commissioner  an  accountant's
 7    or attorney's statement as to why no return was filed;
 8        (i)  Will  not  engage in any discrimination or redlining
 9    activities prohibited by Section 3-8 of this Act;
10        (j)  Will not knowingly make any false promises likely to
11    influence   or   persuade,   or   pursue    a    course    of
12    misrepresentation   and   false   promises   through  agents,
13    solicitors, advertising or otherwise;
14        (k)  Will  not  knowingly  misrepresent,  circumvent   or
15    conceal,  through  whatever  subterfuge or device, any of the
16    material particulars  or  the  nature  thereof,  regarding  a
17    transaction  to  which it is a party to the injury of another
18    party thereto;
19        (l)  Will  disburse  funds   in   accordance   with   its
20    agreements;
21        (m)  Has  not  committed  a crime against the law of this
22    State, any other state or of  the  United  States,  involving
23    moral turpitude, fraudulent or dishonest dealing, and that no
24    final  judgment has been entered against it in a civil action
25    upon grounds of fraud, misrepresentation or deceit which  has
26    not been previously reported to the Commissioner;
27        (n)  Will  account  or deliver to any person any personal
28    property  such  as  money,  fund,  deposit,   check,   draft,
29    mortgage,  other  document  or thing of value, which has come
30    into its possession, and which is not its property, or  which
31    it  is  not  in  law  or  equity entitled to retain under the
32    circumstances, at the time which has been agreed upon  or  is
33    required  by  law,  or,  in the absence of a fixed time, upon
34    demand  of  the  person  entitled  to  such  accounting   and
 
SB1784 Enrolled            -75-      LRB093 10148 BDD 11571 b
 1    delivery;
 2        (o)  Has  not engaged in any conduct which would be cause
 3    for denial of a license;
 4        (p)  Has not become insolvent;
 5        (q)  Has not submitted an application for a license under
 6    this Act which contains a material misstatement;
 7        (r)  Has  not  demonstrated   by   course   of   conduct,
 8    negligence or incompetence in performing any act for which it
 9    is required to hold a license under this Act;
10        (s)  Will  advise  the  Commissioner  in  writing  of any
11    changes to the  information  submitted  on  the  most  recent
12    application  for  license within 30 days of said change.  The
13    written notice must  be  signed  in  the  same  form  as  the
14    application for license being amended;
15        (t)  Will comply with the provisions of this Act, or with
16    any lawful order, rule or regulation made or issued under the
17    provisions of this Act;
18        (u)  Will   submit   to   periodic   examination  by  the
19    Commissioner as required by this Act;
20        (v)  Will advise the Commissioner in writing of judgments
21    entered against, and bankruptcy  petitions  by,  the  license
22    applicant within 5 days of occurrence;
23        (w)  Will  advise  the  Commissioner in writing within 30
24    days when the license applicant  requests  a  licensee  under
25    this   Act  to  repurchase  a  loan,  and  the  circumstances
26    therefor; and
27        (x)  Will advise the Commissioner in  writing  within  30
28    days  when  the  license  applicant  is  requested by another
29    entity to repurchase a loan, and the circumstances therefor.
30        (y) Will at all times act in  a  manner  consistent  with
31    subsections (a) and (b) of Section 1-2 of this Act.
32        (x)  Will  not knowingly hire or employ a loan originator
33    who is not registered with the Commissioner as required under
34    Section 7-1 of this Act.
 
SB1784 Enrolled            -76-      LRB093 10148 BDD 11571 b
 1        A  licensee  who  fails  to  fulfill  obligations  of  an
 2    averment,  to  comply  with  averments  made,  or   otherwise
 3    violates  any  of the averments made under this Section shall
 4    be subject to the penalties in Section 4-5 of this Act.
 5    (Source: P.A. 90-301, eff. 8-1-97.)

 6        (205 ILCS 635/2-6) (from Ch. 17, par. 2322-6)
 7        Sec. 2-6.  License issuance and renewal; fee.
 8        (a)  Beginning  May  1,  1992,  licenses  issued   before
 9    January  1,  1988,  shall  be renewed every 2 years on May 1.
10    Beginning May 1, 1992, licenses issued on or after January 1,
11    1988, shall be renewed every 2 years on  the  anniversary  of
12    the  date  of the issuance of the original license.  Licenses
13    issued for first time applicants on or  after  May  1,  1992,
14    shall  be  renewed on the first anniversary of their issuance
15    and every 2 years thereafter.    Properly  completed  renewal
16    application  forms  and  filing  fees must be received by the
17    Commissioner 60 45 days prior to the renewal date.
18        (b)  It shall be the responsibility of each  licensee  to
19    accomplish renewal of its license; failure of the licensee to
20    receive renewal forms absent a request sent by certified mail
21    for such forms will not waive said responsibility. Failure by
22    a licensee to submit a properly completed renewal application
23    form and fees in a timely fashion, absent a written extension
24    from  the  Commissioner,  will  result  in  the assessment of
25    additional fees, as follows:
26             (1)  A fee of $500 will be assessed to the  licensee
27        30  days  after  the  proper renewal date and $1,000 each
28        month thereafter, until the license is either renewed  or
29        expires pursuant to Section 2-6, subsections (c) and (d),
30        of this Act.
31             (2)  Such  fee will be assessed without prior notice
32        to the licensee, but  will  be  assessed  only  in  cases
33        wherein  the  Commissioner  has  in his or her possession
 
