SB0513

SENATE BILL 513

54th legislature - STATE OF NEW MEXICO - first session, 2019

INTRODUCED BY

Clemente Sanchez and William E. Sharer

AN ACT

RELATING TO LENDING; ENACTING NEW SECTIONS OF THE COLLECTION AGENCY REGULATORY ACT AND THE MOTOR VEHICLE SALES FINANCE ACT; PROVIDING FOR THE DIRECTOR OF THE FINANCIAL INSTITUTIONS DIVISION OF THE REGULATION AND LICENSING DEPARTMENT TO UTILIZE THE NATIONWIDE MULTISTATE LICENSING SYSTEM AND REGISTRY TO RECEIVE AND PROCESS APPLICATIONS FOR LICENSES; REPEALING A SECTION OF THE COLLECTION AGENCY REGULATORY ACT.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

SECTION 1. Section 58-19-2 NMSA 1978 (being Laws 1959, Chapter 204, Section 2, as amended) is amended to read:

"58-19-2. DEFINITIONS.--As used in the Motor Vehicle Sales Finance Act:

A. "motor vehicles" means automobiles, recreational vehicles, recreational travel trailers, trailers, motorcycles, trucks, semi-trailers, truck tractors and buses designed and used primarily to transport persons or property on a public highway, farm machinery and all vehicles new or used, with any power other than muscular power except boat trailers, aircraft or any vehicle that runs only on rails or tracks, but does not include any motor vehicle having a gross vehicle weight of ten thousand pounds or more purchased primarily for business or commercial purposes;

B. "retail buyer" or "buyer" means a person who buys a motor vehicle primarily for personal, family or household purposes from a retail seller and who executes a retail installment contract in connection therewith;

C. "retail seller" or "seller" means a person who sells a motor vehicle to a retail buyer or subject to a retail installment contract;

D. "holder" of a retail installment contract means the retail seller of the motor vehicle under or subject to the contract or, if the contract is purchased by a sales finance company or other assignee, the sales finance company or other assignee;

E. "retail installment transaction" means any transaction evidenced by a retail installment contract entered into between a retail buyer and a retail seller wherein the retail buyer buys a motor vehicle from the retail seller at a time price payable in one or more deferred installments. The cash sale price of the motor vehicle, the amount included for insurance and other benefits if a separate charge is made therefor, official fees and the finance charge together constitute the time price;

F. "retail installment contract" or "contract" means an agreement, entered into in this state or made subject to the laws of this state, pursuant to which the title to or a lien upon the motor vehicle that is the subject matter of a retail installment transaction is retained or taken by a retail seller from a retail buyer as security for the buyer's obligation. The term includes a chattel mortgage, a conditional sales contract and a contract for the bailment or leasing of a motor vehicle by which the bailee or lessee contracts to pay as compensation for its use a sum substantially equivalent to or in excess of its value and by which it is agreed that the bailee or lessee is bound to become or has the option of becoming the owner of the motor vehicle upon full compliance with the provisions of the contract;

G. "cash sale price" means the price stated in a retail installment contract for which the seller would have sold to the buyer, and the buyer would have bought from the seller, the motor vehicle that is the subject matter of the retail installment contract, if the sale had been a sale for cash instead of a retail installment transaction. Cash sale price may include any taxes, registration fee, certificate of title fee, license and other fees and charges for accessories and their installation and for delivery, servicing, repairing or improving the motor vehicle;

H. "official fees" means the fee prescribed by law for filing, recording or otherwise perfecting and releasing or satisfying a retained title or a lien created by a retail installment contract;

I. "finance charge" means the amount agreed upon between the buyer and the seller to be added to the aggregate of the cash sale price, the amount, if any, included for insurance and other benefits and official fees, in determining the time price;

J. "person" means an individual, partnership, corporation, association and any other group however organized;

K. "sales finance company" means a person engaged in whole or in part in the business of purchasing retail installment contracts from one or more retail sellers. The term includes [but is not limited to] a bank, trust company, private banker, small loan licensee, industrial bank or investment company, if so engaged; the term also includes a retail seller engaged in whole or in part in the business of creating and holding retail installment contracts that exceed a total aggregate outstanding indebtedness of one hundred thousand dollars ($100,000);

L. "director" means the director of the financial institutions division of the regulation and licensing department or a duly authorized agent designated by the director; [and]

M. "year" means a period of three hundred sixty-five days; "month" means one-twelfth of a year; and "day" means one three-hundred-sixty-fifth of a year; and

N. "nationwide multistate licensing system and registry" means a licensing system developed and maintained by the conference of state bank supervisors and the American association of residential mortgage regulators pursuant to the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 to manage mortgage licenses and other financial services licenses, or a successor registry."

SECTION 2. Section 58-19-3 NMSA 1978 (being Laws 1959, Chapter 204, Section 3, as amended) is amended to read:

"58-19-3. LICENSING OF SALES FINANCE COMPANIES REQUIRED--DENIAL OF LICENSE--PROVISION FOR OUT-OF-STATE LICENSES.--

A. [No] A person shall not engage in the business of a sales finance company in this state without a license [therefor] as provided in the Motor Vehicle Sales Finance Act; provided, however, that a state or national bank authorized to do business in this state shall not be required to obtain a license under that act but shall comply with all of its other provisions.

B. The application for a license shall be in writing, under oath and in the form prescribed by the director. The application shall contain the name of the applicant; date of incorporation, if incorporated; the address where the business is or is to be conducted and similar information as to any branch office of the applicant; the name and resident address of the owner or partners or, if a corporation or association, of the directors, trustees and principal officers; and such other pertinent information as the director may require.

C. The license fee for each calendar year or part thereof shall be four hundred dollars ($400) for the principal place of business of the licensee and four hundred dollars ($400) for each branch of the licensee maintained in this state. For a license maintained out of this state, the license fee shall be five hundred dollars ($500) for each office. All fees shall be deposited with the state treasurer for deposit and transfer as provided in Section 9-16-14 NMSA 1978.

D. Each license shall specify the location of the office or branch [and the license shall be conspicuously displayed in the office or branch]. In case a location is changed, the director shall endorse the change of location on the license upon payment to the director by the licensee of a duplicate license fee of twenty-five dollars ($25.00).

E. Applicants for a license issued pursuant to the Motor Vehicle Sales Finance Act shall apply using a form prescribed by the director. Information required on the form shall be set forth by rule, instruction or procedure of the director, and may be changed or updated as necessary by the director in order to carry out the purposes of the Motor Vehicle Sales Finance Act.

F. The director may establish relationships or contracts with the nationwide multistate licensing system and registry or other entities designated by the nationwide multistate licensing system and registry to collect and maintain records and process transaction fees or other fees related to licenses issued pursuant to the Motor Vehicle Sales Finance Act.

G. In an application for a license issued pursuant to the Motor Vehicle Sales Finance Act, the applicant shall, at a minimum, furnish to the nationwide multistate licensing system and registry information concerning the applicant's identity, including:

(1) the applicant's personal history and experience in a form prescribed by the nationwide multistate licensing system and registry; and

(2) authorization for the nationwide multistate licensing system and registry and the director to obtain information related to any administrative, civil or criminal findings by any governmental jurisdiction regarding the applicant.

H. The director may use the nationwide multistate licensing system and registry as a channeling agent for requesting and distributing information provided pursuant to Paragraphs (1) and (2) of Subsection G of this section to and from any source as deemed appropriate by the director.

[E.] I. Upon the filing of an application and the payment of the fee, the director shall issue to the applicant a license to engage in the business of a sales finance company under and in accordance with the provisions of the Motor Vehicle Sales Finance Act for a period [which] that shall expire on December 31 next following the date of its issuance. The license shall not be transferable or assignable. [No] A licensee shall not transact any business provided for by the Motor Vehicle Sales Finance Act under any other name.

[F.] J. The director shall deny a license under the Motor Vehicle Sales Finance Act if [he] the director finds that:

(1) the applicant has failed to pay the required fee;

(2) the applicant has willfully furnished the director with false or misleading information in the application; or

(3) there is reason to believe that the financial responsibility, character and general fitness of the applicant for an original license and of the individual members and beneficiaries thereof, if the applicant is a copartnership, association or trust, and of the officers and directors thereof, if the applicant is a corporation, are such as to warrant belief that the business will not be operated lawfully, honestly, fairly and efficiently within the declared purposes and spirit of that act.

