EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted. Green numbers along left margin indicate location on the printed bill (e.g., 5-15 indicates page 5, line 15).

1-1 Section 1. Chapter 645B of NRS is hereby amended by adding

1-2 thereto the provisions set forth as sections 2 to 15, inclusive, of this act.

1-3 Sec. 2. 1. Except as otherwise provided in this section, a mortgage

1-4 company shall not engage in any activity that is authorized pursuant to

1-5 this chapter, unless the mortgage company maintains continuously a net

1-6 worth of at least $10,000.

1-7 2. If a mortgage company cannot maintain continuously the net

1-8 worth required pursuant to subsection 1, the commissioner may allow the

1-9 mortgage company to engage in activities that are authorized pursuant to

1-10 this chapter if the mortgage company remedies the deficiency in its net

1-11 worth by depositing with the commissioner a corporate surety bond or a

1-12 substitute form of security that conforms with section 3 or 4 of this act, or

1-13 any combination thereof, in an aggregate amount that is equal to or

1-14 exceeds the deficiency in the net worth of the mortgage company. If a

1-15 mortgage company deposits with the commissioner a corporate surety

2-1 bond or substitute form of security pursuant to this subsection, that

2-2 deposit must be in addition to the corporate surety bond or substitute

2-3 form of security that the mortgage company deposits with the

2-4 commissioner pursuant to section 3 or 4 of this act.

2-5 3. If requested by the commissioner, a mortgage company shall

2-6 submit to the commissioner or allow the commissioner to examine any

2-7 documentation or other evidence that is related to determining the net

2-8 worth of the mortgage company.

2-9 4. The commissioner:

2-10 (a) Shall adopt regulations prescribing standards for determining the

2-11 net worth of a mortgage company; and

2-12 (b) May adopt any other regulations that are necessary to carry out

2-13 the provisions of this section.

2-14 Sec. 3. 1. Except as otherwise provided in section 4 of this act, a

2-15 mortgage company shall deposit with the commissioner a corporate

2-16 surety bond payable to the State of Nevada, in the amount of $10,000,

2-17 which is executed by a corporate surety satisfactory to the commissioner

2-18 and which names the mortgage company as principal.

2-19 2. The bond must be in substantially the following form:

2-20 Know All Men by These Presents, that ........................, as principal,

2-21 and ........................, as surety, are held and firmly bound unto the State

2-22 of Nevada for the use and benefit of any person who suffers damages

2-23 because of a violation of any of the provisions of chapter 645B of NRS,

2-24 in the sum of ............, lawful money of the United States, to be paid to the

2-25 State of Nevada for such use and benefit, for which payment well and

2-26 truly to be made, and that we bind ourselves, our heirs, executors,

2-27 administrators, successors and assigns, jointly and severally, firmly by

2-29 The condition of that obligation is such that: Whereas, the

2-30 commissioner of financial institutions of the department of business and

2-31 industry of the State of Nevada has issued the principal a license as a

2-32 mortgage company, and the principal is required to furnish a bond, in

2-33 the amount of $10,000, which is conditioned as set forth in this bond:

2-34 Now, therefore, if the principal, his agents and employees, strictly,

2-35 honestly and faithfully comply with the provisions of chapter 645B of

2-36 NRS, and pay all damages suffered by any person because of a violation

2-37 of any of the provisions of chapter 645B of NRS, or by reason of any

2-38 fraud, dishonesty, misrepresentation or concealment of material facts

2-39 growing out of any transaction governed by the provisions of chapter

2-40 645B of NRS, then this obligation is void; otherwise it remains in full

2-41 force.

3-1 This bond becomes effective on the ..........(day) of ................(month),

3-2 ......(year), and remains in force until the surety is released from liability

3-3 by the commissioner of financial institutions or until this bond is

3-4 canceled by the surety. The surety may cancel this bond and be relieved

3-5 of further liability hereunder by giving 60 days’ written notice to the

3-6 principal and to the commissioner of financial institutions of the

3-7 department of business and industry of the State of Nevada.

3-8 In Witness Whereof, the seal and signature of the principal hereto is

3-9 affixed, and the corporate seal and the name of the surety hereto is

3-10 affixed and attested by its authorized officers at ........................, Nevada,

3-11 this ................(day) of ................(month), ......(year)

3-12 (Seal)

3-13 Principal

3-14 (Seal)

3-15 Surety

3-16 By

3-17 Attorney in fact

3-18

3-19 Licensed resident agent

3-20 Sec. 4. 1. As a substitute for the surety bond required by section 3

3-21 of this act, a mortgage company may, in accordance with the provisions

3-22 of this section, deposit with any bank or trust company authorized to do

3-23 business in this state, in a form approved by the commissioner:

3-24 (a) An obligation of a bank, savings and loan association, thrift

3-25 company or credit union licensed to do business in this state;

3-26 (b) Bills, bonds, notes, debentures or other obligations of the United

3-27 States or any agency or instrumentality thereof, or guaranteed by the

3-28 United States; or

3-29 (c) Any obligation of this state or any city, county, town, township,

3-30 school district or other instrumentality of this state, or guaranteed by this

3-31 state.