SB1784 Enrolled            -77-      LRB093 10148 BDD 11571 b
 1        documentation of the licensee's continuing  activity  for
 2        which the unrenewed license was issued.
 3        (c)  A  license which is not renewed by the date required
 4    in this Section  shall  automatically  become  inactive.   No
 5    activity  regulated  by  this  Act  shall be conducted by the
 6    licensee  when  a  license  becomes  inactive.   An  inactive
 7    license may be reactivated by filing a completed reactivation
 8    application with the Commissioner,  payment  of  the  renewal
 9    fee,  and  payment of a reactivation fee equal to the renewal
10    fee.
11        (d)  A license which is not renewed within  one  year  of
12    becoming inactive shall expire.
13        (e)  A   licensee   ceasing  an  activity  or  activities
14    regulated by this Act and desiring to no longer  be  licensed
15    shall  so inform the Commissioner in writing and, at the same
16    time, convey the license and all other symbols or indicia  of
17    licensure.   The  licensee  shall  include  a  plan  for  the
18    withdrawal from regulated business, including a timetable for
19    the  disposition  of  the  business.   Upon  receipt  of such
20    written notice, the  Commissioner  shall  issue  a  certified
21    statement canceling the license.
22    (Source: P.A. 90-301, eff. 8-1-97.)

23        (205 ILCS 635/3-2) (from Ch. 17, par. 2323-2)
24        Sec. 3-2.  Annual audit.
25        (a)  At  the  licensee's  fiscal year-end, but in no case
26    more than 12 months after the last audit  conducted  pursuant
27    to  this  Section,  except  as  otherwise  provided  in  this
28    Section,  it shall be mandatory for each residential mortgage
29    licensee to cause its books and accounts to be audited  by  a
30    certified public accountant not connected with such licensee.
31    The  books  and records of all licensees under this Act shall
32    be maintained  on  an  accrual  basis.   The  audit  must  be
33    sufficiently  comprehensive in scope to permit the expression
 
SB1784 Enrolled            -78-      LRB093 10148 BDD 11571 b
 1    of an opinion on the  financial  statements,  which  must  be
 2    prepared  in  accordance  with  generally accepted accounting
 3    principles,  and  must  be  performed  in   accordance   with
 4    generally  accepted  auditing standards.  Notwithstanding the
 5    requirements of this subsection, a licensee that is  a  first
 6    tier  subsidiary  may  submit  audited consolidated financial
 7    statements  of  its  parent  as  long  as  the   consolidated
 8    statements  are  supported  by consolidating statements.  The
 9    licensee's  chief  financial  officer  shall  attest  to  the
10    licensee's   financial   statements    disclosed    in    the
11    consolidating statements.
12        (b)  As  used  herein,  the  term "expression of opinion"
13    includes either (1) an unqualified opinion, (2)  a  qualified
14    opinion,  (3)  a  disclaimer  of  opinion,  or (4) an adverse
15    opinion.
16        (c)  If a qualified or adverse opinion is expressed or if
17    an opinion is disclaimed, the reasons therefore must be fully
18    explained.  An opinion, qualified as to a  scope  limitation,
19    shall not be acceptable.
20        (d)  The most recent audit report shall be filed with the
21    Commissioner  within  90 days after the end of the licensee's
22    fiscal year  at  the  time  of  the  annual  license  renewal
23    payment.   The  report  filed  with the Commissioner shall be
24    certified by the certified public accountant  conducting  the
25    audit.   The Commissioner may promulgate rules regarding late
26    audit reports.
27        (e)  If any licensee required to make an audit shall fail
28    to cause an audit to be made, the  Commissioner  shall  cause
29    the  same  to be made by a certified public accountant at the
30    licensee's  expense.   The  Commissioner  shall  select  such
31    certified public accountant by advertising  for  bids  or  by
32    such  other fair and impartial means as he or she establishes
33    by regulation.
34        (f)  In lieu of the audit required by this  Section,  the
 
