Minnesota Residential Mortgage Originator or Servicer Licensing Act

Beginning August 1, 1999, no person shall act as a residential mortgage originator, or make residential mortgage loans without first obtaining a license from the commissioner according to the licensing procedures provided in this chapter.

 

 

58.01 Citation.
This chapter shall be cited as the "Minnesota Residential Mortgage Originator and Servicer Licensing Act."
58.02 Definitions.
Subdivision 1. Scope. For purposes of this chapter, the terms defined in this section have the meanings given to them.
Subd. 2. Act. "Act" means the Minnesota Residential Mortgage Originator and Servicer Licensing Act.
Subd. 3. Advance fee. "Advance fee" means a commission, fee, charge, or compensation of any kind paid to a residential mortgage originator before the closing of a loan, that is intended in whole or in part as payment for the originator's services in finding or attempting to find a loan for a borrower. Advance fee does not include pass-through fees or commitment or extended lock fees or other fees as determined by the commissioner.
Subd. 4. Borrower. "Borrower" means a person or persons applying for a residential mortgage loan, a mortgagor, or the person or persons on whose behalf the activities in subdivisions 12, 14, 22, and 23 are conducted.
Subd. 5. Closing. "Closing" means either or both of the following: (1) the process whereby the real estate contract between a buyer and a seller is consummated; or (2) the process whereby the documents creating a security interest in real property become effective between the borrower and the lender.
Subd. 6. Commissioner. "Commissioner" means the commissioner of commerce.
Subd. 7. Employee. "Employee" means an individual who is treated as an employee by the residential mortgage originator or servicer for purposes of compliance with federal income tax laws.
Subd. 8. Escrow account. "Escrow account" means a trust account that is established and maintained to hold funds received from a borrower, such as real estate taxes and insurance premiums, incurred in connection with the servicing of the mortgage.
Subd. 9. Exempt person. "Exempt person" means a person exempt from residential mortgage originator licensing requirements, and a person exempt from residential mortgage service licensing requirements.
Subd. 10. Financial institution. "Financial institution" means a bank, bank and trust, trust company with banking powers, savings bank, savings association, or credit union, organized under the laws of this state or the United States; a Minnesota host state branch of an out-of-state state-chartered bank as provided for in section 49.411; an industrial loan and thrift under chapter 53; or a regulated lender under chapter 56. The term "financial institution" also includes a subsidiary or operating subsidiary of a financial institution or of a bank holding company as defined in the federal Bank Holding Company Act, United States Code, title 12, section 1841 et seq., if the subsidiary or operating subsidiary can demonstrate to the satisfaction of the commissioner that it is regulated and subject to active and ongoing oversight and supervision by a federal banking agency, as defined in the Federal Deposit Insurance Act, United States Code, title 12, section 1811 et seq., or the commissioner.
Subd. 11. Lender. "Lender" means a person who makes residential mortgage loans including a person who provides table funding.
Subd. 12. Making a residential mortgage loan. "Making a residential mortgage loan" means for compensation or gain, or the expectation of compensation or gain, to advance funds or make a commitment to advance funds in connection with a residential mortgage.
Subd. 13. Mortgage broker; broker. "Mortgage broker" or "broker" means a person who performs the activities described in subdivisions 14 and 23.
Subd. 14. Mortgage brokering; brokering. "Mortgage brokering" or "brokering" means helping to obtain from another person, for a borrower, a residential mortgage loan or assisting a borrower in obtaining a residential mortgage loan in return for consideration to be paid by the borrower or lender or both. Mortgage brokering or brokering includes, but is not limited to, soliciting, placing, or negotiating a residential mortgage loan.
Subd. 15. Net worth. "Net worth" has the meaning given it in section 58.07.
Subd. 16. Person. "Person" means a natural person, firm, partnership, limited liability partnership, corporation, association, limited liability company, or other form of business organization and the officers, directors, employees, or agents of that person.