If an original license is denied by the director, [he] the director shall immediately notify the applicant in writing setting forth the reasons for denial.

[G.] K. The director may issue a motor vehicle sales finance company license to an applicant who applies for such a license to be located outside the state, if the applicant:

(1) files an application on a form prescribed by the director enclosing a license fee of five hundred dollars ($500);

(2) maintains, at all times, an agent for service of process, who shall be a resident of New Mexico; and

(3) complies with all sections of the Motor Vehicle Sales Finance Act and any rules and regulations that may be promulgated by the director and complies with all statutes relating to money, interest and usury [which] that are applicable to motor vehicle sales finance companies.

A motor vehicle sales finance company license may be granted to an applicant anywhere in the United States. Local situs is not a requirement for the granting of a license to an out-of-state applicant."

SECTION 3. Section 58-21-32 NMSA 1978 (being Laws 2009, Chapter 122, Section 53) is amended to read:

"58-21-32. MORTGAGE CALL REPORTS.--Each licensee shall submit to the nationwide [mortgage] multistate licensing system and registry reports of condition, which shall be in such form and shall contain such information as the nationwide [mortgage] multistate licensing system and registry may require."

SECTION 4. Section 58-21B-3 NMSA 1978 (being Laws 2009, Chapter 122, Section 3) is amended to read:

"58-21B-3. DEFINITIONS.--As used in the New Mexico Mortgage Loan Originator Licensing Act:

A. "clerical or support duties" may include, subsequent to the receipt of an application:

(1) the receipt, collection, distribution and analysis of information common for the processing or underwriting of a residential mortgage loan; and

(2) communicating with a consumer to obtain the information necessary for the processing or underwriting of a loan, to the extent that such communication does not include offering or negotiating loan rates or terms or counseling consumers about residential mortgage loan rates or terms;

B. "depository institution" has the same meaning as the definition of depository institution in Section 3 of the Federal Deposit Insurance Act and includes any credit union;

C. "director" means the director of the financial institutions division of the regulation and licensing department;

D. "dwelling" means a residential structure that contains one to four units whether or not that structure is attached to real property. "Dwelling" includes an individual condominium unit, an individual cooperative unit, a mobile home and a trailer if used as a residence;

E. "federal banking agencies" means the board of governors of the federal reserve system, the comptroller of the currency, [the director of the office of thrift supervision] the national credit union administration and the federal deposit insurance corporation;

F. "immediate family member" means a spouse, child, sibling, parent, grandparent or grandchild, and "immediate family member" includes a stepparent, a stepchild, a stepsibling and an adoptive relationship;

G. "individual" means a natural person;

H. "license" means a license issued pursuant to Section [6 of the New Mexico Mortgage Loan Originator Licensing Act] 58-21B-6 NMSA 1978;

I. "loan processor or underwriter" means an individual who performs clerical or support duties as an employee at the direction of and subject to the supervision and instruction of a person licensed, or exempt from licensing, pursuant to the Mortgage Loan Company Act;

J. "mortgage loan company" means any person defined as such in the Mortgage Loan Company Act;

K. "mortgage loan originator" means an individual who for compensation or gain or in the expectation of compensation or gain takes a residential mortgage loan application or offers or negotiates terms of a residential mortgage loan. "Mortgage loan originator" does not include:

(1) an individual engaged solely as a loan processor or underwriter except as otherwise provided in Subsection I of this section;

(2) a person that only performs real estate brokerage activities and is licensed or registered in accordance with New Mexico law, unless the person is compensated by a lender, a mortgage loan company or other mortgage loan originator or by any agent of such lender, mortgage loan company or other mortgage loan originator; and

(3) a person solely involved in extensions of credit relating to timeshare plans, as that term is defined in Section 101(53D) of Title 11 of the United States Code;

L. "nationwide [mortgage] multistate licensing system and registry" means a [mortgage] licensing system developed and maintained by the conference of state bank supervisors and the American association of residential mortgage regulators [for the licensing and registration of licensed mortgage loan originators] pursuant to the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 to manage mortgage licenses and other financial services licenses, or a successor registry;

M. "nontraditional mortgage product" means any mortgage product other than a thirty-year fixed rate mortgage;

N. "person" means a natural person, corporation, company, limited liability company, partnership or association;

O. "real estate brokerage activity" means any activity that involves offering or providing real estate brokerage services to the public, including:

(1) acting as a real estate agent or real estate broker for a buyer, seller, lessor or lessee of real property;

(2) bringing together parties interested in the sale, purchase, lease, rental or exchange of real property;

(3) negotiating, on behalf of any party, any portion of a contract relating to the sale, purchase, lease, rental or exchange of real property, other than in connection with providing financing with respect to any such transaction;

(4) engaging in any activity for which a person engaged in the activity is required to be registered or licensed as a real estate agent or real estate broker pursuant to any applicable law; and

(5) offering to engage in any activity or to act in any capacity described in Paragraphs (1) through (4) of this subsection;

P. "registered mortgage loan originator" means any individual who:

(1) meets the definition of mortgage loan originator and is an employee of:

(a) a depository institution;

(b) a subsidiary that is: 1) owned and controlled by a depository institution; and 2) regulated by a federal banking agency; or

(2) is registered with, and maintains a unique identifier through, the nationwide [mortgage] multistate licensing system and registry;

Q. "residential mortgage loan" means any loan primarily for personal, family or household use that is secured by a mortgage, deed of trust or other equivalent consensual security interest on a dwelling or on residential real estate upon which is constructed or is intended to be constructed a dwelling as so defined;

R. "residential real estate" means any real property located in New Mexico upon which is constructed or intended to be constructed a dwelling;

S. "servicer" means a person that collects or receives payments, including principal, interest and trust items such as hazard insurance, property taxes and other amounts due, on behalf of a note holder or investor in accordance with the terms of a residential mortgage loan, and includes working with a borrower on behalf of a note holder or investor, when the borrower is in financial hardship or default, to modify either temporarily or permanently the terms of an existing residential mortgage loan; and

T. "unique identifier" means a number or other identifier assigned by protocols established by the nationwide [mortgage] multistate licensing system and registry."

SECTION 5. Section 58-21B-4 NMSA 1978 (being Laws 2009, Chapter 122, Section 4) is amended to read:

"58-21B-4. LICENSE AND REGISTRATION REQUIRED TO ORIGINATE MORTGAGE LOANS.--

A. Unless specifically exempted from the New Mexico Mortgage Loan Originator Licensing Act pursuant to Subsection B of this section, an individual shall not engage in the business of a mortgage loan originator with respect to any dwelling located in New Mexico without first obtaining and maintaining annually a license pursuant to that act. Each licensed mortgage loan originator must register with and maintain a valid unique identifier issued by the nationwide [mortgage] multistate licensing system and registry. All new licenses and license renewals shall expire on December 31 of each year. All license renewal applications shall be submitted on or before November 1 of each year.

B. The following are exempt from the provisions of the New Mexico Mortgage Loan Originator Licensing Act:

(1) registered mortgage loan originators when acting for an entity defined in Subparagraphs (a) through (c) of Paragraph (1) of Subsection P of Section [3 of the New Mexico Mortgage Loan Originator Licensing Act] 58-21B-3 NMSA 1978;

(2) an individual who offers or negotiates terms of a residential mortgage loan with or on behalf of an immediate family member of the individual;

(3) an individual who offers or negotiates terms of a real property sale financed in whole or in part by the seller and secured by the seller's real property; or

(4) a licensed attorney who negotiates the terms of a residential mortgage loan on behalf of a client as an ancillary matter to the attorney's representation of the client, unless the attorney is compensated by a lender, a mortgage loan company or other mortgage loan originator or by any agent of such lender, mortgage loan company or other mortgage loan originator.

C. A loan processor or underwriter who is an independent contractor shall not engage in the activities of a loan processor or underwriter unless the independent contractor loan processor or underwriter obtains and maintains a license pursuant to Subsection A of this section. Each contractor loan processor or underwriter licensed as a mortgage loan originator shall have and maintain a valid unique identifier issued by the nationwide [mortgage] multistate licensing system and registry.