SB1784 Enrolled            -79-      LRB093 10148 BDD 11571 b
 1    Commissioner  may  accept  any audit made in conformance with
 2    the audit requirements of the U.S. Department of Housing  and
 3    Urban Development.
 4        (g)  With   respect   to   licensees  who  solely  broker
 5    residential mortgage loans as defined in  subsection  (o)  of
 6    Section  1-4,  instead of the audit required by this Section,
 7    the Commissioner may accept compilation financial  statements
 8    prepared  at  least  every  12  months,  and  the compilation
 9    financial  statement  must  be  prepared  by  an  independent
10    certified  public  accountant  licensed  under  the  Illinois
11    Public Accounting Act with full disclosure in accordance with
12    generally accepted accounting principals and  must  shall  be
13    submitted  within  90  days  after  the end of the licensee's
14    fiscal year  at  the  time  of  the  annual  license  renewal
15    payment.   If  a  licensee under this Section fails to file a
16    compilation as required,  the  Commissioner  shall  cause  an
17    audit  of  the  licensee's books and accounts to be made by a
18    certified public accountant at the licensee's  expense.   The
19    Commissioner  shall select the certified public accountant by
20    advertising for bids or by  such  other  fair  and  impartial
21    means as he or she establishes by rule.  A licensee who files
22    false  or  misleading  compilation  financial  statements  is
23    guilty of a business offense and shall be fined not less than
24    $5,000.
25        (h)  The  workpapers  of the certified public accountants
26    employed by each licensee for purposes of this Section are to
27    be made available to the Commissioner or  the  Commissioner's
28    designee   upon   request   and  may  be  reproduced  by  the
29    Commissioner or the Commissioner's designee to enable to  the
30    Commissioner to carry out the purposes of this Act.
31        (i)  Notwithstanding any other provision of this Section,
32    if  a  licensee  relying  on  subsection  (g) of this Section
33    causes its books to be audited at any other  time  or  causes
34    its  financial  statements to be reviewed, a complete copy of
 
SB1784 Enrolled            -80-      LRB093 10148 BDD 11571 b
 1    the  audited  or  reviewed  financial  statements  shall   be
 2    delivered  to  the  Commissioner  at  the  time of the annual
 3    license renewal payment following receipt by the licensee  of
 4    the audited or reviewed financial statements.  All workpapers
 5    shall  be  made  available  to the Commissioner upon request.
 6    The financial statements and workpapers may be reproduced  by
 7    the  Commissioner or the Commissioner's designee to carry out
 8    the purposes of this Act.
 9    (Source: P.A. 89-74,  eff.  6-30-95;  89-355,  eff.  8-17-95;
10    90-772, eff. 1-1-99.)

11        (205 ILCS 635/3-5) (from Ch. 17, par. 2323-5)
12        Sec. 3-5.  Net worth requirement. A licensee that holds a
13    license  on  the effective date of this amendatory Act of the
14    93rd General Assembly Every licensee shall have and  maintain
15    a net worth of not less than $100,000; however, no later than
16    2  years  after  the effective date of this amendatory Act of
17    the 93rd General Assembly, the licensee must maintain  a  net
18    worth  of  not  less  than  $150,000.  A  licensee that first
19    obtains a license after the effective date of this amendatory
20    Act of the 93rd General Assembly must have and maintain a net
21    worth  of  not  less  than  $150,000.  Notwithstanding  other
22    requirements of this Section, the net worth requirement for a
23    residential mortgage licensee licensees whose only licensable
24    activity is that of brokering residential mortgage loans  and
25    that holds a license on the effective date of this amendatory
26    Act  of  the 93rd General Assembly shall be $35,000; however,
27    no later than 2  years  after  the  effective  date  of  this
28    amendatory  Act  of  the  93rd General Assembly, the licensee
29    must maintain a net worth of not less than  $50,000.  Such  a
30    licensee  that  first  obtains  a license after the effective
31    date of this amendatory Act of the 93rd General Assembly must
32    have and maintain a net worth of not less than  $50,000.  Net
33    worth  shall  be  evidenced  by a balance sheet prepared by a
 
SB1784 Enrolled            -81-      LRB093 10148 BDD 11571 b
 1    certified public  accountant  in  accordance  with  generally
 2    accepted   accounting   principles   and  generally  accepted
 3    auditing standards or by the compilation financial statements
 4    authorized  under  subsection  (g)  of  Section   3-2.    The
 5    Commissioner  may  promulgate rules with respect to net worth
 6    definitions  and  requirements   for   residential   mortgage
 7    licensees  as  necessary  to  accomplish the purposes of this
 8    Act.  In lieu of the net  worth  requirement  established  by
 9    this   Section,  the  Commissioner  may  accept  evidence  of
10    conformance by the licensee with the net  worth  requirements
11    of   the  United  States  Department  of  Housing  and  Urban
12    Development.
13    (Source: P.A. 89-355, eff. 8-17-95; 89-508, eff. 7-3-96.)

14        (205 ILCS 635/4-5) (from Ch. 17, par. 2324-5)
15        Sec. 4-5.  Suspension, revocation of licenses; fines.
16        (a)  Upon written notice to a licensee, the  Commissioner
17    may suspend or revoke any license issued pursuant to this Act
18    if  he  or  she  shall  make  a finding of one or more of the
19    following in the notice that:
20             (1)  Through separate acts or an act or a course  of
21        conduct, the licensee has violated any provisions of this
22        Act,   any   rule   or   regulation  promulgated  by  the
23        Commissioner or of any other law, rule or  regulation  of
24        this State or the United States.
25             (2)  Any  fact  or condition exists which, if it had
26        existed at the time of the original application for  such
27        license would have warranted the Commissioner in refusing
28        originally to issue such license.
29             (3)  If  a licensee is other than an individual, any
30        ultimate equitable owner, officer, director, or member of
31        the licensed partnership,  association,  corporation,  or
32        other  entity  has  so acted or failed to act as would be
33        cause for suspending or revoking a license to that  party
 
