EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
*hb0686*
HOUSE BILL 686
I1, I2 3lr1369
By: Delegate Queen
Introduced and read first time: February 6, 2023
Assigned to: Economic Matters
Committee Report: Favorable
House action: Adopted
Read second time: March 11, 2023
CHAPTER ______
AN ACT concerning 1
Financial Regulation – Modernizing Licensing of Non–Depository Institutions 2
and Elimination of Branch License Requirements 3
FOR the purpose of eliminating requirements for collection agencies and certain 4
non–depository financial institutions to maintain separate licenses for branch 5
locations and authorizing them to conduct business at multiple licensed locations 6
under a single license; altering certain other requirements and provisions governing 7
the licensing and regulation of collection agencies and certain non–depository 8
financial institutions, including applications, Nationwide Mortgage Licensing 9
System and Registry (NMLS) information, use of trade names, examination, 10
Commissioner of Financial Regulation assessments, and bond requirements; and 11
generally relating to the licensing of financial services providers. 12
BY repealing and reenacting, with amendments, 13
Article – Business Regulation 14
Section 7–101, 7–206, 7–301(c), 7–302(b), (d), and (e), 7–302.1(b), 7–302.2(a), 15
7–304(c)(1), 7–305, 7–306.1(a) and (c), and 7–308(c) 16
Annotated Code of Maryland 17
(2015 Replacement Volume and 2022 Supplement) 18
BY repealing 19
Article – Business Regulation 20
Section 7–302(c) and 7–308(b) 21
Annotated Code of Maryland 22
(2015 Replacement Volume and 2022 Supplement) 23 2 HOUSE BILL 686
BY adding to 1
Article – Business Regulation 2
Section 7–302.2(c) and 7–304(j) 3
Annotated Code of Maryland 4
(2015 Replacement Volume and 2022 Supplement) 5
BY repealing and reenacting, with amendments, 6
Article – Commercial Law 7
Section 14–1216(d) and (e) 8
Annotated Code of Maryland 9
(2013 Replacement Volume and 2022 Supplement) 10
BY adding to 11
Article – Financial Institutions 12
Section 2–120, 2–121, 11–203.1(b), 11–203.3(c), 11–206(d), 11–208, 11–211, 13
11–402.1(c), 11–408, 11–411, 11–501(f–1) and (f–2), 11–503.2(c), 11–508(c), 14
12–104.1(c), 12–110, 12–113, 12–401(k) and (l), 12–404(c), 12–407(b)(1), 15
12–415(a), 12–905(c), and 12–914(f) 16
Annotated Code of Maryland 17
(2020 Replacement Volume and 2022 Supplement) 18
BY repealing and reenacting, with amendments, 19
Article – Financial Institutions 20
Section 11–201, 11–203.3(a), 11–204(a) and (c)(2), 11–206(a)(2) and (c)(3)(i), 21
11–210(b)(1) and (c), 11 –401, 11 –402.1(a), 11–403(b), 22
11–404(a)(2), 11–406(a), 11–410(b)(1) and (c), 11–414, 11–503.1(b), 23
11–503.2(a), 11–505, 11–506.1(b) through (e), 11–507, 11–508(a) and (e) 24
through (g), 11–511(a), (c), and (d), 11–512, 11–512.1(a) and (c), 11–513, 25
11–601(f), 11–602(c), 11–612.1, 12–101, 12–104.1(a), 12–105(b), 12–106, 26
12–108(a)(2), 12–112(b)(1) and (c), 12–114(c), 12–118, 12–401(c) and (k–1), 27
12–404(a), 12–406(a)(3), 12–407(b)(2), 12–410, 12–412(a) and (d), 28
12–424, 12–901, 12–904, 12–905(a), 12–906(b), 12–908(b)(1) and (2), 12–911, 29
12–914(b)(2)(i), 12–915, 12–923(b)(1), 12–924(a), (c), and (d), and 12–1007(a) 30
Annotated Code of Maryland 31
(2020 Replacement Volume and 2022 Supplement) 32
BY repealing 33
Article – Financial Institutions 34
Section 11–203.1(b), 11–206(d), 11–208, 11–211, 11–404(c), 11–408, 11–411, 35
11–508(c) and (d), 11–610, 12–108(c), 12–110, 12–113, 12–401(e), 12–407(b)(1) 36
and (h), 12–415(a), and 12–914(b)(8) 37
Annotated Code of Maryland 38
(2020 Replacement Volume and 2022 Supplement) 39
BY repealing and reenacting, without amendments, 40
Article – Financial Institutions 41 HOUSE BILL 686 3
Section 11–501(a), 11–601(a), and 12–401(a) 1
Annotated Code of Maryland 2
(2020 Replacement Volume and 2022 Supplement) 3
BY repealing and reenacting, without amendments, 4
Article – State Finance and Procurement 5
Section 6–226(a)(2)(i) 6
Annotated Code of Maryland 7
(2021 Replacement Volume and 2022 Supplement) 8
BY repealing and reenacting, with amendments, 9
Article – State Finance and Procurement 10
Section 6–226(a)(2)(ii)170. and 171. 11
Annotated Code of Maryland 12
(2021 Replacement Volume and 2022 Supplement) 13
BY adding to 14
Article – State Finance and Procurement 15
Section 6–226(a)(2)(ii)172. 16
Annotated Code of Maryland 17
(2021 Replacement Volume and 2022 Supplement) 18
BY renumbering 19
Article – Financial Institutions 20
Section 12–401(f) through (k) and (l) through (v) 21
to be Section 12–401(e) through (j) and (n) through (x), respectively 22
Annotated Code of Maryland 23
(2020 Replacement Volume and 2022 Supplement) 24
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 25
That the Laws of Maryland read as follows: 26
Article – Business Regulation 27
7–101. 28
(a) In this title the following words have the meanings indicated. 29
(b) “Board” means the State Collection Agency Licensing Board. 30
(c) [“Branch location” means any location other than the principal executive office 31
of a licensee or license applicant at which a person does business as a collection agency or, 32
on licensure, will do business as a collection agency, in the State or with a person in the 33
State. 34
(d)] “Collection agency” means a person who engages directly or indirectly in the 35
business of: 36 4 HOUSE BILL 686
(1) (i) collecting for, or soliciting from another, a consumer claim; or 1
(ii) collecting a consumer claim the person owns, if the claim was in 2
default when the person acquired it; 3
(2) collecting a consumer claim the person owns, using a name or other 4
artifice that indicates that another party is attempting to collect the consumer claim; 5
(3) giving, selling, attempting to give or sell to another, or using, for 6
collection of a consumer claim, a series or system of forms or letters that indicates directly 7
or indirectly that a person other than the owner is asserting the consumer claim; or 8
(4) employing the services of an individual or business to solicit or sell a 9
collection system to be used for collection of a consumer claim. 10
[(e)] (D) “Commissioner” means the Commissioner of Financial Regulation. 11
[(f)] (E) “Consumer claim” means a claim that: 12
(1) is for money owed or said to be owed by a resident of the State; and 13
(2) arises from a transaction in which, for a family, household, or personal 14
purpose, the resident sought or got credit, money, personal property, real property, or 15
services. 16
[(g)] (F) (1) “Control person” means a person who has the power, directly or 17
indirectly, to direct the management or policies of a collection agency, whether through 18
ownership of securities, by contract, or otherwise. 19
(2) “Control person” includes a person who: 20
(i) is a general partner, an officer, a director, or a member of a 21
collection agency, or occupies a similar position or performs a similar function; 22
(ii) directly or indirectly has the right to vote 10% or more of a class 23
of voting securities, or has the power to sell or direct the sale of 10% or more of a class of 24
voting securities of a collection agency; or 25
(iii) in the case of a partnership, a limited partnership, a limited 26
liability partnership, a limited liability company, or any other business entity: 27
1. has the right to receive on liquidation or dissolution of a 28
collection agency 10% or more of the capital of the collection agency; or 29
2. has contributed 10% or more of the capital of a collection 30
agency. 31 HOUSE BILL 686 5
[(h)] (G) “License” means a license issued in any form by the Board under this 1
title to do business as a collection agency, including as provided for through NMLS. 2
[(h–1) “Licensee” means a person licensed under this title to do business as a 3
collection agency.] 4
[(i)] (H) “Licensed collection agency” means a person who is required to be 5
licensed under this title, regardless of whether the person is actually licensed. 6
(I) “LICENSED LOCATION ” MEANS ANY LOCATION L ISTED BY THE LICENSE E 7
IN NMLS IN ACCORDANCE WITH T HIS TITLE. 8
(J) “LICENSED NAME ” MEANS: 9
(1) THE LICENSEE’S LEGAL NAME; AND 10
(2) ANY TRADE NAME USED BY THE LICENSEE IN ACCORDANCE WITH 11
§ 2–121 OF THE FINANCIAL INSTITUTIONS ARTICLE. 12
(K) “LICENSEE” MEANS A PERSON LICEN SED UNDER THIS TITLE TO DO 13
BUSINESS AS A COLLECTION AGENCY . 14
[(j)] (L) “NMLS” [means a multistate uniform licensing system developed and 15
maintained by the Conference of State Bank Supervisors, or by a subsidiary or an affiliate 16
of the Conference of State Bank Supervisors, that may be used for the licensing of persons 17
required to be licensed by the Board] HAS THE MEANING STAT ED IN § 1–101 OF THE 18
FINANCIAL INSTITUTIONS ARTICLE. 19
[(k)] (M) “Unique identifier” means a number or another identifier assigned by 20
NMLS. 21
7–206. 22
[The] EXCEPT AS PROVID ED IN § 7–302.2 OF THIS TITLE, THE Board shall pay 23
all money collected under this title into the General Fund of the State. 24
7–301. 25
(c) A [separate license is required for the principal executive office and each 26
branch location of a person who does business as a collection agency] LICENSEE MAY DO 27
BUSINESS AS A COLLEC TION AGENCY ONLY AT A LICENSED LOCATION OR AS 28
OTHERWISE AUTHORIZED BY REGULATION . 29
6 HOUSE BILL 686
7–302. 1
(b) An application shall be made under oath and shall include: 2
(1) the applicant’s LEGAL name, ANY TRADE NAME USED BY THE 3
APPLICANT IN ACCORDA NCE WITH § 2–121 OF THE FINANCIAL INSTITUTIONS 4
ARTICLE, AND THE APPLICANT ’S principal executive office address, telephone number, 5
e–mail address, and Web site addresses, if any; 6
(2) the address of each [branch] ADDITIONAL location, if any, THAT: 7
(I) THE GENERAL PUBLIC M AY REASONABLY VIEW A S A 8
LOCATION THAT DOES B USINESS AS A COLLECT ION AGENCY , INCLUDING ANY 9
LOCATION THAT INVEST IGATES CUSTOMER COMP LAINTS OR DIRECTLY 10
COMMUNICATES WITH CU STOMERS VERBALLY , ELECTRONICALLY , OR IN WRITING; 11
(II) HOUSES ANY CORE OPER ATIONAL INFRASTRUCTU RE OR 12
TECHNOLOGY SYSTEMS ; 13
(III) CONDUCTS ANY CORE MA NAGEMENT, INFORMATION 14
SECURITY AND TECHNOL OGY, RISK AND COMPLIANCE , OR FINANCE FUNCTIONS ; OR 15
(IV) IS OTHERWISE REQUIRED TO BE LISTE D IN NMLS BY 16
REGULATION ADOPTED U NDER THIS TITLE ; 17
(3) the federal employer identification number or Social Security number 18
of the applicant, as applicable; 19
(4) the state of formation and the date of formation of the applicant if the 20
applicant is a business entity; 21
(5) the name and residence address of each control person; 22
(6) the name and address of the principal contact for consumer complaints; 23
(7) the name, address, and telephone number of the applicant’s resident 24
agent; and 25
(8) any other information that the Board requests. 26
[(c) If an applicant wishes to do business as a collection agency at a branch 27
location, the applicant shall submit a separate application and pay a separate application 28
fee and investigation fee for each branch location.] 29
[(d)] (C) In addition to any other requirement for licensure under this subtitle, 30 HOUSE BILL 686 7
an applicant for a license shall file with the Board a surety bond as required under § 7–304 1
of this subtitle. 2
[(e)] (D) The Board shall issue a license to each applicant who meets the 3
requirements of this subtitle. 4
7–302.1. 5
(b) The fees established by the Board under this section AND ANY ANNUAL 6
ASSESSMENTS IMPOSED BY THE COMMISSIONER UNDER § 2–120 OF THE FINANCIAL 7
INSTITUTIONS ARTICLE shall be reasonable and set in a manner that will 8
COLLECTIVELY produce funds sufficient to cover the actual direct and indirect costs of 9
regulating collection agencies in accordance with [the provisions of] this title. 10
7–302.2. 11
(a) All revenue received for the licensing AND ASSESSMENT of persons under this 12
title and any other fee or revenue received by THE COMMISSIONER OR the Board under 13
this title shall be: 14
(1) credited to the [Nondepository] NON–DEPOSITORY Special Fund 15
established under [§ 11–610] § 2–120 of the Financial Institutions Article; and 16
(2) used in accordance with [§ 11–610(c)] § 2–120(D) of the Financial 17
Institutions Article. 18
(C) SUBJECT TO § 2–120(H) OF THE FINANCIAL INSTITUTIONS ARTICLE, 19
THE COMMISSIONER MAY IMPO SE AN ANNUAL ASSES SMENT ON ANY LICENSE E 20
UNDER THIS TITLE . 21
7–304. 22
(c) The bond shall be: 23
(1) in the amount [of $5,000] DETERMINED BY THE BOARD UNDER 24
SUBSECTION (J) OF THIS SECTION ; 25
(J) (1) THE AMOUNT OF THE SUR ETY BOND REQUIRED UN DER 26
SUBSECTION (C) OF THIS SECTION SHALL BE IN AN AMOUN T OF NOT LESS THAN 27
$50,000 AND NOT MORE THAN $1,000,000, AS DETERMINED BY THE BOARD FOR 28
EACH LICENSEE . 29
(2) IN SETTING THE AMOUNT OF THE SURETY BOND , THE BOARD MAY 30
CONSIDER: 31
8 HOUSE BILL 686
(I) THE NATURE AND VOLUM E OF THE BUSINESS OR PROPOSED 1
BUSINESS OF THE LICENS EE OR APPLICANT ; 2
(II) THE FINANCIAL CONDIT ION OF THE LICENSEE OR 3
APPLICANT, INCLUDING: 4
1. THE AMOUNT , NATURE, QUALITY, AND LIQUIDITY OF 5
THE ASSETS OF THE LI CENSEE OR APPLICANT ; 6
2. THE AMOUNT AND NATUR E OF THE LIABILITIES , 7
INCLUDING CONTINGENT LIABILITIES, OF THE LICENSEE OR A PPLICANT; 8
3. THE HISTORY OF AND P ROSPECTS FOR THE LIC ENSEE 9
OR APPLICANT TO EARN AND RETAIN INCOME ; AND 10
4. THE POTENTIAL HARM T O CONSUMERS IF THE 11
APPLICANT OR LICENSE E BECOMES FINANCIALL Y IMPAIRED; 12
(III) THE QUALITY OF THE O PERATIONS OF THE LIC ENSEE OR 13
APPLICANT; 14
(IV) THE QUALITY OF THE M ANAGEMENT OF THE LIC ENSEE OR 15
APPLICANT; 16
(V) THE NATURE AND QUALI TY OF EACH CONTROL P ERSON; 17
AND 18
(VI) ANY OTHER FACTOR THA T THE BOARD CONSIDERS 19
RELEVANT. 20
7–305. 21
(a) A license authorizes the licensee to do business as a collection agency at [only 22
the] EACH licensed location AND UNDER EACH LICEN SED NAME, OR AS OTHERWISE 23
AUTHORIZED BY REGULA TION. 24
[(b) Subject to § 7–301(c) of this subtitle, a licensee may hold more than 1 license 25
under this title. 26
(c) (1) Each license provided for through NMLS shall include the following 27
information: 28
(i) the name of the licensee; 29
HOUSE BILL 686 9
(ii) the address at which the business is to be conducted; and 1
(iii) the unique identifier of the licensee. 2
(2) The unique identifier of the licensee shall constitute the license number 3
for the license.] 4
(B) INFORMATION IN NMLS ASSOCIATED WITH A LI CENSE APPROVED BY 5
THE BOARD UNDER THIS SUBT ITLE SHALL INCLUDE T HE FOLLOWING : 6
(1) THE LICENSEE’S LEGAL NAME AND ANY TRADE NAME USED BY THE 7
LICENSEE IN ACCORDAN CE WITH § 2–121 OF THE FINANCIAL INSTITUTIONS 8
ARTICLE; 9
(2) THE ADDRESS OF THE L ICENSEE’S PRINCIPAL EXECUTIV E OFFICE; 10
AND 11
(3) THE ADDRESS OF EACH ADDITIONAL LOCATION , IF ANY, WHERE 12
THE LICENSEE DOES BU SINESS AND THAT : 13
(I) THE GENERAL PUBLIC M AY REASONABLY VIEW A S A 14
LOCATION THAT DOES B USINESS AS A COLLECT ION AGENCY , INCLUDING ANY 15
LOCATION THAT INVEST IGATES CUSTOMER COMP LAINTS OR DIRECTLY 16
COMMUNICATES WITH CU STOMERS VERBALLY, ELECTRONICALLY , OR IN WRITING; 17
(II) HOUSES ANY CORE OPER ATIONAL INFRASTRUCTU RE OR 18
TECHNOLOGY SYSTEMS ; 19