3-32 2. The obligations of a bank, savings and loan association, thrift

3-33 company or credit union must be held to secure the same obligation as

3-34 would the surety bond. With the approval of the commissioner, the

3-35 depositor may substitute other suitable obligations for those deposited

3-36 which must be assigned to the State of Nevada and are negotiable only

3-37 upon approval by the commissioner.

3-38 3. Any interest or dividends earned on the deposit accrue to the

3-39 account of the depositor.

4-1 4. The deposit must be in an amount at least equal to the required

4-2 surety bond and must state that the amount may not be withdrawn except

4-3 by direct and sole order of the commissioner. The value of any item

4-4 deposited pursuant to this section must be based upon principal amount

4-5 or market value, whichever is lower.

4-6 Sec. 5. 1. The surety may cancel a bond upon giving 60 days’

4-7 notice to the commissioner by certified mail. Upon receipt by the

4-8 commissioner of such a notice, the commissioner immediately shall

4-9 notify the mortgage company that is the principal on the bond of the

4-10 effective date of cancellation of the bond, and that his license will be

4-11 revoked unless he furnishes an equivalent bond or a substitute form of

4-12 security authorized by section 4 of this act before the effective date of the

4-13 cancellation. The notice must be sent to the mortgage company by

4-14 certified mail to his last address of record filed in the office of the

4-15 division.

4-16 2. If the mortgage company does not comply with the requirements

4-17 set out in the notice from the commissioner, his license must be revoked

4-18 on the date the bond is canceled.

4-19 Sec. 6. 1. Any person claiming against a bond may bring an action

4-20 in a court of competent jurisdiction on the bond for damages to the

4-21 extent covered by the bond. A person who brings an action on a bond

4-22 shall notify the commissioner in writing upon filing the action. An action

4-23 may not be commenced after the expiration of 3 years following the

4-24 commission of the act on which the action is based.

4-25 2. Upon receiving a request from a person for whose benefit a bond

4-26 is required, the commissioner shall notify him:

4-27 (a) That a bond is in effect and the amount of the bond; and

4-28 (b) If there is an action against the bond, the title, court and case

4-29 number of the action and the amount sought by the plaintiff.

4-30 3. If a surety wishes to make payment without awaiting action by a

4-31 court, the amount of the bond must be reduced to the extent of any

4-32 payment made by the surety in good faith under the bond. Any payment

4-33 must be based on written claims received by the surety before any action

4-34 is taken by a court.

4-35 4. The surety may bring an action for interpleader against all

4-36 claimants upon the bond. If it does so, it shall publish notice of the action

4-37 at least once each week for 2 weeks in every issue of a newspaper of

4-38 general circulation in the county where the mortgage company has its

4-39 principal place of business. The surety may deduct its costs of the action,

4-40 including attorney’s fees and publication, from its liability under the

4-41 bond.

5-1 5. Claims against a bond have equal priority, and if the bond is

5-2 insufficient to pay all claims in full, they must be paid on a pro rata

5-3 basis. Partial payment of claims is not full payment, and any claimant

5-4 may bring an action against the mortgage company for the unpaid

5-5 balance.

5-6 Sec. 7. 1. If a prospective debtor submits an application to a

5-7 mortgage company for a loan secured by a lien on real property that is or

5-8 will be used for a single-family residence occupied by the prospective

5-9 debtor or a relative of the prospective debtor, the mortgage company

5-10 shall give the prospective debtor, in accordance with the regulations

5-11 adopted pursuant to subsection 2:

5-12 (a) A special information booklet;

5-13 (b) A good faith estimate; and

5-14 (c) A settlement statement.

5-15 2. The commissioner shall adopt regulations prescribing:

5-16 (a) The information that must be included in a special information

5-17 booklet, a good faith estimate and a settlement statement. Such

5-18 information must include, to the extent reasonably practicable, the

5-19 information that must be included in a special information booklet, a

5-20 good faith estimate and a HUD-1 or HUD-1A settlement statement

5-21 pursuant to RESPA and Regulation X.

5-22 (b) The period within which a mortgage company must give a special

5-23 information booklet, a good faith estimate and a settlement statement to a

5-24 prospective debtor. The period must be, to the extent reasonably

5-25 practicable, the same period required pursuant to RESPA and

5-26 Regulation X.

5-27 (c) Any other regulations that are necessary to carry out the

5-28 provisions of this section.

5-29 3. As used in this section:

5-30 (a) "Regulation X" means the regulations adopted pursuant to

5-31 RESPA and codified in 24 C.F.R. Part 3500.

5-32 (b) "Relative" means a spouse, any other person who is related within

5-33 the second degree by blood or marriage. The term includes a former

5-34 spouse.