SB1784 Enrolled            -82-      LRB093 10148 BDD 11571 b
 1        as an individual.
 2        (b)  No  license shall be suspended or revoked, except as
 3    provided in this Section, nor shall  any  licensee  be  fined
 4    without  notice  of his or her right to a hearing as provided
 5    in Section 4-12 of this Act.
 6        (c)  The  Commissioner,  on  good  cause  shown  that  an
 7    emergency exists, may suspend any license for  a  period  not
 8    exceeding  180  days,  pending investigation.  Upon a showing
 9    that  a  licensee  has  failed  to  meet  the  experience  or
10    educational requirements of Section 2-2 or  the  requirements
11    of  subsection  (g)  of  Section  3-2, the Commissioner shall
12    suspend, prior to hearing as provided in  Section  4-12,  the
13    license until those requirements have been met.
14        (d)  The  provisions  of subsection (e) of Section 2-6 of
15    this Act shall not affect  a  licensee's  civil  or  criminal
16    liability for acts committed prior to surrender of a license.
17        (e)  No   revocation,  suspension  or  surrender  of  any
18    license  shall  impair  or  affect  the  obligation  of   any
19    pre-existing  lawful  contract  between  the licensee and any
20    person.
21        (f)  Every license issued under this Act shall remain  in
22    force  and  effect  until the same shall have expired without
23    renewal, have  been  surrendered,  revoked  or  suspended  in
24    accordance   with   the  provisions  of  this  Act,  but  the
25    Commissioner shall have authority to  reinstate  a  suspended
26    license or to issue a new license to a licensee whose license
27    shall  have  been revoked if no fact or condition then exists
28    which would  have  warranted  the  Commissioner  in  refusing
29    originally to issue such license under this Act.
30        (g)  Whenever  the Commissioner shall revoke or suspend a
31    license issued pursuant to this Act or fine a licensee  under
32    this  Act,  he  or she shall forthwith execute in duplicate a
33    written order to that effect.  The Commissioner shall publish
34    notice of such order in the Illinois Register and a newspaper
 
SB1784 Enrolled            -83-      LRB093 10148 BDD 11571 b
 1    of general circulation in the county in which the license  is
 2    located  and  shall forthwith serve a copy of such order upon
 3    the licensee.   Any such order may be reviewed in the  manner
 4    provided by Section 4-12 of this Act.
 5        (h)  When  the Commissioner finds any person in violation
 6    of the grounds set forth in subsection (i),  he  or  she  may
 7    enter  an  order  imposing  one  or  more  of  the  following
 8    penalties:
 9             (1)  Revocation of license;
10             (2)  Suspension    of    a    license   subject   to
11        reinstatement upon satisfying all  reasonable  conditions
12        the Commissioner may specify;
13             (3)  Placement  of  the  licensee  or  applicant  on
14        probation  for  a  period  of  time  and  subject  to all
15        reasonable conditions as the Commissioner may specify;
16             (4)  Issuance of a reprimand;
17             (5)  Imposition of a  fine  not  to  exceed  $25,000
18        $10,000 for each count of separate offense; and
19             (6)  Denial of a license.
20        (i)  The  following  acts  shall  constitute  grounds for
21    which the disciplinary actions specified  in  subsection  (h)
22    above may be taken:
23             (1)  Being  convicted or found guilty, regardless of
24        pendency of an appeal, of a  crime  in  any  jurisdiction
25        which involves fraud, dishonest dealing, or any other act
26        of moral turpitude;
27             (2)  Fraud,  misrepresentation, deceit or negligence
28        in any mortgage financing transaction;
29             (3)  A material or intentional misstatement of  fact
30        on an initial or renewal application;
31             (4)  Failure    to    follow    the   Commissioner's
32        regulations with respect to placement of funds in  escrow
33        accounts;
34             (5)  Insolvency or filing under any provision of the
 
SB1784 Enrolled            -84-      LRB093 10148 BDD 11571 b
 1        Bankruptcy Code as a debtor;
 2             (6)  Failure to account or deliver to any person any
 3        property  such as any money, fund, deposit, check, draft,
 4        mortgage, or other document or thing of value, which  has
 5        come  into  his  or her hands and which is not his or her
 6        property or which he or she  is  not  in  law  or  equity
 7        entitled  to  retain,  under the circumstances and at the
 8        time which has been agreed upon or is required by law or,
 9        in the absence of a fixed time, upon demand of the person
10        entitled to such accounting and delivery;
11             (7)  Failure to disburse funds  in  accordance  with
12        agreements;
13             (8)  Any misuse, misapplication, or misappropriation
14        of trust funds or escrow funds;
15             (9)  Having   a   license,  or  the  equivalent,  to
16        practice any profession or occupation revoked, suspended,
17        or otherwise  acted  against,  including  the  denial  of
18        licensure  by  a  licensing  authority  of  this State or
19        another state, territory or country for fraud,  dishonest
20        dealing or any other act of moral turpitude;
21             (10)  Failure  to  issue  a satisfaction of mortgage
22        when the  residential  mortgage  has  been  executed  and
23        proceeds  were  not  disbursed  to  the  benefit  of  the
24        mortgagor   and   when   the  mortgagor  has  fully  paid
25        licensee's costs and commission;
26             (11)  Failure  to  comply  with  any  order  of  the
27        Commissioner or rule made or issued under the  provisions
28        of this Act;
29             (12)  Engaging  in  activities regulated by this Act
30        without a current,  active  license  unless  specifically
31        exempted by this Act;
32             (13)  Failure  to  pay  in  a timely manner any fee,
33        charge or fine under this Act;
34             (14)  Failure  to  maintain,  preserve,   and   keep
 