Subd. 17. Person in control. "Person in control" means any member of senior management and other persons who possess, directly or indirectly, the power to direct or cause the direction of the management policies of an applicant or licensee under this chapter, regardless of whether the person has any ownership interest in the applicant or licensee. Control is presumed to exist if a person, directly or indirectly, owns, controls, or holds with power to vote ten percent or more of the voting stock of an applicant or licensee or of a person who owns, controls, or holds with power to vote ten percent or more of the voting stock of an applicant or licensee.
Subd. 18. Residential mortgage loan. "Residential mortgage loan" means a loan made primarily for personal, family, or household use and secured primarily by either: (1) a mortgage on residential real property; or (2) certificates of stock or other evidence of ownership interest in and proprietary lease from corporations, partnerships, or other forms of business organizations formed for the purpose of cooperative ownership of residential real property.
Subd. 19. Residential mortgage originator. "Residential mortgage originator" means a person who, directly or indirectly, for compensation or gain or in expectation of compensation or gain, solicits or offers to solicit, or accepts or offers to accept an application for a residential mortgage loan through any medium or mode of communication from a borrower, or makes a residential mortgage loan. "Residential mortgage originator" includes a lender as defined in subdivision 11 and a broker as defined in subdivision 13.
Subd. 20. Residential mortgage servicer; servicer. "Residential mortgage servicer" or "servicer" means a person who engages in the activity of servicing a residential mortgage as defined in subdivision 22.
Subd. 21. Residential real property; residential real estate. "Residential real property" or "residential real estate" means real property improved or intended to be improved by a structure designed principally for the occupancy of from one to four families.
Subd. 22. Servicing; servicing a residential mortgage. "Servicing" or "servicing a residential mortgage loan" means through any medium or mode of communication the collection or remittance for, or the right or obligation to collect or remit for a lender, mortgagee, note owner, noteholder, or for a person's own account, of payments, interest, principal, and escrow items such as insurance and taxes for property subject to a residential mortgage loan.
Subd. 23. Soliciting, placing, or negotiating a residential mortgage loan. "Soliciting, placing, or negotiating a residential mortgage loan" means for compensation or gain or expectation of compensation or gain, whether directly or indirectly, accepting or offering to accept an application for a residential mortgage loan, assisting, or offering to assist a borrower in applying for a residential mortgage loan, or negotiating or offering to negotiate the terms or conditions of a residential mortgage loan with a lender on behalf of a borrower.
Subd. 24. Table funding. "Table funding" means a closing or settlement at which a residential mortgage loan is funded by a lender by way of a contemporaneous advance of residential mortgage loan funds and an assignment of the residential mortgage loan to the lender advancing the funds.
Subd. 25. Trust account. "Trust account" means a negotiable order of withdrawal account, demand deposit, or checking account maintained for the purpose of segregating trust funds from other funds. A "trust account" must not allow the financial institution a right of set-off against the money owed it by the account holder.
Subd. 26. Trust funds. "Trust funds" means funds received by a residential mortgage originator or servicer in a fiduciary capacity for later distribution, such as appraisal or credit report fees, taxes, or insurance premiums. Trust funds includes commitment, lock, extended lock, and advance fees.
58.03 Classes of license.
The commissioner may issue the following classes of license under this chapter:
(1) a residential mortgage originator license; and
(2) a residential mortgage servicer license.
58.04 Licensing requirement.
Subdivision 1. Residential mortgage originator licensing requirements. (a) Beginning August 1, 1999, no person shall act as a residential mortgage originator, or make residential mortgage loans without first obtaining a license from the commissioner according to the licensing procedures provided in this chapter.
(b) The following persons are exempt from the residential mortgage originator licensing requirements:
(1) an employee of one mortgage originator licensee or one person holding a certificate of exemption;
(2) a person engaged solely in commercial mortgage activities;
(3) a person licensed as a real estate broker under chapter 82, and an individual licensee who is licensed to the broker if:
(i) the individual licensee acts only under the name, authority, and supervision of the broker to whom the licensee is licensed;
(ii) the broker obtains a certificate of exemption according to section 58.05, subdivision 2;
(iii) the broker does not collect an advance fee for its residential mortgage-related activities; and
(iv) the residential mortgage origination activities are incidental to the real estate licensee's primary activities as a
real estate broker or salesperson;
(4) a person making no more than five residential mortgage loans with its own funds, during any 12-month period;
(5) a financial institution as defined in section 58.02, subdivision 10;
(6) an agency of the federal government, or of a state or municipal government;
(7) an employee or employer pension plan making loans only to its participants;
(8) a person acting in a fiduciary capacity, such as a trustee or receiver, as a result of a specific order issued by a
court of competent jurisdiction; or
(9) a person exempted by order of the commissioner.

