Full Text of SB2908 93rd General Assembly
SB2908sam001 93RD GENERAL ASSEMBLY
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Sen. William R. Haine
Filed: 3/24/2004
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| AMENDMENT TO SENATE BILL 2908
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| AMENDMENT NO. ______. Amend Senate Bill 2908 by replacing | 3 |
| everything after the enacting clause with the following:
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| by replacing everything after the enacting clause with the | 5 |
| following:
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| "Section 5. The Residential Mortgage License Act of 1987 is | 7 |
| amended by changing Sections 1-3, 1-4, 1-5, 2-2, 2-4, 2-6, 3-1, | 8 |
| 3-2, 3-4, 3-5, 4-1, 4-2, 4-5, and 6-2 and by adding Section | 9 |
| 4-9.1 as follows:
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| (205 ILCS 635/1-3) (from Ch. 17, par. 2321-3)
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| Sec. 1-3. Necessity for License; Scope of Act.
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| (a) No person, partnership, association, corporation or | 13 |
| other entity
shall engage in the business of brokering, | 14 |
| funding, originating, servicing
or purchasing of residential | 15 |
| mortgage loans without first obtaining a
license from the | 16 |
| Commissioner in accordance with the licensing procedure
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| provided in this Article I and such regulations as may be | 18 |
| promulgated by
the Commissioner. The licensing provisions of | 19 |
| this Section shall not apply
to any entity engaged solely in | 20 |
| commercial mortgage lending or
to any person, partnership | 21 |
| association, corporation or other entity
exempted pursuant to | 22 |
| Section 1-4, subsection (d), of this Act or in accordance
with | 23 |
| regulations promulgated by the Commissioner hereunder.
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| (b) No person, partnership, association, corporation, or | 2 |
| other entity
except a licensee under this Act or an entity | 3 |
| exempt from licensing
pursuant to Section 1-4, subsection (d), | 4 |
| of this Act shall do any business
under any name or title, or | 5 |
| circulate or use any advertising or make any
representation or | 6 |
| give any information to any person, which indicates or
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| reasonably implies activity within the scope
of this Act.
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| (c) The Commissioner may, through the Attorney General, | 9 |
| request the circuit
court of either Cook or Sangamon County to | 10 |
| issue an injunction to restrain
any person from violating or | 11 |
| continuing to violate any of the foregoing
provisions of this | 12 |
| Section.
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| (d) When the Commissioner has reasonable cause to believe | 14 |
| that any
entity which has not submitted an application for | 15 |
| licensure is conducting
any of the activities described in | 16 |
| subsection (a) hereof, the Commissioner
shall have the power to | 17 |
| examine all books and records of the entity and any
additional | 18 |
| documentation necessary in order to determine whether such
| 19 |
| entity should become licensed under this Act.
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| (d-1) The Commissioner shall have the power to issue orders | 21 |
| against any person, if the Commissioner has reasonable cause to | 22 |
| believe that an unsafe, unsound, or unlawful practice has | 23 |
| occurred, is occurring, or is about to occur, if any person has | 24 |
| violated, is violating, or is about to violate any law, rule, | 25 |
| or written agreement with the Commissioner, or for the purpose | 26 |
| of administering the provisions of this Act and any rule | 27 |
| promulgated in accordance with this Act.
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| (e) Any person, partnership, association, corporation or | 29 |
| other entity
who violates any provision of this Section commits | 30 |
| a business offense and
shall be fined an amount not to exceed | 31 |
| $25,000
$5,000 .
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| (f) Each person, partnership, association, corporation or | 33 |
| other entity
conducting activities regulated by this Act shall | 34 |
| be issued one license.
Each office, place of business or |
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| location at which a residential mortgage
licensee conducts any | 2 |
| part of his or her business must
be recorded with the | 3 |
| Commissioner pursuant to Section 2-8 of this Act.
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| (g) Licensees under this Act shall solicit, broker, fund, | 5 |
| originate,
service and purchase residential mortgage loans | 6 |
| only in conformity with the
provisions of this Act and such | 7 |
| rules and regulations as may be promulgated
by the | 8 |
| Commissioner.
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| (h) This Act applies to all entities doing business in | 10 |
| Illinois as
residential mortgage bankers, as defined by "An Act | 11 |
| to provide for the
regulation of mortgage bankers", approved | 12 |
| September 15, 1977, as amended,
regardless of whether licensed | 13 |
| under that or any prior Act. Any existing
residential mortgage | 14 |
| lender or residential mortgage broker in Illinois
whether or | 15 |
| not previously licensed, must operate in accordance with this | 16 |
| Act.
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| (i) This Act is a successor Act to and a continuance of the | 18 |
| regulation
of residential mortgage bankers provided in, "An Act | 19 |
| to provide for the
regulation of mortgage bankers", approved | 20 |
| September 15, 1977, as amended.
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| Entities and persons subject to the predecessor Act shall | 22 |
| be subject to
this Act from and after its effective date.
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| (Source: P.A. 86-137; 87-642.)
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| (205 ILCS 635/1-4) (from Ch. 17, par. 2321-4)
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| Sec. 1-4. Definitions.
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| (a) "Residential real property" or "residential real | 27 |
| estate" shall mean
real property located in this State improved | 28 |
| by a one-to-four family
dwelling used or occupied, wholly or | 29 |
| partly, as the home or residence of
one or more persons and may | 30 |
| refer, subject to regulations of the
Commissioner, to | 31 |
| unimproved real property upon which those kinds dwellings
are | 32 |
| to be constructed.
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| (b) "Making a residential mortgage loan" or "funding a |
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| residential mortgage
loan" shall mean for compensation or gain, | 2 |
| either directly or indirectly,
advancing funds or making a | 3 |
| commitment to advance funds to a loan applicant
for a | 4 |
| residential mortgage loan.
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| (c) "Soliciting, processing, placing, or negotiating a | 6 |
| residential
mortgage loan" shall mean for compensation or gain, | 7 |
| either directly or
indirectly, accepting or offering to accept | 8 |
| an application for a
residential mortgage loan, assisting or | 9 |
| offering to assist in the
processing of an application for a | 10 |
| residential mortgage loan on behalf of a
borrower, or | 11 |
| negotiating or offering to negotiate the terms or conditions
of | 12 |
| a residential mortgage loan with a lender on behalf of a | 13 |
| borrower
including, but not limited to, the submission of | 14 |
| credit packages for the
approval of lenders, the preparation of | 15 |
| residential mortgage loan closing
documents, including a | 16 |
| closing in the name of a broker.
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| (d) "Exempt person or entity" shall mean the following:
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| (1) (i) Any banking organization or foreign banking | 19 |
| corporation
licensed by the Illinois Commissioner of Banks | 20 |
| and Real Estate or the
United States Comptroller of the | 21 |
| Currency to transact business in this
State; (ii) any | 22 |
| national bank, federally chartered savings and loan
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| association, federal savings bank, federal credit union; | 24 |
| (iii) any pension
trust, bank trust, or bank trust company; | 25 |
| (iv) any bank, savings and loan
association, savings bank, | 26 |
| or credit union organized under the laws of this
or any | 27 |
| other state; (v) any Illinois Consumer Installment Loan Act | 28 |
| licensee;
(vi) any insurance company authorized to | 29 |
| transact business in this State;
(vii) any entity engaged | 30 |
| solely in commercial mortgage lending; (viii) any
service | 31 |
| corporation of a savings and loan association or savings | 32 |
| bank organized
under the laws of this State or the service | 33 |
| corporation of a federally
chartered savings and loan | 34 |
| association or savings bank having
its principal place of |
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| business in this State, other than a service
corporation | 2 |
| licensed or entitled to reciprocity under the Real Estate
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| License Act of 2000; or (ix) any first tier subsidiary of a
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| bank, the charter of which is issued under the Illinois | 5 |
| Banking Act
by the Illinois Commissioner of Banks and Real | 6 |
| Estate,
or the first tier subsidiary of a bank chartered by | 7 |
| the United States
Comptroller of the Currency and that has | 8 |
| its principal place of business
in this State, provided | 9 |
| that the first tier subsidiary is regularly
examined by the | 10 |
| Illinois Commissioner of Banks and Real Estate
or the | 11 |
| Comptroller of the Currency, or a consumer compliance | 12 |
| examination is
regularly conducted by the Federal Reserve | 13 |
| Board.
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| (1.5) Any employee of a person or entity mentioned in
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| item (1) of this subsection.
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| (2) Any person or entity that does not originate
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| mortgage loans in the ordinary course of
business making or | 18 |
| acquiring residential mortgage loans
with his or her or its | 19 |
| own funds for his or her or its own investment
without | 20 |
| intent to
make, acquire, or resell more than 10 residential | 21 |
| mortgage loans in
any one calendar year.
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| (3) Any person employed by a licensee to assist in the | 23 |
| performance of
the activities regulated by this Act who is | 24 |
| compensated in any manner by
only one licensee.
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| (4) Any person licensed pursuant to the Real Estate
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| License Act of
2000, who engages only in the taking of | 27 |
| applications and credit
and
appraisal information to | 28 |
| forward to a licensee or an exempt entity under this
Act | 29 |
| and who is compensated by either a licensee or an exempt | 30 |
| entity under this
Act, but is not compensated by either the | 31 |
| buyer (applicant) or the seller.
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| (5) Any individual, corporation, partnership, or other | 33 |
| entity that
originates, services, or brokers residential | 34 |
| mortgage loans, as these
activities are defined in this |
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| Act, and who or which receives no
compensation for those | 2 |
| activities, subject to the Commissioner's
regulations with | 3 |
| regard to the nature and amount of compensation.