SB1784 Enrolled            -85-      LRB093 10148 BDD 11571 b
 1        available  for  examination, all books, accounts or other
 2        documents required by the provisions of this  Act and the
 3        rules of the Commissioner;
 4             (15)  Refusal  to   permit   an   investigation   or
 5        examination  of  the  licensee's or its affiliates' books
 6        and records or refusal to comply with the  Commissioner's
 7        subpoena or subpoena duces tecum;
 8             (16)  A pattern of substantially underestimating the
 9        maximum closing costs;
10             (17)  Failure  to  comply  with  or violation of any
11        provision of this Act.
12        (j)  A licensee shall  be  subject  to  the  disciplinary
13    actions  specified  in  this Act for violations of subsection
14    (i) by any officer,  director,  shareholder,  joint  venture,
15    partner,   ultimate  equitable  owner,  or  employee  of  the
16    licensee.
17        (k)  Such licensee shall  be  subject  to  suspension  or
18    revocation for employee actions only if there is a pattern of
19    repeated   violations   by  employees  or  the  licensee  has
20    knowledge of the violations.
21        (l)  Procedure for surrender of license:
22             (1)  The Commissioner may, after 10 days  notice  by
23        certified  mail  to the licensee at the address set forth
24        on the license, stating the contemplated  action  and  in
25        general the grounds therefor and the date, time and place
26        of  a  hearing  thereon, and after providing the licensee
27        with a reasonable opportunity to be heard prior  to  such
28        action,  fine  such  licensee  an  amount  not  exceeding
29        $10,000  per  violation, or revoke or suspend any license
30        issued hereunder if he or she finds that:
31                  (i)  The licensee has failed to comply with any
32             provision  of  this  Act  or  any  order,  decision,
33             finding,  rule,  regulation  or  direction  of   the
34             Commissioner lawfully made pursuant to the authority
 
SB1784 Enrolled            -86-      LRB093 10148 BDD 11571 b
 1             of this Act; or
 2                  (ii)  Any fact or condition exists which, if it
 3             had  existed at the time of the original application
 4             for the license, clearly would  have  warranted  the
 5             Commissioner in refusing to issue the license.
 6             (2)  Any   licensee   may  surrender  a  license  by
 7        delivering to the Commissioner written notice that he  or
 8        she  thereby surrenders such license, but surrender shall
 9        not affect the licensee's civil or criminal liability for
10        acts committed prior to surrender or entitle the licensee
11        to a return of any part of the license fee.
12    (Source: P.A. 89-355, eff. 8-17-95.)

13        (205 ILCS 635/4-8.1 new)
14        Sec.  4-8.1.  Confidential   information.   In   hearings
15    conducted under this Act, information presented into evidence
16    that was acquired by the licensee when serving any individual
17    in  connection  with  a  residential  mortgage, including all
18    financial information of  the  individual,  shall  be  deemed
19    strictly  confidential  and  shall  be made available only as
20    part of the record of a hearing under this Act  or  otherwise
21    (i)  when  the  record  is  required,  in  its  entirety, for
22    purposes of judicial review or (ii) upon the express  written
23    consent  of  the  individual served, or in the case of his or
24    her death or disability, the consent of his or  her  personal
25    representative.

26        (205 ILCS 635/4-8.2 new)
27        Sec.  4-8.2.  Reports  of violations. Any person licensed
28    under this  Act  or  any  other  person  may  report  to  the
29    Commissioner any information to show that a person subject to
30    this Act is or may be in violation of this Act.

31        (205 ILCS 635/Art. VII heading new)
 
SB1784 Enrolled            -87-      LRB093 10148 BDD 11571 b
 1            ARTICLE VII. REGISTRATION OF LOAN ORIGINATORS

 2        (205 ILCS 635/7-1 new)
 3        Sec.  7-1.  Registration required; rules and regulations.
 4    Beginning  6  months  after  the  effective  date   of   this
 5    amendatory  Act  of the 93rd General Assembly, it is unlawful
 6    for any natural person to act or assume  to  act  as  a  loan
 7    originator,  as  defined  in  subsection (hh) of Section 1-4,
 8    without being registered with  the  Commissioner  unless  the
 9    natural  person  is  exempt  under  items  (1)  and  (1.5) of
10    subsection (d) of Section 1-4 of this Act.  The  Commissioner
11    shall  promulgate  rules  prescribing  the  criteria  for the
12    registration and regulation of  loan  originators,  including
13    but   not  limited  to,  qualifications,  fees,  examination,
14    education, supervision, and enforcement.