D. A mortgage loan originator who is currently licensed in another state through the nationwide [mortgage] multistate licensing system and registry may be granted a temporary mortgage loan originator license valid for ninety days while the mortgage loan originator completes the education and testing requirements of the New Mexico Mortgage Loan Originator Licensing Act. The mortgage loan originator's current license in another state must be valid for more than ninety days beyond the date of application for a temporary license in order to receive a temporary license in New Mexico."

SECTION 6. Section 58-21B-5 NMSA 1978 (being Laws 2009, Chapter 122, Section 5) is amended to read:

"58-21B-5. STATE LICENSE AND REGISTRATION APPLICATION AND ISSUANCE.--

A. Applicants for a license shall apply in a form as prescribed by the director. Each form shall contain content as set forth by rule, instruction or procedure of the director and may be changed or updated as necessary by the director in order to carry out the purposes of the New Mexico Mortgage Loan Originator Licensing Act.

B. In order to fulfill the purposes of the New Mexico Mortgage Loan Originator Licensing Act, the director may establish relationships or contracts with the nationwide [mortgage] multistate licensing system and registry or other entities designated by the nationwide [mortgage] multistate licensing system and registry to collect and maintain records and process transaction fees or other fees related to licensed mortgage loan originators or other individuals subject to that act.

C. In connection with an application for licensing as a mortgage loan originator, the applicant shall, at a minimum, furnish to the nationwide [mortgage] multistate licensing system and registry information concerning the applicant's identity, including:

(1) fingerprints for submission to the federal bureau of investigation and any governmental agency or entity authorized to receive such information for a state, national and international criminal history background check; and

(2) personal history and experience in a form prescribed by the nationwide [mortgage] multistate licensing system and registry, including the submission of authorization for the nationwide [mortgage] multistate licensing system and registry and the director to obtain:

(a) an independent credit report obtained from a consumer reporting agency described in Section 603(p) of the federal Fair Credit Reporting Act; and

(b) information related to any administrative, civil or criminal findings by any governmental jurisdiction.

D. For the purposes of this section and in order to reduce the points of contact that the federal bureau of investigation may have to maintain for purposes of Paragraph (1) of Subsection C of this section and Subparagraph (b) of Paragraph (2) of Subsection C of this section, the director may use the nationwide [mortgage] multistate licensing system and registry as a channeling agent for requesting information from and distributing information to the federal department of justice or any governmental agency with mortgage industry oversight authority.

E. For the purposes of this section and in order to reduce the points of contact that the director may have to maintain for purposes of Subparagraphs (a) and (b) of Paragraph (2) of Subsection C of this section, the director may use the nationwide [mortgage] multistate licensing system and registry as a channeling agent for requesting and distributing information to and from any source as directed by the director."

SECTION 7. Section 58-21B-7 NMSA 1978 (being Laws 2009, Chapter 122, Section 7) is amended to read:

"58-21B-7. PRE-LICENSING EDUCATION OF MORTGAGE LOAN ORIGINATORS.--

A. In order to meet the pre-licensing education requirement referred to in Subsection D of Section [6 of the New Mexico Mortgage Loan Originator Licensing Act] 58-21B-6 NMSA 1978, an individual shall complete at least twenty hours of education approved in accordance with Subsection B of this section, which shall include at least:

(1) three hours of federal law and regulations;

(2) three hours of ethics, including instruction on fraud, consumer protection and fair lending issues;

(3) two hours of training related to lending standards for the nontraditional mortgage product marketplace; and

(4) three hours of New Mexico law and administrative rules.

B. For the purposes of Subsection A of this section, pre-licensing education courses shall be reviewed and approved by the nationwide [mortgage] multistate licensing system and registry based upon reasonable standards. Review and approval of a pre-licensing education course shall include review and approval of the course provider.

C. Nothing in this section shall preclude any pre-licensing education course, as approved by the nationwide [mortgage] multistate licensing system and registry, that is provided by the employer of the applicant or by an entity that is affiliated with the applicant by an agency contract, or by any subsidiary or affiliate of the employer or entity.

D. Pre-licensing education may be offered in a classroom, online or by any other means approved by the nationwide [mortgage] multistate licensing system and registry.

E. The pre-licensing education requirements approved by the nationwide [mortgage] multistate licensing system and registry in Paragraphs (1) through (4) of Subsection A of this section for any state shall be accepted as credit toward completion of pre-licensing education requirements in New Mexico.

F. An individual previously licensed pursuant to the New Mexico Mortgage Loan Originator Licensing Act subsequent to the effective date of that act applying to be licensed again shall prove that the individual has completed all of the continuing education requirements for the year in which the license was last held."

SECTION 8. Section 58-21B-8 NMSA 1978 (being Laws 2009, Chapter 122, Section 8) is amended to read:

"58-21B-8. TESTING OF MORTGAGE LOAN ORIGINATORS.--

A. In order to meet the written test requirement referred to in Subsection E of Section [6 of the New Mexico Mortgage Loan Originator Licensing Act] 58-21B-6 NMSA 1978, an individual shall pass, in accordance with the standards established pursuant to this section, a qualified written test developed by the nationwide [mortgage] multistate licensing system and registry and administered by a test provider approved by the nationwide [mortgage] multistate licensing system and registry based upon reasonable standards.

B. A written test shall not be treated as a qualified written test for purposes of Subsection A of this section unless the test adequately measures the applicant's knowledge and comprehension in appropriate subject areas, including:

(1) ethics;

(2) federal law and regulations pertaining to mortgage origination;

(3) New Mexico law and rules pertaining to mortgage origination; and

(4) federal and New Mexico law and regulations and rules, including those concerning fraud, consumer protection, the nontraditional mortgage product marketplace and fair lending issues.

C. Nothing in this section shall prohibit a test provider approved by the nationwide [mortgage] multistate licensing system and registry from providing a test at the location of the employer of the applicant or the location of any subsidiary or affiliate of the employer of the applicant, or at the location of any entity with which the applicant holds an exclusive arrangement to conduct the business of a mortgage loan originator.

D. An individual shall not be considered to have passed a qualified written test unless the individual achieves a test score of not less than seventy-five percent correct answers to questions.

E. An individual may retake a test two consecutive times, provided that each retake occurs at least thirty days after the preceding test. After failing three consecutive tests, an individual shall wait at least six months before taking the test again.

F. A licensed mortgage loan originator who fails to maintain a valid license for a period of five years or longer shall retake the test, not taking into account any time during which the individual is a registered mortgage loan originator."

SECTION 9. Section 58-21B-9 NMSA 1978 (being Laws 2009, Chapter 122, Section 9) is amended to read:

"58-21B-9. STANDARDS FOR LICENSE RENEWAL.--

A. The minimum standards for license renewal for mortgage loan originators shall include the following:

(1) the mortgage loan originator continues to meet the minimum standards for license issuance pursuant to Section [6 of the New Mexico Mortgage Loan Originator Licensing Act] 58-21B-6 NMSA 1978;

(2) the mortgage loan originator has satisfied the annual continuing education requirements set forth in Section [10 of the New Mexico Mortgage Loan Originator Licensing Act] 58-21B-10 NMSA 1978; and

(3) the mortgage loan originator has paid all required fees for renewal of the license.

B. The license of a mortgage loan originator who fails to satisfy the minimum standards for license renewal shall expire. The director may adopt rules for the reinstatement of expired licenses consistent with the standards established by the nationwide [mortgage] multistate licensing system and registry."

SECTION 10. Section 58-21B-10 NMSA 1978 (being Laws 2009, Chapter 122, Section 10) is amended to read:

"58-21B-10. CONTINUING EDUCATION FOR MORTGAGE LOAN ORIGINATORS.--

A. In order to meet the annual continuing education requirements set forth in Paragraph (2) of Subsection A of Section [9 of the New Mexico Mortgage Loan Originator Licensing Act] 58-21B-9 NMSA 1978, a licensed mortgage loan originator shall complete at least eight hours of education approved in accordance with Subsection B of this section, which shall include at least:

(1) three hours of federal law and regulations;

(2) two hours of ethics, including instruction on fraud, consumer protection and fair lending issues;

(3) two hours of training related to lending standards for the nontraditional mortgage product marketplace; and

(4) one hour of New Mexico law and administrative rules.