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| (6) A person who prepares supporting documentation for | 5 |
| a residential
mortgage loan application taken by a licensee | 6 |
| and performs ministerial
functions pursuant to specific | 7 |
| instructions of the licensee who neither
requires nor | 8 |
| permits the preparer to exercise his or her discretion or
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| judgment; provided that this activity is engaged in | 10 |
| pursuant to a binding,
written agreement between the | 11 |
| licensee and the preparer that:
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| (A) holds the licensee fully accountable for the | 13 |
| preparer's action; and
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| (B) otherwise meets the requirements of this | 15 |
| Section and this Act, does
not undermine the purposes | 16 |
| of this Act, and is approved by the
Commissioner.
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| (e) "Licensee" or "residential mortgage licensee" shall | 18 |
| mean a person,
partnership, association, corporation, or any | 19 |
| other entity who or which is
licensed pursuant to this Act to | 20 |
| engage in the activities regulated by
this Act.
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| (f) "Mortgage loan" "residential mortgage loan" or "home
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| mortgage loan" shall mean a loan to or for the benefit of any
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| natural person made primarily for personal, family, or | 24 |
| household use,
primarily secured by either a mortgage on | 25 |
| residential real property or
certificates of stock or other | 26 |
| evidence of ownership interests in and
proprietary leases from, | 27 |
| corporations, partnerships, or limited
liability companies | 28 |
| formed for the purpose
of cooperative ownership of residential | 29 |
| real property, all located in Illinois.
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| (g) "Lender" shall mean any person, partnership, | 31 |
| association,
corporation, or any other entity who either lends | 32 |
| or invests money in
residential mortgage loans.
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| (h) "Ultimate equitable owner" shall mean a person who, | 34 |
| directly
or indirectly, owns or controls an ownership interest |
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| in a corporation,
foreign corporation, alien business | 2 |
| organization, trust, or any other form
of business organization | 3 |
| regardless of whether the person owns or controls
the ownership | 4 |
| interest through one or more persons or one or more proxies,
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| powers of attorney, nominees, corporations, associations, | 6 |
| partnerships,
trusts, joint stock companies, or other entities | 7 |
| or devices, or any
combination thereof.
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| (i) "Residential mortgage financing transaction" shall | 9 |
| mean the negotiation,
acquisition, sale, or arrangement for or | 10 |
| the offer to negotiate, acquire,
sell, or arrange for, a | 11 |
| residential mortgage loan or residential mortgage
loan | 12 |
| commitment.
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| (j) "Personal residence address" shall mean a street | 14 |
| address and shall
not include a post office box number.
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| (k) "Residential mortgage loan commitment" shall mean a | 16 |
| contract for
residential mortgage loan financing.
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| (l) "Party to a residential mortgage financing | 18 |
| transaction" shall mean a
borrower, lender, or loan broker in a | 19 |
| residential mortgage financing
transaction.
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| (m) "Payments" shall mean payment of all or any of the | 21 |
| following:
principal, interest and escrow reserves for taxes, | 22 |
| insurance and other related
reserves, and reimbursement for | 23 |
| lender advances.
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| (n) "Commissioner" shall mean the Commissioner of Banks and | 25 |
| Real Estate
or a person authorized by the Commissioner, the | 26 |
| Office of Banks and Real Estate
Act, or this Act to act in the | 27 |
| Commissioner's stead.
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| (o) "Loan brokering", "brokering", or "brokerage service" | 29 |
| shall mean the act
of helping to obtain from another entity, | 30 |
| for a borrower, a loan secured by
residential real estate | 31 |
| situated in Illinois or assisting a borrower in
obtaining a | 32 |
| loan secured by residential real estate situated in Illinois in
| 33 |
| return for consideration to be paid by either the borrower or | 34 |
| the lender
including, but not limited to, contracting for the |
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| delivery of residential
mortgage loans to a third party lender | 2 |
| and soliciting, processing, placing,
or negotiating | 3 |
| residential mortgage loans.
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| (p) "Loan broker" or "broker" shall mean a person, | 5 |
| partnership,
association, corporation, or limited liability | 6 |
| company, other than
those persons, partnerships,
associations, | 7 |
| corporations, or limited liability companies exempted
from | 8 |
| licensing pursuant to Section
1-4, subsection (d), of this Act, | 9 |
| who performs the activities described
in subsections (c) and | 10 |
| (o) of this Section.
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| (q) "Servicing" shall mean the collection or remittance for | 12 |
| or the
right or obligation to collect or remit for any lender, | 13 |
| noteowner,
noteholder, or for a licensee's own account, of | 14 |
| payments, interests,
principal, and trust items such as hazard | 15 |
| insurance and taxes on a
residential mortgage loan in | 16 |
| accordance with the terms of the residential
mortgage loan; and | 17 |
| includes loan payment follow-up, delinquency loan
follow-up, | 18 |
| loan analysis and any notifications to the borrower that are
| 19 |
| necessary to enable the borrower to keep the loan current and | 20 |
| in good standing.
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| (r) "Full service office" shall mean office and staff in | 22 |
| Illinois
reasonably adequate to handle efficiently | 23 |
| communications, questions, and
other matters relating to any | 24 |
| application for, or an existing home mortgage
secured by | 25 |
| residential real estate situated in Illinois
with respect to | 26 |
| which the licensee is brokering, funding originating,
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| purchasing, or servicing. The management and operation of each | 28 |
| full service
office must include observance of good business | 29 |
| practices such as adequate,
organized, and accurate books and | 30 |
| records; ample phone lines, hours of
business, staff training | 31 |
| and supervision, and provision for a mechanism to
resolve | 32 |
| consumer inquiries, complaints, and problems. The Commissioner
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| shall issue regulations with regard to these requirements and | 34 |
| shall include
an evaluation of compliance with this Section in |
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| his or her periodic
examination of each licensee.
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| (s) "Purchasing" shall mean the purchase of conventional or
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| government-insured mortgage loans secured by residential real | 4 |
| estate
situated in Illinois from either the lender or from the | 5 |
| secondary market.
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| (t) "Borrower" shall mean the person or persons who seek | 7 |
| the services of
a loan broker, originator, or lender.
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| (u) "Originating" shall mean the issuing of commitments for | 9 |
| and funding of
residential mortgage loans.
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| (v) "Loan brokerage agreement" shall mean a written | 11 |
| agreement in which a
broker or loan broker agrees to do either | 12 |
| of the following:
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| (1) obtain a residential mortgage loan for the borrower | 14 |
| or assist the
borrower in obtaining a residential mortgage | 15 |
| loan; or
| 16 |
| (2) consider making a residential mortgage loan to the | 17 |
| borrower.
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| (w) "Advertisement" shall mean the attempt by publication,
| 19 |
| dissemination, or circulation to induce, directly or | 20 |
| indirectly,
any person to enter into a residential mortgage | 21 |
| loan agreement or
residential mortgage loan brokerage | 22 |
| agreement relative to a
mortgage secured by residential real | 23 |
| estate situated in Illinois.
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| (x) "Residential Mortgage Board" shall mean the | 25 |
| Residential Mortgage
Board created in Section 1-5 of this Act.
| 26 |
| (y) "Government-insured mortgage loan" shall mean any | 27 |
| mortgage loan made
on the security of residential real estate | 28 |
| insured by the Department of
Housing and Urban Development or | 29 |
| Farmers Home Loan Administration, or
guaranteed by the Veterans | 30 |
| Administration.
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| (z) "Annual audit" shall mean a certified audit of the | 32 |
| licensee's books and
records and systems of internal control | 33 |
| performed by a certified public
accountant in accordance with | 34 |
| generally accepted accounting principles
and generally |
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| accepted auditing standards.
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| (aa) "Financial institution" shall mean a savings and loan
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| association, savings bank, credit union, or a bank organized | 4 |
| under the
laws of Illinois or a savings and loan association, | 5 |
| savings bank,
credit union or a bank organized under the laws | 6 |
| of the United States and
headquartered in Illinois.
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| (bb) "Escrow agent" shall mean a third party, individual or | 8 |
| entity
charged with the fiduciary obligation for holding escrow | 9 |
| funds on a
residential mortgage loan pending final payout of | 10 |
| those funds
in accordance with the terms of the residential | 11 |
| mortgage loan.
| 12 |
| (cc) "Net worth" shall have the meaning ascribed thereto in | 13 |
| Section 3-5
of this Act.
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| (dd) "Affiliate" shall mean:
| 15 |
| (1) any entity that directly controls or is controlled | 16 |
| by the licensee
and any other company that is directly | 17 |
| affecting activities regulated by
this Act that is | 18 |
| controlled by the company that controls the licensee;
| 19 |
| (2) any entity:
| 20 |
| (A) that is controlled, directly or indirectly, by | 21 |
| a trust or otherwise,
by or for the benefit of | 22 |
| shareholders who beneficially or otherwise
control, | 23 |
| directly or indirectly, by trust or otherwise, the | 24 |
| licensee or any
company that controls the licensee; or
| 25 |
| (B) a majority of the directors or trustees of | 26 |
| which constitute a
majority of the persons holding any | 27 |
| such office with the licensee or any
company that | 28 |
| controls the licensee;
| 29 |
| (3) any company, including a real estate investment | 30 |
| trust, that is
sponsored and advised on a contractual basis | 31 |
| by the licensee or any
subsidiary or affiliate of the | 32 |
| licensee.
| 33 |
| The Commissioner may define by rule and regulation any | 34 |
| terms used
in this Act for the efficient and clear |
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| administration of this Act.