15        Section  835.   The  Limited  Liability  Company  Act  is
16    amended by changing Sections 1-25, 5-5, 5-55, 37-5, and 37-35
17    as follows:

18        (805 ILCS 180/1-25)
19        Sec. 1-25.   Nature  of  business.  A  limited  liability
20    company  may  be  formed  for  any lawful purpose or business
21    except:
22             (1)  (Blank)  banking,  exclusive   of   fiduciaries
23        organized  for  the  purpose  of  accepting and executing
24        trusts;
25             (2)  insurance unless, for the purpose  of  carrying
26        on business as a member of a group including incorporated
27        and  individual unincorporated underwriters, the Director
28        of Insurance finds that the group meets the  requirements
29        of subsection (3) of Section 86 of the Illinois Insurance
30        Code  and the limited liability company, if insolvent, is
31        subject to liquidation by the Director of Insurance under
 
SB1784 Enrolled            -88-      LRB093 10148 BDD 11571 b
 1        Article XIII of the Illinois Insurance Code;
 2             (3)  the  practice  of  dentistry  unless  all   the
 3        members  and  managers are licensed as dentists under the
 4        Illinois Dental Practice Act; or
 5             (4)  the  practice  of  medicine  unless   all   the
 6        managers, if any, are licensed to practice medicine under
 7        the Medical Practice Act of 1987 and any of the following
 8        conditions apply:
 9                  (A)  the  member  or  members  are  licensed to
10             practice medicine under the Medical Practice Act  of
11             1987; or
12                  (B)  the  member  or  members  are a registered
13             medical  corporation   or   corporations   organized
14             pursuant to the Medical Corporation Act; or
15                  (C)  the  member  or members are a professional
16             corporation organized pursuant to  the  Professional
17             Service  Corporation  Act  of physicians licensed to
18             practice medicine in all its branches; or
19                  (D)  the  member  or  members  are  a   medical
20             limited liability company or companies.
21    (Source: P.A. 91-593, eff. 8-14-99; 92-144, eff. 7-24-01.)

22        (805 ILCS 180/5-5)
23        Sec. 5-5.  Articles of organization.
24        (a)  The  articles of organization shall set forth all of
25    the following:
26             (1)  The name of the limited liability  company  and
27        the address of its principal place of business which may,
28        but need not be a place of business in this State.
29             (2)  The  purposes  for  which the limited liability
30        company is organized, which may be stated to  be,  or  to
31        include,  the transaction of any or all lawful businesses
32        for which limited liability companies  may  be  organized
33        under this Act.
 
SB1784 Enrolled            -89-      LRB093 10148 BDD 11571 b
 1             (3)  The  name  of  its  registered  agent  and  the
 2        address of its registered office.
 3             (4)  If  the  limited  liability  company  is  to be
 4        managed by a manager or managers, the names and  business
 5        addresses of the initial manager or managers.
 6             (5)  If  management of the limited liability company
 7        is to be vested in the members under Section  15-1,  then
 8        the names and addresses of the initial member or members.
 9             (6)  The latest date, if any, upon which the limited
10        liability  company  is  to  dissolve  and other events of
11        dissolution, if any, that  may  be  agreed  upon  by  the
12        members under Section 35-1 hereof.
13             (7)  The name and address of each organizer.
14             (8)  Any other provision, not inconsistent with law,
15        that  the  members  elect  to  set out in the articles of
16        organization for the regulation of the  internal  affairs
17        of   the   limited   liability   company,  including  any
18        provisions  that,  under  this  Act,  are   required   or
19        permitted to be set out in the operating agreement of the
20        limited liability company.
21        (b)  A limited liability company is organized at the time
22    articles  of organization are filed by the Secretary of State
23    or at any later time, not more than 60 days after the  filing
24    of the articles of organization, specified in the articles of
25    organization.
26        (c)  Articles  of  organization for the organization of a
27    limited liability company for the purpose  of  accepting  and
28    executing trusts shall not be filed by the Secretary of State
29    until  there  is delivered to him or her a statement executed
30    by the Commissioner of the Office of Banks  and  Real  Estate
31    that  the  organizers  of  the limited liability company have
32    made arrangements with the  Commissioner  of  the  Office  of
33    Banks  and Real Estate to comply with the Corporate Fiduciary
34    Act.
 
SB1784 Enrolled            -90-      LRB093 10148 BDD 11571 b
 1        (d) Articles of organization for the  organization  of  a
 2    limited liability company as a bank or a savings bank must be
 3    filed  with  the Commissioner of Banks and Real Estate or, if
 4    the bank or savings bank will be organized under federal law,
 5    with the appropriate federal banking regulator.
 6    (Source: P.A. 90-424, eff. 1-1-98.)