Subd. 2. Residential mortgage servicer licensing requirements. (a) Beginning August 1, 1999, no person shall
engage in activities or practices that fall within the definition of "servicing a residential mortgage loan" under
section 58.02, subdivision 22, without first obtaining a license from the commissioner according to the licensing procedures provided in this chapter.
(b) The following persons are exempt from the residential mortgage servicer licensing requirements:
(1) a person licensed as a residential mortgage originator;
(2) an employee of one licensee or one person holding a certificate of exemption based on an exemption under this subdivision;
(3) a person engaged solely in commercial mortgage activities;
(4) a person servicing loans made with its own funds, if no more than five such loans are made in any 12-month period;
(5) a financial institution as defined in section 58.02, subdivision 10;
(6) an agency of the federal government, or of a state or municipal government;
(7) an employee or employer pension plan making loans only to its participants;
(8) a person acting in a fiduciary capacity, such as a trustee or receiver, as a result of a specific order issued by a
court of competent jurisdiction; or
(9) a person exempted by order of the commissioner.
Subd. 3. Conducting business under license. No person required to be licensed under this chapter may, without a license, do business under a name or title or circulate or use advertising or make representations or give information to a person, that indicates or reasonably implies activity within the scope of this chapter.
Subd. 4. Applicability to banks and credit unions.
Except for section 58.13, this chapter does not apply to a bank, savings bank, savings association, or credit union subject to supervision by either a federal regulatory agency or the commissioner.
58.06 Application requirements for residential mortgage originators and servicers.
Subdivision 1. License application form. Application for a residential mortgage originator or a residential mortgage servicer license must be in writing, under oath, and on a form obtained from and prescribed by the commissioner.
Subd. 2. Application contents. The application must contain the name and complete business address or addresses of the license applicant. If the license applicant is a partnership, limited liability partnership, association, limited liability company, corporation, or other form of business organization, the application must contain the names and complete business addresses of each partner, member, director, and principal officer. The application must also include a description of the activities of the license applicant, in the detail and for the periods the commissioner may require. The application must also include all of the following:
(a) an affirmation under oath that the applicant:
(1) will maintain competent staff and adequate staffing levels, through direct employees or otherwise, to meet the requirements of this chapter;
(2) will advise the commissioner of any material changes to the information submitted in the most recent application within ten days of the change;
(3) will advise the commissioner in writing immediately of any bankruptcy petitions filed against or by the applicant or licensee;
(4) is financially solvent and in compliance with net worth requirements;
(5) complies with federal and state tax laws;
(6) complies with sections 345.31 to 345.60, the Minnesota unclaimed property law; and
(7) is, or that a person in control of the license applicant is, at least 18 years of age;
(b) information as to the mortgage lending, servicing, or brokering experience of the applicant and persons in control of the applicant;
(c) information as to criminal convictions, excluding traffic violations, of persons in control of the license applicant;
(d) whether a court of competent jurisdiction has found that the applicant or persons in control of the applicant have engaged in conduct evidencing gross negligence, fraud, misrepresentation, or deceit in performing an act for which a license is required under this chapter;
(e) whether the applicant or persons in control of the applicant have been the subject of: an order of suspension or revocation, cease and desist order, or injunctive order, or order barring involvement in an industry or profession issued by this or another state or federal regulatory agency or by the Secretary of Housing and Urban Development within the ten-year period immediately preceding submission of the application; and
(f) other information required by the commissioner.
58.07 Net worth for originators and servicers.
Subdivision 1. Requirement. A licensee who is issued a residential mortgage originator license shall maintain a minimum net worth of $25,000. A licensee who is issued a residential mortgage servicer's license shall maintain a minimum net worth of $250,000.