5-35 (c) "RESPA" means the Real Estate Settlement Procedures Act of

5-36 1974, 12 U.S.C. §§ 2601 et seq.

5-37 Sec. 8. 1. If a person who is required to be licensed pursuant to

5-38 this chapter or a partner, officer, director, trustee, agent or employee of

5-39 such a person engages in any act or transaction that violates any

5-40 provision of this chapter, a regulation adopted pursuant to this chapter or

5-41 an order of the commissioner and a person, other than the person who is

5-42 required to be licensed pursuant to this chapter or a partner, officer,

5-43 director, trustee, agent or employee of such a person, suffers damages as

6-1 a proximate result of that act or transaction, the person who suffers

6-2 damages may bring an action to recover for his actual damages and

6-3 punitive damages against the following persons, who are jointly and

6-4 severally liable:

6-5 (a) The person who engaged in the act or transaction;

6-6 (b) The person who is required to be licensed pursuant to this chapter,

6-7 whether or not he encouraged, facilitated, aided, participated in or

6-8 ratified the act or transaction before or after it occurred; and

6-9 (c) If the person who is required to be licensed pursuant to this

6-10 chapter is a partnership, corporation or unincorporated association, each

6-11 general partner, officer or director who knowingly encouraged,

6-12 facilitated, aided, participated in or ratified the act or transaction before

6-13 or after it occurred.

6-14 2. If a person prevails in an action brought pursuant to this section,

6-15 the court shall award him costs and reasonable attorney’s fees.

6-16 3. The cause of action provided for in this section:

6-17 (a) Is not a cause of action upon a contract or other agreement

6-18 underlying the act or transaction.

6-19 (b) Is in addition to and not in substitution for any other cause of

6-20 action provided for by another statute or the common law, except that a

6-21 person may not recover his actual damages or punitive damages more

6-22 than once for the same loss.

6-23 4. The provisions of NRS 41.745 do not apply to the cause of action

6-24 provided for in this section.

6-25 Sec. 9. 1. There is hereby created, within the division, the bureau

6-26 for the regulation of mortgage companies.

6-27 2. The commissioner shall appoint, within the limits of legislative

6-28 appropriations, one or more deputy commissioners, investigators or

6-29 examiners to the bureau for the regulation of mortgage companies.

6-30 3. The duties of a deputy commissioner, investigator or examiner

6-31 who is appointed to the bureau for the regulation of mortgage companies

6-32 are to:

6-33 (a) Act as an investigator in the enforcement of the provisions of this

6-34 chapter; and

6-35 (b) Perform any other duties assigned to him by the commissioner.

6-36 Sec. 10. 1. A person may, in accordance with the regulations

6-37 adopted pursuant to subsection 2, file a complaint with the commissioner

6-38 alleging that another person has violated a provision of this chapter, a

6-39 regulation adopted pursuant to this chapter or an order of the

6-40 commissioner.

6-41 2. The commissioner shall adopt regulations prescribing:

6-42 (a) The form that such a complaint must take;

7-1 (b) The information that must be included in such a complaint; and

7-2 (c) The procedures that a person must follow to file such a complaint.

7-3 Sec. 11. 1. If a person properly files a complaint with the

7-4 commissioner pursuant to section 10 of this act, the commissioner shall

7-5 investigate each violation alleged in the complaint, unless the

7-6 commissioner has previously investigated the alleged violation.

7-7 2. Except as otherwise provided in NRS 645B.090, if the

7-8 commissioner does not conduct an investigation of an alleged violation

7-9 pursuant to subsection 1 because he has previously investigated the

7-10 alleged violation, the commissioner shall provide to the person who filed

7-11 the complaint a written summary of the previous investigation and the

7-12 nature of any disciplinary action that was taken as a result of the

7-13 previous investigation.

7-14 3. If the commissioner conducts an investigation of an alleged

7-15 violation pursuant to subsection 1, the commissioner shall determine

7-16 from the investigation whether there is reasonable cause to believe that

7-17 the person committed the alleged violation.

7-18 4. If, upon investigation, the commissioner determines that there is

7-19 not reasonable cause to believe that the person committed the alleged

7-20 violation, the commissioner shall provide the reasons for his

7-21 determination, in writing, to the person who filed the complaint and to

7-22 the person alleged to have committed the violation.