 7        (805 ILCS 180/5-55)
 8        Sec. 5-55.  Filing in Office of Secretary of State.
 9        (a)  Whenever  any  provision  of  this  Act  requires  a
10    limited liability company  to  file  any  document  with  the
11    Office of the Secretary of State, the requirement means that:
12             (1)  the original document, executed as described in
13        Section 5-45, and, if required by this Act to be filed in
14        duplicate,  one  copy  (which  may  be a signed carbon or
15        photocopy) shall  be  delivered  to  the  Office  of  the
16        Secretary of State;
17             (2)  all  fees  and  charges authorized by law to be
18        collected by the Secretary of State  in  connection  with
19        the  filing  of  the  document  shall  be tendered to the
20        Secretary of State; and
21             (3)  unless the Secretary of State  finds  that  the
22        document  does  not conform to law, he or she shall, when
23        all fees have been paid:
24                  (A)  endorse on the original and  on  the  copy
25             the word "Filed" and the month, day, and year of the
26             filing thereof;
27                  (B)  file  in his or her office the original of
28             the document; and
29                  (C)  return the copy to the person who filed it
30             or to that person's representative.
31        (b)  If  another  Section  of   this   Act   specifically
32    prescribes a manner of filing or signing a specified document
33    that  differs  from  the  corresponding  provisions  of  this
 
SB1784 Enrolled            -91-      LRB093 10148 BDD 11571 b
 1    Section,  then  the  provisions  of  the  other Section shall
 2    govern.
 3        (c) Whenever any provision of this Act requires a limited
 4    liability company that is a bank or a savings  bank  to  file
 5    any document, that requirement means that the filing shall be
 6    made  exclusively  with  the  Commissioner  of Banks and Real
 7    Estate or, if the bank or savings  bank  is  organized  under
 8    federal  law,  with the appropriate federal banking regulator
 9    at  such  times  and  in  such  manner  as  required  by  the
10    Commissioner or federal regulator.
11    (Source: P.A. 92-33, eff. 7-1-01.)

12        (805 ILCS 180/37-5)
13        Sec. 37-5.  Definitions.  In this Article:
14        "Corporation" means (i) a corporation under the  Business
15    Corporation Act of 1983, a predecessor law, or comparable law
16    of another jurisdiction or (ii) a bank or savings bank.
17        "General  partner" means a partner in a partnership and a
18    general partner in a limited partnership.
19        "Limited partner" means a limited partner  in  a  limited
20    partnership.
21        "Limited partnership" means a limited partnership created
22    under   the   Revised  Uniform  Limited  Partnership  Act,  a
23    predecessor law, or comparable law of another jurisdiction.
24        "Partner"  includes  a  general  partner  and  a  limited
25    partner.
26        "Partnership"  means  a  general  partnership  under  the
27    Uniform Partnership Act, a predecessor law, or comparable law
28    of another jurisdiction.
29        "Partnership agreement"  means  an  agreement  among  the
30    partners concerning the partnership or limited partnership.
31        "Shareholder" means a shareholder in a corporation.
32    (Source: P.A. 90-424, eff. 1-1-98.)
 
SB1784 Enrolled            -92-      LRB093 10148 BDD 11571 b
 1        (805 ILCS 180/37-35)
 2        Sec. 37-35.  Article not exclusive. This Article does not
 3    preclude an entity from being converted or merged under other
 4    law.  A  bank or savings bank that converts to or merges with
 5    and into a limited liability company shall be subject to  the
 6    provisions  of this Article or to other applicable law to the
 7    extent that those provisions do not conflict with  the  State
 8    or  federal law pursuant to which the conversion or merger of
 9    the bank or savings bank is authorized.
10    (Source: P.A. 90-424, eff. 1-1-98.)

11        Section 840.  The Illinois Fairness  in  Lending  Act  is
12    amended by changing Sections 2, 3, and 5 as follows:

13        (815 ILCS 120/2) (from Ch. 17, par. 852)
14        Sec. 2. As used in this Act:
15        (a)  "Financial   Institution"  means  any  bank,  credit
16    union, insurance company, mortgage banking  company,  savings
17    bank,  or  savings and loan association, or other residential
18    mortgage lender which operates or has a place of business  in
19    this State.
20        (b)  "Person" means any natural person.
21        (c)  "Varying  the  terms of a loan" includes, but is not
22    limited to the following practices:
23        (1)  Requiring a greater than average down  payment  than
24    is usual for the particular type of a loan involved.
25        (2)  Requiring  a  shorter period of amortization than is
26    usual for the particular type of loan involved.
27        (3)  Charging a higher interest rate than  is  usual  for
28    the particular type of loan involved.
29        (4)  An  underappraisal  of  real estate or other item of
30    property offered as security.
31        (d) "Equity  stripping"  means  to  assist  a  person  in
32    obtaining  a loan secured by the person's principal residence
 