(III) CONDUCTS ANY CORE MA NAGEMENT, INFORMATION 20
SECURITY AND TECHNOL OGY, RISK AND COMPLIANCE , OR FINANCE FUNCTIONS ; OR 21
(IV) IS OTHERWISE REQUIRED TO BE LISTED IN NMLS BY 22
REGULATION . 23
(C) A LICENSEE SHALL MAINT AIN AND UPDATE THE I NFORMATION IN 24
NMLS ASSOCIATED WITH THE LICENSEE’S LICENSE TO REFLECT ACCURATELY AT 25
ALL TIMES THE INFORM ATION REQUIRED BY SU BSECTION (B) OF THIS SECTION. 26
(D) THE UNIQUE IDENTIFIER OF THE LICENSEE SHAL L CONSTITUTE THE 27
LICENSE NUMBER FOR T HE LICENSE. 28
(E) A LICENSEE MAY NOT ADD , DELETE, OR MODIFY A LOCATION REQUIRED 29
TO BE LISTED IN NMLS UNDER SUBSECTION (B) OF THIS SECTION UNLE SS: 30
10 HOUSE BILL 686
(1) THE LICENSEE PROVIDES TO THE BOARD, THROUGH NMLS AND 1
IN ACCORDANCE WITH A NY APPLICABLE REGULA TIONS, NOTICE OF THE ADDITI ON, 2
DELETION, OR MODIFICATION ; 3
(2) THE ADDITION, DELETION, OR MODIFICATION OF T HE LOCATION 4
IS RECORDED WITH THE INFORMATION ASSOCIAT ED WITH THE LICENSEE’S LICENSE 5
IN NMLS; AND 6
(3) THE ADDITION, DELETION, OR MODIFICATION OF T HE LOCATION 7
OTHERWISE COMPLIES W ITH THIS TITLE. 8
(F) THE LICENSEE MAY NOT DO BUSINESS AT A LOC ATION REQUIRED TO BE 9
LISTED IN NMLS UNDER SUBSECTION (B) OF THIS SECTION UNTI L THE LOCATION 10
IS RECORDED WITH THE INFORMATION ASSOCIAT ED WITH THE LICENSEE ’S LICENSE 11
IN NMLS. 12
7–306.1. 13
(a) Each licensee shall conspicuously post, in 48 point or larger type, at [the 14
licensee’s] EACH licensed location, the following information: 15
(1) the licensee’s unique identifier; and 16
(2) a statement advising consumers of the availability of the NMLS 17
Consumer Access website to verify the licensing status of the licensee. 18
(c) A licensee is not required to post the information required under subsection 19
(a) of this section AT A LICENSED LOCATI ON if the licensee does not regularly grant access 20
to [the] THAT licensed location to members of the general public. 21
7–308. 22
[(b) If the Board finds that a ground for suspension or revocation of a license 23
applies to more than 1 place of business that the licensee operates, the Board may act 24
against: 25
(1) each license of the licensee; or 26
(2) only the licenses to which the ground applies.] 27
[(c)] (B) In determining whether to reprimand a licensee or to suspend or revoke 28
a license for a reason described in subsection (a)(2) of this section, the Board shall consider: 29
(1) the nature of the crime; 30
HOUSE BILL 686 11
(2) the relationship of the crime to the activities authorized by the license; 1
(3) with respect to a felony, the relevance of the conviction to the fitness 2
and qualification of the licensee to engage in the collection agency business; 3
(4) the length of time since the conviction; and 4
(5) the behavior and activities of the licensee since the conviction. 5
Article – Commercial Law 6
14–1216. 7
(d) Except as provided in § 14–1226 of this subtitle, all fees and other revenues 8
collected under this subtitle shall be deposited into the [Nondepository] 9
NON–DEPOSITORY Special Fund established under [§ 11–610] § 2–120 of the Financial 10
Institutions Article. 11
(e) The Commissioner may require a consumer reporting agency to register 12
through [the Nationwide Mortgage Licensing System and Registry] NMLS or through 13
other means specified by the Commissioner by regulation. 14
Article – Financial Institutions 15
2–120. 16
(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 17
INDICATED. 18
(2) “BOARD” MEANS THE STATE COLLECTION AGENCY LICENSING 19
BOARD ESTABLISHED UND ER TITLE 7 OF THE BUSINESS REGULATION ARTICLE. 20
(3) “FUND” MEANS THE NON–DEPOSITORY SPECIAL FUND 21
ESTABLISHED UNDER TH IS SECTION. 22
(4) “LICENSE” MEANS ANY LICENSE IS SUED BY THE COMMISSIONER 23
OR THE BOARD UNDER APPLICABL E LAW. 24
(5) “LICENSE CATEGORY ” REFERS TO ALL LICENS ES ISSUED BY 25
EITHER THE COMMISSIONER OR THE BOARD UNDER ANY OF TH E FOLLOWING 26
PROVISIONS: 27
(I) TITLE 11, SUBTITLE 2 OF THIS ARTICLE; 28
(II) TITLE 11, SUBTITLE 3 OF THIS ARTICLE; 29 12 HOUSE BILL 686
(III) TITLE 11, SUBTITLE 4 OF THIS ARTICLE; 1
(IV) TITLE 11, SUBTITLE 5 OF THIS ARTICLE; 2
(V) TITLE 11, SUBTITLE 6 OF THIS ARTICLE; 3
(VI) TITLE 12, SUBTITLE 1 OF THIS ARTICLE; 4
(VII) TITLE 12, SUBTITLE 4 OF THIS ARTICLE; 5
(VIII) TITLE 12, SUBTITLE 9 OF THIS ARTICLE; OR 6
(IX) TITLE 7 OF THE BUSINESS REGULATION ARTICLE. 7
(6) “LICENSED PERSON ” MEANS ANY PERSON REQ UIRED BY LAW TO 8
BE LICENSED BY EITHE R THE COMMISSIONER OR THE BOARD, REGARDLESS OF 9
WHETHER THE PERSON M AINTAINS THE REQUIRE D LICENSE. 10
(7) “REGISTERED PERSON ” MEANS ANY PERSON REQ UIRED BY LAW 11
TO BE REGISTERED BY THE COMMISSIONER OR THE BOARD, REGARDLESS OF 12
WHETHER THE PERSON M AINTAINS THE REQUIRE D REGISTRATION . 13
(8) “REGULATED PERSON ” MEANS: 14
(I) A LICENSED PERSON OR R EGISTERED PERSON ; OR 15
(II) ANY PERSON OTHERWISE ENGAGING IN ACTIVITY SUBJECT 16
TO A PROVISION OF LA W, REGULATION , RULE, OR ORDER OVER WHICH THE 17
COMMISSIONER HAS JURI SDICTION, OTHER THAN ACTIVITY SUBJECT TO ANY OF 18
TITLES 3 THROUGH 9 OF THIS ARTICLE. 19
(B) THERE IS A NON–DEPOSITORY SPECIAL FUND THAT CONSISTS OF : 20
(1) ALL REVENUES RECEIVED FROM LICENSING FEES FROM EAC H 21
LICENSED PERSON ; 22
(2) ALL REVENUES RECEIVED FROM REGISTRATION FE ES FROM 23
EACH REGISTERED PERS ON; 24
(3) ALL REVENUES RECEIVED FROM ANNUAL ASSESSME NTS UNDER 25
SUBSECTION (H) OF THIS SECTION; 26
HOUSE BILL 686 13
(4) INCOME FROM THE INVES TMENTS THAT THE STATE TREASURER 1
MAKES FOR THE FUND; AND 2
(5) ANY OTHER FEE , EXAMINATION OR INVES TIGATION FEE OR 3
ASSESSMENT , OR REVENUE RECEIVED BY THE COMMISSIONER OR THE BOARD WITH 4
RESPECT TO ANY REGUL ATED PERSON . 5
(C) NOTWITHSTAN DING SUBSECTION (B) OF THIS SECTION: 6
(1) THE COMMISSIONER AND THE BOARD SHALL PAY ALL F INES AND 7
PENALTIES COLLECTED FROM ANY REGULATED P ERSON INTO THE GENERAL FUND 8
OF THE STATE; AND 9
(2) REVENUE RECEIVED BY T HE COMMISSIONER FOR USE OF THE 10
FORECLOSED PROPERTY REGISTRY ESTABLISHED UNDER TITLE 7 OF THE REAL 11
PROPERTY ARTICLE SHALL BE PAID BY THE COMMISSIONER TO THE FORECLOSED 12
PROPERTY REGISTRY FUND ESTABLISHED UNDE R § 7–105.14 OF THE REAL 13
PROPERTY ARTICLE. 14
(D) THE PURPOSE OF THE FUND IS TO COVER THE DIRECT AND INDIRECT 15
COSTS OF FULFILLING THE STATUTORY AND RE GULATORY DUTIES OF T HE 16
COMMISSIONER AND THE BOARD RELATED TO REGU LATED PERSONS . 17
(E) (1) THE ANNUAL STATE BUDGET SHALL IN CLUDE THE COSTS AND 18
EXPENSES OF THE COMMISSIONER AND THE BOARD RELATING TO SUBSECTION (D) 19
OF THIS SECTION. 20
(2) ANY EXPENDITURES FROM THE FUND TO COVER COSTS A ND 21
EXPENSES OF THE COMMISSIONER AND THE BOARD RELATING TO SUB SECTION (D) 22
OF THIS SECTION MAY BE MADE ONLY : 23
(I) WITH AN APPROPRIATION FROM THE FUND APPROVED BY 24
THE GENERAL ASSEMBLY IN THE ANNUA L STATE BUDGET ; OR 25
(II) BY THE BUDGET AMENDME NT PROCEDURE UNDER § 7–209 26
OF THE STATE FINANCE AND PROCUREMENT ARTICLE. 27
(3) IF, IN ANY FISCAL YEAR , THE AMOUNT OF THE RE VENUE 28
COLLECTED BY THE COMMISSIONER AND THE BOARD AND DE POSITED INTO THE 29
FUND EXCEEDS THE ACTU AL APPROPRIATION FOR THE COMMISSIONER AND THE 30
BOARD UNDER PARAGRAPH (2)(I) OF THIS SUBSECTION , THE EXCESS AMOUNT 31
SHALL BE CARRIED FOR WARD WITHIN THE FUND. 32
14 HOUSE BILL 686
(F) (1) THE STATE TREASURER IS THE CUST ODIAN OF THE FUND. 1
(2) THE STATE TREASURER SHALL DEPOS IT PAYMENTS RECEIVED 2
FROM THE COMMISSIONER AND THE BOARD INTO THE FUND. 3
(G) (1) (I) THE FUND IS A SPECIAL, NONLAPSING FUND THAT IS NOT 4
SUBJECT TO § 7–302 OF THE STATE FINANCE AND PROCUREMENT ARTICLE. 5
(II) THE FUND MAY NOT BE DEEMED A P ART OF THE GENERAL 6
FUND OF THE STATE. 7
(2) UNLESS OTHERWISE PROV IDED BY LAW, NO PART OF THE FUND 8
MAY REVERT OR BE CRE DITED TO: 9
(I) THE GENERAL FUND OF THE STATE; OR 10
(II) ANY OTHER SPECIAL FUN D OF THE STATE. 11
(H) (1) IN ORDER TO ENSURE THE FUND CONTAINS SUFFICI ENT 12
AMOUNTS TO ACHIEVE I TS PURPOSE UNDER SUB SECTION (D) OF THIS SECTION, THE 13
COMMISSIONER MAY IMPO SE AN ANNUAL ASSESSM ENT ON ANY LICENSED PERSON 14
NOT MORE THAN ONCE E ACH YEAR. 15
(2) IN CALCULATING AN ASS ESSMENT WITH RESPE CT TO ANY 16
LICENSED PERSON , THE COMMISSIONER MAY CONS IDER: 17
(I) THE COSTS INCURRED BY THE COMMISSIONER OR THE 18
BOARD IN SUPERVISING LICENSED PERSONS OF THAT LICENSE CATEGOR Y; 19
(II) THE TYPE OF BUSINESS CONDUCTED IN THE STATE BY THAT 20
LICENSED PERSON ; 21
(III) THE VOLUME OF BUSINES S THAT LICENSED PERS ON 22
CONDUCTS IN THE STATE; 23
(IV) ASSETS OF THE LICENSE D PERSON; AND 24
(V) ANY OTHER FACTOR THE COMMISSIONER CONSIDER S 25
APPROPRIATE . 26
(3) A LICENSED PERSON SHAL L PAY ANY ASSESSMENT IMPOSED 27
UNDER THIS SEC TION TO THE COMMISSIONER WITHIN 30 CALENDAR DAYS AFTER 28
THE ASSESSMENT IS IM POSED. 29 HOUSE BILL 686 15
(4) (I) FAILURE BY A LICENSED PERSON TO TIMELY PAY AN 1
ANNUAL ASSESSMENT UN DER THIS SECTION IS A VIOLATION OF THIS SECTION. 2
(II) THE COMMISSIONER MAY TAKE ACTION FOR TH E 3
VIOLATION AGAINST TH E LICENSED PERSON AN D THE LICENSE UNDER APPLICABLE 4
LAW. 5
2–121. 6
(A) BEFORE USING A TRADE NAME T O ENGAGE IN ANY ACTI VITY REQUIRING 7
A LICENSE OR REGISTRATION FROM THE COMMISSIONER OR THE STATE 8
COLLECTION AGENCY LICENSING BOARD, THE LICENSED OR REGISTERED PER SON 9
SHALL: 10
(1) REGISTER THE TRADE NA ME WITH THE STATE DEPARTMENT OF 11
ASSESSMENTS AND TAXATION; AND 12
(2) OBTAIN THE APPROVAL O F THE COMMISSIONER , OR THE STATE 13
COLLECTION AGENCY LICENSING BOARD IF LICENSED BY THE BOARD, TO USE THE 14
TRADE NAME BY : 15
(I) DESIGNATING ON AN ORIGINAL LICENSE OR REGISTRATION 16
APPLICATION OR ON A LICENSE OR REGISTRAT ION RENEWAL APPLICAT ION 17
THROUGH NMLS THE TRADE NAME UNDER WHICH THE LICENSE D OR REGISTERED 18
PERSON WILL ENGAGE IN LICENSED A CTIVITY IN THE STATE; OR 19
(II) IF THE PERSON WISHES TO BEGIN USING A TRADE NAME 20
BEFORE RENEWING A LI CENSE OR REGISTRATIO N, NOTIFYING THE COMMISSIONER , 21
OR THE STATE COLLECTION AGENCY LICENSING BOARD IF LICENSED BY THE 22
BOARD, IN WRITING BY LISTIN G THE TRADE NAME IN THE PERSON’S NMLS RECORD. 23
(B) AFTER RECEIVING APPRO VAL FROM THE COMMISSIONER OR FROM THE 24
STATE COLLECTION AGENCY LICENSING BOARD IF LICENSED BY THE BOARD FOR 25
THE USE OF A TRADE N AME, THE LICENSED OR REGISTER ED PERSON SHALL : 26
(1) MAINTAIN REGISTRATI ON OF THE TRADE NAME IN ACCORDANCE 27
WITH § 1–406 OF THE CORPORATIONS AND ASSOCIATIONS ARTICLE AND ANY 28
IMPLEMENTING REGULATIONS ; 29
(2) LIST THE TRADE NAME I N NMLS; AND 30
(3) IMMEDIATELY NOTIFY TH E COMMISSIONER , OR THE STATE 31 16 HOUSE BILL 686
COLLECTION AGENCY LICENSING BOARD IF LICENSED BY THE BOARD, IF THE 1
PERSON AMENDS , CANCELS, OR OTHERWISE FAILS T O RENEW THE REGISTRATION 2
OF THE TRADE NAME . 3
11–201. 4
(a) In this subtitle the following words have the meanings indicated. 5
(b) [“Branch location” means any location other than the principal executive office 6
of a licensee or license applicant at which the licensee conducts, or the license applicant, on 7
licensure, will conduct, activities required to be licensed under this subtitle. 8
(c)] (1) “Control person” means a person who has the power, directly or 9
indirectly, to direct the management or policies of a licensee or license applicant, whether 10
through ownership of securities, by contract, or otherwise. 11
(2) “Control person” includes a person who: 12
(i) Is a general partner, an officer, or a director of a licensee or 13
license applicant, or occupies a similar position or performs a similar function; 14
(ii) Directly or indirectly has the right to vote 10% or more of a class 15
of voting securities, or has the power to sell or direct the sale of 10% or more of a class of 16
voting securities of a licensee or license applicant; or 17
(iii) In the case of a partnership, a limited partnership, a limited 18
liability partnership, a limited liability company, or any other business entity: 19
1. Has the right to receive on liquidation or dissolution of a 20
licensee or license applicant 10% or more of the capital of the licensee or license applicant; 21
or 22
2. Has contributed 10% or more of the capital of a licensee or 23
license applicant. 24
[(d)] (C) “License” means a license issued in any form by the Commissioner 25
under this subtitle to make loans under the Maryland Consumer Loan Law, including as 26
provided for through NMLS. 27
(D) “LICENSED LOCATION” MEANS ANY LOCATION L ISTED BY THE LICENSE E 28
IN NMLS IN ACCORDANCE WITH T HIS SUBTITLE. 29
(E) “LICENSED NAME ” MEANS: 30
(1) THE LICENSEE’S LEGAL NAME; AND 31
HOUSE BILL 686 17
(2) ANY TRADE NAME USED B Y THE LICENSEE IN AC CORDANCE WITH 1
§ 2–121 OF THIS ARTICLE. 2
[(d–1)] (F) “Licensee” means a person licensed under this subtitle to make loans 3
under the Maryland Consumer Loan Law. 4
[(e)] (G) “Loan” means any loan or advance of money or credit subject to Title 5
12, Subtitle 3 of the Commercial Law Article, the Maryland Consumer Loan Law – Credit 6
Provisions, regardless of whether the loan or advance of money or credit is or purports to 7
be made under Title 12, Subtitle 3 of the Commercial Law Article. 8
[(f)] (H) “Maryland Consumer Loan Law” means this subtitle and Title 12, 9
Subtitle 3 of the Commercial Law Article. 10
[(g)] (I) “Person” includes an individual, corporation, business trust, statutory 11
trust, estate, trust, partnership, association, two or more persons having a joint or common 12
interest, or any other legal or commercial entity. 13
[(h)] (J) “Unique identifier” means a number or another identifier assigned by 14
NMLS. 15
11–203.1. 16
[(b) A separate license is required for the principal executive office of the license 17
applicant or licensee and each branch location.] 18
(B) EXCEPT AS OTHERWISE P ROVIDED IN § 11–204 OF THIS SUBTITLE OR 19
AUTHORIZED BY THE COMMISSIONER BY REGUL ATION, A LICENSEE MAY NOT 20
ENGAGE IN THE BUSINE SS OF MAKING LOANS A T A LOCATION OTHER T HAN A 21
LICENSED LOCATION . 22
11–203.3. 23
(a) All revenue received for the licensing AND ASSESSMENT of persons under this 24
subtitle and Subtitle 3 of this title and any other fee or revenue received by the 25
Commissioner under this subtitle shall be: 26
(1) Credited to the [Nondepository] NON–DEPOSITORY Special Fund 27
established under [§ 11–610] § 2–120 of this [title] ARTICLE; and 28
(2) Used in accordance with [§ 11–610(c)] § 2–120(D) of this [title] 29
ARTICLE. 30
(C) SUBJECT TO § 2–120(H) OF THIS ARTICLE , THE COMMISSIONER MAY 31
IMPOSE AN ANNUAL ASS ESSMENT ON ANY LICENSEE UNDE R THIS SUBTITLE. 32 18 HOUSE BILL 686
11–204. 1
(a) A person may not: 2
(1) Receive any application for a loan or allow any note or contract for a 3
loan to be signed at any place of business [for which the person does not have a license] 4
THAT IS NOT A LICE NSED LOCATION ; 5
(2) Conduct any business under the Maryland Consumer Loan Law under 6
a name different from the [name that appears on the person’s license] LICENSED NAME ; 7
or 8
(3) Evade the application of this section by any device, subterfuge, or 9
pretense of any kind. 10
(c) Notwithstanding subsections (a) and (b) of this section, for a loan that is to be 11
secured by residential real property: 12
(2) Except as provided in item (3) of this subsection, the loan closing shall 13