7-23 5. If, upon investigation, the commissioner determines that there is

7-24 reasonable cause to believe that the person committed the alleged

7-25 violation, the commissioner shall:

7-26 (a) Schedule a hearing concerning the alleged violation;

7-27 (b) Mail to the last known address of the person who filed the

7-28 complaint written notice that must include, without limitation:

7-29 (1) The date, time and place of the hearing; and

7-30 (2) A statement of each alleged violation that will be considered at

7-31 the hearing; and

7-32 (c) By personal service in accordance with the Nevada Rules of Civil

7-33 Procedure and any applicable provision of NRS, serve written notice of

7-34 the hearing to the person alleged to have committed the violation. The

7-35 written notice that is served pursuant to this paragraph must include,

7-36 without limitation:

7-37 (1) The date, time and place of the hearing;

7-38 (2) A copy of the complaint and a statement of each alleged

7-39 violation that will be considered at the hearing; and

7-40 (3) A statement informing the person that, pursuant to section 13 of

7-41 this act, if he fails to appear, without reasonable cause, at the hearing:

7-42 (I) He is guilty of a misdemeanor;

7-43 (II) A warrant will be issued for his arrest; and

8-1 (III) The commissioner is authorized to conduct the hearing in

8-2 his absence, draw any conclusions that the commissioner deems

8-3 appropriate from his failure to appear and render a decision concerning

8-4 each alleged violation.

8-5 6. The commissioner may investigate and conduct a hearing

8-6 concerning any alleged violation, whether or not a complaint has been

8-7 filed.

8-8 7. The commissioner may hear and consider more than one alleged

8-9 violation against a person at the same hearing.

8-10 8. Except as otherwise provided by specific statute, if the

8-11 commissioner conducts a hearing concerning an alleged violation

8-12 without a complaint having been filed, the commissioner shall serve

8-13 written notice of the hearing, pursuant to paragraph (c) of subsection 5,

8-14 to the person alleged to have committed the violation.

8-15 Sec. 12. Before conducting a hearing, the commissioner may, to the

8-16 fullest extent permitted by the Constitution of the United States and the

8-17 constitution of this state:

8-18 1. Order a summary suspension of a license pursuant to subsection 3

8-19 of NRS 233B.127; and

8-20 2. Take any other action against a licensee or other person that is

8-21 necessary to protect the health, safety or welfare of the public.

8-22 Sec. 13. If a person is alleged to have engaged in any conduct or

8-23 committed any violation that is described in NRS 645B.100, 645B.120 or

8-24 645B.150 or is alleged to have committed a violation of any other

8-25 provision of this chapter, a regulation adopted pursuant to this chapter or

8-26 an order of the commissioner, and the person fails to appear, without

8-27 reasonable cause, at a hearing before the commissioner concerning the

8-28 alleged conduct or violation:

8-29 1. The commissioner shall notify the attorney general that the person

8-30 failed to appear;

8-31 2. The attorney general shall request from the appropriate court a

8-32 warrant for the arrest of the person;

8-33 3. The court shall issue a warrant for the arrest of the person if there

8-34 is probable cause to believe that the person failed to appear without

8-35 reasonable cause;

8-36 4. The person is guilty of a misdemeanor; and

8-37 5. The commissioner may conduct the hearing in the person’s

8-38 absence, draw any conclusions that the commissioner deems appropriate

8-39 from his failure to appear and render a decision concerning the alleged

8-40 conduct or violation.

8-41 Sec. 14. 1. The attorney general has primary jurisdiction for the

8-42 enforcement of this chapter. The attorney general shall investigate and, if

8-43 appropriate, prosecute a person who violates:

9-1 (a) Any provision of this chapter, a regulation adopted pursuant to

9-2 this chapter or an order of the commissioner, including, without

9-3 limitation, a violation of any provision of NRS 645B.100 or NRS

9-4 645B.120; or

9-5 (b) Any other law or regulation if the person commits the violation in

9-6 the course of offering or providing any services of a mortgage company

9-7 or while otherwise engaging in, carrying on or holding himself out as

9-8 engaging in or carrying on the business of a mortgage company.

9-9 2. The attorney general shall investigate and, if appropriate,

9-10 prosecute a person who is alleged to have committed a violation

9-11 described in subsection 1 whether or not:

9-12 (a) The commissioner notifies the attorney general of the alleged

9-13 violation;

9-14 (b) The commissioner takes any disciplinary action against the person

9-15 alleged to have committed the violation;

9-16 (c) Any other person files a complaint against the person alleged to

9-17 have committed the violation; or

9-18 (d) A civil action is commenced against the person alleged to have

9-19 committed the violation.

9-20 3. When acting pursuant to this section, the attorney general may

9-21 commence his investigation and file a criminal action without leave of

9-22 court, and the attorney general has exclusive charge of the conduct of

9-23 the prosecution.

9-24 4. Except as otherwise provided by the Constitution of the United

9-25 States, the constitution of this state or a specific statute, a person shall, if

9-26 requested, provide the attorney general with information that would

9-27 assist in the prosecution of any other person who is alleged to have

9-28 committed a violation described in subsection 1. If a person fails, without

9-29 reasonable cause, to provide the attorney general with such information

9-30 upon request, the person is guilty of a misdemeanor.