Subd. 2. Computation. Net worth must be computed according to generally accepted accounting principles and must reflect any adjustment to net worth required by the Government National Mortgage Association.
Subd. 3. Certified financials. The commissioner may require the submission of financial data audited by an independent certified public accountant when it is considered necessary for an investigation or examination.
58.08 Bonds; letters of credit.
Subdivision 1. Requirement of residential mortgage originators. A residential mortgage originator licensee shall continuously maintain a surety bond or irrevocable letter of credit in an amount not less than $50,000 in a form approved by the commissioner, issued by an insurance company or bank authorized to do so in this state. The bond must be available for the recovery of expenses, fines, and fees levied by the commissioner under this chapter, and for losses or damages incurred by borrowers as the result of a licensee's noncompliance with the requirements of this chapter, sections 325D.43 to 325D.48, and 325F.67 to 325F.69, or breach of contract.
The bond or irrevocable letter of credit must be submitted with the originator's license application, and evidence of continued coverage must be submitted with each renewal. Any change in the bond or letter of credit must be submitted for approval by the commissioner, within ten days of its execution.
Subd. 2. Requirement of residential mortgage servicers. A residential mortgage servicer licensee shall continuously maintain a surety bond or irrevocable letter of credit in an amount not less than $100,000 in a form approved by the commissioner, issued by an insurance company or bank authorized to do so in this state. The bond must be available for the recovery of expenses, fines, and fees levied by the commissioner under this chapter, and for losses or damages incurred by borrowers or other aggrieved parties as the result of a licensee's noncompliance with the requirements of this chapter, sections 325D.43 to 325D.48, and 325F.67 to 325F.69, or breach of contract relating to activities regulated by this chapter.
The bond or irrevocable letter of credit must be submitted with the servicer's license application and evidence of continued coverage must be submitted with each renewal. Any change in the bond or letter of credit must be submitted for approval by the commissioner, within ten days of its execution.
Subd. 3. Exemption. Subdivisions 1 and 2 do not apply to mortgage originators or mortgage servicers who are approved as seller/servicers by the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation.
58.09 Term of license.
Initial licenses for residential mortgage originators and residential mortgage servicers issued under this chapter expire on July 31, 2001, and are renewable on August 1, 2001, and on August 1 of each odd-numbered year after that date. A new licensee whose license expires less than 12 months from the date of issuance shall pay a fee equal to one-half the applicable initial license fee set forth in section 58.10, subdivision 1, clause (1) or (3).
58.10 Fees.
Subdivision 1. Amounts. The following fees must be paid to the commissioner:
(1) for an initial residential mortgage originator license, $800;
(2) for a renewal license, $400;
(3) for an initial residential mortgage servicer's license, $1,000;
(4) for a renewal license, $500;
(5) license service fees as set forth in chapter 45; and
(6) for a certificate of exemption, $100.
Subd. 2. Forfeiture. All fees are nonrefundable except that an overpayment of a fee must be refunded upon proper application.
58.15 Disclosure requirements for residential mortgage originators.
Subdivision 1. Nonagency disclosure. If a residential mortgage originator or exempt person does not contract or offer to contract to act as an agent of a borrower, or accept an advance fee, it must, within 72 hours of accepting an application for a residential mortgage loan, provide the borrower with a written disclosure as provided in subdivision 2.
Subd. 2. Form and content requirements. The disclosure must be a separate document, 8-1/2 inches by 11 inches, must be signed by the borrower and must contain the following statement in 14-point boldface print:
Originator IS NOT ACTING AS YOUR AGENT IN CONNECTION WITH OBTAINING A RESIDENTIAL MORTGAGE LOAN. WHILE WE SEEK TO ASSIST YOU IN MEETING YOUR FINANCIAL NEEDS, WE CANNOT GUARANTEE THE LOWEST OR BEST TERMS AVAILABLE IN THE MARKET.
Subd. 3. Electronic application disclosure requirement. In case of an electronic residential mortgage application, the disclosure requirements of this section may be satisfied by providing the disclosure statement as a separate screen if the disclosure must be acknowledged by the borrower before an application is accepted.