be conducted at: 14
(i) [The lender’s] A licensed location; 15
(ii) The office of an attorney representing the licensee, the borrower, 16
the title company, or title insurer in connection with the loan; or 17
(iii) The office of the title insurer or title agency performing closing 18
services in connection with the loan; and 19
11–206. 20
(a) (2) The application shall include: 21
(i) The applicant’s LEGAL name[, the] AND ANY TRADE NAME 22
USED BY THE APPLICAN T IN ACCORDANCE WITH § 2–121 OF THIS ARTICLE; 23
(II) THE applicant’s principal executive office address[, and, if]; 24
(III) IF the applicant is not an individual, the name and residence 25
address of each control person; 26
[(ii)] (IV) The address of each [branch] ADDITIONAL location, if 27
any, THAT: 28
1. THE GENERAL PUBLIC MA Y REASONABLY VIEW AS A 29 HOUSE BILL 686 19
LOCATION THAT MAKES LOANS, INCLUDING ANY LOCATI ON THAT INVESTIGATES 1
CUSTOMER COMPLAINTS OR DIRECTLY COMMUNIC ATES WITH CUSTOMERS 2
VERBALLY, ELECTRONICALLY , OR IN WRITING; 3
2. HOUSES ANY CORE OPERA TIONAL INFRASTRUCTUR E 4
OR TECHNOLOGY SYSTEM S; 5
3. CONDUCTS ANY CORE MAN AGEMENT, INFORMATION 6
SECURITY AND TECHNOL OGY, RISK AND COMPLIANCE , OR FINANCE FUNCTIONS ; OR 7
4. IS OTHERWISE REQUIRED TO BE LISTED IN NMLS BY 8
REGULATION THE COMMISSIONER ADOPTS U NDER THIS SUBTITLE ; and 9
[(iii)] (V) Any other pertinent information that the Commissioner 10
requires for an investigation and findings under § 11–207 of this subtitle. 11
(c) (3) The bond shall be: 12
(i) In an amount [equal to twice the amount of the largest loan that 13
may be made under the Maryla nd Consumer Loan Law ] DETERMINED BY THE 14
COMMISSIONER UNDER SU BSECTION (D) OF THIS SECTION ; 15
[(d) For the principal executive office and each branch location license for which 16
an applicant applies, the applicant shall: 17
(1) Submit a separate application; and 18
(2) Pay a separate investigation fee and license fee.] 19
(D) (1) THE AMOUNT OF THE SUR ETY BOND UNDER SUBSE CTION (C) OF 20
THIS SECTION SHALL B E IN AN AMOUNT OF NO T LESS THAN $50,000 AND NOT MORE 21
THAN $200,000, AS DETERMINED BY THE COMMISSIONER FOR EA CH LICENSEE. 22
(2) IN SETTING THE AMOUNT OF THE SURETY BOND , THE 23
COMMISSIONER MAY CONS IDER: 24
(I) THE NATURE AND VOLUME OF THE BUSINESS OR P ROPOSED 25
BUSINESS OF THE LICE NSEE OR APPLICANT ; 26
(II) THE FINANCIAL CONDITI ON OF THE LICENSEE O R 27
APPLICANT, INCLUDING: 28
1. THE AMOUNT, NATURE, QUALITY, AND LIQUIDITY OF 29
THE ASSETS OF THE LI CENSEE OR APPLICANT ; 30 20 HOUSE BILL 686
2. THE AMOUNT AND NATURE OF THE LIABILITIES , 1
INCLUDING CONTINGENT LIABILITIES, OF THE LICENSEE OR A PPLICANT; 2
3. THE HISTORY OF AND PR OSPECTS FOR THE LICENSEE 3
OR APPLICANT TO EARN AND RETAIN INCOME ; AND 4
4. THE POTENTIAL HARM TO CONSUMERS IF THE 5
APPLICANT OR LICENSE E BECOMES FINANCIALL Y IMPAIRED; 6
(III) THE QUALITY OF THE OP ERATIONS OF THE LICE NSEE OR 7
APPLICANT; 8
(IV) THE QUALITY OF THE MANAGEMENT OF THE LI CENSEE OR 9
APPLICANT; 10
(V) THE NATURE AND QUALIT Y OF THE PERSON THAT HAS 11
CONTROL OF THE LICEN SEE OR APPLICANT ; AND 12
(VI) ANY OTHER FACTOR THAT THE COMMISSIONER CONSIDER S 13
RELEVANT. 14
[11–208. 15
(a) (1) Each license provided for through NMLS shall include the following 16
information: 17
(i) The name of the licensee; 18
(ii) The address of the location at which the business is to be 19
conducted; and 20
(iii) The unique identifier of the licensee. 21
(2) The unique identifier of the licensee shall constitute the license number 22
for the license. 23
(b) (1) A license authorizes the licensee to do business under the license, at the 24
licensed location and under the name stated on the license. 25
(2) Only one location may be maintained under any one license. 26
(c) Subject to § 11–203.1(b) of this subtitle, the Commissioner may issue more 27
than one license to an applicant who: 28
HOUSE BILL 686 21
(1) Conducts activities for which a license is required at more than one 1
location; 2
(2) Complies with § 11–206 of this subtitle; and 3
(3) Otherwise meets the requirements of this subtitle.] 4
11–208. 5
(A) INFORMATION IN NMLS ASSOCIATED WITH A LI CENSE APPROVED BY 6
THE COMMISSIONER UNDER TH IS SUBTITLE SHALL IN CLUDE THE FOLLOWING : 7
(1) THE LICENSEE’S LEGAL NAME AND ANY TRADE NAME USED BY 8
THE LICENSEE IN ACCO RDANCE WITH § 2–121 OF THIS ARTICLE; 9
(2) THE ADDRESS OF THE LI CENSEE’S PRINCIPAL EXECUTIV E 10
OFFICE; AND 11
(3) THE ADDRESS OF EACH A DDITIONAL LOCATION , IF ANY, WHERE 12
THE LICENSEE DOES BU SINESS AND THAT : 13
(I) THE GENERAL PUBLIC MA Y REASONABLY VIEW AS A 14
LOCATION THAT MAKES LOANS, INCLUDING ANY LOCATI ON THAT INVESTIGATES 15
CUSTOMER COMPLAINTS OR DIRECTLY COMMUNIC ATES WITH CUSTOMERS 16
VERBALLY, ELECTRONICALLY , OR IN WRITING; 17
(II) HOUSES ANY CORE OPERA TIONAL INFRA STRUCTURE OR 18
TECHNOLOGY SYSTEMS ; 19
(III) CONDUCTS ANY CORE MAN AGEMENT, INFORMATION 20
SECURITY AND TECHNOL OGY, RISK AND COMPLIANCE , OR FINANCE FUNCTIONS ; OR 21
(IV) IS OTHERWISE REQUIRED TO BE LISTED IN NMLS BY 22
REGULATION THE COMMISSIONER ADOPTS U NDER THIS SUBTITLE. 23
(B) A LICENSEE SHALL MAINT AIN AND UPDATE THE I NFORMATION IN 24
NMLS ASSOCIATED WITH THE LICENSEE’S LICENSE TO REFLECT ACCURATELY AT 25
ALL TIMES THE INFORM ATION REQUIRED BY SU BSECTION (A) OF THIS SECTION. 26
(C) THE UNIQUE IDENTIFIER OF THE LICENSEE SHALL CONSTITUTE THE 27
LICENSE NUMBER FOR T HE LICENSE. 28
(D) A LICENSE AUTHORIZES T HE LICENSEE TO DO BU SINESS UNDER THE 29
LICENSE AT ANY LICEN SED LOCATION AND UND ER ANY LICENSED NAME , OR AS 30 22 HOUSE BILL 686
OTHERWISE AUTHORIZED BY THE COMMISSIONER THROUGH REGULATION . 1
11–210. 2
(b) (1) Each licensee shall conspicuously post, in 48 point or larger type, at 3
[the licensee’s] EACH licensed location the following information: 4
(i) The licensee’s unique identifier; and 5
(ii) A statement advising consumers of the availability of the NMLS 6
Consumer Access website to verify the licensing status of the licensee. 7
(c) A licensee is not required to post the information required in subsection (b)(1) 8
of this section AT A LICENSED LOCATI ON if the licensee does not REGULARLY grant 9
[regular] access to [the] THAT licensed location to members of the general public. 10
[11–211. 11
A licensee may not change the location for which a license is issued unless the 12
licensee: 13
(1) Provides to the Commissioner, in the form and in accordance with the 14
process that the Commissioner requires, notice of the proposed change; and 15
(2) Receives the written consent of the Commissioner by United States 16
mail, e–mail, or any means provided through NMLS.] 17
11–211. 18
(A) A LICENSEE MAY NOT ADD , DELETE, OR MODIFY A LOCATION REQUIRED 19
TO BE LISTED IN NMLS UNDER § 11–208(A)(2) OR (3) OF THIS SUBTITLE UNL ESS: 20
(1) THE LICENSEE PROVIDES TO THE COMMISSIONER , THROUGH 21
NMLS AND IN ACCORDANCE WI TH ANY REGULATIONS T HE COMMISSIONER ADOPTS , 22
NOTICE OF THE ADDITI ON, DELETION, OR MODIFICATION ; 23
(2) THE ADDITION, DELETION, OR MODIFICATION OF T HE LOCATION 24
IS RECORDED WITH THE INFORMATION ASSOCIAT ED WITH THE LICENSEE ’S LICENSE 25
IN NMLS; AND 26
(3) THE ADDITION, DELETION, OR MODIFICATION OF T HE LOCATION 27
OTHERWISE COMPLIES W ITH THIS SUBTITLE. 28
(B) THE LICENSEE MAY NOT DO BUSINESS AT A LOC ATION REQUIRED TO BE 29
LISTED IN NMLS BY § 11–208(A)(2) OR (3) OF THIS SUBTITLE UNT IL THE LOCATION 30 HOUSE BILL 686 23
IS RECORDED WITH THE INFORMATION ASSOCIAT ED WITH THE LICENSEE ’S LICENSE 1
IN NMLS. 2
11–401. 3
(a) In this subtitle the following words have the meanings indicated. 4
(b) “Agreement” means an installment sale agreement, a renewed or extended 5
installment sale agreement, and any renewal, extension, or refund agreement made in 6
connection with an installment sale agreement. 7
(c) [“Branch location” means any location other than the principal executive office 8
of a licensee or license applicant at which the licensee conducts, or the license applicant, on 9
licensure, will conduct, activities required to be licensed under this subtitle. 10
(d)] (1) “Buyer” means a person who buys or leases goods under an installment 11
sale agreement, even though the person has entered into one or more renewal, extension, 12
or refund agreements. 13
(2) “Buyer” includes a prospective buyer. 14
[(e)] (D) (1) “Collateral security” means any security interest in, 15
encumbrance on, or pledge of property or goods that is given to secure performance of an 16
obligation of a buyer or a surety for a buyer under an agreement. 17
(2) “Collateral security” includes the undertaking of a surety for a buyer. 18
(3) “Collateral security” does not include any goods or interest in goods that 19
are the subject of an installment sale agreement. 20
[(f)] (E) (1) “Control person” means a person who has the power, directly or 21
indirectly, to direct the management or policies of a licensee or license applicant, whether 22
through ownership of securities, by contract, or otherwise. 23
(2) “Control person” includes a person who: 24
(i) Is a general partner, an officer, a director, or a member of a 25
licensee or license applicant, or occupies a similar position or performs a similar function; 26
(ii) Directly or indirectly has the right to vote 20% or more of a class 27
of voting securities, or has the power to sell or direct the sale of 20% or more of a class of 28
voting securities, of a licensee or license applicant; or 29
(iii) In the case of a partnership, a limited partnership, a limited 30
liability partnership, a limited liability company, or any other business entity: 31
24 HOUSE BILL 686
1. Has the right to receive on liquidation or dissolution of a 1
licensee or license applicant 20% or more of the capital of the licensee or license applicant; 2
or 3
2. Has contributed 20% or more of the capital of a licensee or 4
license applicant. 5
[(g)] (F) (1) “Goods” means all tangible personal property that has a cash 6
price of $25,000 or less. 7
(2) “Goods” does not include money or things in action. 8
[(h)] (G) (1) “Installment sale agreement” means a contract for the retail sale 9
of consumer goods, negotiated or entered into in this State, under which: 10
(i) Part or all of the price is payable in one or more payments after 11
the making of the contract; and 12
(ii) The seller takes collateral security or keeps a security interest in 13
the goods sold. 14
(2) “Installment sale agreement” includes: 15
(i) A prospective installment sale agreement; 16
(ii) A purchase money security agreement; and 17
(iii) A contract for the bailment or leasing of consumer goods under 18
which the bailee or lessee contracts to pay as compensation a sum that is substantially 19
equal to or is more than the value of the goods. 20
(3) “Installment sale agreement” does not include: 21
(i) A bona fide C.O.D. transaction or a layaway agreement as 22
defined in § 14–1101(g) of the Commercial Law Article; or 23
(ii) A lease for industrial, commercial, or agricultural purposes. 24
[(i)] (H) “License” means a license issued in any form by the Commissioner 25
under this subtitle to [engage in] DO business as a sales finance company, including as 26
provided for through NMLS. 27
(I) “LICENSED LOCATION ” MEANS ANY LOCATION L ISTED BY THE LICENSE E 28
IN NMLS IN ACCORDANCE WITH T HIS SUBTITLE. 29
(J) “LICENSED NAME ” MEANS: 30 HOUSE BILL 686 25
(1) THE LICENSEE’S LEGAL NAME; AND 1
(2) ANY TRADE NAME USED B Y THE LICENSEE IN AC CORDANCE WITH 2
§ 2–121 OF THIS ARTICLE. 3
[(i–1)] (K) “Licensee” means a person licensed under this subtitle to [engage in] 4
DO business as a sales finance company. 5
[(j)] (L) “Person” includes an individual, corporation, business trust, statutory 6
trust, estate, trust, partnership, association, two or more persons having a joint or common 7
interest, or any other legal or commercial entity. 8
[(k)] (M) “Retail sale” means the sale of goods for use or consumption by the 9
buyer or for the benefit or satisfaction that the buyer may derive from the use or 10
consumption of the goods by another, but not for resale by the buyer. 11
[(l)] (N) “Sales finance company” means a person who is engaged, whether by 12
purchase, discount, pledge, loan, or otherwise, in the business of acquiring, investing in, or 13
lending money or credit on the security of any interest in: 14
(1) An installment sale agreement made between other parties; 15
(2) A retail credit account transaction, as defined in § 12–501 of the 16
Commercial Law Article, made between other parties; or 17
(3) A transaction that deals with home improvement, as defined in § 8–101 18
of the Business Regulation Article, made between other parties, if collateral security is 19
required by and given to the contractor as a condition to the transaction. 20
[(m)] (O) “Security interest” has the meaning stated in § 1–201(37) of the 21
Commercial Law Article. 22
[(n)] (P) “Seller” means a person who sells or leases or agrees to sell or lease 23
goods under an installment sale agreement. 24
[(o)] (Q) (1) “Surety” includes a guarantor. 25
(2) “Surety” does not include a seller who sells, transfers, or assigns an 26
agreement. 27
[(p)] (R) “Unique identifier” means a number or another identifier assigned by 28
NMLS. 29
11–402.1. 30
26 HOUSE BILL 686
(a) All revenue received for the licensing AND ASSESSMENT of persons under this 1
subtitle and any other fee, investigation fee or assessment, or revenue received by the 2
Commissioner under this subtitle shall be: 3
(1) Credited to the [Nondepository] NON–DEPOSITORY Special Fund 4
established under [§ 11–610] § 2–120 of this [title] ARTICLE; and 5
(2) Used in accordance with [§ 11–610(c)] § 2–120(D) of this [title] 6
ARTICLE. 7
(C) SUBJECT TO § 2–120(H) OF THIS ARTICLE , THE COMMISSIONER MAY 8
IMPOSE AN ANNUAL ASS ESSMENT ON ANY LICEN SEE UNDER THI S SUBTITLE. 9
11–403. 10
(b) A [separate license is required for the principal executive office and each 11
branch location where a person engages in business as a sales finance company] LICENSEE 12
MAY DO BUSINESS AS A SALES FINANCE COMPAN Y ONLY AT A LICENSED LOCATION 13
OR AS OTHERWISE AUTH ORIZED BY THE COMMISSIONER THROUGH REGULATION . 14
11–404. 15
(a) (2) The application shall include: 16
(i) The applicant’s LEGAL name[, the] AND ANY TRADE NAME 17
USED BY THE APPLICAN T IN ACCORDANCE WITH § 2–121 OF THIS ARTICLE; 18
(II) THE applicant’s principal executive office address[, and, if]; 19
(III) IF the applicant is not an individual, the name and residence 20
address of each control person; 21
[(ii)] (IV) The address of each [branch] ADDITIONAL location, if 22
any, THAT: 23
1. THE GENERAL PUBLIC MA Y REASONABLY VIEW AS A 24
LOCATION THAT DOES B USINESS AS A SALES F INANCE COMPANY , INCLUDING ANY 25
LOCATION THAT INVEST IGATES CUSTOMER COMP LAINTS OR DIRECTLY 26
COMMUNICATES WITH CUSTO MERS VERBALLY , ELECTRONICALLY , OR IN WRITING; 27
2. HOUSES ANY CORE OPERA TIONAL INFRASTRUCTUR E 28
OR TECHNOLOGY SYSTEM S; 29
3. CONDUCTS ANY CORE MAN AGEMENT, INFORMATION 30 HOUSE BILL 686 27
SECURITY AND TECHNOL OGY, RISK AND COMPLIANCE , OR FINANCE FUNCTIONS ; OR 1
4. IS OTHERWISE REQUIRED TO BE LISTED IN NMLS BY 2