9-31 Sec. 15. 1. The attorney general may bring any appropriate civil

9-32 action against a person to enforce any provision of this chapter, a

9-33 regulation adopted pursuant to this chapter or an order of the

9-34 commissioner, including, without limitation, an order of the

9-35 commissioner:

9-36 (a) Imposing an administrative fine; or

9-37 (b) Suspending, revoking or placing conditions upon a license.

9-38 2. Whether or not the attorney general brings a civil action against a

9-39 person pursuant to this chapter, the attorney general may prosecute the

9-40 person for a criminal violation pursuant to this chapter.

9-41 Sec. 16. NRS 645B.010 is hereby amended to read as follows:

9-42 645B.010 As used in this chapter, unless the context otherwise

9-43 requires:

10-1 1. "Commissioner" means the commissioner of financial institutions.

10-2 2. "Division" means the division of financial institutions of the

10-3 department of business and industry.

10-4 3. "Depository financial institution" means a bank, savings and loan

10-5 association, thrift company or credit union.

10-6 4. "Mortgage company" means any person who, directly or indirectly:

10-7 (a) Holds himself out for hire to serve as an agent for any person in an

10-8 attempt to obtain a loan which will be secured by a lien on real property;

10-9 (b) Holds himself out for hire to serve as an agent for any person who

10-10 has money to lend, if the loan is or will be secured by a lien on real

10-11 property;

10-12 (c) Holds himself out as being able to make loans secured by liens on

10-13 real property, unless the loans are made pursuant to subsection [8 or 10] 4

10-14 or 6 of NRS 645B.015;

10-15 (d) Holds himself out as being able to buy or sell notes secured by liens

10-16 on real property; or

10-17 (e) Offers for sale in this state any security which is exempt from

10-18 registration under state or federal law and purports to make investments in

10-19 promissory notes secured by liens on real property.

10-20 Sec. 17. NRS 645B.015 is hereby amended to read as follows:

10-21 645B.015 [Except as otherwise provided in subsection 5 of NRS

10-43 property which is secured by a mortgage;

11-1 (b) Approved by the Federal National Mortgage Association as a seller

11-2 and servicer; and

11-3 (c) Approved by the Department of Housing and Urban Development

11-4 and the Department of Veterans Affairs.

11-5 A firm or corporation is not exempt from the provisions of this chapter

11-6 pursuant to this subsection if it maintains any accounts described in

11-7 subsection 1 of NRS 645B.175 or offers for sale in this state any

11-8 unregistered security under state or federal law and purports to make

11-9 investments in promissory notes secured by liens on real property. A firm

11-10 or corporation which is exempted pursuant to this subsection must submit

11-11 annually as a condition of its continued exemption a certified statement by

11-12 an independent certified public accountant that the firm or corporation

11-13 does not maintain any such accounts. This subsection does not prohibit an

11-14 exempt firm or corporation from maintaining accounts described in NRS

11-15 645B.170 and subsection 3 of NRS 645B.175.

11-16 7.] 3. Any person doing any act under an order of any court.

11-17 [8.] 4. Any one natural person, or husband and wife, who provides

11-18 money for investment in loans secured by a lien on real property, on his

11-19 own account.

11-20 [9.] 5. Agencies of the United States and of this state and its political

11-21 subdivisions, including the public employees’ retirement system.

11-22 [10.] 6. A seller of real property who offers credit secured by a

11-23 mortgage of the property sold.

11-24 Sec. 18. NRS 645B.020 is hereby amended to read as follows:

11-25 645B.020 1. A license as a mortgage company may be obtained by

11-42 (1) Its articles of incorporation and its bylaws;

12-1 (2) Its most recent balance sheet and a statement of the profit and

12-2 loss of the corporation;

12-3 (3) The most recent list of its officers, directors and resident agents

12-4 that is filed with the secretary of state; and

12-5 (4) A current resume for each of its officers, directors, agents and

12-6 employees.

12-7 (j) If the applicant is a partnership or joint venture, include a

12-8 notarized copy of:

12-9 (1) The agreement of partnership or joint venture; and

12-10 (2) The financial statements of each of the partners or the

12-11 participants in the joint venture for the 2 years immediately preceding the

12-12 year of the application.

12-13 (k) Include such other information as the commissioner determines

12-14 necessary.

12-15 3. [The] Except as otherwise provided in this chapter, the

12-16 commissioner shall issue a license to an applicant as a mortgage company

12-17 if:

12-18 (a) The application complies with the requirements of [subsection 2;]

12-19 this chapter;

12-20 (b) The applicant submits the statement required pursuant to NRS

12-21 645B.023, if the applicant is required to do so; [and]

12-22 (c) The applicant or a general partner, officer or director of the

12-23 applicant, if the applicant is a partnership, corporation or

12-24 unincorporated association, has:

12-25 (1) At least 2 years of verifiable experience in lending money for

12-26 real property or mortgages; and

12-27 (2) A knowledge of generally accepted accounting practices and

12-28 bookkeeping procedures evidenced by verifiable work experience in these

12-29 areas or appropriate educational training, or both; and

12-30 (d) The applicant and each general partner, officer or director of the

12-31 applicant, if the applicant is a partnership, corporation or unincorporated

12-32 association:

12-33 (1) Has a good reputation for honesty, trustworthiness, integrity and

12-34 displays competence to transact the business of a mortgage company in a

12-35 manner which safeguards the interests of the general public. The applicant

12-36 must submit satisfactory proof of these qualifications to the commissioner.