Subd. 4. Exemption from disclosure requirement. If the Department of Housing and Urban Development adopts and implements a disclosure requirement for persons offering mortgage origination services that the commissioner determines to be substantially similar to the disclosure required in subdivision 2, licensees and exempt persons complying with the HUD disclosure shall be considered to have complied with the requirements of subdivisions 1 and 2.
58.16 Residential mortgage originators; standards of conduct for agency or advance fee transactions.
Subdivision 1. Compliance. Residential mortgage originators who solicit or receive an advance fee in exchange for assisting a borrower located in this state in obtaining a loan secured by a lien on residential real estate, or who offer to act as an agent of the borrower located in this state in obtaining a loan secured by a lien on residential real estate shall be considered to have created a fiduciary relationship with the borrower and shall comply with the requirements of subdivisions 2 to 7.
Subd. 2. Contract provisions. (a) A residential mortgage originator who engages in the activities described in subdivision 1 shall enter into a written contract with each borrower and shall provide a copy of the written contract to each borrower at or before the time of receipt of any fee or valuable consideration paid for mortgage origination services. The written contract must:
(1) specifically describe the services to be provided by the residential mortgage originator and if the originator collects an advance fee, the dates by which the services will be performed;
(2) specifically identify whether the residential mortgage originator may receive compensation from sources other than the borrower in connection with the loan transaction;
(3) state the total amount of commission or compensation that the borrower agrees to pay for the residential mortgage originator's services, or the basis on which the compensation will be computed;
(4) state the maximum rate of interest to be charged on any residential mortgage loan obtained;
(5) contain a statement that notifies the borrower of the right to cancel the contract according to subdivision 3; and
(6) disclose, with respect to the 12-month period ending ten business days before the date of the contract in question, the percentage of the mortgage originator's customers for whom loans have actually been funded as a result of the residential mortgage originator's services.
(b) If an advance fee is solicited or received the contract must also:
(1) identify the trust account into which the fees or consideration will be deposited;
(2) set forth the circumstances under which the residential mortgage originator will be entitled to disbursement from the trust account; and
(3) set forth the circumstances under which the borrower will be entitled to a refund of all or part of the fee.
Subd. 3. Cancellation. A borrower who pays an advance fee, or who enters into a contract for residential mortgage services as set forth in subdivisions 1 and 2, has an unconditional right to rescind the contract for residential mortgage origination services at any time until midnight of the third business day after the day on which the contract is signed. Cancellation is evidenced by the borrower giving written notice of cancellation to the residential mortgage originator at the address stated in the contract. Notice of cancellation, if given by mail, is effective upon deposit in a mailbox properly addressed to the originator with postage prepaid. Notice of cancellation need not take a particular form and is sufficient if it indicates by any form of written expression the intention of the borrower not be bound by the contract. No act of a borrower or a residential mortgage originator is effective to waive the right to rescind as provided in this subdivision.
Subd. 4. Trust account. The residential mortgage originator shall deposit in a trust account within three business days all fees received before the time a loan is actually funded. The trust account must be in a financial institution located within the state of Minnesota.
Subd. 5. Records. The residential mortgage originator shall maintain a separate record of all fees received for services performed or to be performed as a residential mortgage originator. Each record must set forth the date the funds are received; the person from whom the funds are received; the amount received; the date of deposit in the escrow account, the account number, the date the funds are disbursed and the check number of the disbursement, and a description of each disbursement and the justification for the disbursement.
Subd. 6. Monthly statement. The residential mortgage originator shall provide to each borrower at least monthly a detailed written accounting of all disbursements of the borrower's funds from the trust account.
Subd. 7. Disclosure of lenders. The residential mortgage originator shall provide to each borrower at the expiration of the contract a list of the lenders or loan sources to whom loan applications were submitted on behalf of the borrower.
HIST: 1998 c 343 art 1 s 16
* NOTE: This section, as added by Laws 1998, chapter 343, *article 1, section 16, is effective July 1, 1999. Laws 1998, *chapter 343, article 1, section 19.