REGULATION THE COMMISSIONER ADOPTS U NDER THIS SUBTITLE ; and 3
[(iii)] (V) Any other pertinent information that the Commissioner 4
requires. 5
[(c) For the principal executive office and each branch location license for which 6
an applicant applies, the applicant shall: 7
(1) Submit a separate application; and 8
(2) Pay a separate investigation fee and license fee.] 9
11–406. 10
(a) In addition to the investigation fee required by § 11–404 of this subtitle, if an 11
applicant [applies for a license for a place of business that is located] REQUESTS ANY 12
LICENSED LOCATION outside of [this] THE State AND THE INVESTIGATIO N INCLUDES 13
TRAVEL TO THAT LOCATION , the applicant shall pay to the Commissioner, on 14
presentation by the Commissioner of a detailed account, the reasonable travel and living 15
expenses incurred on account of the investigation. 16
[11–408. 17
(a) (1) Each license provided for through NMLS shall include the following 18
information: 19
(i) The name of the licensee; 20
(ii) The address of the location at which the business will be 21
conducted; and 22
(iii) The unique identifier of the licensee. 23
(2) The unique identifier of the licensee shall constitute the license number 24
for the license. 25
(b) (1) A license authorizes the licensee to do business under the license, at the 26
licensed location and under the name stated on the license. 27
(2) Only one location may be maintained under any one license. 28
(c) Subject to § 11–403(b) of this subtitle, the Commissioner may issue more than 29
one license to an applicant who: 30 28 HOUSE BILL 686
(1) Conducts activities for which a license is required at more than one 1
branch location; 2
(2) Complies with §§ 11–404 and 11–406 of this subtitle; and 3
(3) Otherwise meets the requirements of this subtitle.] 4
11–408. 5
(A) INFORMATION IN NMLS ASSOCIATED WITH A LI CENSE APPROVED BY 6
THE COMMISSIONER UNDER TH IS SUBTITLE SHALL IN CLUDE THE FOLLOWING : 7
(1) THE LICENSEE’S LEGAL NAME AND ANY TRADE NAME USED BY 8
THE LICENSEE IN ACCO RDANCE WITH § 2–121 OF THIS ARTICLE; 9
(2) THE ADDRESS OF THE LI CENSEE’S PRINCIPAL EXECUTIV E 10
OFFICE; AND 11
(3) THE ADDRESS OF EACH A DDITIONAL LOCATION , IF ANY, WHERE 12
THE LICENSEE DOES BU SINESS AND THAT : 13
(I) THE GENERAL PUBLIC MA Y REASONABLY VIEW AS A 14
LOCATION THAT DOES B USINESS AS A SALES F INANCE COMPANY , INCLUDING ANY 15
LOCATION THAT INVEST IGATES CUSTOMER COMP LAINTS OR DIRECTLY 16
COMMUNICATES WITH CU STOMERS VERBALLY , ELECTRONICALLY , OR IN WRITING; 17
(II) HOUSES ANY CORE OPERA TIONAL INFRASTRUCTUR E OR 18
TECHNOLOGY SYSTEMS ; 19
(III) CONDUCTS ANY CORE MAN AGEMENT, INFORMATION 20
SECURITY AND TECHNOL OGY, RISK AND COMPLIANCE , OR FINANCE FUNCTIONS ; OR 21
(IV) IS OTHERWISE REQUIRED TO BE LISTED IN NMLS BY 22
REGULATIO N THE COMMISSIONER ADOPTS U NDER THIS SUBTITLE . 23
(B) A LICENSEE SHALL MAINT AIN AND UPDATE THE I NFORMATION IN 24
NMLS ASSOCIATED WITH THE LICENSEE’S LICENSE TO REFLECT ACCURATELY AT 25
ALL TIMES THE INFORM ATION REQUIRED BY SU BSECTION (A) OF THIS SECTION. 26
(C) THE UNIQUE IDENTIFIER OF THE LICENSEE SHAL L CONSTITUTE THE 27
LICENSE NUMBER FOR T HE LICENSE. 28
(D) A LICENSE AUTHORIZES T HE LICENSEE TO DO BU SINESS UNDER THE 29 HOUSE BILL 686 29
LICENSE AT ANY LICEN SED LOCATION AND UND ER ANY LICENSED NAME , OR AS 1
OTHERWISE AUTHORIZED BY THE COMMISSIONER THROUGH REGULATION . 2
11–410. 3
(b) (1) Each licensee shall conspicuously post, in 48 point or larger type, at 4
[the licensee’s] EACH licensed location the following information: 5
(i) The licensee’s unique identifier; and 6
(ii) A statement advising consumers of the availability of the NMLS 7
Consumer Access website to verify the licensing status of the licensee. 8
(c) A licensee is not required to post the information required in subsection (b)(1) 9
of this section AT A LICENSED LOCATI ON if the licensee does not REGULARLY grant 10
[regular] access to [the] THAT licensed location to members of the general public. 11
[11–411. 12
If a licensee changes the location for which a license is issued, the licensee 13
immediately shall provide to the Commissioner, in the form and in accordance with the 14
process that the Commissioner requires, notice of the change.] 15
11–411. 16
(A) A LICENSEE MAY NOT ADD , DELETE, OR MODIFY A LOCATION REQUIRED 17
TO BE LISTED IN NMLS UNDER § 11–408(A)(2) OR (3) OF THIS SUBTITLE UNL ESS: 18
(1) THE LICENSEE PROVIDES TO THE COMMISSIONER , THROUGH 19
NMLS AND IN ACCORDANCE WI TH ANY REGULATIONS T HE COMMISSIONER ADOPTS , 20
NOTICE OF THE ADDITI ON, DELETION, OR MODIFICATION ; 21
(2) THE ADDITION, DELETION, OR MODIFICATION OF T HE LOCATION 22
IS RECORDED WITH THE INFORMATION ASSO CIATED WITH THE LICE NSEE’S LICENSE 23
IN NMLS; AND 24
(3) THE ADDITION, DELETION, OR MODIFICATION OF T HE LOCATION 25
OTHERWISE COMPLIES W ITH THIS SUBTITLE. 26
(B) THE LICENSEE MAY NOT DO BUSINESS AT A LOC ATION REQUIRED TO BE 27
LISTED IN NMLS BY § 11–408(A)(2) OR (3) OF THIS SUBTITLE UNT IL THE LOCATION 28
IS RECORDED WITH THE INFORMATION ASSOCIAT ED WITH THE LICENSEE ’S LICENSE 29
IN NMLS. 30
30 HOUSE BILL 686
11–414. 1
[(a)] Subject to the hearing provisions of § 11–415 of this subtitle, the 2
Commissioner may suspend or revoke the license of any licensee, if: 3
(1) The licensee knowingly or without exercising due care: 4
(i) Violates any provision of this subtitle or of any other law that 5
regulates agreements; or 6
(ii) Fails to comply with any demand or requirement that the 7
Commissioner makes under this subtitle; 8
(2) The licensee makes any material misstatement in an application for a 9
license; 10
(3) The licensee defrauds any buyer, to the buyer’s damage; 11
(4) The licensee willfully fails to carry out any written agreement with a 12
buyer; 13
(5) The licensee knowingly and repeatedly violates any provision of the 14
Maryland Consumer Debt Collection Act; 15
(6) An officer, director, or trustee of or partner in the licensee is responsible 16
for any act or omission that would be a ground for suspending or revoking a license; or 17
(7) Any agent or employee of the licensee is responsible for any act or 18
omission that would be a ground for suspending or revoking a license, if the licensee: 19
(i) Approves or knows of that or similar acts or omissions; and 20
(ii) After giving approval or learning of the act or omission, keeps 21
any benefit, proceeds, profit, or advantage resulting from the act or omission or otherwise 22
ratifies the act or omission. 23
[(b) If the licensee has more than one place of business, the Commissioner may 24
suspend or revoke only the licenses of the places of business to which the grounds for 25
suspension or revocation relate. However, if the Commissioner suspends or revokes the 26
license of one place of business and finds that the grounds for that action apply to any other 27
place of business, the Commissioner shall take the same action against the license for each 28
other place of business to which the grounds apply.] 29
11–501. 30
(a) In this subtitle the following words have the meanings indicated. 31
HOUSE BILL 686 31
(F–1) “LICENSED LOCATION ” MEANS ANY LOCATION L ISTED BY THE LICENSE E 1
IN NMLS IN ACCORDANCE WITH T HIS SUBTITLE. 2
(F–2) “LICENSED NAME ” MEANS: 3
(1) THE LICENSEE’S LEGAL NAME; AND 4
(2) ANY TRADE NAME USED B Y THE LICENSEE IN ACCORDANCE WI TH 5
§ 2–121 OF THIS ARTICLE. 6
11–503.1. 7
(b) The fees established by the Commissioner under this section TOGETHER 8
WITH ANY ASSESSMENTS OF LICENSEES UNDER T HIS SUBTITLE shall be reasonable 9
and set in a manner that will COLLECTIVELY produce funds sufficient to cover the [actual] 10
direct and indirect costs of [regulating] FULFILLING THE STATU TORY AND 11
REGULATORY DUTIES OF THE COMMISSIONER RELATED TO licensees in accordance 12
with [the provisions of] this subtitle. 13
11–503.2. 14
(a) All revenue received for the licensing AND ASSESSMENT of persons under this 15
subtitle and any other fee, examination or investigation fee or assessment, or revenue 16
received by the Commissioner under this subtitle shall be: 17
(1) Credited to the [Nondepository] NON–DEPOSITORY Special Fund 18
established under [§ 11–610] § 2–120 of this [title] ARTICLE; and 19
(2) Used in accordance with [§ 11–610(c)] § 2–120(D) of this [title] 20
ARTICLE. 21
(C) SUBJECT TO § 2–120(H) OF THIS ARTICLE , THE COMMISSIONER MAY 22
IMPOSE AN ANNUAL ASSESSMENT ON ANY LI CENSEE UNDER THIS SU BTITLE. 23
11–505. 24
(a) A license issued under this subtitle authorizes the licensee to act as a 25
mortgage lender under the license at [the] ANY licensed [place of business] LOCATION 26
AND UNDER ANY LICENS ED NAME, OR AS OTHERWISE AUTHORIZED BY THE 27
COMMISSIONER THROUGH REGULATION . 28
(b) [Only one place of business may be maintained under any one license] 29
EXCEPT AS PROVIDED IN SUBSECTION (C) OF THIS SECTION OR A S OTHERWISE 30
AUTHORIZED BY THE COMMISSIONER THROUGH REGULATION , A LICENSEE MAY DO 31
BUSINESS AS A MORTGA GE LENDER ONLY AT A LICENSED LOCATION . 32 32 HOUSE BILL 686
[(c) A mortgage lender may maintain more than one license under this subtitle 1
provided that a separate application for each license is made pursuant to § 11–507 of this 2
subtitle and the Commissioner approves such application. 3
(d) (1) (i) Each license provided for through NMLS shall include the 4
following information: 5
1. The name of the licensee; 6
2. The address at which the business is to be conducted; and 7
3. The unique identifier of the licensee. 8
(ii) The unique identifier of the licensee shall constitute the license 9
number for the license. 10
(2) A person may not conduct any mortgage loan business at any location 11
or under any name different from the address and name that appears on the person’s 12
license.] 13
[(e)] (C) (1) A licensee may not allow any note, or loan contract, mortgage, or 14
evidence of indebtedness secured by a secondary mortgage or deed of trust on a dwelling or 15
residential real estate to be signed or executed at any place [for which the person does not 16
have a license] OTHER THAN A LICENSE D LOCATION, except at the office of: 17
(i) The attorney for the borrower or for the licensee; or 18
(ii) A title insurance company, a title company, or an attorney for a 19
title insurance company or a title company. 20
(2) Notwithstanding paragraph (1) of this subsection, a licensee may 21
conduct the loan closing at another location at the written request of the borrower or the 22
borrower’s designee to accommodate the borrower because of the borrower’s sickness. 23
(3) The Commissioner shall adopt regulations to ensure that the loan 24
application process is conducted fairly and in a manner consistent with the best interests 25
of both the borrower and mortgage lender. 26
[(f)] (D) A license may be issued under this subtitle to a business entity whose 27
principal EXECUTIVE office is located outside [this] THE State [provided that] IF the 28
business entity maintains a resident agent within the State at all times during the term of 29
the license, regardless of whether: 30
(1) The business entity maintains any office within the State; or 31
HOUSE BILL 686 33
(2) The activities of the business entity constitute doing business or having 1
a tax situs in [this] THE State under the applicable provisions of the Corporations and 2
Associations Article. 3
[(g)] (E) A person exempt from licensing under this subtitle who employs a 4
mortgage loan originator licensed under Subtitle 6 of this title shall be registered with [the 5
Nationwide Mortgage Licensing System and Registry] NMLS. 6
(F) INFORMATION IN NMLS ASSOCIATED WITH A LI CENSE APPROVED BY 7
THE COMMISSIONER UNDER TH IS SUBTITLE SHALL IN CLUDE THE FOLLOWING : 8
(1) THE LICENSEE’S LEGAL NAME AND ANY TRADE NAME USED BY 9
THE LICENSEE IN ACCO RDANCE WITH § 2–121 OF THIS ARTICLE; 10
(2) THE ADDRESS OF THE LI CENSEE’S PRINCIPAL EXECUTIV E 11
OFFICE; AND 12
(3) THE ADDRESS OF EACH A DDITIONAL LOCATION , IF ANY, WHERE 13
THE LICENSEE DOES BU SINESS AND THAT: 14
(I) THE GENERAL PUBLIC MA Y REASONABLY VIEW AS A 15
LOCATION THAT DOES B USINESS AS A MORTGAG E LENDER, INCLUDING ANY 16
LOCATION THAT INVEST IGATES CUSTOMER COMP LAINTS OR DIRECTLY 17
COMMUNICATES WITH CU STOMERS VERBALLY , ELECTRONICALLY , OR IN WRITING; 18
(II) HOUSES ANY CORE OPERA TIONAL INFRASTRUCTUR E OR 19
TECHNOLOGY SYSTEMS ; 20
(III) CONDUCTS ANY CORE MAN AGEMENT, INFORMATION 21
SECURITY AND TECHNOL OGY, RISK AND COMPLIANCE , OR FINANCE FUNCTIONS ; OR 22
(IV) IS OTHERWISE REQUIRED TO BE LISTED IN NMLS BY 23
REGULATION THE COMMISSIONER ADOPTS U NDER THIS SUBTITLE . 24
(G) A LICENSEE SHALL MAINT AIN AND UPDATE THE I NFORMATION IN 25
NMLS ASSOCIATED WITH THE LICENSEE’S LICENSE TO REFLECT ACCURATELY AT 26
ALL TIMES THE INFORM ATION REQUIRED BY SU BSECTION (F) OF THIS SECTION. 27
(H) THE UNIQUE IDENTIFIER OF THE LICENSEE SHAL L CONSTITUTE THE 28
LICENSE NUMBER FOR T HE LICENSE. 29
(I) A LICENSEE MAY NOT CON DUCT ANY BUSINESS AS A MORTGAGE 30
LENDER: 31
34 HOUSE BILL 686
(1) UNDER ANY NAME OTHER THAN A LICENSED NAME ; OR 1
(2) EXCEPT AS PROVIDED IN SUBSECTION (C) OF THIS SECTION OR A S 2
OTHERWISE AUTHORIZED BY THE COMMISSIONER THROUGH REGULATION , AT A 3
LOCATION OTHER THAN A LICENSED LOCATION . 4
11–506.1. 5
(b) In connection with an initial application for a license under § 11–507 of this 6
subtitle, and at any other time the Commissioner requests, an applicant or licensee shall 7
provide to [the Nationwide Mortgage Licensing System and Registry] NMLS information 8
concerning the applicant’s identity, including: 9
(1) Fingerprints for submission to the Federal Bureau of Investigation, and 10
any other governmental agency or entity authorized to receive this information, for a state, 11
national, or international criminal history background check; and 12
(2) Personal history and experience in a form prescribed by [the 13
Nationwide Mortgage Licensing System and Registry] NMLS, including the submission of 14
authorization for [the Nationwide Mortgage Licensing System and Registry] NMLS and 15
the Commissioner to obtain: 16
(i) An independent credit report from a consumer reporting agency 17
described in the federal Fair Credit Reporting Act, 15 U.S.C. § 1681a(p); and 18
(ii) Information related to any administrative, civil, or criminal 19
findings by any governmental jurisdiction. 20
(c) The Commissioner may request from the Federal Bureau of Investigation or 21
[the Nationwide Mortgage Licensing System and Registry] NMLS, as applicable, for each 22
applicant or licensee who is required to provide fingerprints under subsection (b) of this 23
section: 24
(1) (i) The state, national, or international criminal history records of 25
the applicant or licensee; and 26
(ii) A printed statement listing any conviction or other disposition of, 27
and any plea of guilty or nolo contendere to, any criminal charge; 28
(2) (i) An update of the initial criminal history records check or 29
criminal history background check of the applicant or licensee; and 30
(ii) A revised statement listing any conviction or other disposition of, 31
and any plea of guilty or nolo contendere to, any criminal charge occurring after the date 32