SB1784 Enrolled            -93-      LRB093 10148 BDD 11571 b
 1    for the primary purpose of  receiving  fees  related  to  the
 2    financing  when (i) the loan decreased the person's equity in
 3    the principal residence and (ii) at  the  time  the  loan  is
 4    made,  the  financial institution does not reasonably believe
 5    that the person will be able to make the  scheduled  payments
 6    to  repay  the  loan.  "Equity  stripping"  does  not include
 7    reverse mortgages as defined in Section 5a  of  the  Illinois
 8    Banking  Act,  Section  1-6a of the Illinois Savings and Loan
 9    Act of 1985, or subsection (3) of Section 46 of the  Illinois
10    Credit Union Act.
11        (e)   "Loan   flipping"  means  to  assist  a  person  in
12    refinancing  a  loan  secured  by  the   person's   principal
13    residence  for  the primary purpose of receiving fees related
14    to the refinancing when  (i)  the  refinancing  of  the  loan
15    results  in no tangible benefit to the person and (ii) at the
16    time the loan is made, the  financial  institution  does  not
17    reasonably  believe  that  the  refinancing  of the loan will
18    result in a tangible benefit to the person.
19        (f)  "Principal  residence"  means  a  person's   primary
20    residence  that is a dwelling consisting of 4 or fewer family
21    units or that is in a dwelling consisting of  condominium  or
22    cooperative units.
23    (Source: P.A. 81-1391.)

24        (815 ILCS 120/3) (from Ch. 17, par. 853)
25        Sec.  3.  No financial institution, in connection with or
26    in contemplation of any loan to any person, may:
27        (a)  Deny or vary the terms of a loan on the basis that a
28    specific parcel of real estate offered as security is located
29    in a specific geographical area.
30        (b)  Deny or vary the terms  of  a  loan  without  having
31    considered  all  of the regular and dependable income of each
32    person who would be liable for repayment of the loan.
33        (c)  Deny or vary the terms of a loan on the  sole  basis
 
SB1784 Enrolled            -94-      LRB093 10148 BDD 11571 b
 1    of   the   childbearing   capacity  of  an  applicant  or  an
 2    applicant's spouse.
 3        (d)  Utilize lending  standards  that  have  no  economic
 4    basis and which are discriminatory in effect.
 5        (e)  Engage in equity stripping or loan flipping.
 6    (Source: P.A. 81-1391.)

 7        (815 ILCS 120/5) (from Ch. 17, par. 855)
 8        Sec.   5.  (a)  Subject  to  the  limitation  imposed  by
 9    subsection (b), any person who has been aggrieved as a result
10    of a violation of this Act may bring an individual action  in
11    the  circuit  court  of  the  county  in which the particular
12    financial institution involved is located or doing business.
13        Upon a finding that a financial institution has committed
14    a violation of this Act, the court may award actual  damages,
15    and may in its discretion award court costs.
16        (b)  If the same events or circumstances would constitute
17    the basis for an action under this Act or an action under any
18    other  Act,  the  aggrieved  person  may  elect  between  the
19    remedies  proposed by the two Acts but may not bring actions,
20    either administrative or judicial, under more than one of the
21    two Acts in relation to those same events or circumstances.
22        (c)  An action to enjoin any person subject to  this  Act
23    from  engaging  in  activity in violation  of this Act may be
24    maintained in the name of the people of the State of Illinois
25    by the Attorney General or by the  State's  Attorney  of  the
26    county  in which the action is brought.  This remedy shall be
27    in addition to other remedies provided for any  violation  of
28    this Act.
29    (Source: P.A. 81-1391.)

30        Section  845.  The  Consumer Fraud and Deceptive Business
31    Practices Act is amended by changing Section 2Z as follows:
 
SB1784 Enrolled            -95-      LRB093 10148 BDD 11571 b
 1        (815 ILCS 505/2Z) (from Ch. 121 1/2, par. 262Z)
 2        Sec. 2Z.  Violations  of  other  Acts.   Any  person  who
 3    knowingly violates the Automotive Repair Act, the Home Repair
 4    and  Remodeling  Act,  the  Dance  Studio  Act,  the Physical
 5    Fitness  Services  Act,  the  Hearing   Instrument   Consumer
 6    Protection  Act,  the  Illinois  Union  Label  Act,  the  Job
 7    Referral  and  Job  Listing Services Consumer Protection Act,
 8    the Travel Promotion  Consumer  Protection  Act,  the  Credit
 9    Services  Organizations  Act, the Automatic Telephone Dialers
10    Act, the Pay-Per-Call Services Consumer Protection  Act,  the
11    Telephone  Solicitations  Act, the Illinois Funeral or Burial
12    Funds Act, the Cemetery Care Act, the Safe and  Hygienic  Bed
13    Act, the Pre-Need Cemetery Sales Act, the High Risk Home Loan
14    Act,  subsection  (a) or (b) of Section 3-10 of the Cigarette
15    Tax Act, subsection  (a)  or  (b)  of  Section  3-10  of  the
16    Cigarette  Use Tax Act, the Electronic Mail Act, or paragraph
17    (6) of subsection  (k)  of  Section  6-305  of  the  Illinois
18    Vehicle  Code commits an unlawful practice within the meaning
19    of this Act.
20    (Source: P.A. 91-164,  eff.  7-16-99;  91-230,  eff.  1-1-00;
21    91-233,  eff.  1-1-00;  91-810,  eff.  6-13-00;  92-426, eff.
22    1-1-02.)

23        Section 900. Severability. The provisions of this Act are
24    severable under Section 1.31 of the Statute on Statutes.