B. For the purposes of Subsection A of this section, continuing education courses shall be reviewed and approved by the nationwide [mortgage] multistate licensing system and registry based upon reasonable standards. Review and approval of a continuing education course shall include review and approval of the course provider.

C. Nothing in this section shall preclude any education course, as approved by the nationwide [mortgage] multistate licensing system and registry, that is provided by the employer of the mortgage loan originator or by an entity that is affiliated with the mortgage loan originator by an agency contract, or any subsidiary or affiliate of such employer or entity.

D. Continuing education may be offered in a classroom, online or by any other means approved by the nationwide [mortgage] multistate licensing system and registry.

E. A licensed mortgage loan originator:

(1) except for the provisions of Subsection B of Section [9 of the New Mexico Mortgage Loan Originator Licensing Act] 58-21B-9 NMSA 1978 and Subsection I of this section, may only receive credit for a continuing education course in the year in which the course is taken; and

(2) may not take the same approved course in the same or successive years to meet the annual requirements for continuing education.

F. A licensed mortgage loan originator who is an approved instructor of an approved continuing education course may receive credit for the licensed mortgage loan originator's own annual continuing education requirement at the rate of two hours' credit for every one hour taught.

G. An individual who has successfully completed the education requirements approved by the nationwide [mortgage] multistate licensing system and registry and as set forth in Subsection A of this section for any state shall be accepted as credit toward completion of continuing education requirements in New Mexico.

H. A licensed mortgage loan originator who subsequently becomes unlicensed shall complete the continuing education requirements for the last year in which the license was held prior to issuance of a new or renewed license.

I. An individual who meets the requirements set forth in Paragraphs (1) and (3) of Subsection A of Section [9 of the New Mexico Mortgage Loan Originator Licensing Act] 58-21B-9 NMSA 1978 may make up any deficiency in continuing education as established by rule promulgated by the director."

SECTION 11. Section 58-21B-11 NMSA 1978 (being Laws 2009, Chapter 122, Section 11) is amended to read:

"58-21B-11. AUTHORITY TO REQUIRE LICENSE AND TO SET FEES.--

A. In addition to any other duties imposed upon the director by law, the director shall require mortgage loan originators to be licensed and registered through the nationwide [mortgage] multistate licensing system and registry. In order to carry out this requirement, the director may participate in the nationwide [mortgage] multistate licensing system and registry. For this purpose, the director may establish requirements as necessary, including [but not limited to]:

(1) background checks for:

(a) criminal history through fingerprint or other databases;

(b) civil or administrative records;

(d) any other information deemed necessary by the nationwide [mortgage] multistate licensing system and registry;

(2) payment of fees to apply for or renew licenses through the nationwide [mortgage] multistate licensing system and registry;

(3) setting or resetting as necessary renewal or reporting dates; and

(4) requirements for amending or surrendering a license or any other activities the director deems necessary for participation in the nationwide [mortgage] multistate licensing system and registry.

B. The director shall establish by rule fees sufficient to cover the costs of administering the New Mexico Mortgage Loan Originator Licensing Act. These fees may include:

(1) an original and renewal license fee paid by each licensed mortgage loan originator;

(2) an application fee to cover the costs of processing applications;

(3) an examination or investigation fee to cover the costs of any examination or investigation of the books and records of a licensed mortgage loan originator or other person subject to the New Mexico Mortgage Loan Originator Licensing Act; and

(4) late fees, license amendment fees and any other fees associated with the costs of administering the New Mexico Mortgage Loan Originator Licensing Act.

C. Mortgage loan originators shall not be charged investigation fees for the processing of complaints when the investigation determines that no violation of the New Mexico Mortgage Loan Originator Licensing Act occurred or when the mortgage loan originator provides a remedy satisfactory to the complainant and the director and no order of the director is issued. All money, fees and penalties collected pursuant to the New Mexico Mortgage Loan Originator Licensing Act shall be deposited into the mortgage regulatory fund.

D. For the purposes of implementing an orderly and efficient licensing process, the director may establish licensing rules and interim procedures for licensing and acceptance of applications. For individuals previously registered or licensed pursuant to the Mortgage Loan Company [and Loan Broker] Act, the director may establish expedited review and licensing procedures."

SECTION 12. Section 58-21B-12 NMSA 1978 (being Laws 2009, Chapter 122, Section 12) is amended to read:

"58-21B-12. NATIONWIDE [MORTGAGE] MULTISTATE LICENSING SYSTEM AND REGISTRY INFORMATION CHALLENGE PROCESS.--The director shall establish rules whereby mortgage loan originators may challenge information entered into the nationwide [mortgage] multistate licensing system and registry by the director."

SECTION 13. Section 58-21B-13 NMSA 1978 (being Laws 2009, Chapter 122, Section 13) is amended to read:

"58-21B-13. ENFORCEMENT--VIOLATIONS--PENALTIES.--

A. In order to ensure the effective supervision and enforcement of the New Mexico Mortgage Loan Originator Licensing Act, the director may:

(1) deny, suspend, revoke or decline to renew a license for a violation of the New Mexico Mortgage Loan Originator Licensing Act or rules issued pursuant to that act or an order or a directive entered pursuant to that act;

(2) deny, suspend, revoke or decline to renew a license if an applicant or licensed mortgage loan originator:

(a) fails at any time to meet the requirements of Section [6 or 9 of the New Mexico Mortgage Loan Originator Licensing Act] 58-21B-6 or 58-21B-9 NMSA 1978; or

(b) withholds information or makes a material misstatement in an application for a license or renewal of a license;

(3) order restitution against mortgage loan originators for violations of that act;

(4) impose fines on mortgage loan originators pursuant to Subsections C through E of this section;

(5) order or direct such other affirmative action as the director deems necessary;

(6) bar or suspend a mortgage loan originator from licensure in New Mexico as a mortgage loan originator; and

(7) issue orders or directives pursuant to the New Mexico Mortgage Loan Originator Licensing Act as follows:

(a) order or direct mortgage loan originators to cease and desist from conducting business, including issuing an immediate temporary order to cease and desist;

(b) order or direct mortgage loan originators to cease any harmful activities or violations of that act, including issuing an immediate temporary order to cease and desist; and

(c) enter immediate temporary orders to cease business pursuant to a license issued pursuant to the authority granted pursuant to Section [4 of the New Mexico Mortgage Loan Originator Licensing Act] 58-21B-4 NMSA 1978 if the director determines that the license was erroneously granted or the licensed mortgage loan originator is currently in violation of that act.

B. The director may initiate one or more of the actions set forth in Section [15 of the New Mexico Mortgage Loan Originator Licensing Act] 58-21B-15 NMSA 1978.

C. It is a violation of the New Mexico Mortgage Loan Originator Licensing Act for a mortgage loan originator to:

(1) directly or indirectly employ any scheme, device or artifice to defraud or mislead borrowers or lenders or to defraud any person;

(2) engage in any unfair or deceptive practice toward any person;

(3) obtain property by fraud or misrepresentation;

(4) solicit or enter into a contract with a borrower that provides in substance that the mortgage loan originator may earn a fee or commission through "best efforts" to obtain a loan even though no loan is actually obtained for the borrower;

(5) solicit, advertise or enter into a contract for specific interest rates, points or other financing terms unless the terms are actually available at the time of soliciting, advertising or contracting;

(6) conduct any business covered by the New Mexico Mortgage Loan Originator Licensing Act without holding a valid license as required pursuant to that act, or assist or aid and abet any person in the conduct of business pursuant to that act without a valid license as required pursuant to that act;

(7) fail to make disclosures as required by the New Mexico Mortgage Loan Originator Licensing Act and any other applicable state or federal law, including rules and regulations thereunder;

(8) fail to comply with the provisions of the New Mexico Mortgage Loan Originator Licensing Act or rules or regulations promulgated pursuant to that act, or fail to comply with any other state or federal law, including rules and regulations thereunder, applicable to any business authorized or conducted pursuant to the New Mexico Mortgage Loan Originator Licensing Act;