of the initial criminal history records check or criminal history background check; and 33
HOUSE BILL 686 35
(3) An acknowledged receipt of the application for a criminal history 1
records check or criminal history background check of the applicant or licensee. 2
(d) An applicant or licensee who is required to provide fingerprints under 3
subsection (b) of this section shall pay any processing or other fees required by the Federal 4
Bureau of Investigation and [the Nationwide Mortgage Licensing System and Registry] 5
NMLS. 6
(e) To implement this subtitle, the Commissioner may use [the Nationwide 7
Mortgage Licensing System and Registry] NMLS as a channeling agent to request 8
information from and distribute information to the Department of Justice, any other 9
governmental agency with subject matter jurisdiction, and any other state licensing entity 10
that has loan originators registered with [the Nationwide Mortgage Licensing System and 11
Registry] NMLS. 12
11–507. 13
(a) (1) To apply for a license, an applicant shall: 14
(i) Complete, sign, and submit to the Commissioner an application 15
made under oath in the form, and in accordance with the process, that the Commissioner 16
requires; and 17
(ii) Provide all information that the Commissioner requests. 18
(2) THE APPLICATION SHALL INCLUDE: 19
(I) THE APPLICANT’S LEGAL NAME AND ANY TRADE NAME USED 20
BY THE APPLICANT IN ACCORDANCE WITH § 2–121 OF THIS ARTICLE; 21
(II) THE APPLICANT’S PRINCIPAL EXECUTIV E OFFICE ADDRESS ; 22
(III) IF THE APPLICANT IS N OT AN INDIVIDUAL, THE NAME AND 23
RESIDENCE ADDRESS OF EACH CONTROL PERSON ; 24
(IV) THE ADDRESS OF EACH A DDITIONAL LOCATION , IF ANY, 25
THAT: 26
1. THE GENERAL PUBLIC MA Y REASONABLY VIEW AS A 27
LOCATION THAT DOES B USINESS AS A MORTGAG E LENDER, INCLUDING ANY 28
LOCATION THAT INVESTIGATES CUSTOMER COMPLAINTS OR DIRECTLY 29
COMMUNICATES WITH CU STOMERS VERBALLY , ELECTRONICALLY , OR IN WRITING; 30
2. HOUSES ANY CORE OPERA TIONAL INFRASTRUCTUR E 31
OR TECHNOLOGY SYSTEM S; 32 36 HOUSE BILL 686
3. CONDUCTS ANY CORE MAN AGEMENT, INFORMATION 1
SECURITY AND TECHNOLOGY , RISK AND COMPLIANCE , OR FINANCE FUNCTIONS ; OR 2
4. IS OTHERWISE REQUIRED TO BE LISTED IN NMLS BY 3
REGULATION THE COMMISSIONER ADOPTS U NDER THIS SUBTITLE ; AND 4
(V) ANY OTHER PERTINENT I NFORMATION THAT THE 5
COMMISSIONER REQUIRES . 6
(3) The applicant shall comply with all conditions and provisions of the 7
application for licensure and be issued a license before acting as a mortgage lender [at a 8
particular location]. 9
(b) [With each application, the] THE applicant shall pay to the Commissioner the 10
following fees: 11
(1) A nonrefundable investigation fee set by the Commissioner; and 12
(2) A nonrefundable license fee set by the Commissioner. 13
(c) In addition to the license fee required under subsection (b)(2) of this section, 14
an applicant for an initial license shall pay to [the Nationwide Mortgage Licensing System 15
and Registry] NMLS any fees that [the Nationwide Mortgage Licensing System and 16
Registry] NMLS imposes in connection with the application. 17
(d) [For each license for which an applicant applies, the applicant shall: 18
(1) Submit a separate application; 19
(2) Pay a separate nonrefundable license fee; 20
(3) Pay any application processing fee or other fees that the Nationwide 21
Mortgage Licensing System and Registry imposes in connection with the application; 22
(4) If applicable, pay the surcharge; and 23
(5) File a separate surety bond or other financial guaranty under § 11–508 24
of this subtitle. 25
(e)] In addition to any sanctions that may be imposed under this subtitle by the 26
Commissioner, a nonrefundable surcharge of $500 shall be paid [with]: 27
(1) WITH an application if the applicant has begun acting as a mortgage 28
lender without a license [at the location for which an application is filed]; AND 29 HOUSE BILL 686 37
(2) BY A LICENSEE IF THE LICENSEE HAS ACTED A S A MORTGAGE 1
LENDER AT A LOCATION THAT IS NOT A LICENS ED LOCATION. 2
[(f)] (E) A person who knowingly makes a false statement under oath on an 3
application filed with the Commissioner under this section is guilty of perjury and on 4
conviction is subject to the penalties of § 9–101 of the Criminal Law Article. 5
11–508. 6
(a) With the application for a [new] license, an applicant shall file a surety bond 7
with the Commissioner. 8
[(c) (1) If an applicant has not conducted a mortgage lending business any time 9
during the 36 months prior to the filing of an original application for a license, the applicant 10
shall provide a sworn statement setting forth that fact. 11
(2) If an applicant has conducted a mortgage lending business any time 12
during the 36 months prior to the filing of an original application, the applicant shall 13
provide a sworn statement setting forth the aggregate principal amount of mortgage loans 14
secured or to be secured by property located in Maryland and applied for and accepted or 15
serviced or mortgage loans secured or to be secured by property located in Maryland and 16
applied for, procured, and accepted or serviced by the mortgage lender during the 12 17
months immediately preceding the month in which the application is filed. 18
(3) If an applicant has conducted a mortgage lending business any time 19
during the 36 months prior to the filing of an original application, but during that time has 20
not acted as a mortgage lender in Maryland, the applicant shall provide with the original 21
application a sworn statement setting forth the aggregate principal amount of loans 22
secured or to be secured by a dwelling or residential real estate located in states other than 23
Maryland and applied for, procured, and accepted or serviced by the mortgage lender 24
during the 12 months preceding the month in which the application is filed. 25
(4) Except as provided in subsection (d) of this section, the applicant shall 26
file with the original application: 27
(i) Where the aggregate principal amount of loans set forth in the 28
sworn statement was $3,000,000 or less, a surety bond in the amount of $50,000; 29
(ii) Where the aggregate principal amount of loans set forth in the 30
sworn statement was more than $3,000,000 but not more than $10,000,000, a surety bond 31
in the amount of $100,000; and 32
(iii) Where the aggregate principal amount of loans set forth in the 33
sworn statement was more than $10,000,000, a surety bond in the amount of $150,000.] 34
38 HOUSE BILL 686
(C) (1) THE AMOUNT OF THE SUR ETY BOND UNDE R SUBSECTION (B) OF 1
THIS SECTION SHALL B E IN AN AMOUNT OF NO T LESS THAN $50,000 AND NOT MORE 2
THAN $750,000, AS DETERMINED BY THE COMMISSIONER FOR EACH LICENSEE. 3
(2) IN SETTING THE AMOUNT OF THE SURETY BOND , THE 4
COMMISSIONER MAY CONS IDER: 5
(I) THE NATURE AND VOLUME OF TH E BUSINESS OR PROPOS ED 6
BUSINESS OF THE LICE NSEE OR APPLICANT ; 7
(II) THE FINANCIAL CONDITI ON OF THE LICENSEE O R 8
APPLICANT, INCLUDING: 9
1. THE AMOUNT, NATURE, QUALITY, AND LIQUIDITY OF 10
THE ASSETS OF THE LI CENSEE OR APPLICANT ; 11
2. THE AMOUNT AND NATURE OF THE LIABILITIES , 12
INCLUDING CONTINGENT LIABILITIES, OF THE LICENSEE OR A PPLICANT; 13
3. THE HISTORY OF AND PR OSPECTS FOR THE LICE NSEE 14
OR APPLICANT TO EARN AND RETAIN INCOME ; AND 15
4. THE POTENTIAL HARM TO CONSUMERS IF THE 16
APPLICANT OR LICENSEE BECOMES FINANCIALLY IMPAIRED; 17
(III) THE QUALITY OF THE OP ERATIONS OF THE LICE NSEE OR 18
APPLICANT; 19
(IV) THE QUALITY OF THE MA NAGEMENT OF THE LICE NSEE OR 20
APPLICANT; 21
(V) THE NATURE AND QUALIT Y OF THE PERSON THAT HAS 22
CONTROL OF THE LICENSEE OR APPL ICANT; AND 23
(VI) ANY OTHER FACTOR THAT THE COMMISSIONER CONSIDER S 24
RELEVANT. 25
[(d) Notwithstanding any other provisions of this section, and subject to approval 26
by the Commissioner, if an applicant files five or more original or renewal applications at 27
the same time, the applicant may provide a blanket surety bond for all licensed offices in 28
the amount of $750,000.] 29
[(e)] (D) Subject to approval by the Commissioner, an applicant for license who 30
files an application for a new license may satisfy the bonding requirement under this 31 HOUSE BILL 686 39
section by establishing a trust account with or obtaining an irrevocable letter of credit from 1
a financial institution insured by the Federal Deposit Insurance Corporation in an amount 2
equal to the bond required under this section. 3
[(f)] (E) (1) The Commissioner may adopt regulations reasonably necessary 4
to assure that the proper surety bond amount established by this section is maintained by 5
each licensee throughout each licensing term. 6
(2) The regulations may provide for periodic reporting, recalculation, and 7
enforcement of required bond amounts. 8
[(g)] (F) If a mortgage servicer is subject to a receivership proceeding, the 9
Commissioner or a receiver appointed under § 7–404.1(b)(2) or § 7–506(b) of the Real 10
Property Article, without regard to any priorities, preferences, or adverse claims, may: 11
(1) Reduce the bond or the deposit in lieu of a bond to cash; and 12
(2) Use the cash to defray the costs associated with the receivership. 13
11–511. 14
(a) Subject to any regulations the Commissioner adopts in connection with the 15
transition to [the Nationwide Mortgage Licensing System and Registry] NMLS, an initial 16
license term shall: 17
(1) Begin on the day the license is issued; and 18
(2) Expire on December 31 of the year: 19
(i) The license is issued, if the license is issued before November 1; 20
or 21
(ii) Succeeding the year that the license is issued, if the license is 22
issued on or after November 1. 23
(c) Subject to any regulations the Commissioner adopts in connection with the 24
transition to [the Nationwide Mortgage Licensing System and Registry] NMLS, a renewal 25
term shall: 26
(1) Be for a period of 1 year; 27
(2) Begin on January 1 of each year after the initial term; and 28
(3) Expire on December 31 of the year the renewal term begins. 29
(d) In addition to the license renewal fee required under subsection (b)(2) of this 30 40 HOUSE BILL 686
section, an applicant for a license renewal shall pay to [the Nationwide Mortgage Licensing 1
System and Registry] NMLS any fees that [the Nationwide Mortgage Licensing System 2
and Registry] NMLS imposes in connection with the renewal application. 3
11–512. 4
[(a) (1) A licensee may not change the place of business for which a license is 5
issued unless the licensee: 6
(i) Notifies the Commissioner through NMLS of the proposed 7
change; and 8
(ii) Receives the approval of the Commissioner through NMLS. 9
(2) Within 60 days after receiving a request for approval of a proposed 10
change in the place of business for a licensee, the Commissioner shall approve or deny the 11
request. 12
(3) If the Commissioner does not approve or deny a request for approval of 13
a proposed change in the place of business for a licensee as provided under paragraph (2) 14
of this subsection, the request shall be deemed approved.] 15
(A) A LICENSEE MAY NOT ADD , DELETE, OR MODIFY A LOCATION REQUIRED 16
TO BE LISTED IN NMLS UNDER § 11–505(F)(2) OR (3) OF THIS SUBTITLE UNL ESS: 17
(1) THE LICENSEE PROVIDES TO THE COMMISSIONER , THROUGH 18
NMLS AND IN ACCORDANCE WI TH ANY REGULATIONS T HE COMMISSIONER ADOPTS, 19
NOTICE OF THE ADDITI ON, DELETION, OR MODIFICATION ; 20
(2) THE ADDITION, DELETION, OR MODIFICATION OF T HE LOCATION 21
IS RECORDED WITH THE INFORMATION ASSOCIAT ED WITH THE LICENSEE ’S LICENSE 22
IN NMLS; AND 23
(3) THE ADDITION, DELETION, OR MODIFICATI ON OF THE LOCATION 24
OTHERWISE COMPLIES W ITH THIS SUBTITLE. 25
(B) THE LICENSEE MAY NOT DO BUSINESS AT A LOC ATION REQUIRED TO BE 26
LISTED IN NMLS BY § 11–505(F)(2) OR (3) OF THIS SUBTITLE UNT IL THE LOCATION 27
IS RECORDED WITH THE INFORMATION ASSOCIAT ED WITH THE LICENSEE’S LICENSE 28
IN NMLS. 29
[(b)] (C) (1) A licensee may not undergo a change in control unless the 30
licensee: 31
(i) Notifies the Commissioner through NMLS of the proposed 32 HOUSE BILL 686 41
change; 1
(ii) Makes a request through NMLS that the Commissioner approve 2
the proposed change; 3
(iii) Provides any information the Commissioner may require under 4
paragraph (3) of this subsection; and 5
(iv) Receives the approval of the Commissioner through NMLS. 6
(2) For purposes of this subsection: 7
(i) If the licensee is a corporation, “control” means direct or indirect 8
ownership of, or the right to control, 25% or more of the voting shares of the licensee, or the 9
ability to elect a majority of the directors or otherwise effect a change in policy; and 10
(ii) If the licensee is an entity other than a corporation, “control” 11
means the possession, directly or indirectly, of the power to direct or cause the direction of 12
the management and policies of the licensee, whether through the ownership of voting 13
securities, by contract, or otherwise. 14
(3) Within 60 days after receiving a request for approval of a proposed 15
change in control, the Commissioner may require the licensee to provide any information 16
deemed necessary to determine whether a new application is required because of the 17
proposed change in control. 18
(4) The Commissioner shall approve or deny a request for approval of a 19
proposed change in control: 20
(i) Within 60 days after the date the Commissioner receives the 21
request; or 22
(ii) If the Commissioner requests information from the licensee 23
under paragraph (3) of this subsection, within 60 days after the date the information is 24
received by the Commissioner. 25
(5) If the Commissioner does not approve or deny a request for approval of 26
a proposed change in control as provided under paragraph (4) of this subsection, the request 27
shall be deemed approved. 28
[(c)] (D) In addition to any sanctions which may be imposed under this subtitle 29
by the Commissioner, a licensee who fails to provide in a timely manner the notice required 30
under subsection (a)(1) or [(b)(1)] (C)(1) of this section shall: 31
(1) For each such failure pay to the Commissioner a surcharge in the 32
amount of $500; and 33
42 HOUSE BILL 686
(2) For a licensee who fails to provide in a timely manner the notice 1
required under subsection [(b)(1)] (C)(1) of this section, file with the Commissioner an 2
application for a new license, together with all applicable application and investigation fees. 3
11–512.1. 4
(a) Each licensee shall conspicuously post, in 48 point or larger type, at [the 5
licensee’s] EACH licensed location the following information: 6
(1) The licensee’s unique identifier; and 7
(2) A statement advising consumers of the availability of the NMLS 8
Consumer Access website to verify the licensing status of the licensee. 9
(c) A licensee is not required to post the information required in subsection (a) of 10
this section AT A LICENSED LOCATI ON if the licensee does not regularly grant access to 11
[the] THAT licensed location to members of the general public. 12
11–513. 13
(a) Each licensee shall keep and make available to the Commissioner at the 14
licensee’s [place of business] LICENSED LOCATION any books and records that the 15