12-37 (2) Has not been convicted of, or entered a plea of nolo contendere

12-38 to, a felony or any crime involving fraud, misrepresentation or moral

12-39 turpitude.

12-40 (3) Has not made a false statement of material fact on his application.

12-41 (4) Has not had a license that was issued pursuant to the provisions of

12-42 this chapter suspended or revoked within the 10 years immediately

12-43 preceding the date of his application.

13-1 (5) Has not had a license that was issued in any other state, district or

13-2 territory of the United States or any foreign country suspended or revoked

13-3 within the 10 years immediately preceding the date of his application.

13-4 (6) Has not violated any of the provisions of this chapter or any

13-5 regulation adopted pursuant thereto.

13-6 4. If an applicant is issued a license, the applicant shall file with the

13-7 secretary of state a list that contains the business address of the principal

13-8 office and each branch office of the mortgage company in this state.

13-9 5. A license entitles the holder to engage only in the activities

13-10 authorized by this chapter.

13-11 [5. A person who claims an exemption from the provisions of this

13-12 chapter must apply to the commissioner for a certificate of exemption and

13-13 pay the fee for application.]

13-14 Sec. 19. NRS 645B.050 is hereby amended to read as follows:

13-15 645B.050 1. A mortgage company’s license expires June 30 next

13-42 audits conducted pursuant to this subsection.

14-1 4. [A certificate of exemption issued pursuant to subsection 5 of NRS

14-2 645B.020 expires December 31 next after the date of issuance if it is not

14-3 renewed. A certificate of exemption may be renewed by filing an

14-4 application for renewal and paying the annual fee for renewal of a

14-5 certificate of exemption for the succeeding year. The application and

14-6 payment must be received by the commissioner on or before December 31

14-7 next preceding the expiration date. If the application or payment is not

14-8 received by December 31, the certificate of exemption is canceled. The

14-9 commissioner may reinstate the certificate if the applicant pays the filing

14-10 fee and a reinstatement fee of $100.

14-11 5.] The filing fees are:

14-12 (a) For filing an original application, $1,500 for the principal office and

14-13 $40 for each branch office. The applicant shall also pay such additional

14-14 expenses incurred in the process of investigation as the commissioner

14-15 deems necessary. All money received by the commissioner pursuant to this

14-16 paragraph must be placed in the investigative account created by NRS

14-17 232.545.

14-18 (b) If the license is approved for issuance, $1,000 for the principal

14-19 office and $60 for each branch office before issuance.

14-20 (c) For filing an application for renewal, $500 for the principal office

14-21 and $100 for each branch office.

14-22 (d) [For filing an application for a certificate of exemption, $200.

14-23 (e) For filing an application for renewal of a certificate of exemption,

14-24 $100.

14-25 (f)] For filing an application for a duplicate copy of any license, upon

14-26 satisfactory showing of its loss, $10.

14-27 [6.] 5. Except as otherwise provided in this chapter, all fees received

14-28 pursuant to this chapter must be deposited in the state treasury for credit to

14-29 the state general fund.

14-30 Sec. 20. NRS 645B.070 is hereby amended to read as follows:

14-31 645B.070 1. In the conduct of any examination, periodic or special

14-43 of a misdemeanor.

15-1 3. The commissioner may assess against and collect from a person

15-2 the cost of any examination, periodic or special audit, investigation or

15-3 hearing that is conducted [under] to examine or investigate the conduct,

15-4 activities or business of the person pursuant to this chapter . [may be

15-5 assessed to and collected from the mortgage company in question by the

15-6 commissioner.]

15-7 Sec. 21. NRS 645B.100 is hereby amended to read as follows:

15-8 645B.100 1. The commissioner may [require] impose upon a

15-43 645B.070;

16-1 (l) Has failed to satisfy a claim made by a client which has been

16-2 reduced to judgment;

16-3 (m) Has failed to account for or to remit any money of a client within a

16-4 reasonable time after a request for an accounting or remittal;

16-5 (n) Has commingled the money or other property of a client with his

16-6 own or has converted the money or property of others to his own use;

16-7 (o) Has engaged in any other conduct constituting a deceitful,

16-8 fraudulent or dishonest business practice; [or]

16-9 (p) Has failed to maintain adequate supervision of an employee of the

16-10 mortgage company;

16-11 (q) Has instructed an employee of the mortgage company to commit

16-12 an act that would be cause for the revocation of the license of the

16-13 mortgage company, whether or not the employee commits the act; or

16-14 (r) Has not conducted verifiable business as a mortgage company for 12

16-15 consecutive months, except in the case of a new applicant. The

16-16 commissioner shall determine whether a mortgage company is conducting

16-17 business by examining the monthly reports of activity submitted by the

16-18 licensee or by conducting an examination of the licensee.

