Relates to unregistered and unlicensed mortgage brokers; establishes additional penalties against unlicensed or unregistered persons or entities engaging in activities after receiving a cease and desist notice.
STATE OF NEW YORK
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1144--A
Cal. No. 83
2023-2024 Regular Sessions
IN SENATE
January 10, 2023
___________
Introduced by Sens. SANDERS, MANNION -- read twice and ordered printed,
and when printed to be committed to the Committee on Banks -- reported
favorably from said committee and committed to the Committee on Rules
-- reported favorably from said committee, ordered to a third reading,
passed by Senate and delivered to the Assembly, recalled, vote recon-
sidered, restored to third reading, amended and ordered reprinted,
retaining its place in the order of third reading
AN ACT to amend the banking law, in relation to unregistered and unli-
censed mortgage brokers
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Paragraph (e) of subdivision 5 of section 590 of the bank-
2 ing law is relettered paragraph (f) and a new paragraph (e) is added to
3 read as follows:
4 (e) No mortgage banker, mortgage broker or exempt organization shall
5 conduct business with any person, partnership, association, corporation
6 or other entity which it knows or should have known is acting as a mort-
7 gage banker or a mortgage broker without being licensed or registered as
8 required by this article. A person, partnership, association, corpo-
9 ration or other entity who provides non-residential subordinate loans
10 shall be exempt from this paragraph. A mortgage banker, mortgage broker
11 or exempt organization shall promptly notify the department of any such
12 unlicensed or unregistered operations.
13 § 2. Subdivision 5 of section 598 of the banking law, as added by
14 chapter 571 of the laws of 1986, is amended to read as follows:
15 5. Civil penalties assessable against unlicensed or unregistered
16 persons or entities. If any non-exempt unlicensed or unregistered person
17 or entity engages in activities encompassed by this article, he shall be
18 liable to any person or entity affected by such activities for a sum of
19 money of not less than the amount of money paid to an affected person or
20 entity in connection with such activities, nor more than four times such
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD03777-03-3
S. 1144--A 2
1 sum; provided however that where a non-exempt unlicensed or unregistered
2 person has continued to engage in such unauthorized activities after
3 receiving a cease and desist notice from the superintendent, the maximum
4 amount of liability shall be up to the amount of actual damages. Such
5 sum may be sued for and recovered by any person or entity for his use
6 and benefit in any court of competent jurisdiction.
7 § 3. This act shall take effect on the thirtieth day after it shall
8 have become a law.