Commissioner, by rule or regulation, requires to enable the Commissioner to enforce: 16
(1) This subtitle; 17
(2) Any rule or regulation adopted under this subtitle; and 18
(3) Any other provision regulating the application, making, brokering, or 19
servicing of mortgage loans under Titles 12 through 14 of the Commercial Law Article. 20
(b) Subject to approval by the Commissioner, nothing in this section is to be 21
construed to prohibit a licensee from maintaining duplicate records or electronic 22
equivalents at the licensee’s [place of business] LICENSED LOCATION . 23
(c) Notwithstanding subsection (a) of this section, on approval of the 24
Commissioner, a licensee need not keep at the licensee’s [place of business] LICENSED 25
LOCATION any books and records otherwise required by the Commissioner under 26
subsection (a) of this section if the licensee: 27
(1) Makes the books and records available to the Commissioner at the 28
licensee’s [place of business] LICENSED LOCATION within 5 business days [of] AFTER the 29
Commissioner’s official request; and 30
(2) Retains the records for at least 61 months in a storage facility disclosed 31
to the Commissioner. 32 HOUSE BILL 686 43
11–601. 1
(a) In this subtitle the following words have the meanings indicated. 2
(f) “Fund” means the [Nondepository] NON–DEPOSITORY Special Fund 3
established under [§ 11–610] § 2–120 of this [subtitle] ARTICLE. 4
11–602. 5
(c) Each licensee shall obtain and maintain a valid unique identifier issued by 6
[the Nationwide Mortgage Licensing System and Registry] NMLS: 7
(1) On obtaining an initial or renewal license on or after July 1, 2009; or 8
(2) If the Commissioner has not joined [the Nationwide Mortgage 9
Licensing System and Registry] NMLS as of July 1, 2009, on or after the date that the 10
Commissioner joins, as instructed by the Commissioner by notice to the licensee. 11
[11–610. 12
(a) There is a Nondepository Special Fund that consists of: 13
(1) Revenue received for the licensing of individuals under this subtitle; 14
(2) Revenue received for the licensing of persons under Subtitle 2 of this 15
title; 16
(3) Revenue received for the licensing of persons under Subtitle 3 of this 17
title; 18
(4) Revenue received for the licensing of persons under Subtitle 4 of this 19
title; 20
(5) Revenue received for the licensing of persons under Subtitle 5 of this 21
title; 22
(6) Revenue received for the licensing of persons under Title 12, Subtitle 1 23
of this article; 24
(7) Revenue received for the licensing of persons under Title 12, Subtitle 4 25
of this article; 26
(8) Revenue received for the licensing of persons under Title 12, Subtitle 9 27
of this article; 28
44 HOUSE BILL 686
(9) Revenue received for the registration of persons under Title 12, Subtitle 1
10 of this article; 2
(10) Revenue received for the licensing of persons under Title 7 of the 3
Business Regulation Article; 4
(11) Revenue received for the licensing of persons under Title 14, Subtitle 5
19 of the Commercial Law Article; 6
(12) Income from the investments that the State Treasurer makes for the 7
Fund; and 8
(13) (i) Any other fee, examination or investigation fee or assessment, or 9
revenue received by the Commissioner under this subtitle, Subtitles 2, 3, 4, and 5 of this 10
title, Title 12, Subtitles 1, 4, 9, and 10 of this article, Title 12, Subtitle 14 of the Commercial 11
Law Article, and Title 14, Subtitles 12 and 19 of the Commercial Law Article; and 12
(ii) Any other fee or revenue received by the State Collection Agency 13
Licensing Board under Title 7 of the Business Regulation Article. 14
(b) Notwithstanding subsection (a) of this section: 15
(1) The Commissioner shall pay all fines and penalties collected by the 16
Commissioner under Title 2, Subtitle 1 of this article, this subtitle, Subtitles 2, 3, 4, and 5 17
of this title, Title 12, Subtitles 1, 4, 9, and 10 of this article, Title 12, Subtitle 14 of the 18
Commercial Law Article, and Title 14, Subtitles 12 and 19 of the Commercial Law Article 19
into the General Fund of the State; and 20
(2) The State Collection Agency Licensing Board shall pay all fines and 21
penalties collected by the Board under Title 7 of the Business Regulation Article into the 22
General Fund of the State. 23
(c) The purpose of the Fund is to cover the direct and indirect costs of fulfilling 24
the statutory and regulatory duties of the Commissioner and the State Collection Agency 25
Licensing Board related to: 26
(1) Title 2, Subtitle 1 of this article; 27
(2) This subtitle; 28
(3) Subtitle 2 of this title; 29
(4) Subtitle 3 of this title; 30
(5) Subtitle 4 of this title; 31
(6) Subtitle 5 of this title; 32 HOUSE BILL 686 45
(7) Title 12, Subtitle 1 of this article; 1
(8) Title 12, Subtitle 4 of this article; 2
(9) Title 12, Subtitle 9 of this article; 3
(10) Title 12, Subtitle 10 of this article; 4
(11) Title 7 of the Business Regulation Article; 5
(12) Title 12 of the Commercial Law Article; 6
(13) Title 14, Subtitles 12, 19, and 42 of the Commercial Law Article; 7
(14) Title 7, Subtitles 1, 3, 4, and 5 of the Real Property Article; 8
(15) Title 26, Subtitle 6 of the Education Article; and 9
(16) Any other expense authorized in the State budget. 10
(d) (1) The annual State budget shall include the costs and expenses of the 11
Commissioner and the State Collection Agency Licensing Board relating to subsection (c) 12
of this section. 13
(2) Any expenditures from the Fund to cover costs and expenses of the 14
Commissioner and the State Collection Agency Licensing Board relating to subsection (c) 15
of this section may be made only: 16
(i) With an appropriation from the Fund approved by the General 17
Assembly in the annual State budget; or 18
(ii) By the budget amendment procedure provided for in § 7–209 of 19
the State Finance and Procurement Article. 20
(3) If, in any fiscal year, the amount of the revenue collected by the 21
Commissioner and the State Collection Agency Licensing Board and deposited into the 22
Fund exceeds the actual appropriation for the Commissioner and the State Collection 23
Agency Licensing Board under paragraph (2)(i) of this subsection, the excess amount shall 24
be carried forward within the Fund. 25
(e) (1) The State Treasurer is the custodian of the Fund. 26
(2) The State Treasurer shall deposit payments received from the 27
Commissioner into the Fund. 28
(f) (1) (i) The Fund is a special, nonlapsing fund that is not subject to § 29 46 HOUSE BILL 686
7–302 of the State Finance and Procurement Article. 1
(ii) The Fund may not be deemed a part of the General Fund of the 2
State. 3
(2) Unless otherwise provided by law, no part of the Fund may revert or be 4
credited to: 5
(i) The General Fund of the State; or 6
(ii) Any other special fund of the State.] 7
11–612.1. 8
(a) The Commissioner shall set by regulation the fees provided for in this subtitle. 9
(b) The fees established by the Commissioner under this section shall be 10
reasonable and set in a manner that will produce funds sufficient to cover the actual direct 11
and indirect costs of regulating licensees in accordance with the provisions of this subtitle. 12
(c) The Commissioner shall publish the fee schedule set by the Commissioner. 13
(D) ALL REVENUE RECEIVED FOR THE LICENSING AN D ASSESSMENT OF 14
PERSONS UNDER THIS S UBTITLE AND ANY OTHE R FEE OR REVENUE THE 15
COMMISSIONER RECEIVES UNDER THIS SUBTITLE SHALL BE: 16
(1) CREDITED TO THE FUND; AND 17
(2) USED IN ACCORDANCE WI TH § 2–120(D) OF THIS ARTICLE. 18
(E) SUBJECT TO § 2–120(H) OF THIS ARTICLE , THE COMMISSIONER MAY 19
IMPOSE AN ANNUAL ASS ESSMENT ON ANY LICEN SEE UNDER THIS SUBTI TLE. 20
12–101. 21
(a) In this subtitle the following words have the meanings indicated. 22
(b) [“Branch location” means any location other than the principal executive office 23
of a licensee or license applicant at which the licensee conducts, or the license applicant, on 24
licensure, will conduct, activities required to be licensed under this subtitle. 25
(c)] (1) “Control person” means a person who has the power, directly or 26
indirectly, to direct the management or policies of a licensee or license applicant, whether 27
through ownership of securities, by contract, or otherwise. 28
(2) “Control person” includes a person who: 29 HOUSE BILL 686 47
(i) Is a general partner, an officer, a director, or a member, or 1
occupies a similar position or performs a similar function; 2
(ii) Directly or indirectly has the right to vote 5% or more of a class 3
of voting securities, or has the power to sell or direct the sale of 5% or more of a class of 4
voting securities, of a licensee or license applicant; or 5
(iii) In the case of a partnership, a limited partnership, a limited 6
liability partnership, a limited liability company, or any other business entity: 7
1. Has the right to receive on liquidation or dissolution of a 8
licensee or license applicant 5% or more of the capital of the licensee or license applicant; 9
or 10
2. Has contributed 5% or more of the capital of a licensee or 11
license applicant. 12
[(d)] (C) “Exempt entity” means an entity that is exempt from all requirements 13
of licensing as provided under § 12–103(b) and (c) of this subtitle. 14
[(e)] (D) “License” means a license issued in any form by the Commissioner 15
under this subtitle to provide check cashing services, including as provided for through 16
NMLS. 17
(E) (1) “LICENSED LOCATION ” MEANS ANY LOCATION L ISTED BY THE 18
LICENSEE IN NMLS IN ACCORDANCE WITH T HIS SUBTITLE. 19
(2) “LICENSED LOCATION” INCLUDES A MOBILE UN IT. 20
(F) “LICENSED NAME ” MEANS: 21
(1) THE LICENSEE’S LEGAL NAME; AND 22
(2) ANY TRADE NAME USED B Y THE LICENSEE IN AC CORDANCE WITH 23
§ 2–121 OF THIS ARTICLE. 24
[(f)] (G) “Licensee” means a person licensed under this subtitle to provide check 25
cashing services. 26
[(g)] (H) “Mobile unit” means a motor vehicle or other movable means from 27
which check cashing services are provided. 28
[(h)] (I) (1) “Payment instrument” means a check or a draft ordering a 29
person to pay money. 30
48 HOUSE BILL 686
(2) “Payment instrument” includes a money order. 1
[(i)] (J) “Provide check cashing services” means to accept or cash, for 2
compensation, a payment instrument regardless of the date of the payment instrument. 3
[(j)] (K) “Unique identifier” means a number or another identifier assigned by 4
NMLS. 5
12–104.1. 6
(a) All revenue received for the licensing AND ASSESSMENT of persons under this 7
subtitle and any other fee or revenue received by the Commissioner under this subtitle 8
shall be: 9
(1) Credited to the [Nondepository] NON–DEPOSITORY Special Fund 10
established under [§ 11–610] § 2–120 of this article; and 11
(2) Used in accordance with [§ 11–610(c)] § 2–120(D) of this article. 12
(C) SUBJECT TO § 2–120(H) OF THIS ARTICLE , THE COMMISSIONER MAY 13
IMPOSE AN ANNUA L ASSESSMENT ON ANY LICENSEE UNDER THIS SUBTITLE. 14
12–105. 15
(b) A [separate license is required for the principal executive office of the license 16
applicant or licensee at which, each branch location at which, and each mobile unit from 17
which, a person provides check cashing services] LICENSEE MAY PROVIDE CHECK 18
CASHING SERVICES ONL Y AT A LICENSED LOCA TION OR AS OTHERWISE AUTHORIZED 19
BY THE COMMISSIONER THROUGH REGULATION . 20
12–106. 21
To qualify for a license, an applicant shall satisfy the Commissioner that: 22
(1) The applicant’s business will promote the convenience and advantage 23
of the [community in which] COMMUNITIES WHERE the [applicant’s place of business, or 24
mobile unit, will be located] APPLICANT WILL OPERA TE A LICENSED LOCATI ON 25
OFFERING CHECK CASHI NG SERVICES; and 26
(2) The applicant or, if the applicant is not an individual, each of the 27
owners, officers, directors, or principals of the entity: 28
(i) Has sufficient experience, character, financial responsibility, and 29
general fitness to: 30
1. Command the confidence of the public; and 31 HOUSE BILL 686 49
2. Warrant the belief that the business will be operated 1
lawfully, honestly, fairly, and efficiently; and 2
(ii) Has not committed any act that would be a ground for suspension 3
or revocation of a license under this subtitle. 4
12–108. 5
(a) (2) The application shall include: 6
(i) The applicant’s LEGAL name[, the] AND ANY TRADE NAME 7
USED BY THE APPLICAN T IN ACCORDANCE WITH § 2–121 OF THIS ARTICLE; 8
(II) THE applicant’s principal executive office address[, and, if]; 9
(III) IF the applicant is not an individual, the name and residence 10
address of each control person; 11
[(ii)] (IV) The address of each [branch] ADDITIONAL location, if 12
any, THAT: 13
1. THE GENERAL PUBLIC MA Y REASONABLY VIEW AS A 14
LOCATION THAT PROVIDES CHECK C ASHING SERVICES , INCLUDING ANY LOCATI ON 15
THAT INVESTIGATES CU STOMER COMPLAINTS OR DIRECTLY COMMUNICATE S WITH 16
CUSTOMERS VERBALLY , ELECTRONICALLY , OR IN WRITING; 17
2. HOUSES ANY CORE OPERA TIONAL INFRASTRUCTUR E 18
OR TECHNOLOGY SYSTEM S; 19
3. CONDUCTS ANY CORE MAN AGEMENT, INFORMATION 20
SECURITY AND TECHNOL OGY, RISK AND COMPLIANCE , OR FINANCE FUNCTIONS ; OR 21
4. IS OTHERWISE REQUIRED TO BE LISTED IN NMLS BY 22
REGULATION THE COMMISSIONER ADOPTS U NDER THIS SUBTITLE ; 23
[(iii)] (V) If the [license is for] LICENSEE OPERATES a mobile unit, 24
the vehicle identification number of [the] EACH mobile unit and the geographic area [in 25
which the] WHERE EACH mobile unit will be operating; and 26
[(iv)] (VI) Any other information that the Commissioner requires for 27
an investigation and findings under § 12–109 of this subtitle. 28
[(c) For the principal executive office, each branch location, and each mobile unit 29
license for which an applicant applies, the applicant shall: 30 50 HOUSE BILL 686
(1) Submit a separate application; and 1
(2) Pay a separate investigation fee and license fee.] 2
[12–110. 3
(a) (1) Each license provided for through NMLS shall include the following 4
information: 5
(i) The name of the licensee; 6
(ii) 1. The address of the location at which check cashing services 7
will be provided; or 8
2. If the license is for a mobile unit, the vehicle identification 9
number of the mobile unit and the geographic area in which check cashing services will be 10
provided; and 11
(iii) The unique identifier of the licensee. 12
(2) The unique identifier of the licensee shall constitute the license number 13
for the license. 14
(b) (1) A license authorizes the licensee to provide check cashing services 15
under the name stated on the license and at the location at which, or if the license is for a 16
mobile unit the geographic area in which, check cashing services will be provided. 17
(2) Only one location, or one mobile unit, may be maintained under any one 18
license. 19
(c) Subject to § 12–105(b) of this subtitle, the Commissioner may issue more than 20
one license to an applicant who: 21
(1) Conducts activities for which a license is required at more than one 22
location; 23
(2) Complies with § 12–108 of this subtitle; and 24
(3) Otherwise meets the requirements of this subtitle.] 25
12–110. 26
(A) INFORMATION IN NMLS ASSOCIATED WITH A LI CENSE APPROVED BY 27