(9) make, in any manner, a false or deceptive statement or representation, including, with regard to the rates, points or other financing terms or conditions for a residential mortgage loan, engaging in bait-and-switch advertising;

(10) negligently make any false statement or knowingly and willfully make any omission of material fact in connection with any information or reports filed with a governmental agency or the nationwide [mortgage] multistate licensing system and registry or in connection with any investigation conducted by the director or another governmental agency;

(11) make any payment, threat or promise, directly or indirectly, to any person for the purposes of influencing the independent judgment of the person in connection with a residential mortgage loan or make any payment, threat or promise, directly or indirectly, to any appraiser of a property for the purposes of influencing the independent judgment of the appraiser with respect to the value of the property. Nothing in this paragraph shall be construed to prohibit a mortgage loan originator from asking the appraiser to consider additional appropriate property information or provide further detail, substantiation or explanation for the appraiser's value conclusion;

(12) collect, charge, attempt to collect or charge, or to use or propose any agreement purporting to collect or charge, any fee prohibited by the New Mexico Mortgage Loan Originator Licensing Act;

(13) cause or require a borrower to obtain property insurance coverage in an amount that exceeds the replacement cost of the improvements as established by the director and the property insurer;

(14) fail to account truthfully for money belonging to a party to a residential mortgage loan transaction;

(15) engage in mortgage loan origination on behalf of more than one mortgage loan company;

(16) pay, receive or collect in whole or in part any commission, fee or other compensation for originating a mortgage loan in violation of the New Mexico Mortgage Loan Originator Licensing Act, including a mortgage loan originated by any unlicensed person other than an exempt person;

(17) charge or collect any fee, commission or rate of interest or make or originate any mortgage loan with terms or conditions or in a manner contrary to other applicable federal and state laws;

(18) advertise mortgage loans, including rates, margins, discounts, points, fees, commission or other material information, including material limitations on the loans, unless the person is able to make the mortgage loans available to a reasonable number of qualified applicants;

(19) coerce, extort, induce, bribe or intimidate or attempt to coerce, extort, induce, bribe or intimidate an appraiser to value property in excess of its fair market value;

(20) originate a mortgage loan that contains a pre-payment penalty;

(21) misrepresent a borrower's credit rating;

(22) misrepresent, inflate or fabricate, or encourage a borrower to misrepresent, inflate or fabricate, the source or amount of a borrower's actual income or assets, other than allowable grossed-up income not to exceed twenty-five percent per current agency guidelines as set by the director, in the application or underwriting process for a residential mortgage loan;

(23) originate a residential mortgage loan when the terms of that loan are in violation of the Home Loan Protection Act;

(24) originate a residential mortgage loan that does not require documentation and consideration of the borrower's reasonable ability to repay that loan pursuant to its terms. The borrower's ability to repay shall be demonstrated through reasonably reliable documentation that may include payroll receipts, tax returns, bank records, asset and credit evaluations, mortgage payment history or other similar reliable documentation. The provisions of this paragraph shall not apply to a residential mortgage loan originated pursuant to a government streamline program or a streamline program administered by a government-sponsored enterprise, to a reverse mortgage insured as part of a government program or to loss mitigation activities of a mortgage loan servicer or lender with which the borrower has a current relationship, so long as each of these exceptions, as applicable, provides the borrower with a reasonable, tangible net benefit; or

(25) originate a residential mortgage loan that does not require a determination of the borrower's reasonable ability to pay the costs set forth in this paragraph. In the case of an adjustable rate residential mortgage loan, the reasonable ability to pay shall be determined based on a fully indexed rate and repayment schedule that achieves full amortization over the life of the mortgage loan. The costs, as applicable, to be used in determining the borrower's reasonable ability to pay include principal, interest, real estate taxes, property insurance, property assessments, mortgage insurance premiums and other scheduled long-term monthly debt payments.

D. The director may impose a civil penalty on a mortgage loan originator if the director finds, on the record after notice and opportunity for hearing, that the mortgage loan originator has violated or failed to comply with any requirement of the New Mexico Mortgage Loan Originator Licensing Act or any rule promulgated by the director pursuant to that act or any order issued pursuant to authority of that act.

E. The maximum amount of penalty for each act or omission described in Subsection C of this section shall be twenty-five thousand dollars ($25,000).

F. Each violation or failure to comply with any directive or order of the director is a separate and distinct violation or failure."

SECTION 14. Section 58-21B-18 NMSA 1978 (being Laws 2009, Chapter 122, Section 18) is amended to read:

"58-21B-18. CONFIDENTIALITY.--In order to promote more effective regulation and reduce regulatory burden through supervisory information-sharing, except as otherwise provided in Public Law 110-289, Section 1512, the requirements pursuant to any federal law or pursuant to the Inspection of Public Records Act regarding the privacy or confidentiality of any information or material provided to the nationwide [mortgage] multistate licensing system and registry, and any privilege arising pursuant to federal or state law, including the rules of any federal or state court, with respect to such information or material, shall continue to apply to such information or material after the information or material has been disclosed to the nationwide [mortgage] multistate licensing system and registry. Such information and material may be shared with all state and federal regulatory officials with mortgage industry oversight authority without the loss of privilege or the loss of confidentiality protections provided by federal law or the Inspection of Public Records Act, and the director may enter into agreements or sharing arrangements with other governmental agencies, the conference of state bank supervisors, the American association of residential mortgage regulators or other associations representing governmental agencies as established by rule or order of the director."

SECTION 15. Section 58-21B-22 NMSA 1978 (being Laws 2009, Chapter 122, Section 22) is amended to read:

"58-21B-22. MORTGAGE CALL REPORTS.--A mortgage loan originator shall submit to the nationwide [mortgage] multistate licensing system and registry reports of condition, which shall be in such form and shall contain such information as the nationwide [mortgage] multistate licensing system and registry may require."

SECTION 16. Section 58-21B-23 NMSA 1978 (being Laws 2009, Chapter 122, Section 23) is amended to read:

"58-21B-23. REPORT TO NATIONWIDE [MORTGAGE] MULTISTATE LICENSING SYSTEM AND REGISTRY.--Subject to state privacy laws, the director shall report regularly violations of the New Mexico Mortgage Loan Originator Licensing Act, as well as enforcement actions and other relevant information, to the nationwide [mortgage] multistate licensing system and registry subject to the provisions set forth in Section [18 of the New Mexico Mortgage Loan Originator Licensing Act] 58-21B-18 NMSA 1978."

SECTION 17. Section 58-32-102 NMSA 1978 (being Laws 2016, Chapter 88, Section 102) is amended to read:

"58-32-102. DEFINITIONS.--As used in the Uniform Money Services Act:

A. "applicant" means a person that files an application for a license pursuant to the Uniform Money Services Act;

B. "authorized delegate" means a person that a licensee designates to provide money services on behalf of the licensee;

C. "bank" means an institution organized under federal or state law that:

(1) accepts demand deposits or deposits that the depositor may use for payment to third parties and engages in the business of making commercial loans; or

(2) engages in credit card operations and maintains only one office that accepts deposits, does not accept demand deposits or deposits that the depositor may use for payments to third parties, does not accept a savings or time deposit less than one hundred thousand dollars ($100,000) and does not engage in the business of making commercial loans;

D. "check cashing" means receiving compensation for taking payment instruments or stored value, other than traveler's checks, in exchange for money, payment instruments or stored value delivered to the person delivering the payment instrument or stored value at the time and place of delivery without an agreement specifying when the person taking the payment instrument will present it for collection;

E. "control" means:

(1) ownership of, or the power to vote, directly or indirectly, at least twenty-five percent of a class of voting securities or voting interests of a licensee or person in control of a licensee;

(2) the power to elect, appoint, choose or otherwise designate, directly or indirectly, a majority of executive officers, managers, directors, trustees or other persons exercising managerial authority of a licensee or person in control of a licensee; or

(3) the power to exercise, directly or indirectly, a controlling influence over the management or policies of a licensee or person in control of a licensee;

F. "currency exchange" means receipt of revenues from the exchange of money of one government for money of another government;