16-19 2. It is sufficient cause for refusal or revocation of a license in the case

16-20 of a partnership or corporation or any unincorporated association that any

16-21 member of the partnership or any officer or director of the corporation or

16-22 association has been guilty of any act or omission which would be cause

16-23 for refusing or revoking the registration of a natural person.

16-24 3. The commissioner may impose upon a person who is an agent or

16-25 employee of a mortgage company an administrative fine of not more

16-26 than $5,000 for each violation that he commits or prohibit the person, for

16-27 a limited period or indefinitely, from being associated with or employed

16-28 by the mortgage company, or do both, if the person:

16-29 (a) Is grossly negligent or incompetent in performing any act for

16-30 which the mortgage company is required to be licensed pursuant to the

16-31 provisions of this chapter;

16-32 (b) Has encouraged, facilitated, aided or participated in any act of the

16-33 mortgage company that violates any provision of this chapter, a

16-34 regulation adopted pursuant to this chapter or an order of the

16-35 commissioner;

16-36 (c) Has made a material misrepresentation in connection with any

16-37 transaction governed by this chapter;

16-38 (d) Has suppressed or withheld from a client any material facts, data

16-39 or other information relating to any transaction governed by the

16-40 provisions of this chapter which the person knew or, by the exercise of

16-41 reasonable diligence, should have known;

16-42 (e) Has knowingly made or caused to be made to the commissioner

16-43 any false representation of material fact or has suppressed or withheld

17-1 from the commissioner any information which the person possesses and

17-2 which, if submitted by him, would have rendered the mortgage company

17-3 ineligible to be licensed pursuant to the provisions of this chapter;

17-4 (f) Has refused or failed, within a reasonable time, to furnish any

17-5 information or make any report that may be required by the

17-6 commissioner pursuant to the provisions of this chapter or a regulation

17-7 adopted pursuant to this chapter;

17-8 (g) Has been convicted of, or entered a plea of nolo contendere to, a

17-9 felony or any crime involving fraud, misrepresentation or moral

17-10 turpitude;

17-11 (h) Has failed to satisfy a claim made by a client which has been

17-12 reduced to judgment;

17-13 (i) Has failed to account for or to remit any money of a client within a

17-14 reasonable time after a request for an accounting or remittal;

17-15 (j) Has commingled the money or other property of a client with his

17-16 own or has converted the money or property of others to his own use; or

17-17 (k) Has engaged in any other conduct constituting a deceitful,

17-18 fraudulent or dishonest business practice.

17-19 Sec. 22. NRS 645B.110 is hereby amended to read as follows:

17-20 645B.110 1. [Notice of the entry of any order of suspension or of

17-33 concerning the matter.

17-34 Sec. 23. NRS 645B.120 is hereby amended to read as follows:

17-35 645B.120 1. [The commissioner may investigate either upon

17-43 order of the commissioner;

18-1 (b) The person is offering or providing any services of a mortgage

18-2 company or otherwise engaging in [the] , carrying on or holding himself

18-3 out as engaging in or carrying on the business of a mortgage company

18-4 [business] without being licensed [under] or exempt from licensing

18-5 pursuant to the provisions of [those sections.] this chapter; or

18-6 (c) The person is violating any other provision of this chapter, a

18-7 regulation adopted pursuant to this chapter or an order of the

18-8 commissioner.

18-9 2. If , upon investigation [it appears that such company is so

18-10 conducting its business or an unlicensed person is engaged in the mortgage

18-11 company business, the commissioner may:

18-12 (a) Advise the district attorney of the county in which the business is

18-13 conducted, and the district attorney shall cause the appropriate legal action

18-14 to be taken to enjoin the operation of the business or prosecute the

18-15 violations of this chapter; and

18-16 (b) Bring suit in the name and on behalf of the State of Nevada against

18-17 such person and any other person concerned in or in any way participating

18-18 in or about to participate in such unsafe or injurious practices or action in

18-19 violation of this chapter or regulations thereunder to enjoin any such

18-20 person from continuing such practices or engaging therein or doing any

18-21 such act.

18-22 3. If the commissioner brings suit,] , the commissioner has reasonable

18-23 cause to believe that the mortgage company or other person has engaged

18-24 in any conduct or committed any violation described in subsection 1:

18-25 (a) The commissioner shall notify the attorney general of the conduct

18-26 or violation and, if applicable, the commissioner shall immediately take

18-27 possession of the property of the mortgage company pursuant to NRS

18-28 645B.150; and

18-29 (b) The attorney general shall:

18-30 (1) Investigate and, if appropriate, prosecute the mortgage company

18-31 or other person pursuant to section 14 of this act; and

18-32 (2) Bring a civil action to enjoin the mortgage company or other

18-33 person from engaging in the conduct or committing the violation and to

18-34 enjoin any other person who has encouraged, facilitated, aided or

18-35 participated in the conduct or the commission of the violation, or who is

18-36 likely to engage in such acts, from engaging in or continuing to engage

18-37 in such acts.