THE COMMISSIONER UNDER TH IS SUBTITLE SHALL IN CLUDE THE FOLLOWING : 28
HOUSE BILL 686 51
(1) THE LICENSEE’S LEGAL NAME AND ANY TRADE NAME USED BY 1
THE LICENSEE IN ACCO RDANCE WITH § 2–121 OF THIS ARTICLE; 2
(2) THE ADDRESS OF THE LI CENSEE’S PRINCIPAL EXECUTIV E 3
OFFICE; 4
(3) THE ADDRESS OF EACH A DDITIONAL LOCATION , IF ANY, WHERE 5
THE LICENSEE DOES BU SINESS AND THAT : 6
(I) THE GENERAL PUBLIC MA Y REASONABLY VIEW AS A 7
LOCATION THAT OFFERS CHECK CASHING SERVIC ES, INCLUDING ANY LOCATIO N 8
THAT INVESTIGATES CU STOMER COMPLAINTS OR DIRECTLY COMMUNICATE S WITH 9
CUSTOMERS VERBALLY , ELECTRONICALLY , OR IN WRITING; 10
(II) HOUSES ANY CORE OPERA TIONAL INFRASTRUCTUR E OR 11
TECHNOLOGY SYSTEMS ; 12
(III) CONDUCTS ANY CORE MAN AGEMENT, INFORMATION 13
SECURITY AND TECHNOL OGY, RISK AND COMPLIANCE , OR FINANCE FUNCTIONS ; OR 14
(IV) IS OTHERWISE REQUIRED TO BE LISTED IN NMLS BY 15
REGULATION THE COMMISSIONER ADOPTS U NDER THIS SUBTITLE ; AND 16
(4) THE INFORMATION REQUI RED BY § 12–108(A)(2)(V) OF THIS 17
SUBTITLE FOR EACH MO BILE UNIT, IF ANY, OF THE LICENSEE . 18
(B) A LICENSEE SHALL MAINT AIN AND UPDATE THE I NFORMATION IN 19
NMLS ASSOCIATED WITH THE LICENSEE’S LICENSE TO REFLECT ACCURATELY AT 20
ALL TIMES THE INFORM ATION REQUIRED BY SU BSECTION (A) OF THIS SECTION. 21
(C) THE UNIQUE IDENTIFIER ASSIGNED BY NMLS TO A LICENSEE SHALL 22
CONSTITUTE THE LICEN SEE’S LICENSE NUMBER . 23
(D) A LICENSE AUTHORIZES T HE LICENSEE TO DO BU SINESS UNDER THE 24
LICENSE AT ANY LICEN SED LOCATION, UNDER ANY LICENSED N AME AND, FOR EACH 25
MOBILE UNIT, IN THE GEOGRAPHIC AR EA LISTED FOR THE MO BILE UNIT IN NMLS, 26
OR AS OTHERWISE AUTH ORIZED BY THE COMMISSIONER THROUGH REGULATION . 27
12–112. 28
(b) (1) Each licensee shall conspicuously post, in 48 point or larger type, at 29
[the licensee’s] EACH licensed location [or mobile unit] the following information: 30
(i) The licensee’s unique identifier; and 31 52 HOUSE BILL 686
(ii) A statement advising consumers of the availability of the NMLS 1
Consumer Access website to verify the licensing status of the licensee. 2
(c) A licensee is not required to post the information required in subsection (b)(1) 3
of this section AT A LICENSED LOCATI ON if THE LICENSED LOCATIO N IS NOT A MOBILE 4
UNIT AND the licensee does not regularly grant access to [the] THAT licensed location to 5
members of the general public. 6
[12–113. 7
A licensee may not change the location for which a license is issued unless the 8
licensee: 9
(1) Provides to the Commissioner, in the form and in accordance with the 10
process that the Commissioner requires, notice of the proposed change; and 11
(2) Receives the consent of the Commissioner through NMLS prior to the 12
change.] 13
12–113. 14
(A) A LICENSEE MAY NOT ADD , DELETE, OR MODIFY A LOCATION REQUIRED 15
TO BE LISTED IN NMLS UNDER § 12–110(A)(2), (3), OR (4) OF THIS SUBTITLE 16
UNLESS: 17
(1) THE LICENSEE PROVIDES TO THE COMMISSIONER , THROUGH 18
NMLS AND IN ACCORDANCE WI TH ANY REGULATIONS T HE COMMISSIONER ADOPTS , 19
NOTICE OF THE ADDITI ON, DELETION, OR MODIFICATION ; 20
(2) THE ADDITION, DELETION, OR MODIFICATION OF T HE LOCATION 21
IS RECORDED WITH THE INFORM ATION ASSOCIATED WIT H THE LICENSEE’S LICENSE 22
IN NMLS; AND 23
(3) THE ADDITION, DELETION, OR MODIFICATION OF T HE LOCATION 24
OTHERWISE COMPLIES W ITH THIS SUBTITLE. 25
(B) THE LICENSEE MAY NOT DO BUSINESS AT A LOC ATION OR IN A 26
GEOGRAPHIC ARE A REQUIRED TO BE LIS TED IN NMLS BY § 12–110(A)(2), (3), OR 27
(4) OF THIS SUBTITLE UNT IL THE LOCATION OR G EOGRAPHIC AREA IS RE CORDED 28
WITH THE INFORMATION ASSOCIATED WITH THE LICENSEE’S LICENSE IN NMLS. 29
12–114. 30
(c) A licensee may retain the records required under this subtitle at any location, 31 HOUSE BILL 686 53
[provided that] IF the licensee: 1
(1) Notifies the Commissioner in writing of the location of the records; and 2
(2) Makes the records available at [a place of business for which a license 3
has been issued or at the licensee’s principal place of business] THE LICENSED LOCATIO N, 4
as agreed by the Commissioner and the licensee, within 7 days [of] AFTER a written 5
request for examination by the Commissioner. 6
12–118. 7
A licensee shall conspicuously post, in 48 point or larger type, at each [place of 8
business at which, or mobile unit from which,] LICENSED LOCATION WH ERE the licensee 9
provides check cashing services: 10
(1) A notice of the fees for check cashing services; and 11
(2) The phone number of the Commissioner for customers to file 12
complaints. 13
12–401. 14
(a) In this subtitle the following words have the meanings indicated. 15
(c) [(1)] “Authorized delegate” means a person who is authorized by a licensee 16
to engage in the business of money transmission under [the name of the licensee] A 17
LICENSED NAME at any location other than [the place of business specified in the license] 18
A LICENSED LOCATION . 19
[(2) “Authorized delegate” does not include a branch location of a licensee.] 20
[(e) (1) “Branch location” means any location other than the principal executive 21
office of a licensee or license applicant at which money transmission services are, or will be 22
on licensure, conducted in the State or with a person in the State. 23
(2) “Branch location” does not include an authorized delegate.] 24
(K) (1) “LICENSED LOCATION ” MEANS ANY LOCATION L ISTED BY THE 25
LICENSEE IN NMLS IN ACCORDANCE WITH T HIS SUBTITLE. 26
(2) “LICENSED LOCATION ” INCLUDES A SELF –SERVICE FINANCIAL 27
KIOSK. 28
(3) “LICENSED LOCATION ” DOES NOT INCLUDE AN AUTHORIZED 29
DELEGATE. 30 54 HOUSE BILL 686
(L) “LICENSED NAME ” MEANS: 1
(1) THE LICENSEE’S LEGAL NAME; AND 2
(2) ANY TRADE NAME USED B Y THE LICENSEE IN AC CORDANCE WITH 3
§ 2–121 OF THIS ARTICLE. 4
[(k–1)] (M) “Licensee” means a person licensed under this subtitle to engage in the 5
business of money transmission. 6
12–404. 7
(a) All revenue received for the licensing AND ASSESSMENT of money 8
transmitters under this subtitle and any other fee, examination assessment, or revenue 9
received by the Commissioner under this subtitle shall be: 10
(1) Credited to the [Nondepository] NON–DEPOSITORY Special Fund 11
established under [§ 11–610] § 2–120 of this article; and 12
(2) Used in accordance with [§ 11–610(c)] § 2–120(D) of this article. 13
(C) SUBJECT TO § 2–120(H) OF THIS ARTICLE , THE COMMISSIONER MAY 14
IMPOSE AN ANNUAL ASS ESSMENT ON ANY LICEN SEE UNDER THIS SUBTI TLE. 15
12–406. 16
(a) To qualify for a license, an applicant shall satisfy the Commissioner that the 17
applicant: 18
(3) Has a tangible net worth computed according to generally accepted 19
accounting principles of at least $150,000, plus an additional net worth of $10,000 for each 20
[additional branch] LICENSED location or authorized delegate, up to a maximum of 21
$500,000 as provided in subsection (b) of this section; and 22
12–407. 23
(b) An applicant shall provide: 24
[(1) The trade name of the applicant, as filed with the State Department of 25
Assessments and Taxation under § 1–406 of the Corporations and Associations Article, and 26
any fictitious or other name used by the applicant in the conduct of the applicant’s 27
business;] 28
(1) THE APPLICANT ’S LEGAL NAME AND ANY TRADE NAME USED BY 29 HOUSE BILL 686 55
THE APPLICANT IN ACC ORDANCE WITH § 2–121 OF THIS ARTICLE; 1
(2) (I) The address of the principal executive office of the applicant[, 2
each branch location, and each self–service financial kiosk]; 3
(II) THE ADDRESS OF EACH ADDITIONAL LOCATION, IF ANY, 4
THAT: 5
1. THE GENERAL PUBLIC MA Y REASONABLY VIEW AS A 6
LOCATION THAT ENGAGE S IN THE BUSINESS OF MONEY TRANSMISSION , INCLUDING 7
ANY LOCATION THAT IN VESTIGATES CUSTOMER COMPLAINTS OR DIRECTLY 8
COMMUNICATES WITH CU STOMERS VERBALLY , ELECTRONICALLY , OR IN WRITING; 9
2. HOUSES ANY CORE OPERA TIONAL INFRASTRUCTUR E 10
OR TECHNOLOGY SYSTEM S; 11
3. CONDUCTS ANY CORE MAN AGEMENT, INFORMATION 12
SECURITY AND TECHNOL OGY, RISK AND COMPLIANCE , OR FINANCE FUNCTIONS ; OR 13
4. IS OTHERWISE REQUIRED TO BE LISTED IN NMLS BY 14
REGULATION THE COMMISSIONER ADOPTS U NDER THIS SUBTITLE ; AND 15
(III) IF THE LICENSEE OPERA TES A SELF–SERVICE FINANCIAL 16
KIOSK, THE FOLLOWING INFORM ATION FOR EACH SELF –SERVICE FINANC IAL KIOSK: 17
1. UNIQUE IDENTIFYING IN FORMATION FOR THE 18
SELF–SERVICE FINANCIAL KI OSK, SUCH AS THE MANUFACT URER NAME , MODEL 19
NUMBER, SERIAL NUMBER , OR ASSET TAG; 20
2. IF THE LICENSEE INTEN DS TO OPERATE THE 21
SELF–SERVICE FINANCIAL KI OSK FROM ANY FIXED L OCATION FOR MORE THA N 30 22
DAYS IN A CALENDAR Y EAR, EACH PHYSICAL ADDRES S WHERE THE SELF –SERVICE 23
FINANCIAL KIOSK WILL BE OPERATED ; AND 24
3. IF THE LICENSEE INTEN DS TO OPERATE THE 25
SELF–SERVICE FINANCIAL KI OSK AT ANY LOCATION FOR 30 DAYS OR LESS IN A 26
CALENDAR YEAR, THE GEOGRAPHIC AREA WHERE THE LICENSEE I NTENDS TO 27
OPERATE THE SELF –SERVICE FINANCIAL KI OSK; 28
[(h) (1) In addition to any license required under §§ 12–405 and 12–410 of this 29
subtitle, each money transmitter shall obtain and maintain a license for its principal 30
executive office. 31
(2) For each branch location license for which an applicant applies, the 32 56 HOUSE BILL 686
applicant shall: 1
(i) Submit a separate application; 2
(ii) Pay a separate nonrefundable license fee of $1,000; and 3
(iii) Pay the application processing fee that NMLS imposes in 4
connection with processing the application for the branch location. 5
(3) For each self–service financial kiosk license for which an applicant 6
applies, the applicant shall: 7
(i) Submit a separate application; 8
(ii) Pay a separate nonrefundable license fee of $500; and 9
(iii) Pay the application processing fee that NMLS imposes in 10
connection with processing the application for the self–service financial kiosk. 11
(4) If an applicant has or is applying for more than one license, the 12
applicant may comply with subsection (g) of this section by filing evidence of only one surety 13
device. 14
(5) If an applicant has or is applying for more than one license, the 15
applicant is not required to pay a separate investigation fee.] 16
12–410. 17
[(a) (1) Each license provided for through NMLS shall include the following 18
information: 19
(i) The name of the licensee; 20
(ii) The trade name of the licensee; 21
(iii) The address at which the business is to be conducted; and 22
(iv) The unique identifier of the licensee. 23
(2) The unique identifier of the licensee shall constitute the license number 24
for the license. 25
(b) (1) A license authorizes the licensee to do business under the license, at the 26
licensed place of business. 27
(2) A license does not authorize the licensee to accept deposits or engage 28
otherwise in a banking business except as authorized in this subtitle. 29 HOUSE BILL 686 57
(3) Only one place of business may be maintained under any one license. 1
(c) The Commissioner may issue more than one license to an applicant who: 2
(1) Complies with § 12–407 of this subtitle; and 3
(2) Otherwise meets the requirements of this subtitle.] 4
(A) INFORMATION IN NMLS ASSOCIATED WITH A LI CENSE APPROVED BY 5
THE COMMISSIONER U NDER THIS SUBTITLE S HALL INCLUDE THE FOL LOWING: 6
(1) THE LICENSEE’S LEGAL NAME AND ANY TRADE NAME USED BY 7
THE LICENSEE IN ACCO RDANCE WITH § 2–121 OF THIS ARTICLE; 8
(2) THE ADDRESS OF THE LI CENSEE’S PRINCIPAL EXECUTIV E 9
OFFICE; 10
(3) THE ADDRESS OF EACH ADDITIONAL LOCATION , IF ANY, WHERE 11
THE LICENSEE DOES BU SINESS AND THAT : 12
(I) THE GENERAL PUBLIC MA Y REASONABLY VIEW AS A 13
LOCATION THAT OFFERS MONEY TRANSMISSION S ERVICES, INCLUDING ANY 14
LOCATION THAT INVEST IGATES CUSTOMER COMP LAINTS OR DIRECTLY 15
COMMUNIC ATES WITH CUSTOMERS VERBALLY, ELECTRONICALLY , OR IN WRITING; 16
(II) HOUSES ANY CORE OPERA TIONAL INFRASTRUCTUR E OR 17
TECHNOLOGY SYSTEMS ; 18
(III) CONDUCTS ANY CORE MAN AGEMENT, INFORMATION 19
SECURITY AND TECHNOL OGY, RISK AND COMPLIANCE , OR FINANCE FUNCTIONS ; OR 20
(IV) IS OTHERWISE REQUIRED TO BE LISTED IN NMLS BY 21
REGULATION THE COMMISSIONER ADOPTS U NDER THIS SUBTITLE ; AND 22
(4) THE INFORMATION REQUI RED BY § 12–407(B)(2)(III) OF THIS 23
SUBTITLE FOR EACH SE LF–SERVICE FINANCIAL KI OSK, IF ANY, OF THE LICENSEE . 24
(B) A LICENSEE SHALL MAINT AIN AND UPDATE THE I NFORMATION IN 25
NMLS ASSOCIATED WITH THE LICENSEE’S LICENSE TO REFLECT ACCURATELY AT 26
ALL TIMES THE INFORM ATION REQUIRED BY SU BSECTION (A) OF THIS SECTION. 27
(C) THE UNIQUE IDENTIFIER ASSIGNED BY NMLS TO A LICENSE E SHALL 28
CONSTITUTE THE LICEN SEE’S LICENSE NUMBER . 29 58 HOUSE BILL 686
(D) A LICENSE AUTHORIZES T HE LICENSEE TO DO BU SINESS UNDER THE 1
LICENSE AT ANY LICEN SED LOCATION, UNDER ANY LICENSED N AME AND, FOR EACH 2
SELF–SERVICE FINANCIAL KI OSK, THE ADDRESS OR GEOGR APHIC AREA LISTED FOR 3
THE SELF–SERVICE FINANCIAL KI OSK IN NMLS, OR AS OTHERWISE AUTH ORIZED BY 4
THE COMMISSIONER THROUGH REGULATION . 5
[(d)] (E) A license may not be transferred or assigned. 6
[(e)] (F) (1) Each licensee shall conspicuously post, in 48 point or larger type, 7
at [the licensee’s] EACH licensed location the following information: 8
(i) The licensee’s unique identifier; and 9
(ii) A statement advising consumers of the availability of the NMLS 10
Consumer Access website to verify the licensing status of the licensee. 11
(2) Each authorized delegate, at each location open to the public, shall 12
conspicuously post, in at least [48–point] 48 POINT type, the following information: 13
(i) A notice stating, “the Commissioner of Financial Regulation for 14
the State of Maryland will accept all questions or complaints regarding this authorized 15
delegate of (name of licensee and unique identifier) at (address of Commissioner), phone 16
(toll–free phone number of the Commissioner)”; and 17
(ii) A statement advising consumers of the availability of the NMLS 18
Consumer Access website to verify the licensing status of the licensee. 19
(3) Each licensee shall conspicuously display the following information on 20
the licensee’s website, any mobile application through which the services are offered, the 21
outside of the self–service financial kiosk, any software application accessible to the public 22
and used for money transmission services, and profile page within each social media 23
platform the licensee uses: 24
(i) The licensee’s unique identifier; 25
(ii) A link to the NMLS Consumer Access website; and 26
(iii) A notice stating, “The Commissioner of Financial Regulation for 27
the State of Maryland will accept all questions or complaints from Maryland residents 28
regarding (name of licensee and unique identifier) at (address of Commissioner), phone 29
(toll–free phone number of the Commissioner)”. 30
[(f)] (G) A licensee is not required to post the information required in subsection 31
[(e)(1)] (F)(1) of this section AT A LICENSED LOCATI ON if the LICENSED LOCATION IS 32
NOT A SELF–SERVICE FINANCIAL KI OSK AND THE licensee does not regularly grant 33 HOUSE BILL 686 59
access to [the] THAT licensed location to members of the general public. 1
12–412. 2
(a) (1) In this section[, “trust] THE FOLLOWING WORDS HAVE THE 3
MEANINGS IND ICATED. 4
(2) “AVERAGE DAILY MONEY T RANSMISSION LIABILIT Y” MEANS THE 5