G. "director" means the director of the financial institutions division of the regulation and licensing department;

H. "electronic" means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic or similar capabilities;

I. "executive officer" means a president, chair of the executive committee, chief financial officer, responsible individual or other individual who performs similar functions;

J. "internet-based money services business" means a business that provides money transmission, check cashing or currency exchange services to residents of New Mexico through the internet;

K. "licensee" means a person licensed pursuant to the Uniform Money Services Act;

L. "limited station" means private premises where a check casher is authorized to engage in check cashing solely for the employees of the particular employer or group of employers specified in the check casher's license application;

M. "mobile location" means a vehicle or a movable facility where check cashing occurs;

N. "monetary value" means a medium of exchange, whether or not redeemable in money;

O. "money" means a medium of exchange that is authorized or adopted by the United States or a foreign government. "Money" includes a monetary unit of account established by an intergovernmental organization or by agreement between two or more governments;

P. "money services" means money transmission, check cashing or currency exchange;

Q. "money transmission" means selling or issuing payment instruments, stored value or receiving money or monetary value for transmission. "Money transmission" does not include the provision solely of delivery, online or telecommunications services or network access;

R. "nationwide [mortgage] multistate licensing system and registry" means a licensing system developed and maintained by the conference of state bank supervisors and the American association of residential mortgage regulators pursuant to the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 to manage mortgage licenses and other financial services licenses, or a successor registry;

S. "outstanding", with respect to a payment instrument, means issued or sold by or for the licensee and reported as sold but not yet paid by or for the licensee;

T. "payment instrument" means a check, draft, money order, traveler's check or other instrument for the transmission or payment of money or monetary value, whether or not negotiable. "Payment instrument" does not include a credit card voucher, letter of credit or instrument that is redeemable by the issuer in goods or services;

U. "person" means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, government, governmental subdivision, agency or instrumentality, public corporation or any other legal or commercial entity;

V. "record", when used as a noun, means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form;

W. "responsible individual" means an individual who is employed by a licensee and has principal managerial authority over the provision of money services by the licensee in New Mexico;

X. "sign" means, with present intent to authenticate or adopt a record:

(1) to execute or adopt a tangible symbol; or

(2) to attach to or logically associate with the record an electronic sound, symbol or process;

Y. "state" means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands or any territory or insular possession subject to the jurisdiction of the United States;

Z. "stored value" means monetary value that is evidenced by an electronic record;

AA. "unique identifier" means a number or other identifier assigned by protocols established by the nationwide [mortgage] multistate licensing system and registry; and

BB. "unsafe or unsound practice" means a practice or conduct by a person licensed to engage in money transmission or an authorized delegate of such a person that creates the likelihood of material loss, insolvency or dissipation of the licensee's assets, or otherwise materially prejudices the interests of its customers."

SECTION 18. Section 58-32-202 NMSA 1978 (being Laws 2016, Chapter 88, Section 202) is amended to read:

"58-32-202. APPLICATION FOR LICENSE.--

A. A person applying for a license pursuant to Article 2 of the Uniform Money Services Act shall apply in a record signed under penalty of perjury that shall be in a form and in a medium required by the director. Each form shall contain content as set forth by rule, instruction or procedure of the director. The form shall include the following information:

(1) the legal name and residential and business addresses of the applicant and any fictitious or trade name used by the applicant in conducting its business;

(2) a list of any criminal convictions of the applicant and any material litigation in which the applicant has been involved in the ten-year period next preceding the submission of the application;

(3) a description of any money services previously provided by the applicant and the money services that the applicant seeks to provide in New Mexico;

(4) a list of the applicant's proposed authorized delegates and the locations in New Mexico where the applicant and its authorized delegates propose to engage in money transmission or provide other money services;

(5) a list of other states in which the applicant is licensed to engage in money transmission or provide other money services and any license revocations, suspensions or other disciplinary action taken against the applicant in another state;

(6) information concerning any bankruptcy or receivership proceedings affecting the applicant;

(7) a sample form of contract for authorized delegates, if applicable, and a sample form of payment instrument or instrument upon which stored value is recorded, if applicable;

(8) the name and address of any bank through which the applicant's payment instruments and stored value will be paid;

(9) a description of the source of money and credit to be used by the applicant to provide money services; and

(10) any other information the director reasonably requires with respect to the applicant.

B. In order to fulfill the purposes of the Uniform Money Services Act, the director may establish relationships or contracts with the nationwide [mortgage] multistate licensing system and registry or other entities designated by the nationwide [mortgage] multistate licensing system and registry to collect and maintain records and process transaction fees or other fees related to applicants or other individuals subject to that act.

C. In connection with an application for licensing pursuant to Article 2 of the Uniform Money Services Act, the applicant shall, at a minimum, furnish to the nationwide [mortgage] multistate licensing system and registry the following information in a form and medium prescribed by the nationwide [mortgage] multistate licensing system and registry:

(1) the applicant's history and experience; and

(2) an authorization for the nationwide [mortgage] multistate licensing system and registry and the director to obtain:

(a) an independent credit report; and

(b) information related to any administrative, civil or criminal findings by any governmental jurisdiction.

D. If an applicant is a corporation, limited liability company, partnership or other entity, the applicant shall also provide:

(1) the date of the applicant's incorporation or formation and the state or country of incorporation or formation;

(2) if applicable, a certificate of good standing from the state or country in which the applicant is incorporated or formed;

(3) a brief description of the structure or organization of the applicant, including any parent or subsidiary of the applicant, and whether any parent or subsidiary is publicly traded;

(4) the legal name, any fictitious or trade name, all business and residential addresses and the employment in the ten-year period next preceding the submission of the application of each executive officer, manager, director or person that has control of the applicant;

(5) a list of any criminal convictions and material litigation in which any executive officer, manager, director or person in control of the applicant has been involved in the ten-year period next preceding the submission of the application;

(6) a copy of the applicant's audited financial statements for the most recent fiscal year and, if available, for the two-year period next preceding the submission of the application;

(7) a copy of the applicant's unconsolidated financial statements for the current fiscal year, whether audited or not, and, if available, for the two-year period next preceding the submission of the application;

(8) if the applicant is publicly traded, a copy of the most recent report filed with the United States securities and exchange commission pursuant to Section 13 of the federal Securities Exchange Act of 1934;

(9) if the applicant is a wholly owned subsidiary of:

(a) a corporation publicly traded in the United States, a copy of audited financial statements for the parent corporation for the most recent fiscal year or a copy of the parent corporation's most recent report filed pursuant to Section 13 of the federal Securities Exchange Act of 1934; or

(b) a corporation publicly traded outside the United States, a copy of similar documentation filed with the regulator of the parent corporation's domicile outside the United States;

(10) if the applicant has a registered agent in New Mexico, the name and address of the applicant's registered agent in New Mexico; and

(11) any other information the director reasonably requires with respect to the applicant.

E. A nonrefundable application fee of two thousand dollars ($2,000) and a nonrefundable license fee of two thousand dollars ($2,000) shall accompany an application for a license pursuant to Article 2 of the Uniform Money Services Act. The application shall also be accompanied by the surety bond or other security required by Section [203 of the Uniform Money Services Act] 58-32-203 NMSA 1978.

F. The director may waive one or more requirements of Subsection C or D of this section or permit an applicant to submit other information in lieu of the required information.

G. As used in this section, "material litigation" means litigation that, according to generally accepted accounting principles, is significant to an applicant's or a licensee's financial health and would be required to be disclosed in the applicant's or licensee's annual audited financial statements, report to shareholders or similar records."

SECTION 19. Section 58-32-302 NMSA 1978 (being Laws 2016, Chapter 88, Section 302) is amended to read:

"58-32-302. APPLICATION FOR LICENSE.--

A. A person applying for a license pursuant to Article 3 of the Uniform Money Services Act shall apply in a record signed under penalty of perjury that shall be in a form and in a medium required by the director. Each form shall contain content as set forth by rule, instruction or procedure of the director. The form shall include the following information:

(1) the legal name and residential and business addresses of the applicant if the applicant is an individual or, if the applicant is not an individual, the name of each partner, executive officer, manager and director;

(2) the location of the principal office of the applicant;

(3) complete addresses of other locations in New Mexico where the applicant proposes to engage in check cashing or currency exchange, including all limited stations and mobile locations;

(4) a description of the source of money and credit to be used by the applicant to engage in check cashing and currency exchange; and

(5) other information the director reasonably requires with respect to the applicant, but not more than the director may require pursuant to Article 2 of the Uniform Money Services Act.