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| (ee) "First tier subsidiary" shall be defined by regulation
| 3 |
| incorporating the comparable definitions used by the Office of | 4 |
| the
Comptroller of the Currency and the Illinois Commissioner | 5 |
| of Banks
and Real Estate.
| 6 |
| (ff) "Gross delinquency rate" means the quotient | 7 |
| determined by dividing
(1) the sum of (i) the number of | 8 |
| government-insured residential mortgage loans
funded or | 9 |
| purchased by a licensee in the preceding calendar year that are
| 10 |
| delinquent and (ii) the number of conventional residential | 11 |
| mortgage loans
funded or purchased by the licensee in the | 12 |
| preceding calendar year that are
delinquent by (2) the sum of | 13 |
| (i) the number of government-insured residential
mortgage | 14 |
| loans funded or purchased by the licensee in the preceding | 15 |
| calendar
year and (ii) the number of conventional residential | 16 |
| mortgage loans funded or
purchased by the licensee in the | 17 |
| preceding calendar year.
| 18 |
| (gg) "Delinquency rate factor" means the factor set by rule | 19 |
| of the
Commissioner that is multiplied by the average gross | 20 |
| delinquency rate of
licensees, determined annually for the | 21 |
| immediately preceding calendar year, for
the purpose of | 22 |
| determining which licensees shall be examined by the
| 23 |
| Commissioner pursuant to subsection (b) of Section 4-8 of this | 24 |
| Act.
| 25 |
| (hh) "Loan originator" means any natural person who, for | 26 |
| compensation or in
the expectation of compensation, either | 27 |
| directly or indirectly makes, offers to
make, solicits, places, | 28 |
| or negotiates a residential mortgage loan.
| 29 |
| (ii) "Confidential supervisory information" means any | 30 |
| report of examination, visitation, or investigation prepared | 31 |
| by the Commissioner under this Act, any report of examination, | 32 |
| visitation, or investigation prepared by the state regulatory | 33 |
| authority of another state that examines a licensee, any | 34 |
| document or record prepared or obtained in connection with or |
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| relating to any examination, visitation, or investigation, and | 2 |
| any record prepared or obtained by the Commissioner to the | 3 |
| extent that the record summarizes or contains information | 4 |
| derived from any report, document, or record described in this | 5 |
| subdivision (ii). "Confidential supervisory information" does | 6 |
| not include any information or record routinely prepared by a | 7 |
| licensee and maintained in the ordinary course of business or | 8 |
| any information or record that is required to be made publicly | 9 |
| available pursuant to State or federal law or rule.
| 10 |
| (Source: P.A. 93-561, eff. 1-1-04.)
| 11 |
| (205 ILCS 635/1-5) (from Ch. 17, par. 2321-5)
| 12 |
| Sec. 1-5. Residential Mortgage Board.
| 13 |
| (a) Board composition, compensation. There is created the | 14 |
| Residential
Mortgage Board composed of 5 members appointed by | 15 |
| the Commissioner of Banks
and Real Estate. The majority of | 16 |
| persons
on the Board shall have no financial interest in any | 17 |
| residential mortgage
business and one member shall be a | 18 |
| representative of the Mortgage Banking Trade
Association and | 19 |
| one member shall be a representative of the Mortgage Broker
| 20 |
| Trade Association. Members of the Board serving on the | 21 |
| effective
date of this amendatory Act of 1996 shall continue to | 22 |
| serve their
unexpired terms as members of the Residential | 23 |
| Mortgage Board. Thereafter, on
or before January 15 of each | 24 |
| year, the Commissioner shall appoint one or more
board members, | 25 |
| as shall be necessary to maintain a 5 member Board, whose terms
| 26 |
| shall be for 3 years commencing February 1 of the year in which | 27 |
| they are
respectively appointed.
| 28 |
| If a vacancy occurs on the Residential Mortgage Board, the | 29 |
| Commissioner
shall within 60 days appoint a new member who | 30 |
| shall hold office for the
remainder of the vacated term.
| 31 |
| The Board shall meet at the call of the chairman, who along | 32 |
| with a
Secretary, shall be selected by the Board from among its | 33 |
| members.
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| Members of the Board shall be entitled to receive a per | 2 |
| diem allowance of
$25 for each day or part of a day spent on | 3 |
| Board work and shall be entitled
to their expenses actually and | 4 |
| necessarily incurred in the performance of
their duties. The | 5 |
| members of the Board serve at the pleasure of the
Commissioner.
| 6 |
| (b) Duties of Board. The Residential Mortgage Board shall | 7 |
| assist the
Commissioner by:
| 8 |
| (1) submitting recommendations to the Commissioner for | 9 |
| the efficient
administration of this Act; and
| 10 |
| (2) performing other duties as are prescribed by the | 11 |
| Commissioner.
| 12 |
| (c) Conflict of interest declarations. Each member of the | 13 |
| Residential
Mortgage Board shall file annually, no later than | 14 |
| February 1, with the
Commissioner a statement of his or her | 15 |
| current business transactions or
other affiliations with any | 16 |
| licensee under this Act.
The Commissioner may adopt rules to | 17 |
| avoid conflicts of interest on the
part of members of the | 18 |
| Residential Mortgage Board in connection with their
position on | 19 |
| the Board.
| 20 |
| (Source: P.A. 89-355, eff. 8-17-95; 89-508, eff. 7-3-96.)
| 21 |
| (205 ILCS 635/2-2) (from Ch. 17, par. 2322-2)
| 22 |
| Sec. 2-2. Application process; investigation; fee.
| 23 |
| (a) The Commissioner shall issue a license upon completion | 24 |
| of all of the
following:
| 25 |
| (1) The filing of an application for license.
| 26 |
| (2) The filing with the Commissioner of a listing of | 27 |
| judgments entered
against, and bankruptcy petitions by, | 28 |
| the license applicant for the
preceding 10 years.
| 29 |
| (3) The payment, in certified funds, of
investigation | 30 |
| and application fees, the total of which shall be in an
| 31 |
| amount equal to $2,700 annually, however, the Commissioner | 32 |
| may
increase the
investigation and application fees by rule | 33 |
| as provided in Section 4-11.
|
|
|
|
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| (4) Except for a broker applying to renew a license, | 2 |
| the filing of an
audited balance sheet including all | 3 |
| footnotes prepared by a certified public
accountant in | 4 |
| accordance with generally accepted accounting principles | 5 |
| and
generally accepted auditing principles which evidences | 6 |
| that the applicant meets
the net worth requirements of | 7 |
| Section 3-5.
| 8 |
| (5) The filing of proof satisfactory to the | 9 |
| Commissioner that the
applicant, the members thereof if the | 10 |
| applicant is a partnership or
association, the members or | 11 |
| managers thereof that retain any authority or
| 12 |
| responsibility under the operating agreement if the | 13 |
| applicant is a limited
liability company, or the officers | 14 |
| thereof if the applicant
is a corporation have 3 years | 15 |
| experience preceding application
in real estate finance. | 16 |
| Instead of this requirement, the applicant and the
| 17 |
| applicant's officers or members, as applicable, may
| 18 |
| satisfactorily complete a program of education in real | 19 |
| estate finance and
fair lending, as
approved by the | 20 |
| Commissioner, prior to receiving the
initial license.
The | 21 |
| Commissioner shall promulgate rules regarding proof of | 22 |
| experience
requirements and educational requirements and | 23 |
| the satisfactory completion of
those requirements. The | 24 |
| Commissioner may establish by rule a list of duly
licensed | 25 |
| professionals and others who may be exempt from this | 26 |
| requirement.
| 27 |
| (6) An investigation of the averments required by | 28 |
| Section 2-4, which
investigation must allow the | 29 |
| Commissioner to issue positive findings stating
that the | 30 |
| financial responsibility, experience, character, and | 31 |
| general fitness
of the license applicant and of the members | 32 |
| thereof if the license applicant is
a partnership or | 33 |
| association, of the officers and directors thereof if the
| 34 |
| license applicant is a corporation, and of the managers and |
|
|
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| members that retain
any authority or responsibility under | 2 |
| the operating agreement if the license
applicant is a | 3 |
| limited liability company are such as to command the | 4 |
| confidence
of the community and to warrant belief that the | 5 |
| business will be operated
honestly, fairly and efficiently | 6 |
| within the purpose of this Act. If the
Commissioner shall | 7 |
| not so find, he or she shall not issue such license, and he
| 8 |
| or she shall notify the license applicant of the denial.
| 9 |
| The Commissioner shall have the power to impose conditions | 10 |
| on any approval issued by
the Commissioner if the Commissioner | 11 |
| determines that the conditions are necessary or appropriate. | 12 |
| These conditions shall be imposed in writing and shall continue | 13 |
| in effect for the period prescribed by the Commissioner.
| 14 |
| (b) All licenses shall be issued in duplicate with one copy
| 15 |
| being transmitted to the license applicant and the second being
| 16 |
| retained with the Commissioner.
| 17 |
| Upon receipt of such license, a residential mortgage | 18 |
| licensee shall be
authorized to engage in the business | 19 |
| regulated by this Act. Such license
shall remain in full force | 20 |
| and effect until it expires without renewal, is
surrendered by | 21 |
| the licensee or revoked or suspended as hereinafter provided.
| 22 |
| (Source: P.A. 93-32, eff. 7-1-03.)