Copyright 1998 by the Office of Revisor of Statutes, State of Minnesota.

AMENDMENTS Journal of the House - 57th Day - Tuesday, May 4, 1999 - Top of Page 3711
Sec. 34. Minnesota Statutes 1998, section 58.04, subdivision 1, is amended to read:
Subdivision 1. [RESIDENTIAL MORTGAGE ORIGINATOR LICENSING REQUIREMENTS.] (a) Beginning August 1, 1999, no person shall act as a residential mortgage originator, or make residential mortgage loans without first obtaining a license from the commissioner according to the licensing procedures provided in this chapter.
(b) The following persons are exempt from the residential mortgage originator licensing requirements:
(1) an employee of one mortgage originator licensee or one person holding a certificate of exemption;
(2) a person engaged solely in commercial mortgage activities;
(3) a person licensed as a real estate broker under chapter 82, and an individual licensee who is licensed to the broker if:
(i) the individual licensee acts only under the name, authority, and supervision of the broker to whom the licensee is licensed;
(ii) the broker obtains a certificate of exemption according to section 58.05, subdivision 2;
(iii) the broker does not collect an advance fee for its residential mortgage-related activities; and
(iv) the residential mortgage origination activities are incidental to the real estate licensee's primary activities as a real estate broker or salesperson;
(4) an individual licensed as a property/casualty or life/health insurance agent under chapter 60K if:
(i) the insurance agent acts on behalf of only one residential mortgage originator, which is in compliance with chapter 58;
(ii) the insurance agent has entered into a written contract with the mortgage originator under the terms of which the mortgage originator agrees to accept responsibility for the insurance agent's residential mortgage-related activities;
(iii) the insurance agent obtains a certificate of exemption under section 58.05, subdivision 2; and
(iv) the insurance agent does not collect an advance fee for the insurance agent's residential mortgage-related activities;
(5) a person making no more than five residential mortgage loans with its own funds, during any 12-month period;
(5) (6) a financial institution as defined in section 58.02, subdivision 10;
(6) (7) an agency of the federal government, or of a state or municipal government;
(7) (8) an employee or employer pension plan making loans only to its participants;
(8) (9) a person acting in a fiduciary capacity, such as a trustee or receiver, as a result of a specific order issued by a court of competent jurisdiction; or
(9) (10) a person exempted by order of the commissioner.
Sec. 35. Minnesota Statutes 1998, section 58.06, subdivision 2, is amended to read:
Subd. 2. [APPLICATION CONTENTS.] The application must contain the name and complete business address or addresses of the license applicant. If the license applicant is a partnership, limited liability partnership, association, limited liability company, corporation, or other form of business organization, the application must contain the names and complete business addresses of each partner, member, director, and principal officer. The application must also include a description of the activities of the license applicant, in the detail and for the periods the commissioner may require. The application must also include all of the following:
(a) an affirmation under oath that the applicant:
(1) will maintain competent staff and adequate staffing levels, through direct employees or otherwise, to meet the requirements of this chapter;
(2) will advise the commissioner of any material changes to the information submitted in the most recent application within ten days of the change;
(3) will advise the commissioner in writing immediately of any bankruptcy petitions filed against or by the applicant or licensee;
(4) is financially solvent and in compliance with net worth requirements;
(5) complies with federal and state tax laws;
(6) complies with sections 345.31 to 345.60, the Minnesota unclaimed property law; and
(7) is, or that a person in control of the license applicant is, at least 18 years of age;
(b) information as to the mortgage lending, servicing, or brokering experience of the applicant and persons in control of the applicant;
(c) information as to criminal convictions, excluding traffic violations, of persons in control of the license applicant;
(d) whether a court of competent jurisdiction has found that the applicant or persons in control of the applicant have engaged in conduct evidencing gross negligence, fraud, misrepresentation, or deceit in performing an act for which a license is required under this chapter;
(e) whether the applicant or persons in control of the applicant have been the subject of: an order of suspension or revocation, cease and desist order, or injunctive order, or order barring involvement in an industry or profession issued by this or another state or federal regulatory agency or by the Secretary of Housing and Urban Development within the ten-year period immediately preceding submission of the application; and
(f) other information required by the commissioner.