B. In connection with an application for licensing pursuant to Article 3 of the Uniform Money Services Act, the applicant shall, at a minimum, furnish to the nationwide [mortgage] multistate licensing system and registry the following information in a form and medium prescribed by the nationwide [mortgage] multistate licensing system and registry:

(1) the applicant's history and experience; and

(2) an authorization for the nationwide [mortgage] multistate licensing system and registry and the director to obtain:

(a) an independent credit report; and

(b) information related to any administrative, civil or criminal findings by any governmental jurisdiction.

C. A nonrefundable application fee of two thousand dollars ($2,000) and a nonrefundable license fee of two thousand dollars ($2,000) shall accompany an application for a license pursuant to Article 3 of the Uniform Money Services Act."

SECTION 20. Section 58-32-402 NMSA 1978 (being Laws 2016, Chapter 88, Section 402) is amended to read:

"58-32-402. APPLICATION FOR LICENSE.--

A. A person applying for a license pursuant to Article 4 of the Uniform Money Services Act shall apply in a record signed under penalty of perjury that shall be in a form and in a medium required by the director. Each form shall contain content as set forth by rule, instruction or procedure of the director. The form shall include the following information:

(2) the location of the principal office of the applicant;

(3) complete addresses of other locations in New Mexico where the applicant proposes to engage in currency exchange or check cashing, including all limited stations and mobile locations;

(4) a description of the source of money and credit to be used by the applicant to engage in check cashing and currency exchange; and

(5) other information the director reasonably requires with respect to the applicant, but not more than the director may require pursuant to Article 2 of the Uniform Money Services Act.

B. In connection with an application for licensing pursuant to Article 4 of the Uniform Money Services Act, the applicant shall, at a minimum, furnish to the nationwide [mortgage] multistate licensing system and registry the following information in a form and medium prescribed by the nationwide [mortgage] multistate licensing system and registry:

(1) the applicant's history and experience; and

(2) an authorization for the nationwide [mortgage] multistate licensing system and registry and the director to obtain:

(a) an independent credit report; and

(b) information related to any administrative, civil or criminal findings by any governmental jurisdiction.

SECTION 21. Section 58-32-602 NMSA 1978 (being Laws 2016, Chapter 88, Section 602) is amended to read:

"58-32-602. COOPERATION.--The director may consult and cooperate with other state agencies, agencies of another state or of the United States or the nationwide [mortgage] multistate licensing system and registry in enforcing and administering the Uniform Money Services Act. They may jointly pursue examinations and take other official action that they are otherwise empowered to take."

SECTION 22. Section 58-32-603 NMSA 1978 (being Laws 2016, Chapter 88, Section 603) is amended to read:

"58-32-603. REPORTS.--

A. A licensee shall file with the director a record signed under penalty of perjury that shall be in a form and in a medium prescribed by the director and that shall contain any material change in information provided in the licensee's application or the information provided by the licensee to the nationwide [mortgage] multistate licensing system and registry. The record shall be filed within fifteen business days after the licensee has reason to know of the change.

B. A licensee shall file with the director within forty-five days after the end of each fiscal quarter a record signed under penalty of perjury that shall be in a form and in a medium prescribed by the director and that shall contain a current list of all authorized delegates and locations in New Mexico where the licensee or an authorized delegate of the licensee provides money services, including limited stations and mobile locations. The licensee shall state the name and street address of each location and authorized delegate.

C. A licensee shall file a report with the director within one business day after the licensee has reason to know of the occurrence of any of the following events:

(1) the filing of a petition by or against the licensee pursuant to the United States Bankruptcy Code for bankruptcy or reorganization;

(2) the filing of a petition by or against the licensee for receivership, the commencement of any other judicial or administrative proceeding for its dissolution or reorganization or the making of a general assignment for the benefit of its creditors;

(3) the commencement of a proceeding to revoke or suspend its license in a state or country in which the licensee engages in business or is licensed;

(4) the cancellation or other impairment of the licensee's bond or other security;

(5) a charge or conviction of the licensee or of an executive officer, manager, director or person in control of the licensee for a felony; or

(6) a charge or conviction of an authorized delegate for a felony.

D. The report required pursuant to Subsection C of this section shall be a record signed under penalty of perjury and in a form and in a medium prescribed by the director and shall describe the event requiring the report."

SECTION 23. Section 58-32-901 NMSA 1978 (being Laws 2016, Chapter 88, Section 901) is amended to read:

"58-32-901. POWERS OF DIRECTOR.--

A. The director may act on the director's own initiative or in response to complaints and may receive complaints, take action to obtain voluntary compliance with the Uniform Money Services Act, refer cases to the office of the attorney general or any other state agency or agency of another state or the United States and seek or provide remedies as provided in the Uniform Money Services Act.

B. The director may investigate and examine, in New Mexico or in any other state or country, by subpoena or otherwise, the activities, books, accounts and records of a person that provides or offers to provide money services, or a person to which a licensee has delegated its obligations pursuant to an agreement or the Uniform Money Services Act, to determine compliance with the Uniform Money Services Act. Information that identifies individuals who have agreements with the licensee shall not be disclosed to the public. In connection with the investigation, the director may:

(1) charge the person the reasonable expenses necessarily incurred to conduct the examination; and

(2) require or permit a person to file a statement under oath as to all the facts and circumstances of a matter to be investigated.

C. The director may enter into cooperative arrangements with other state agencies or agencies of another state or of the United States, or the nationwide [mortgage] multistate licensing system and registry, and may exchange with any of those entities information about a licensee, including information obtained during an examination of the licensee.

D. The director may bring an action to enforce the Uniform Money Services Act in New Mexico or in any other state or country.

E. The director may recover the reasonable expenses of enforcing the Uniform Money Services Act pursuant to Article 8 of that act, including nongovernmental attorney and expert witness fees based on the hours reasonably expended and the hourly rates for attorneys and expert witnesses of comparable experience in the community."

SECTION 24. Section 61-18A-1 NMSA 1978 (being Laws 1987, Chapter 252, Section 1) is amended to read:

"61-18A-1. SHORT TITLE.--[This act] Chapter 61, Article 18A NMSA 1978 may be cited as the "Collection Agency Regulatory Act"."

SECTION 25. Section 61-18A-2 NMSA 1978 (being Laws 1987, Chapter 252, Section 2) is amended to read:

"61-18A-2. DEFINITIONS.--As used in the Collection Agency Regulatory Act:

A. "division" means the financial institutions division of the regulation and licensing department;

B. "director" means the director of the [financial institutions] division [of the regulation and licensing department] or a duly authorized agent designated by the director;

C. "collection agency" means [any] a person engaging in business for the purpose of collecting or attempting to collect, directly or indirectly, debts owed or due or asserted to be owed or due another, where such person is so engaged by two or more creditors. The term also includes [any] a creditor who, in the process of collecting [his] the creditor's own debts, uses any name other than [his] the creditor's own [which] that would indicate that a third person is collecting or attempting to collect [such] the debts. The term does not include:

(1) [any] an officer or employee of a creditor while, in the name of the creditor, collecting debts for such creditor;

(2) [any] a person while collecting debts for another person, both of whom are related by common ownership or affiliated by corporate control, if the person collects debts only for persons to whom it is so related or affiliated and if the principal business of such person is not the collection of debts;

(3) [any] an officer or employee of the United States, [any] a state or [any] a political subdivision thereof to the extent that collecting or attempting to collect [any] a debt is in the performance of [his] official duties;

(4) [any] a person while serving or attempting to serve legal process on any other person in connection with the judicial enforcement of [any] a debt;

(5) [any] a nonprofit organization [which] that, at the request of debtors, performs bona fide consumer credit counseling and assists debtors in the liquidation of their debts by receiving payments from such debtors and distributing such amounts to creditors;