| 23 |
| (205 ILCS 635/2-4) (from Ch. 17, par. 2322-4)
| 24 |
| Sec. 2-4. Averments of Licensee. Each application for | 25 |
| license or for the
renewal of a license shall be accompanied by | 26 |
| the following averments stating
that the applicant:
| 27 |
| (a) Will maintain at least one full service office | 28 |
| within the
State of Illinois pursuant to Section 3-4 of | 29 |
| this Act;
| 30 |
| (b) Will maintain staff reasonably adequate to meet the | 31 |
| requirements of
Section 3-4 of this Act;
| 32 |
| (c) Will keep and maintain for 36 months the same | 33 |
| written records
as required by the federal Equal Credit |
|
|
|
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| 1 |
| Opportunity Act, and any other
information required by | 2 |
| regulations of the Commissioner regarding any home
| 3 |
| mortgage in the course of the conduct of its residential | 4 |
| mortgage business;
| 5 |
| (d) Will file with the Commissioner, when due, any | 6 |
| report or reports
which it is required to file under any of | 7 |
| the provisions of this Act;
| 8 |
| (e) Will not engage, whether as principal or agent, in | 9 |
| the practice of
rejecting residential mortgage | 10 |
| applications without reasonable cause, or
varying terms or | 11 |
| application procedures without reasonable cause, for home
| 12 |
| mortgages on real estate within any specific geographic | 13 |
| area from the terms
or procedures generally provided by the | 14 |
| licensee within other geographic
areas of the State;
| 15 |
| (f) Will not engage in fraudulent home mortgage | 16 |
| underwriting practices;
| 17 |
| (g) Will not make payment, whether directly or | 18 |
| indirectly, of any kind
to any in house or fee appraiser of | 19 |
| any government or private money lending
agency with which | 20 |
| an application for a home mortgage has been filed for the
| 21 |
| purpose of influencing the independent judgment of the | 22 |
| appraiser with respect
to the value of any real estate | 23 |
| which is to be covered by such home mortgage;
| 24 |
| (h) Has filed tax returns (State and Federal) for the | 25 |
| past 3
years or filed with the Commissioner an accountant's | 26 |
| or attorney's
statement as to why no return was filed;
| 27 |
| (i) Will not engage in any discrimination or redlining | 28 |
| activities
prohibited by Section 3-8 of this Act;
| 29 |
| (j) Will not knowingly make any false promises likely | 30 |
| to influence or
persuade, or pursue a course of | 31 |
| misrepresentation and false promises
through agents, | 32 |
| solicitors, advertising or otherwise;
| 33 |
| (k) Will not knowingly misrepresent, circumvent or | 34 |
| conceal, through
whatever subterfuge or device, any of the |
|
|
|
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| 1 |
| material particulars or the
nature thereof, regarding a | 2 |
| transaction to which it is a party to the
injury of another | 3 |
| party thereto;
| 4 |
| (l) Will disburse funds in accordance with its | 5 |
| agreements;
| 6 |
| (m) Has not committed a crime against the law of this | 7 |
| State, any other
state or of the United States, involving | 8 |
| moral turpitude, fraudulent or
dishonest dealing, and that | 9 |
| no final judgment has been entered against it in
a civil | 10 |
| action upon grounds of fraud, misrepresentation or deceit | 11 |
| which has
not been previously reported to the Commissioner;
| 12 |
| (n) Will account or deliver to any person any personal | 13 |
| property such as
money, fund, deposit, check, draft, | 14 |
| mortgage, other document or thing of
value, which has come | 15 |
| into its possession, and which is not its property,
or | 16 |
| which it is not in law or equity entitled to retain under | 17 |
| the
circumstances, at the time which has been agreed upon | 18 |
| or is required
by law, or, in the absence of a fixed time, | 19 |
| upon demand of the person
entitled to such accounting and | 20 |
| delivery;
| 21 |
| (o) Has not engaged in any conduct which would be cause | 22 |
| for denial of a
license;
| 23 |
| (p) Has not become insolvent;
| 24 |
| (q) Has not submitted an application for a license | 25 |
| under this Act which
contains a material misstatement;
| 26 |
| (r) Has not demonstrated by course of conduct, | 27 |
| negligence or incompetence
in performing any act for which | 28 |
| it is required to hold a license under this
Act;
| 29 |
| (s) Will advise the Commissioner in writing of any | 30 |
| changes to the
information submitted on the most recent | 31 |
| application for license within 30
days of said change. The | 32 |
| written notice must be signed in the same form as
the | 33 |
| application for license being amended;
| 34 |
| (t) Will comply with the provisions of this Act, or |
|
|
|
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| 1 |
| with any lawful
order, rule or regulation made or issued | 2 |
| under the provisions of this Act;
| 3 |
| (u) Will submit to periodic examination by the | 4 |
| Commissioner as required
by this Act;
| 5 |
| (v) Will advise the Commissioner in writing of | 6 |
| judgments entered
against, and bankruptcy petitions by, | 7 |
| the license applicant within 5
days of occurrence;
| 8 |
| (w) Will advise the Commissioner in writing within 30 | 9 |
| days when the
license applicant requests a licensee under | 10 |
| this Act to repurchase a loan, and
the circumstances | 11 |
| therefor; and
| 12 |
| (x) Will advise the Commissioner in writing within 30 | 13 |
| days when the
license applicant is requested by another | 14 |
| entity to repurchase a loan, and the
circumstances | 15 |
| therefor ;
.
| 16 |
| (y) Will at all times act in a manner consistent with | 17 |
| subsections (a) and
(b) of Section 1-2 of this Act ;
.
| 18 |
| (z)
(x) Will not knowingly hire or employ a loan | 19 |
| originator who is
not registered with the Commissioner as | 20 |
| required under Section 7-1 of this Act ; and | 21 |
| (z-1) Will not knowingly employ or otherwise permit, | 22 |
| except with prior written consent of the Commissioner, an | 23 |
| individual to serve as an officer, director, or employee | 24 |
| for the licensee if the individual has been convicted of a | 25 |
| felony or any criminal offense relating to dishonesty or | 26 |
| breach of trust .
| 27 |
| A licensee who fails to fulfill obligations of an averment, | 28 |
| to comply with
averments made, or otherwise violates any of the | 29 |
| averments made under this
Section shall be subject to the | 30 |
| penalties in Section 4-5 of this Act.
| 31 |
| (Source: P.A. 93-561, eff. 1-1-04; revised 10-9-03.)
| 32 |
| (205 ILCS 635/2-6) (from Ch. 17, par. 2322-6)
| 33 |
| Sec. 2-6. License issuance and renewal; fee.
|
|
|
|
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| 1 |
| (a) Beginning July 1, 2003, licenses shall be renewed every | 2 |
| year on the
anniversary of the date of issuance of the original | 3 |
| license.
Properly completed renewal application forms and | 4 |
| filing fees must be received
by the Commissioner 60 days prior | 5 |
| to the renewal date.
| 6 |
| (b) It shall be the responsibility of each licensee to | 7 |
| accomplish renewal
of its license; failure of the licensee to | 8 |
| receive renewal forms absent a
request sent by certified mail | 9 |
| for such forms will not waive said
responsibility. Failure by a | 10 |
| licensee to submit a properly completed
renewal application | 11 |
| form and fees in a timely fashion, absent a written
extension | 12 |
| from the Commissioner, will result in the assessment of
| 13 |
| additional fees, as follows:
| 14 |
| (1) A fee of $750 will be assessed to the licensee 30 | 15 |
| days
after the
proper renewal date and $1,500 each month | 16 |
| thereafter, until the
license is
either renewed or expires | 17 |
| pursuant to Section 2-6, subsections (c) and (d),
of this | 18 |
| Act.
| 19 |
| (2) Such fee will be assessed without prior notice to | 20 |
| the licensee, but
will be assessed only in cases wherein | 21 |
| the Commissioner has in his or her
possession documentation | 22 |
| of the licensee's continuing activity for which
the | 23 |
| unrenewed license was issued.
| 24 |
| (c) A license which is not renewed by the date required in | 25 |
| this Section
shall automatically become inactive. No activity | 26 |
| regulated by this Act
shall be conducted by the licensee when a | 27 |
| license becomes inactive. The Commissioner may require the | 28 |
| licensee to provide a plan for the disposition of any | 29 |
| residential mortgage loans not closed or funded when the | 30 |
| license becomes inactive. The Commissioner may approve the | 31 |
| licensee conducting activities regulated by this Act with an | 32 |
| inactive license for the sole purpose of assisting borrowers in | 33 |
| the closing or funding of loans for which the licensee had an | 34 |
| active license at the time the loan application was taken from |
|
|
|
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| 1 |
| a borrower. An
inactive license may be reactivated by filing a | 2 |
| completed reactivation
application with the Commissioner upon
| 3 |
| , payment of the renewal fee, and payment
of a reactivation fee | 4 |
| equal to the renewal fee.
| 5 |
| (d) A license which is not renewed within one year of | 6 |
| becoming inactive
shall expire.
| 7 |
| (e) A licensee ceasing an activity or activities regulated | 8 |
| by this Act
and desiring to no longer be licensed shall so | 9 |
| inform the Commissioner in
writing and, at the same time, | 10 |
| convey the license and all other symbols or
indicia of | 11 |
| licensure. The licensee shall include a plan for the withdrawal
| 12 |
| from regulated business, including a timetable for the | 13 |
| disposition of the
business. Upon receipt of such written | 14 |
| notice, the Commissioner shall issue
a certified statement | 15 |
| canceling the license.
| 16 |
| (Source: P.A. 93-32, eff. 7-1-03; 93-561, eff. 1-1-04; revised | 17 |
| 9-23-03.)
| 18 |
| (205 ILCS 635/3-1) (from Ch. 17, par. 2323-1)
| 19 |
| Sec. 3-1. Bonds of licensees.
| 20 |
| (a) Every licensee, with respect to any person appointed or | 21 |
| elected
to any position requiring the receipt of payment, | 22 |
| management, or use of money
belonging to a residential mortgage | 23 |
| licensee engaged in the activities of
originating, servicing, | 24 |
| or purchasing mortgage loans or whose duties permit him
or her | 25 |
| to have access to or custody of any of its money or securities | 26 |
| or
custody of any money or securities belonging to third | 27 |
| parties or whose duties
permit him or her regularly to make | 28 |
| entries in the books or other records of a
licensee, shall, | 29 |
| before assuming his or her duties, maintain a fidelity bond in
| 30 |
| the amount of $100,000 by some fidelity insurance company | 31 |
| licensed to do
business in this State.
| 32 |
| (b) Each bond shall be for any loss the licensee may | 33 |
| sustain in money or
other property through the commission of |
|
|
|
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| 1 |
| any dishonest or criminal act or
omission by any person | 2 |
| required to be bonded, whether committed alone or in
concert | 3 |
| with another. The bond shall be in the form and amount approved
| 4 |
| by the Commissioner who may at any time require one or more | 5 |
| additional
bonds. A true copy of every bond, including all | 6 |
| riders and endorsements
executed subsequent to the effective | 7 |
| date of the bond, shall be filed at
all times with the | 8 |
| Commissioner. Each bond shall provide that a
cancellation | 9 |
| thereof shall not become effective unless and until
30 days | 10 |
| notice in writing first shall have been given to the | 11 |
| Commissioner
unless he or she shall have approved the | 12 |
| cancellation earlier.
