Washington state Attorney General says debt buyers are collection agencies, files lawsuit for operating without a license

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On September 21, the Washington state Attorney General announced that it filed a lawsuit against several collection agencies and their owner (defendants) for allegedly purchasing and suing on charged-off consumer debts in violation of the Washington Collection Agency Act (WCAA) and the Washington Consumer Protection Act (WCPA). The complaint alleges that defendants bought and then obtained judgements on…

New York adds three license applications to NMLS

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On October 1, without notice, the New York State Department of Financial Services and the Nationwide Multistate Licensing System announced that the NMLS would begin receiving new application and transition filings for the check casher license, the commercial check casher license, and the virtual currency license in New York. The announcement from the NYSDFS explained…

NYDFS adds check cashing and virtual currency businesses to nationwide licensing system

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On October 1, NYDFS announced the commencement of the final phase of its initiative to manage the license application and regulation of all non-depository financial institutions operating in the state through the Nationwide Multistate Licensing System and Registry (NMLS). As such, NYDFS now allows financial services companies holding check casher and virtual currency business activity licenses to…

APPROVED Checkpoint: Fingerprinting

APPROVED Checkpoint, Insights

Fingerprints for purposes of conducting a criminal background check may be required of any number of individuals associated with a licensee/license applicant: from employees to senior officers to ultimate owners. The fingerprinting process typically involves an individual making an appointment with and traveling to an authorized fingerprint technician who will then capture the individual’s fingerprints…

Colorado regulator exempts certain cryptocurrency exchanges from money transmitter licensing requirements

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On September 20, the Colorado Department of Regulatory Agencies Division of Banking (Division) issued interim guidance exempting certain types of cryptocurrency exchanges from the state’s money transmitter licensing requirements. Under the interim guidance — which outlines the Division’s interpretation of Colorado’s existing Money Transmitters Act (the Act) — the Division determined that the Act regulates the transmission…

Federal Reserve seeks to repeal SAFE Act regulations to reflect CFPB authority

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On September 21, the Federal Reserve Board (Board) issued a notice of proposed rulemaking seeking comment on the repeal of certain provisions of regulations that incorporate the Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act), which the Board states are intended to reflect the transfer of rulemaking authority to the CFPB by the Dodd-Frank Act. Specifically, the…

Massachusetts adds mortgage licensing exemption for certain nonprofit organizations

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On September 19, the Massachusetts Division of Banks (the Division) issued an Industry Letter to provide guidance regarding a new mortgage licensing exemption for “bona fide nonprofit affordable homeownership organizations.” These bona fide nonprofits, who must have as their primary purpose helping qualified low-income individuals build, repair, and purchase affordable housing, may apply to the…

District of Columbia moves to dismiss lawsuit alleging city’s student loan servicer regulations are preempted by federal law

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On September 7, the District of Columbia filed a memorandum in support of its motion to dismiss a lawsuit claiming that the city’s regulations and requirements for student loan servicers are preempted by federal law. The plaintiff, a D.C.-based trade group whose membership consists of national student loan servicers, argues in its complaint that various provisions of District of Columbia…

Sports betting and licensing

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Following the U.S. Supreme Court’s decision in Murphy v. NCAA, a number of states are expected to legalize some form of sports betting. Each state will institute its own regulatory compliance framework, with many likely borrowing heavily from those states with more mature sports betting industries (like Nevada and New Jersey). Those seeking to establish…

1st Circuit holds homeowners who defaulted on an allegedly unlicensed mortgage loan cannot escape time bars for their claims

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On August 23, the U.S. Court of Appeals for the 1st Circuit held that homeowners who defaulted on a refinance loan on their Massachusetts property could not void the transaction or enjoin their property’s foreclosure sale. The appellate court determined that the homeowners’ claims that the lender violated the Fair Debt Collection Practices Act, the Real Estate…

New Jersey amends mortgage statute, includes “transitional mortgage loan originator license”

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On August 24, New Jersey Governor Phil Murphy signed AB 2035, which amends the New Jersey Residential Mortgage Lending Act and certain related statutes. Among other technical and clarifying changes, the amendments create a framework for the issuance of a “transitional mortgage loan originator license,” which would allow an “out-of-state mortgage loan originator” or a “registered…

Personal e-mail address and telephone number now required for New York personal questionnaire

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Financial services companies that have applied for a license issued by the New York State Department of Financial Services are likely familiar with the personal questionnaire that control persons are required to complete. The questionnaire requests a wealth of information—from residential, work, and education history, to the names of parents and dependents. Recently, the NYSDFS…

Illinois updates Residential Mortgage License Act

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On August 14 and 10, the Illinois governor signed HB 4404 and SB 2615, which amend the Illinois Residential Mortgage License Act of 1987. Effective immediately, SB 2615, now Public Act 100-0795, requires, among other things, that mortgage loan advertisements in Illinois, whether print or electronic, reference the Nationwide Multistate Licensing System (NMLS) and Registry’s Consumer…

Conference of State Bank Supervisors announces single, national exam for mortgage loan originator licensing

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On August 8, the Conference of State Bank Supervisors announced that all states and U.S. territories now use a single, common exam to assess mortgage loan originators (MLOs) in order to simplify the licensing process and streamline the mortgage industry. MLSs who pass the National SAFE MLO Test with Uniform State Content (National Test) will no longer be required…

Maryland Court of Appeals holds foreign securitization trusts do not need to be licensed in the state as collection agencies

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On August 2, the Maryland Court of Appeals, in a consolidated appeal of four circuit cases, held that foreign statutory trusts are not required to obtain a debt collection agency license under the Maryland Collection Agency Licensing Act (MCALA) before filing foreclosure actions in state circuit courts. The decision results from two cases consolidated before the Court…

Georgia Department of Banking and Finance issues cease and desist over licensing violation involving bitcoin

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On July 26, the Georgia Department of Banking and Finance (Department) announced the issuance of a cease and desist order against a bitcoin trading platform. According to the Department, the company allegedly engaged in the sale of payment instruments and money transmissions without first acquiring a valid license or applicable exemption in violation of the state’s financial institutions code.…