(6) [any] an attorney-at-law collecting a debt as an attorney on behalf of and in the name of a client; [and] or

(7) [any] a person collecting or attempting to collect [any] a debt owed or due or asserted to be owed or due to another to the extent such activity:

(a) is incidental to a bona fide fiduciary obligation or a bona fide escrow arrangement;

(b) concerns a debt [which] that was originated by such person;

(d) concerns a debt obtained by such person as a secured party in a commercial credit transaction involving the creditor;

D. "communication" means the conveying of information regarding a debt directly or indirectly to [any] a person through any medium;

E. "creditor" means [any] a person who offers or extends credit creating a debt or to whom a debt is owed, but [such] the term does not include [any] a person to the extent that [he] the person receives an assignment or transfer of a debt in default solely for the purpose of facilitating collection of such debt for another;

F. "debt" means [any] an obligation or alleged obligation of a debtor to pay money arising out of a transaction in which the money, property, insurance or services [which] that are the subject of the transaction are primarily for personal, family or household purposes, whether or not such obligation has been reduced to judgment;

G. "debt collector" means a collection agency, a repossessor, a manager, a solicitor and [any] an attorney-at-law collecting a debt as an attorney on behalf of and in the name of a client;

H. "debtor" means [any] a natural person obligated or allegedly obligated to pay [any] a debt;

I. "location information" means a debtor's place of abode and [his] the telephone number at such place or [his] the debtor's place of employment;

J. "manager" means a natural person who qualifies under the Collection Agency Regulatory Act to be in full-time charge of a licensed collection agency and to whom a manager's license has been issued by the director;

K. "nationwide multistate licensing system and registry" means a licensing system developed and maintained by the conference of state bank supervisors and the American association of residential mortgage regulators pursuant to the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 to manage mortgage licenses and other financial services licenses, or a successor registry;

[K.] L. "person" means an individual, corporation, partnership, association, joint-stock company, trust where the interests of the beneficiaries are evidenced by a security, unincorporated organization, government or political subdivision of a government;

[L.] M. "repossessor" means a person engaged solely in the business of repossessing personal property for others for a fee. The term does not include a duly licensed collection agency; and

[M.] N. "solicitor" means a natural person who, through lawful means, communicates with debtors or solicits the payment of debts for a collection agency licensee by the use of telephone, personal contact, letters or other methods of collection conducted from and within the licensee's office."

SECTION 26. Section 61-18A-3 NMSA 1978 (being Laws 1987, Chapter 252, Section 3) is amended to read:

"61-18A-3. ADMINISTRATION AND ENFORCEMENT.--

A. The administration and enforcement of the Collection Agency Regulatory Act shall be vested in the office of the director as [hereinafter] set forth in that act.

[A.] B. The director shall investigate violations or alleged [violation] violations of the Collection Agency Regulatory Act by persons engaged in business as collection agencies or repossessors who fail to obtain licenses.

[B.] C. The director may examine the business and the books, accounts, records and files used therein by a collection agency licensee, and for such purpose, the director shall have free access to the offices, places of business, books, accounts, records, papers, files, safes and vaults of all licensees and other persons engaging or attempting to engage in business as a collection agency.

[C.] D. Any examination reports or other documents or information developed in administration of this section are confidential and not subject to subpoena.

E. Applicants for a license issued pursuant to the Collection Agency Regulatory Act shall apply on a form prescribed by the director. Information required on the form shall be set forth by rule, instruction or procedure of the director and may be changed or updated as necessary by the director in order to carry out the purposes of the Collection Agency Regulatory Act.

F. In order to fulfill the purposes of the Collection Agency Regulatory Act, the director may establish relationships or contracts with the nationwide multistate licensing system and registry or other entities designated by the nationwide multistate licensing system and registry to collect and maintain records and process transaction fees or other fees related to licenses issued pursuant to the Collection Agency Regulatory Act.

G. An applicant for a license pursuant to the Collection Agency Regulatory Act shall, at a minimum, furnish to the nationwide multistate licensing system and registry information concerning the applicants identity, including:

(1) the applicant's personal history and experience in a form prescribed by the nationwide multistate licensing system and registry; and

SECTION 27. Section 61-18A-7 NMSA 1978 (being Laws 1987, Chapter 252, Section 7, as amended) is amended to read:

"61-18A-7. APPLICATION FOR LICENSE.--

A. Application for a collection agency license, repossessor's license or manager's license shall be made to the director in such form as may be required by the director.

B. Applicants for an original license issued pursuant to the Collection Agency Regulatory Act for the period beginning July 1, 2020 and ending December 31, 2020 shall pay an amount equal to one-half of the original license fee for the applicable license as established pursuant to Section 61-18A-30 NMSA 1978.

C. Applicants for renewal of a license issued pursuant to the Collection Agency Regulatory Act with an expiration date of June 30, 2020 may apply for renewal of the license for the period beginning July 1, 2020 and ending December 31, 2020 and shall pay an amount equal to one-half of the renewal license fee for the applicable license as established pursuant to Section 61-18A-30 NMSA 1978.

D. Applicants for all licenses issued pursuant to the Collection Agency Regulatory Act beginning on or after January 1, 2021, and ending at the conclusion of the calendar year for which the license may be issued, shall pay an amount equal to the applicable original or renewal license fee as established pursuant to Section 61-18A-30 NMSA 1978."

SECTION 28. Section 61-18A-8 NMSA 1978 (being Laws 1987, Chapter 252, Section 8) is amended to read:

"61-18A-8. APPLICATIONS--REQUIRED INFORMATION.--

A. The application for a collection agency license shall state, among other things that may be required, the name of the applicant together with the name under which the applicant will do business and the location by street number and city in this state of the office of the business for which the license is sought.

B. The application shall state:

(1) in the case of an individual, [the application shall state] the full residence address of the applicant;

(2) in the case of a partnership, [the application shall state] the true names and complete residence addresses of all partners;

(3) in the case of a corporation, [the application shall state] the true names and complete residence addresses of all directors and officers and the true names and residence addresses of all holders of ten percent or more of the corporation's outstanding stock and other securities and the number of shares or units of each and of all classes held by each and the total number of shares or units of each class issued and outstanding; and

(4) in the case of a nonstock corporation or an unincorporated association, the true names and complete residence addresses of all officers, directors and trustees.

C. The application shall state the name of the licensed manager who will be actively in charge of the collection agency for which the license is sought.

D. The director may establish, by rule, regulation or order, requirements for a license application as necessary, including:

(1) background checks for criminal history through fingerprint or other databases;

(2) civil or administrative records;

(3) credit history; and

(4) other information as deemed relevant and necessary by the director."

SECTION 29. Section 61-18A-22 NMSA 1978 (being Laws 1987, Chapter 252, Section 22) is amended to read:

"61-18A-22. OFFICE MANAGEMENT--LICENSE.--

A. Every licensed office of a collection agency, whether a principal or branch office, shall be under the active charge of a licensed manager. Each manager's license shall be issued by the director upon qualification by the applicant [for same] and shall be renewed annually upon application [therefor] accompanied by the manager's renewal license fee, which application is to be filed with the division on or before [May 31] November 30 of each year. Unless so renewed, each manager's license shall expire on [June 30] January 1 unless previously revoked or canceled.

B. As used in this section, "under the active charge of a licensed manager" means that a licensed manager [must] shall be physically present at the licensee's office at least seventy-five percent of the time during which the office is open for business."

SECTION 30. Section 61-18A-27 NMSA 1978 (being Laws 1987, Chapter 252, Section 27) is amended to read:

"61-18A-27. RENEWAL OF LICENSE--FEE.--

A. A licensee desiring renewal of [his] the licensee's license shall, on or before [May 31] November 30 of each year, file with the director an application for renewal on [such] forms as may be designated by the director. The application shall be accompanied by the renewal fee.

B. The director shall issue a renewal license [which] that shall be dated [July 1] January 1 next ensuing and shall bear the date to and including which the license is renewed."

SECTION 31. REPEAL.--Section 61-18A-18 NMSA 1978 (being Laws 1987, Chapter 252, Section 18) is repealed.

SECTION 32. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2019.

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