If the Commissioner believes the | 13 |
| licensee's business is being conducted in
an unsafe manner due | 14 |
| to the lack of bonds or the inadequacy of bonds,
he or she may | 15 |
| proceed against the licensee as provided for in Section 4-5.
| 16 |
| (c) All licensees shall maintain a bond in accordance with | 17 |
| this subsection.
Each bond shall be for the recovery of | 18 |
| expenses, fines, or fees due to or
levied by the Commissioner | 19 |
| in accordance with this Act. The bond shall be
payable when the | 20 |
| licensee fails to comply with any provisions of this Act and
| 21 |
| shall be in the form of a surety or licensure bond in the | 22 |
| amount and form as
prescribed by the Commissioner pursuant to | 23 |
| rules and regulations. The bond
shall be payable to the Office | 24 |
| of Banks and Real Estate and shall be issued by some insurance | 25 |
| company
authorized to do business in this State. A copy of the | 26 |
| bond, including any and
all riders and endorsements executed | 27 |
| subsequent to the effective date of the
bond, shall be placed | 28 |
| on file with the Office of Banks and Real Estate within 10 days | 29 |
| of the
execution thereof.
| 30 |
| (d) The Commissioner may promulgate rules with respect to | 31 |
| bonding
requirements for residential mortgage licensees that | 32 |
| are
reasonable and necessary to accomplish the purposes of this | 33 |
| Act.
| 34 |
| (e) The Commissioner may require licensees to maintain a |
|
|
|
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| 1 |
| bond for errors and omissions in performing activities | 2 |
| regulated by this Act.
| 3 |
| (Source: P.A. 89-508, eff. 7-3-96.)
| 4 |
| (205 ILCS 635/3-2) (from Ch. 17, par. 2323-2)
| 5 |
| Sec. 3-2. Annual audit.
| 6 |
| (a) At the licensee's fiscal year-end, but in no
case more | 7 |
| than 12 months after the last audit conducted pursuant to this
| 8 |
| Section, except as otherwise provided in this Section, it shall | 9 |
| be
mandatory for each residential mortgage licensee to
cause | 10 |
| its books and accounts to be audited by a certified public | 11 |
| accountant
not connected with such licensee. The books and | 12 |
| records of all licensees
under this Act shall be maintained on | 13 |
| an accrual basis. The audit must be
sufficiently comprehensive | 14 |
| in scope to permit
the expression of an opinion on the | 15 |
| financial statements, which must be
prepared in accordance with | 16 |
| generally accepted accounting principles, and
must be | 17 |
| performed in accordance with generally accepted auditing | 18 |
| standards. Notwithstanding
the requirements of this | 19 |
| subsection, a licensee that is a first tier subsidiary
may | 20 |
| submit audited consolidated financial statements of its parent | 21 |
| as long as
the consolidated statements are supported by | 22 |
| consolidating statements. The
licensee's chief financial | 23 |
| officer shall attest to the licensee's financial
statements | 24 |
| disclosed in the consolidating statements.
| 25 |
| (b) As used herein, the term "expression of opinion" | 26 |
| includes either
(1) an unqualified opinion, (2) a qualified | 27 |
| opinion, (3) a disclaimer of
opinion, or (4) an adverse | 28 |
| opinion.
| 29 |
| (c) If a qualified or adverse opinion is expressed or if an | 30 |
| opinion is
disclaimed, the reasons therefore must be fully | 31 |
| explained. An opinion,
qualified as to a scope limitation, | 32 |
| shall not be acceptable.
| 33 |
| (d) The most recent audit report shall be filed with the
|
|
|
|
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| 1 |
| Commissioner within 90 days after the end of the licensee's | 2 |
| fiscal year. The report
filed with the Commissioner shall be | 3 |
| certified by the certified public
accountant conducting the | 4 |
| audit. The Commissioner may promulgate rules
regarding late | 5 |
| audit reports.
| 6 |
| (e) If any licensee required to make an audit shall fail to | 7 |
| cause an
audit to be made, the Commissioner shall cause the | 8 |
| same to be made by a
certified public accountant at the | 9 |
| licensee's expense. The Commissioner
shall select such | 10 |
| certified public accountant by advertising for bids or
by such | 11 |
| other fair and impartial means as he or she establishes by | 12 |
| regulation.
| 13 |
| (f) In lieu of the audit or compilation financial statement
| 14 |
| required by this Section, a licensee shall submit and the | 15 |
| Commissioner may
accept any audit made in conformance with the | 16 |
| audit
requirements of the U.S. Department of Housing and Urban | 17 |
| Development.
| 18 |
| (g) With respect to licensees who solely broker residential | 19 |
| mortgage
loans as defined in subsection (o) of Section 1-4, | 20 |
| instead of the audit
required by this Section, the Commissioner | 21 |
| may
accept
compilation financial statements prepared at least | 22 |
| every 12 months, and
the compilation financial statement must | 23 |
| be prepared by an independent
certified public accountant | 24 |
| licensed under the Illinois Public Accounting Act or by an | 25 |
| equivalent state licensing law
with full disclosure in | 26 |
| accordance with generally accepted accounting
principles
| 27 |
| principals and must be submitted within 90 days after the end | 28 |
| of
the licensee's fiscal year. If a
licensee
under this Section | 29 |
| fails to file a compilation as required, the Commissioner
shall | 30 |
| cause an audit of the licensee's books and accounts to be made | 31 |
| by a
certified public accountant at the licensee's expense. The | 32 |
| Commissioner shall
select the certified public accountant by | 33 |
| advertising for bids or by such other
fair and impartial means | 34 |
| as he or she establishes by rule. A licensee who
files false or |
|
|
|
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| 1 |
| misleading compilation financial statements is guilty of a
| 2 |
| business offense and shall be fined not less than $5,000.
| 3 |
| (h) The workpapers of the certified public accountants | 4 |
| employed
by each
licensee for purposes of this Section are to | 5 |
| be made available to the
Commissioner or the Commissioner's | 6 |
| designee upon request and may be
reproduced by the Commissioner | 7 |
| or the Commissioner's designee to enable to
the Commissioner to | 8 |
| carry out the purposes of this Act.
| 9 |
| (i) Notwithstanding any other provision of this Section, if | 10 |
| a licensee
relying on subsection (g) of this Section causes its | 11 |
| books to be audited at any
other time or causes its financial | 12 |
| statements to be reviewed, a complete copy
of the audited or | 13 |
| reviewed financial statements shall be delivered to the
| 14 |
| Commissioner at the time of the annual license renewal payment | 15 |
| following
receipt by the licensee of the audited or reviewed | 16 |
| financial statements. All workpapers shall be made available to | 17 |
| the
Commissioner upon request. The financial statements and | 18 |
| workpapers may be
reproduced by the Commissioner or the | 19 |
| Commissioner's designee to carry out the
purposes of this Act.
| 20 |
| (Source: P.A. 93-561, eff. 1-1-04.)
| 21 |
| (205 ILCS 635/3-4) (from Ch. 17, par. 2323-4)
| 22 |
| Sec. 3-4. Office and staff within the State.
| 23 |
| (a) A licensee whose principal place of business is located | 24 |
| in the State
of Illinois shall
maintain at least one full | 25 |
| service office with
staff reasonably adequate to handle | 26 |
| efficiently communications, questions,
and all other matters | 27 |
| relating to any application for a home mortgage or an
existing | 28 |
| home mortgage with respect
to which such licensee is performing | 29 |
| services, regardless of kind, for any
borrower or lender, note | 30 |
| owner or holder, or for himself or herself while
engaged in the | 31 |
| residential
mortgage business. The location and operation of a | 32 |
| full service office shall be in compliance with any applicable | 33 |
| zoning laws or ordinances and home office or business |
|
|
|
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| 1 |
| regulations.
| 2 |
| (b) In lieu of maintaining a full service office in the | 3 |
| State of
Illinois,
a licensee whose principal place of business | 4 |
| is located outside the
State of Illinois
must submit a | 5 |
| certified audit as required in Section 3-2 of this Act
| 6 |
| evidencing a minimum net worth of $100,000, which must be | 7 |
| maintained at all
times, and shall submit and maintain a | 8 |
| fidelity bond in the amount of
$100,000.
| 9 |
| (Source: P.A. 89-355, eff. 8-17-95; 90-301, eff. 8-1-97; | 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 shall have and
maintain a net worth of | 15 |
| not less than $100,000; however, no later than 2
years after | 16 |
| the effective date of this amendatory
Act of the 93rd General | 17 |
| Assembly, the licensee must maintain a net worth of not
less | 18 |
| than $150,000. A licensee that first obtains a license after | 19 |
| the effective
date of this amendatory Act of the 93rd General | 20 |
| Assembly must have and maintain
a net worth of not less than | 21 |
| $150,000.
Notwithstanding other requirements of this Section, | 22 |
| the net worth
requirement for a residential mortgage licensee | 23 |
| whose
only licensable
activity is that of brokering residential | 24 |
| mortgage loans and that holds a
license on the effective date | 25 |
| of this amendatory Act of the 93rd General
Assembly shall be | 26 |
| $35,000; however, no later than 2 years after the
effective | 27 |
| date of this amendatory
Act of the 93rd General Assembly, the | 28 |
| licensee must maintain a net worth of
not less than $50,000. | 29 |
| Such a licensee that first obtains a license after the
| 30 |
| effective date of this amendatory Act of the 93rd General | 31 |
| Assembly
must have and maintain a net worth of not less than | 32 |
| $50,000.