18-38 3. If the attorney general brings a civil action pursuant to subsection

18-39 2, the district court of any county of this state is hereby vested with the

18-40 jurisdiction in equity to [restrain unsafe, injurious or illegal practices or

18-41 transactions] enjoin the conduct or the commission of the violation and

18-42 may grant any injunctions that are necessary to prevent and restrain [such

18-43 practices or transactions. The court may, during] the conduct or the

19-1 commission of the violation. During the pendency of the proceedings

19-2 before [it, issue such] the district court:

19-3 (a) The court may issue any temporary restraining orders as may

19-4 appear to be just and proper; [and the]

19-5 (b) The findings of the commissioner shall be deemed to be prima facie

19-6 evidence and sufficient grounds, in the discretion of the court, for the

19-7 [issue] ex parte issuance of a temporary restraining order [. In any such

19-8 court proceedings the commissioner] ; and

19-9 (c) The attorney general may apply for and on due showing is entitled

19-10 to have issued the court’s subpoena requiring forthwith the appearance of

19-11 any [defendant and his employees and the production of] person to:

19-12 (1) Produce any documents, books and records as may appear

19-13 necessary for the hearing of the petition ; [, to testify] and

19-14 (2) Testify and give evidence concerning the [acts or conduct or

19-15 things] conduct complained of in the [application for injunction.] petition.

19-16 Sec. 24. NRS 645B.150 is hereby amended to read as follows:

19-17 645B.150 1. [When] In addition to any other action that is required

19-42 3. The commissioner shall file] ; and

20-1 (b) File one copy of the inventory in his office and one copy in the

20-2 office of the clerk of the district court of the county in which the principal

20-3 office of the mortgage company is located and shall mail one copy to each

20-4 stockholder, partner, officer or associate of the mortgage company at his

20-5 last known address.

20-6 4. The clerk of the court with which the copy of the inventory is filed

20-7 shall file it as any other case or proceeding pending in the court and shall

20-8 give it a docket number.

20-9 Sec. 25. NRS 645B.160 is hereby amended to read as follows:

20-10 645B.160 1. [The] If the commissioner takes possession of the

20-36 hands as the receiver.

20-37 Sec. 26. NRS 645B.210 is hereby amended to read as follows:

20-38 645B.210 It is unlawful for any person to offer or provide any of the

20-42 without first obtaining a license as a mortgage company [.] pursuant to

21-1 this chapter, unless the person is exempt from the provisions of this

21-2 chapter pursuant to NRS 645B.015.

21-3 Sec. 27. NRS 645B.230 is hereby amended to read as follows:

21-4 645B.230 [Except as provided in NRS 645B.225, any] Unless a

21-9 guilty of a misdemeanor.

21-10 Sec. 28. NRS 41.745 is hereby amended to read as follows:

21-11 41.745 Except as otherwise provided in section 8 of this act:

21-35 41.0307.

21-36 Sec. 29. 1. Any certificate of exemption issued by the commissioner

21-37 of financial institutions pursuant to chapter 645B of NRS before October 1,

21-38 1999, is void and must not be given effect with regard to any act or

21-39 transaction that occurs on or after October 1, 1999.

21-40 2. Any person who holds a certificate of exemption described in

21-41 subsection 1 shall not, on or after October 1, 1999, offer or provide any of

21-42 the services of a mortgage company or otherwise engage in, carry on or

21-43 hold himself out as engaging in or carrying on the business of a mortgage

22-1 company without first obtaining a license as a mortgage company pursuant

22-2 to chapter 645B of NRS, unless the person is exempt from the provisions

22-3 of this chapter pursuant to NRS 645B.015.

22-4 Sec. 30. 1. Any license issued to a mortgage company by the

22-5 commissioner of financial institutions pursuant to chapter 645B of NRS

22-6 before October 1, 1999, expires on June 30, 2000, and may not be renewed

22-7 pursuant to the provisions of NRS 645B.050.

22-8 2. Any person who holds a license described in subsection 1 shall not,

22-9 on or after June 30, 2000, offer or provide any of the services of a

22-10 mortgage company or otherwise engage in, carry on or hold himself out as

22-11 engaging in or carrying on the business of a mortgage company, unless the

22-12 person applies for and is issued a new license as a mortgage company

22-13 pursuant to chapter 645B of NRS and the amendatory provisions of this

22-14 act.

22-15 Sec. 31. The amendatory provisions of this act do not apply to

22-16 offenses that were committed before October 1, 1999.