Sec. 36. Minnesota Statutes 1998, section 58.08, subdivision 1, is amended to read:
Subdivision 1. [REQUIREMENT OF RESIDENTIAL MORTGAGE ORIGINATORS.] A residential mortgage originator licensee engaging in servicing a residential mortgage loan shall continuously maintain a surety bond or irrevocable letter of credit in an amount not less than $50,000 in a form approved by the commissioner, issued by an insurance company or bank authorized to do so in this state. The bond must be available for the recovery of expenses, fines, and fees levied by the commissioner under this chapter relating to servicing, and for losses or damages incurred by borrowers as the result of a licensee's servicing-related noncompliance with the requirements of this chapter, sections 325D.43 to 325D.48, and 325F.67 to 325F.69, or breach of contract.
The bond or irrevocable letter of credit must be submitted with the originator's license application, and evidence of continued coverage must be submitted with each renewal. Any change in the bond or letter of credit must be submitted for approval by the commissioner, within ten days of its execution.
Sec. 37. Minnesota Statutes 1998, section 59A.03, subdivision 2, is amended to read:
Subd. 2. The applicant at the time of making application, shall pay to the commissioner the sum of $250 as a fee for investigating the application, and the additional sum of $100 $200 as an annual licensee fee for a period terminating on May 31 of each year. In addition to the annual license fee, every licensee shall pay to the commissioner the actual costs of each examination as may be required to be conducted under the terms of sections 59A.01 to 59A.15.
Sec. 38. Minnesota Statutes 1998, section 60K.11, subdivision 1, is amended to read:
Subdivision 1. [GROUNDS.] The commissioner may by order take any or all of the following actions:
(1) deny, suspend, or revoke an insurance agent or agency license;
(2) censure the licensee; or
3) impose a civil penalty as provided for in section 45.027, subdivision 6.
In order to take this action the commissioner must find that the order is in the public interest and that the applicant,; licensee,; or in the case of an insurance agency, partner, director, shareholder, officer, or agent of that insurance agency:
(i) does not intend to or is not in good faith carrying on the business of an insurance agent;
(ii) has filed an application for a license which is incomplete in any material respect or contains any statement which, in light of the circumstances under which it is made, contains any misrepresentation, or is false, misleading, or fraudulent;
(iii) has engaged in an act or practice, whether or not such act or practice involves the business of insurance, which demonstrates that the applicant or licensee is untrustworthy, financially irresponsible, or otherwise incompetent or unqualified to act as an insurance agent or agency;
(iv) has pled guilty, with or without explicitly admitting guilt, pled nolo contendere, or been convicted of a felony, gross misdemeanor, or misdemeanor involving moral turpitude, including, but not limited to, assault or similar conduct;
(v) has violated or failed to comply with any of the provisions of the insurance laws including chapter 45 or chapters 60A to 72A or any rule or order under those chapters;
(vi) is permanently or temporarily enjoined by any court of competent jurisdiction from engaging in or continuing any conduct or practice involving any aspect of the insurance business;
(vii) has violated or failed to comply with any order of the insurance regulator of any other state or jurisdiction;
(viii) has had an insurance agent or agency license denied, suspended, or revoked, has been censured or reprimanded, has been the subject of any other discipline imposed by, or has paid or has been required to pay a monetary penalty or fine to, another state or jurisdiction;
(ix) has misrepresented the terms of any actual or proposed insurance contract;
(x) has engaged in any fraudulent, coercive, deceptive, or dishonest act or practice whether or not such act or practice involves the business of insurance;
(xi) has improperly withheld, misappropriated, or converted to the licensee's or applicant's own use any money belonging to a policyholder, insurer, beneficiary, or other person; or
(xii) has forged another's name to any document whether or not the document relates to an application for insurance or a policy of insurance; or
(xiii) has, while performing residential mortgage activity regulated under chapter 58, violated any notification, disclosure, or recordkeeping requirement, or any standard of conduct, imposed by chapter 58.