Net worth shall be evidenced by a balance sheet | 33 |
| prepared by a certified
public accountant in accordance with |
|
|
|
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| generally accepted accounting principles
and generally | 2 |
| accepted auditing standards or by the compilation financial
| 3 |
| statements authorized under subsection (g) of Section 3-2. The | 4 |
| Commissioner
may promulgate
rules with respect to net worth | 5 |
| definitions
and requirements for residential mortgage | 6 |
| licensees as necessary to
accomplish the purposes of this Act. | 7 |
| In promulgating such rules, the Commissioner may consider | 8 |
| establishing separate net worth requirements for not for profit | 9 |
| entities or their affiliates that are serving economically | 10 |
| depressed or financially underserved areas. In lieu of the net | 11 |
| worth requirement
established by this Section, the | 12 |
| Commissioner may accept evidence of
conformance by the licensee | 13 |
| with the net worth requirements of the United
States Department | 14 |
| of Housing and Urban Development.
| 15 |
| (Source: P.A. 93-561, eff. 1-1-04.)
| 16 |
| (205 ILCS 635/4-1) (from Ch. 17, par. 2324-1)
| 17 |
| Sec. 4-1. Commissioner of Banks and Real Estate; functions, | 18 |
| powers, and duties. The functions,
powers, and duties of the | 19 |
| Commissioner of Banks and Real Estate shall include the | 20 |
| following:
| 21 |
| (a) To issue or refuse to issue any license as provided by | 22 |
| this Act;
| 23 |
| (b) To revoke or suspend for cause any license issued under | 24 |
| this Act;
| 25 |
| (c) To keep records of all licenses issued under this Act;
| 26 |
| (d) To receive, consider, investigate, and act upon | 27 |
| complaints made by
any person in connection with any | 28 |
| residential mortgage licensee in this State;
| 29 |
| (e) To consider and act upon any recommendations from the | 30 |
| Residential
Mortgage Board;
| 31 |
| (f) To prescribe the forms of and receive:
| 32 |
| (1) applications for licenses; and
| 33 |
| (2) all reports and all books and records required to |
|
|
|
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| be made by
any licensee under this Act, including annual | 2 |
| audited financial statements
and annual reports of | 3 |
| mortgage activity;
| 4 |
| (g) To adopt rules and regulations necessary and proper for | 5 |
| the
administration of this Act;
| 6 |
| (h) To subpoena documents and witnesses and compel their | 7 |
| attendance and
production, to administer oaths, and to require | 8 |
| the production of any books,
papers, or other materials | 9 |
| relevant to any inquiry authorized by this Act;
| 10 |
| (h-1) To issue orders against any person, if the
| 11 |
| Commissioner has reasonable cause to believe that an unsafe, | 12 |
| unsound, or unlawful practice has occurred, is occurring, or is | 13 |
| about to occur, if any person has violated, is violating, or is | 14 |
| about to violate any law, rule, or written agreement with the | 15 |
| Commissioner, or for the purpose of administering the | 16 |
| provisions of this Act and any rule promulgated in accordance | 17 |
| with this Act. | 18 |
| (h-2) To address any inquiries to any licensee, or the | 19 |
| officers thereof, in relation to its activities and conditions, | 20 |
| or any other matter connected with its affairs, and it shall be | 21 |
| the duty of any licensee or person so addressed, to promptly | 22 |
| reply in writing to such inquiries. The Commissioner may also | 23 |
| require reports from any licensee at any time the Commissioner | 24 |
| may deem desirable.
| 25 |
| (i) To require information with regard to any license | 26 |
| applicant
as he or she may deem desirable, with due regard to | 27 |
| the paramount interests
of the public as to the experience, | 28 |
| background, honesty, truthfulness,
integrity, and competency | 29 |
| of the license applicant as to financial
transactions involving | 30 |
| primary or subordinate mortgage financing, and where
the | 31 |
| license applicant is an entity other than an individual, as to | 32 |
| the
honesty, truthfulness, integrity, and competency of any | 33 |
| officer or director
of the corporation, association, or other | 34 |
| entity, or the members of a
partnership;
|
|
|
|
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| (j) To examine the books and records of every licensee | 2 |
| under this Act at
intervals as specified in Section 4-2;
| 3 |
| (k) To enforce provisions of this Act;
| 4 |
| (l) To levy fees, fines, and charges for services performed | 5 |
| in administering
this Act; the aggregate of all fees collected | 6 |
| by the Commissioner on and after
the effective date of this Act | 7 |
| shall be paid promptly after receipt of the
same, accompanied | 8 |
| by a detailed statement thereof, into the Savings and
| 9 |
| Residential Finance Regulatory Fund; the amounts deposited | 10 |
| into that Fund shall
be used for the ordinary and contingent | 11 |
| expenses of the Office of Banks and
Real Estate. Nothing in | 12 |
| this Act shall prevent continuing the practice of paying
| 13 |
| expenses involving salaries, retirement, social security, and | 14 |
| State-paid
insurance of State officers by appropriation from | 15 |
| the General Revenue Fund.
| 16 |
| (m) To appoint examiners, supervisors, experts, and | 17 |
| special assistants as
needed to effectively and efficiently | 18 |
| administer this Act; and
| 19 |
| (n) To conduct hearings for the purpose of:
| 20 |
| (1) appeals of orders of the Commissioner;
| 21 |
| (2) suspensions or revocations of licenses, or fining | 22 |
| of licensees;
| 23 |
| (3) investigating:
| 24 |
| (i) complaints against licensees; or
| 25 |
| (ii) annual gross delinquency rates; and
| 26 |
| (4) carrying out the purposes of this Act ;
.
| 27 |
| (o) To exercise exclusive visitorial power over a licensee | 28 |
| and to permit a foreign residential mortgage regulator with an | 29 |
| appropriate supervisory interest in the parent or affiliate of | 30 |
| a licensee to exercise exclusive visitorial power over a | 31 |
| licensee; | 32 |
| (p) To enter into cooperative agreements with state | 33 |
| regulatory authorities of other states to provide for | 34 |
| examination of corporate offices or branches of those states |
|
|
|
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| and to accept reports of such examinations; and | 2 |
| (q) To assign an examiner or examiners to monitor the | 3 |
| affairs of a licensee with whatever frequency the Commissioner | 4 |
| determines appropriate and to charge the licensee for | 5 |
| reasonable and necessary expenses of the Commissioner, if in | 6 |
| the opinion of the Commissioner an emergency exists or appears | 7 |
| likely to occur or if the licensee is engaged in unsafe, | 8 |
| unsound, or unlawful activity or the interest of consumers | 9 |
| appears to be in jeopardy. | 10 |
| (Source: P.A. 89-355, eff. 8-17-95; 89-508, eff. 7-3-96.)
| 11 |
| (205 ILCS 635/4-2) (from Ch. 17, par. 2324-2)
| 12 |
| Sec. 4-2. Examination; prohibited activities.
| 13 |
| (a) The business affairs of a licensee under this Act shall | 14 |
| be examined
for compliance with this Act as often as the | 15 |
| Commissioner deems necessary and
proper. The Commissioner | 16 |
| shall promulgate rules with respect to the frequency
and manner | 17 |
| of examination. The Commissioner shall appoint a suitable | 18 |
| person
to perform such
examination. The Commissioner and his | 19 |
| appointees may examine the
entire
books, records, documents, | 20 |
| and operations of each licensee and may examine
any of the | 21 |
| licensee's officers, directors, employees and agents under | 22 |
| oath.
| 23 |
| (b) The Commissioner shall prepare a
sufficiently
detailed
| 24 |
| report of each
licensee's examination, shall issue a copy of | 25 |
| such report to each
licensee's principals, officers, or | 26 |
| directors and shall take appropriate
steps to ensure correction | 27 |
| of violations of this Act.
| 28 |
| (c) Affiliates of a licensee shall be subject to | 29 |
| examination by the
Commissioner on the same terms as the | 30 |
| licensee, but only when reports
from, or examination of a | 31 |
| licensee provides for documented evidence of
unlawful activity | 32 |
| between a licensee and affiliate benefiting, affecting or
| 33 |
| deriving from the activities regulated by this Act.
|
|
|
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| (d) The expenses of any examination of the licensee and | 2 |
| affiliates shall
be borne by the licensee and assessed by the | 3 |
| Commissioner as established
by regulation.
| 4 |
| (e) Upon completion of the examination, the Commissioner | 5 |
| shall issue a
report to the licensee. All confidential | 6 |
| supervisory information, including the
The examination report ,
| 7 |
| and the work papers
of the report , shall belong to the | 8 |
| Commissioner's office and may not be
disclosed to anyone other | 9 |
| than the licensee, law enforcement officials or other
| 10 |
| regulatory agencies that have an appropriate regulatory | 11 |
| interest as determined by the Commissioner
shall be defined in | 12 |
| rules promulgated by the
Commissioner , or to a party presenting | 13 |
| a lawful subpoena to the Office of the
Commissioner. The | 14 |
| Commissioner may immediately appeal to the court of | 15 |
| jurisdiction the disclosure of such confidential supervisory | 16 |
| information and seek a stay of the subpoena pending the outcome | 17 |
| of the appeal. Reports required of licensees by the | 18 |
| Commissioner under this Act
and results of examinations | 19 |
| performed by the Commissioner under this Act shall
be the | 20 |
| property of only the licensee and the Commissioner , but may be | 21 |
| shared with the licensee . Access under this
Act to the books | 22 |
| and records of each licensee shall be limited to the
| 23 |
| Commissioner and his agents as provided in this Act and to the | 24 |
| licensee and its
authorized agents and designees. No other | 25 |
| person shall have access to the
books and records of a licensee | 26 |
| under this Act. Any person upon whom a demand for production of | 27 |
| confidential supervisory information is made, whether by | 28 |
| subpoena, order, or other judicial or administrative process, | 29 |
| must withhold production of the confidential supervisory | 30 |
| information and must notify the Commissioner of the demand, at | 31 |
| which time the Commissioner is authorized to intervene for the | 32 |
| purpose of enforcing the limitations of this Section or seeking | 33 |
| the withdrawal or termination of the attempt to compel | 34 |
| production of the confidential information. The Commissioner |
|
|
|
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| may impose any conditions and limitations on the disclosure of | 2 |
| confidential supervisory information that are necessary to | 3 |
| protect the confidentiality of such information. Except as | 4 |
| authorized by the Commissioner, no person obtaining access to | 5 |
| confidential supervisory information may make a copy of the | 6 |
| confidential supervisory information. The Commissioner may | 7 |
| condition a decision to disclose confidential supervisory | 8 |
| information on entry of a protective order by the court or | 9 |
| administrative tribunal presiding in the particular case or on | 10 |
| a written agreement of confidentiality. In a case in which a | 11 |
| protective order or agreement has already been entered between | 12 |
| parties other than the Commissioner, the Commissioner may | 13 |
| nevertheless condition approval for release of confidential | 14 |
| supervisory information upon the inclusion of additional or | 15 |
| amended provisions in the protective order. The Commissioner | 16 |
| may authorize a party who obtained the records for use in one | 17 |
| case to provide them to another party in another case, subject | 18 |
| to any conditions that the Commissioner may impose on either or | 19 |
| both parties. The requestor shall promptly notify other parties | 20 |
| to a case of the release of confidential supervisory | 21 |
| information obtained and, upon entry of a protective order, | 22 |
| shall provide copies of confidential supervisory information | 23 |
| to the other parties.
| 24 |
| (f) The Commissioner, deputy commissioners, and employees
| 25 |
| of the Office of Banks and Real Estate shall be subject to the | 26 |
| restrictions
provided in Section 2.5 of the Office of Banks and | 27 |
| Real Estate Act including,
without limitation, the | 28 |
| restrictions on (i) owning shares of stock or holding
any other | 29 |
| equity interest in an entity regulated under this Act or in any
| 30 |
| corporation or company that owns or controls an entity | 31 |
| regulated under this
Act; (ii) being an officer, director, | 32 |
| employee, or agent of an entity regulated
under this Act; and | 33 |
| (iii) obtaining a loan or accepting a gratuity from an
entity | 34 |
| regulated under this Act.
|
|
|
|
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| (g) After the initial examination for those licensees whose | 2 |
| only mortgage
activity is servicing fewer than 1,000 Illinois | 3 |
| residential loans,
the
examination required in subsection (a) | 4 |
| may be waived upon submission of a
letter from the licensee's | 5 |
| independent certified auditor that the licensee
serviced fewer | 6 |
| than 1,000 Illinois residential loans during the
year
in which | 7 |
| the
audit was performed.
| 8 |
| (Source: P.A. 90-301, eff. 8-1-97; 91-586, eff. 8-14-99.)
| 9 |
| (205 ILCS 635/4-5) (from Ch. 17, par. 2324-5)
| 10 |
| Sec. 4-5. Suspension, revocation of licenses; fines.
| 11 |
| (a) Upon written notice to a licensee, the Commissioner may | 12 |
| suspend
or revoke any license issued pursuant to this Act if he | 13 |
| or she shall make a
finding of one or more of the following in | 14 |
| the notice that:
| 15 |
| (1) Through separate acts or an act or a course of | 16 |
| conduct, the licensee
has violated any provisions of this | 17 |
| Act, any rule or regulation
promulgated by the Commissioner | 18 |
| or of any other law, rule or regulation of
this State or | 19 |
| the United States.
| 20 |
| (2) Any fact or condition exists which, if it had | 21 |
| existed at the time of
the original application for such | 22 |
| license would have warranted the
Commissioner in refusing | 23 |
| originally to issue such license.
| 24 |
| (3) If a licensee is other than an individual, any | 25 |
| ultimate
equitable owner, officer, director, or member of | 26 |
| the licensed partnership,
association, corporation, or | 27 |
| other entity has so acted or failed to act as
would be | 28 |
| cause for suspending or revoking a license to that party as | 29 |
| an
individual.
| 30 |
| (b) No license shall be suspended or revoked, except as | 31 |
| provided in this
Section, nor shall any licensee be fined | 32 |
| without notice of his or her right
to a hearing as provided in | 33 |
| Section 4-12 of this Act.
|
|
|
|
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| (c) The Commissioner, on good cause shown that an emergency | 2 |
| exists, may
suspend any license for a period not
exceeding 180 | 3 |
| days, pending investigation. Upon a showing that a
licensee has | 4 |
| failed to meet the experience or educational requirements of
| 5 |
| Section 2-2 or the requirements of subsection (g) of Section | 6 |
| 3-2, the
Commissioner shall suspend, prior to hearing as | 7 |
| provided in Section 4-12, the
license until those requirements | 8 |
| have been met.
| 9 |
| (d) The provisions of subsection (e) of Section 2-6 of this | 10 |
| Act
shall not affect a licensee's civil or criminal liability
| 11 |
| for acts committed prior to surrender of a license.
| 12 |
| (e) No revocation, suspension or surrender of any license | 13 |
| shall impair
or affect the obligation of any pre-existing | 14 |
| lawful contract between the
licensee and any person.
| 15 |
| (f) Every license issued under this Act shall remain in | 16 |
| force and effect
until the same shall have expired without | 17 |
| renewal, have been surrendered,
revoked or suspended in | 18 |
| accordance with the provisions of this Act, but the
| 19 |
| Commissioner shall have authority to reinstate a suspended | 20 |
| license or to
issue a new license to a licensee whose license | 21 |
| shall have been revoked if
no fact or condition then exists | 22 |
| which would have warranted the
Commissioner in refusing | 23 |
| originally to issue such license under this Act.
| 24 |
| (g) Whenever the Commissioner shall revoke or suspend a | 25 |
| license issued
pursuant to this Act or fine a licensee under | 26 |
| this Act, he or she shall
forthwith execute in duplicate a | 27 |
| written order to that effect. The
Commissioner shall publish | 28 |
| notice of such order in the Illinois Register
and post notice | 29 |
| of such order on an agency Internet site maintained by the | 30 |
| Commissioner
a newspaper of general circulation in the county | 31 |
| in which the license
is located and shall forthwith serve a | 32 |
| copy of such order upon the
licensee. Any such order may be | 33 |
| reviewed in the manner provided by
Section 4-12 of this Act.
| 34 |
| (h) When the Commissioner finds any person in violation of |
|
|
|
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| the grounds
set forth in subsection (i), he or she may enter an | 2 |
| order imposing one or
more of the following penalties:
| 3 |
| (1) Revocation of license;
| 4 |
| (2) Suspension of a license subject to reinstatement | 5 |
| upon satisfying all
reasonable conditions the Commissioner | 6 |
| may specify;
| 7 |
| (3) Placement of the licensee or applicant on probation | 8 |
| for a period of
time and subject to all reasonable | 9 |
| conditions as the Commissioner may specify;
| 10 |
| (4) Issuance of a reprimand;
| 11 |
| (5) Imposition of a fine not to exceed $25,000 for each
| 12 |
| count of
separate offense; and
| 13 |
| (6) Denial of a license.
| 14 |
| (i) The following acts shall constitute grounds for which | 15 |
| the
disciplinary actions specified in subsection (h) above may | 16 |
| be taken:
| 17 |
| (1) Being convicted or found guilty, regardless of | 18 |
| pendency of an
appeal, of a crime in any jurisdiction which | 19 |
| involves fraud, dishonest
dealing, or any other act of | 20 |
| moral turpitude;
| 21 |
| (2) Fraud, misrepresentation, deceit or negligence in | 22 |
| any mortgage
financing transaction;
| 23 |
| (3) A material or intentional misstatement of fact on | 24 |
| an initial or
renewal application;
| 25 |
| (4) Failure to follow the Commissioner's regulations | 26 |
| with respect to
placement of funds in escrow accounts;
| 27 |
| (5) Insolvency or filing under any provision of the | 28 |
| Bankruptcy Code
as a debtor;
| 29 |
| (6) Failure to account or deliver to any person any | 30 |
| property such as any
money, fund, deposit, check, draft, | 31 |
| mortgage, or other document or thing of
value, which has | 32 |
| come into his or her hands and which is not his or her
| 33 |
| property or which he or she is not in law or equity | 34 |
| entitled to retain,
under the circumstances and at the time |
|
|
|
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| 1 |
| which has been agreed upon or is
required by law or, in the | 2 |
| absence of a fixed time, upon demand of the
person entitled | 3 |
| to such accounting and delivery;
| 4 |
| (7) Failure to disburse funds in accordance with | 5 |
| agreements;
| 6 |
| (8) Any misuse, misapplication, or misappropriation of | 7 |
| trust funds
or escrow funds;
| 8 |
| (9) Having a license, or the equivalent, to practice | 9 |
| any profession or
occupation revoked, suspended, or | 10 |
| otherwise acted against, including the
denial of licensure | 11 |
| by a licensing authority of this State or another
state, | 12 |
| territory or country for fraud, dishonest dealing or any | 13 |
| other act
of moral turpitude;
| 14 |
| (10) Failure to issue a satisfaction of mortgage when | 15 |
| the residential
mortgage has been executed and proceeds | 16 |
| were not disbursed to the benefit
of the mortgagor and when | 17 |
| the mortgagor has fully paid licensee's costs
and | 18 |
| commission;
| 19 |
| (11) Failure to comply with any order of the | 20 |
| Commissioner or rule made
or issued under the provisions of | 21 |
| this Act;
| 22 |
| (12) Engaging in activities regulated by this Act | 23 |
| without a current,
active license unless specifically | 24 |
| exempted by this Act;
| 25 |
| (13) Failure to pay in a timely manner any fee, charge | 26 |
| or fine under
this Act;
| 27 |
| (14) Failure to maintain, preserve, and keep available | 28 |
| for examination,
all books, accounts or other documents | 29 |
| required by the provisions of this
Act and the rules of the | 30 |
| Commissioner;
| 31 |
| (15) Refusal to permit an investigation or examination | 32 |
| of the licensee's
or its affiliates' books and records or | 33 |
| refusal to comply with the
Commissioner's subpoena or | 34 |
| subpoena duces tecum;
|
|
|
|
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| (16) A pattern of substantially underestimating the | 2 |
| maximum closing costs;
| 3 |
| (17) Failure to comply with or violation of any | 4 |
| provision of this Act.
| 5 |
| (j) A licensee shall be subject to the disciplinary actions | 6 |
| specified in
this Act for violations of subsection (i) by any | 7 |
| officer, director,
shareholder, joint venture, partner, | 8 |
| ultimate equitable owner, or employee
of the licensee.
| 9 |
| (k) Such licensee shall be subject to suspension or | 10 |
| revocation for
employee actions only if there is a pattern of | 11 |
| repeated violations by
employees or the licensee has knowledge | 12 |
| of the violations.
| 13 |
| (l) Procedure for surrender of license:
| 14 |
| (1) The Commissioner may, after 10 days notice by | 15 |
| certified mail to the
licensee at the address set forth on | 16 |
| the license, stating the contemplated
action and in general | 17 |
| the grounds therefor and the date, time and place of
a | 18 |
| hearing thereon, and after providing the licensee with a | 19 |
| reasonable
opportunity to be heard prior to such action, | 20 |
| fine such licensee an amount
not exceeding $25,000
$10,000
| 21 |
| per violation, or revoke or suspend any license
issued | 22 |
| hereunder if he or she finds that:
| 23 |
| (i) The licensee has failed to comply with any | 24 |
| provision of this Act or
any order, decision, finding, | 25 |
| rule, regulation or direction of the
Commissioner | 26 |
| lawfully made pursuant to the authority of this Act; or
| 27 |
| (ii) Any fact or condition exists which, if it had | 28 |
| existed at the time
of the original application for the | 29 |
| license, clearly would have warranted
the Commissioner | 30 |
| in refusing to issue the license.
| 31 |
| (2) Any licensee may surrender a license by delivering | 32 |
| to the
Commissioner written notice that he or she thereby | 33 |
| surrenders such license,
but surrender shall not affect the | 34 |
| licensee's civil or criminal liability
for acts committed |
|
|
|
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| 1 |
| prior to surrender or entitle the licensee to a return
of | 2 |
| any part of the license fee.
| 3 |
| (Source: P.A. 93-561, eff. 1-1-04.)
| 4 |
| (205 ILCS 635/4-9.1 new) | 5 |
| Sec. 4-9.1. Annual report of mortgage and servicing | 6 |
| activities. On or before March 1 of each year, each licensee, | 7 |
| except residential mortgage loan brokers, shall file a report | 8 |
| with the Commissioner that shall disclose information as the | 9 |
| Commissioner deems required. | 10 |
| If the Commissioner finds that another report that the | 11 |
| licensee is required to compile is equivalent to the Annual | 12 |
| Report of Mortgage and Servicing Activities, then the | 13 |
| Commissioner may accept that report as fulfilling the reporting | 14 |
| requirements of this Section. The report required pursuant to | 15 |
| the Home Mortgage Disclosure Act of 1975, 12 U.S.C. 2801 et | 16 |
| seq. and Federal Reserve Board Regulation C, 12 C.F.R. Part | 17 |
| 203, is an example of a report that the Commissioner may find | 18 |
| fulfills the requirements of this Section, if the Commissioner | 19 |
| finds the report equivalent to the Annual Report of Mortgage | 20 |
| and Servicing Activities.
| 21 |
| (205 ILCS 635/6-2) (from Ch. 17, par. 2326-2)
| 22 |
| Sec. 6-2. Removal and prohibition. Upon making any one or | 23 |
| more of the
following findings, the Commissioner may issue a | 24 |
| notice of intent to issue an
order of removal or prohibition, | 25 |
| or an order of removal and prohibition, which
order may remove | 26 |
| a named person, persons, or entity or entities from
| 27 |
| participating in the affairs of one or more licensees and may | 28 |
| be permanent or
for a specific shorter period of time. The | 29 |
| findings required under this Section
may be any one or more of | 30 |
| the following:
| 31 |
| (1) A finding that the party or entity subject to the | 32 |
| order has been
convicted of a crime involving material |
|
|
|
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| financial loss to a licensee, a
federally insured | 2 |
| depository institution, a government sponsored enterprise, | 3 |
| a
Federal Home Loan Bank, a Federal Reserve Bank, or any | 4 |
| other person.
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| (2) A finding that the person or entity subject to the | 6 |
| order has
submitted or caused to be submitted any document | 7 |
| that contains multiple willful
and material misstatements | 8 |
| of facts, and that includes the signature of the
person or | 9 |
| entity specified in the Commissioner's order, or that is | 10 |
| notarized,
certified, verified or is in any other way | 11 |
| attested to, as to its veracity. An
application for | 12 |
| licensure or license renewal may be considered such a | 13 |
| document.
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| (3) Conviction of a business offense under subsection | 15 |
| (e) of Section 1-3
or subsection (g) of Section 3-2.
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| (4) A finding prepared by a hearing officer pursuant to | 17 |
| a hearing held
under Section 4-1(n) of this Act that the | 18 |
| person subject to the order, while
an employee of a | 19 |
| licensee, has knowingly submitted or caused to be submitted
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| any document that contains willful and material | 21 |
| misstatement of facts and which
is used in connection with | 22 |
| any licensable activity as defined in Section 1-3(a)
of | 23 |
| this Act.
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| (5) Whenever, in the opinion of the Commissioner, any | 25 |
| director, officer, or employee of a licensee has violated | 26 |
| any law, rule, or order relating to that licensee, has | 27 |
| obstructed or impeded any examination or investigation by | 28 |
| the Commissioner, has engaged in an unsafe, unsound, or | 29 |
| unlawful practice in conducting the business of the | 30 |
| licensee, or has violated any law or engaged or | 31 |
| participated in any unsafe, unsound, or unlawful practice | 32 |
| in connection with any licensee or other business entity | 33 |
| such that the character and fitness of the director, | 34 |
| officer, or employee does not assure reasonable promise of |
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09300SB2908sam001 |
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LRB093 18470 WGH 48875 a |
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| safe, sound, and lawful operation of the licensee, the | 2 |
| Commissioner may issue an order of removal. If, in the | 3 |
| opinion of the Commissioner, any former director, officer, | 4 |
| or employee of a licensee, prior to the termination of his | 5 |
| or her service with that licensee, violated any law, rule, | 6 |
| or order relating to that licensee, obstructed or impeded | 7 |
| any examination or investigation by the Commissioner, | 8 |
| engaged in an unsafe or unsound practice in conducting the | 9 |
| business of that licensee or any subsidiary or holding | 10 |
| company of the licensee, or violated any law or engaged or | 11 |
| participated in any unsafe, unsound, or unlawful practice | 12 |
| in connection with any financial institution or other | 13 |
| business entity such that the character and fitness of the | 14 |
| director, officer, or employee would not have assured | 15 |
| reasonable promise of safe, sound, and lawful operation of | 16 |
| the licensee, the Commissioner may issue an order | 17 |
| prohibiting that person from further service with a | 18 |
| licensee as a director, officer, or employee. An order | 19 |
| issued pursuant to this subdivision (5) shall be served | 20 |
| upon the director, officer, or employee. A copy of the | 21 |
| order shall be sent to each owner or director of the | 22 |
| licensee affected by registered mail. The person affected | 23 |
| by the action may make a request to the Commissioner for a | 24 |
| hearing pursuant to subsection (n) of Section 4-1 within 10 | 25 |
| days after receipt of the order. The hearing shall be held | 26 |
| before a hearing officer within 30 days after the request | 27 |
| has been received by the Commissioner. The hearing officer | 28 |
| shall prepare a finding and report the finding to the | 29 |
| Commissioner who shall consider the finding in making his | 30 |
| or her determination approving, modifying, or disapproving | 31 |
| his or her order as a final administrative decision. If a | 32 |
| hearing is held before a hearing officer, the Commissioner | 33 |
| shall make his or her determination within 60 days from the | 34 |
| conclusion of the hearing. Any person affected by a |
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LRB093 18470 WGH 48875 a |
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| decision of the Commissioner under this subdivision (5) may | 2 |
| have the decision reviewed only under and in accordance | 3 |
| with the Administrative Review Law and the rules adopted | 4 |
| pursuant to the Administrative Review Law. A copy of the | 5 |
| order shall also be served upon the licensee of which he or | 6 |
| she is a director, officer, or employee, whereupon he or | 7 |
| she shall cease to be a director, officer, or employee of | 8 |
| that licensee. The Commissioner may institute a civil | 9 |
| action against the director, officer, or employee of the | 10 |
| licensee to enforce compliance with or to enjoin any | 11 |
| violation of the terms of the order. Any person who has | 12 |
| been the subject of an order of removal or an order of | 13 |
| prohibition issued by the Commissioner under this | 14 |
| subdivision (5) may not thereafter serve as director, | 15 |
| officer, or employee of any licensee, or of any other | 16 |
| entity that is subject to licensure or regulation by the | 17 |
| Commissioner or the Office of Banks and Real Estate unless | 18 |
| the Commissioner has granted prior approval in writing.
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| (Source: P.A. 89-355, eff. 8-17-95; 90-772, eff. 1-1-99.)".
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