AMOUNT OF THE APPLIC ANT’S OR LICENSEE’S OUTSTANDING MONEY TRANSMISSION 6
OBLIGATIONS IN THE STATE AT THE END OF E ACH DAY IN A GIVEN Q UARTER, ADDED 7
TOGETHER AND DIVIDED BY THE TOTAL NUMBER OF DAYS IN THAT QUAR TER. 8
(3) “TRUST company” has the meaning stated in § 1–101 of the Estates 9
and Trusts Article. 10
(d) (1) The amount of the surety bond under subsection (b) of this section or 11
the deposit in lieu of a surety bond under subsection (c) of this section shall be [in an 12
amount of not less than] THE GREATER OF : 13
(I) $150,000 [and not more than $1,000,000, as determined by the 14
Commissioner]; OR 15
(II) 100% OF THE APPLICANT ’S AVERAGE DAILY MONE Y 16
TRANSMISSION LIABILI TY IN THE STATE CALCULATED FOR THE MOST RECENTLY 17
COMPLETED QUARTER , UP TO A MAXIMUM OF $2,000,000. 18
[(2) In setting the amount of the surety bond or the deposit in lieu of a surety 19
bond, the Commissioner shall consider: 20
(i) The financial condition of the licensee or applicant; 21
(ii) For a licensee, the average monthly outstanding money 22
transmission liability for the previous 12 months; 23
(iii) For an applicant, the projected monthly money transmissions 24
volume in the State, the business experience, and any other factor deemed appropriate; and 25
(iv) The potential loss of money transmissions by persons for whom 26
or to whom money is transmitted if the applicant or licensee becomes financially impaired.] 27
(2) THE QUARTERS FOR CALC ULATING THE AVERAGE DAILY MONEY 28
TRANSMISSION LIABILI TY UNDER PARAGRAPH (1) OF THIS SUBSECTION F OR ANY 29
LICENSEE REQUIRED TO DO SO SHALL BE THE Q UARTERS ENDING MARCH 31, JUNE 30
30, SEPTEMBER 30, AND DECEMBER 31. 31
60 HOUSE BILL 686
12–415. 1
[(a) (1) A licensee may not change the place of business for which a license is 2
issued unless the licensee: 3
(i) Notifies the Commissioner through NMLS of the proposed 4
change; and 5
(ii) Receives the approval of the Commissioner through NMLS. 6
(2) Within 60 days after receiving a request for approval of a proposed 7
change in the place of business for a licensee, the Commissioner shall approve or deny the 8
request. 9
(3) If the Commissioner does not deny a request for approval of a proposed 10
change in the place of business for a licensee as provided under paragraph (2) of this 11
subsection, the request shall be deemed approved.] 12
(A) (1) A LICENSEE MAY NOT ADD , DELETE, OR MODIFY A LOCATION 13
REQUIRED TO BE L ISTED IN NMLS UNDER § 12–410(A)(2), (3), OR (4) OF THIS 14
SUBTITLE UNLESS : 15
(I) THE LICENSEE PROVIDES TO THE COMMISSIONER , 16
THROUGH NMLS AND IN ACCORDANCE WI TH ANY REGULATIONS A DOPTED BY THE 17
COMMISSIONER , NOTICE OF THE ADDITI ON, DELETION, OR MODIFICATION ; 18
(II) THE ADDITION , DELETION, OR MODIFICATION OF T HE 19
LOCATION IS RECORDED WITH THE INFORMATION ASSOCIATED WITH THE 20
LICENSEE’S LICENSE IN NMLS; AND 21
(III) THE ADDITION , DELETION, OR MODIFICATION OF T HE 22
LOCATION OTHERWISE C OMPLIES WITH THIS SU BTITLE. 23
(2) THE LICENSEE MAY NOT DO BUSINESS AT A LOC ATION OR IN A 24
GEOGRAPHIC AREA REQU IRED TO BE LISTED IN NMLS BY § 12–410(A)(2), (3), OR 25
(4) OF THIS SUBTITLE UNT IL THE LOCATION OR G EOGRAPHIC AREA IS RE CORDED 26
WITH THE INFORMATION ASSOCIATED WITH THE LICENSEE’S LICENSE IN NMLS. 27
12–424. 28
(a) The Commissioner may conduct an [on–site] examination of a licensee or AN 29
authorized delegate with not less than 7 business [days] DAYS’ prior notice. 30
(b) With good cause, the Commissioner may conduct an [on–site] examination of 31
a licensee or AN authorized delegate with no prior notice. 32 HOUSE BILL 686 61
(c) The licensee shall pay all reasonably incurred costs of an examination 1
conducted under this section, including a per–day fee set by the Commissioner for each of 2
the Commissioner’s employees engaged in the examination. 3
(d) [The on–site] ANY examination may be conducted in conjunction with an 4
examination performed by a representative of a responsible supervisory agency of another 5
state. 6
(e) (1) The Commissioner, in lieu of an [on–site] examination, may accept the 7
examination report of a responsible supervisory agency of another state, or a report 8
prepared by an independent accounting firm. 9
(2) A report accepted under paragraph (1) of this subsection is considered 10
for all purposes as an official report of the Commissioner. 11
(f) The Commissioner may: 12
(1) Examine all books, accounts, and records the Commissioner determines 13
are necessary to conduct a complete examination; and 14
(2) Examine under oath any officer, director, or employee of the licensee, 15
or any other individual who may provide information on behalf of the licensee. 16
12–901. 17
(a) In this subtitle the following words have the meanings indicated. 18
(b) “Annual gross revenue” means income or revenue from all sources, before any 19
expenses or taxes, computed according to generally accepted accounting principles for the 20
preceding fiscal year. 21
(c) [“Branch location” means any location other than the principal executive office 22
of a licensee or license applicant at which the licensee conducts, or the license applicant, on 23
licensure, will conduct, activities required to be licensed under this subtitle. 24
(d)] “Consultation fee” means a fee paid by a consumer to a debt management 25
services provider in connection with the processing of any application that the consumer 26
makes for debt management services. 27
[(e)] (D) “Consumer” means an individual who: 28
(1) Resides in the State; and 29
(2) Is seeking debt management services or has entered into a debt 30
management services agreement. 31
62 HOUSE BILL 686
[(f)] (E) “Consumer education program” means a program or plan that: 1
(1) Seeks to improve the financial literacy of consumers regarding personal 2
finance, budgeting, and credit and debt management; and 3
(2) Provides counseling tailored to the needs and circumstances of the 4
consumer with regard to options and strategies for addressing the consumer’s debt 5
problems, including: 6
(i) Creating and maintaining a budget; 7
(ii) Establishing debt management payment plans with creditors; 8
(iii) Negotiating directly with creditors on payment or interest rate 9
relief; and 10
(iv) Filing for bankruptcy. 11
[(g)] (F) (1) “Control person” means a person who has the power, directly or 12
indirectly, to direct the management or policies of a licensee or license applicant, whether 13
through ownership of securities, by contract, or otherwise. 14
(2) “Control person” includes a person who: 15
(i) Is a general partner, an officer, or a director of a licensee or 16
license applicant, or a member that occupies a similar position or performs a similar 17
function; 18
(ii) Directly or indirectly has the right to vote 10% or more of a class 19
of voting securities, or has the power to sell or direct the sale of 10% or more of a class of 20
voting securities, of a licensee or license applicant; or 21
(iii) In the case of a partnership, a limited partnership, a limited 22
liability partnership, a limited liability company, or any other business entity: 23
1. Has the right to receive on liquidation or dissolution of a 24
licensee or license applicant 10% or more of the capital of the licensee or license applicant; 25
or 26
2. Has contributed 10% or more of the capital of a licensee or 27
license applicant. 28
[(h)] (G) “Debt management counselor” means a permanent, temporary, or 29
contractual employee of a debt management services provider or its agent who provides 30
counseling to consumers on behalf of the debt management services provider. 31
[(i)] (H) “Debt management services” means receiving funds periodically from a 32 HOUSE BILL 686 63
consumer under an agreement with the consumer for the purpose of distributing the funds 1
among the consumer’s creditors in full or partial payment of the consumer’s debts. 2
[(j)] (I) “Debt management services agreement” means a written contract, plan, 3
or agreement between a debt management services provider and a consumer for the 4
performance of debt management services. 5
[(k)] (J) “Debt management services provider” means a person that provides or 6
offers to provide debt management services to a consumer. 7
[(k–1)] (K) “License” means a license issued in any form by the Commissioner 8
under this subtitle to provide debt management services, including as provided for through 9
NMLS. 10
(L) “LICENSED LOCATION ” MEANS ANY LOCATION L ISTED BY THE LICENSE E 11
IN NMLS IN ACCORDANCE WITH T HIS SUBTITLE. 12
(M) “LICENSED NAME ” MEANS: 13
(1) THE LICENSEE’S LEGAL NAME; AND 14
(2) ANY TRADE NAME USED B Y THE LICENSEE IN AC CORDANCE WITH 15
§ 2–121 OF THIS ARTICLE. 16
[(l)] (N) “Licensee” means a person licensed under this subtitle to provide debt 17
management services. 18
[(m)] (O) “Maintenance fee” means a fee paid by a consumer to a debt 19
management services provider for the maintenance or servicing of the consumer’s accounts 20
with the consumer’s creditors in accordance with a debt management services agreement. 21
[(n)] (P) “Relative” means any of the following who are related to an individual 22
by blood, marriage, or adoption: 23
(1) A spouse; 24
(2) A child; 25
(3) A sibling; 26
(4) A parent; 27
(5) A grandparent; 28
(6) A grandchild; 29
64 HOUSE BILL 686
(7) A stepparent; 1
(8) A stepchild; 2
(9) A stepsibling; 3
(10) An aunt; or 4
(11) An uncle. 5
[(o)] (Q) “Resident agent” means an individual residing in the State or a 6
Maryland corporation whose name, address, and designation as a resident agent are filed 7
or recorded with the State Department of Assessments and Taxation in accordance with 8
[the provisions of] the Corporations and Associations Article. 9
[(p)] (R) “Trust account” means an account that is: 10
(1) Established in a financial institution that is federally insured; 11
(2) Separate from the debt management services provider’s operating 12
account; 13
(3) Designated as a “trust account” or by another appropriate designation 14
indicating that the funds in the account are not the funds of the licensee or its officers, 15
employees, or agents; 16
(4) Unavailable to creditors of the debt management services provider; and 17
(5) Used to hold funds paid by consumers to a debt management services 18
provider for disbursement to creditors of the consumers. 19
[(q)] (S) “Unique identifier” means a number or another identifier assigned by 20
NMLS. 21
12–904. 22
[(a) An applicant shall submit separate applications for the applicant’s principal 23
executive office and each branch location. 24
(b)] With the license application [for the principal executive office of an applicant], 25
the applicant shall pay to the Commissioner: 26
(1) A nonrefundable investigation fee of $1,000 for an initial license; and 27
(2) A license fee for an initial license or a license renewal for an additional 28
1–year term, as follows: 29 HOUSE BILL 686 65
(i) $500, if the applicant’s annual gross revenue is not more than 1
$3,000,000; 2
(ii) $1,000, if the applicant’s annual gross revenue is more than 3
$3,000,000 but not more than $6,000,000; 4
(iii) $2,000, if the applicant’s annual gross revenue is more than 5
$6,000,000 but not more than $15,000,000; 6
(iv) $3,000, if the applicant’s annual gross revenue is more than 7
$15,000,000 but not more than $30,000,000; or 8
(v) $4,000, if the applicant’s annual gross revenue is more than 9
$30,000,000. 10
[(c) With the license application for each branch location of an applicant, the 11
applicant shall pay to the Commissioner a $100 license fee for an initial license or a license 12
renewal for an additional 1–year term.] 13
12–905. 14
(a) All revenue received for the licensing AND ASSESSMENT of persons under this 15
subtitle and, except as provided in subsection (b) of this section, any other fee, examination 16
assessment, or revenue received by the Commissioner under this subtitle shall be: 17
(1) Credited to the [Nondepository] NON–DEPOSITORY Special Fund 18
established under [§ 11–610] § 2–120 of this article; and 19
(2) Used in accordance with [§ 11–610(c)] § 2–120(D) of this article. 20
(C) SUBJECT TO § 2–120(H) OF THIS ARTICLE , THE COMMISSIONER MAY 21
IMPOSE AN ANNUAL ASS ESSMENT ON ANY LICEN SEE UNDER THIS SUBTI TLE. 22
12–906. 23
(b) A [separate license is required for the principal executive office of the license 24
applicant or licensee and each branch location] LICENSEE MAY DO BUSI NESS AS A DEBT 25
MANAGEMENT SERVICES PROVIDER ONLY AT A L ICENSED LOCATION OR AS 26
OTHERWISE AUTHORIZED BY THE COMMISSIONER THROUGH REGULATION . 27
12–908. 28
(b) The application shall include: 29
(1) The applicant’s LEGAL name AND ANY TRADE NAME USED BY THE 30 66 HOUSE BILL 686
APPLICANT IN ACCORDA NCE WITH § 2–121 OF THIS ARTICLE , THE APPLICANT ’S 1
principal executive office address, and website address, if any, and, if the applicant is not 2
an individual, the name and residence address of each control person, if any; 3
(2) The address of each [branch] ADDITIONAL location, if any, [at which 4
the applicant will provide debt management services;] THAT: 5
(I) THE GENERAL PUBLIC MAY R EASONABLY VIEW AS A 6
LOCATION THAT DOES B USINESS AS A DEBT MA NAGEMENT SERVICES PR OVIDER, 7
INCLUDING ANY LOCATI ON THAT INVESTIGATES CUSTOMER COMPLAINTS OR 8
DIRECTLY COMMUNICATE S WITH CUSTOMERS VER BALLY, ELECTRONICALLY , OR IN 9
WRITING; 10
(II) HOUSES ANY CORE OPERA TIONAL INFRASTRUCTUR E OR 11
TECHNOLOGY SYSTEMS ; 12
(III) CONDUCTS ANY CORE MAN AGEMENT, INFORMATION 13
SECURITY AND TECHNOL OGY, RISK AND COMPLIANCE , OR FINANCE FUNCTIONS ; OR 14
(IV) IS OTHERWISE REQUIRED TO BE LISTED IN NMLS BY 15
REGULATION THE COMMISSIONER ADOPTS U NDER THIS SUBTITLE ; 16
12–911. 17
[(a) (1) Each license provided for through NMLS shall include the following 18
information: 19
(i) The name of the licensee; 20
(ii) The address of the location at which the business is to be 21
conducted; and 22
(iii) The unique identifier of the licensee. 23
(2) The unique identifier of the licensee shall constitute the license number 24
for the license. 25
(b) A license authorizes the licensee to provide debt management services.] 26
(A) INFORMATION IN NMLS ASSOCIATED WITH A LI CENSE APPROVED BY 27
THE COMMISSIONER UNDER TH IS SUBTITLE SHALL IN CLUDE THE FOLLOWING : 28
(1) THE LICENSEE’S LEGAL NAME AND ANY TRADE NAME USED BY 29
THE LICENSEE IN ACCO RDANCE WITH § 2–121 OF THIS ARTICLE; 30
HOUSE BILL 686 67
(2) THE ADDRESS OF THE L ICENSEE’S PRINCIPAL EXECUTIV E 1
OFFICE; AND 2
(3) THE ADDRESS OF EACH A DDITIONAL LOCATION , IF ANY, WHERE 3
THE LICENSEE DOES BU SINESS AND THAT : 4
(I) THE GENERAL PUBLIC MA Y REASONABLY VIEW AS A 5
LOCATION THAT DOES B USINESS AS A DEBT MA NAGEMENT SERVICES PR OVIDER, 6
INCLUDING ANY LOCATI ON THAT INVESTIGATES CUSTOMER COMPLAINTS OR 7
DIRECTLY COMMUNICATE S WITH CUSTOMERS VER BALLY, ELECTRONICALLY , OR IN 8
WRITING; 9
(II) HOUSES ANY CORE OPERA TIONAL INFRASTRUCTUR E OR 10
TECHNOLOGY SYSTEMS ; 11
(III) CONDUCTS ANY CORE MAN AGEMENT, INFORMATION 12
SECURITY AND TECHNOL OGY, RISK AND COMPLIANCE , OR FINANCE FUNCTIONS ; OR 13
(IV) IS OTHERWISE REQUIRED TO BE LISTED IN NMLS BY 14
REGULATION THE COMMISSIONER ADOPTS U NDER THIS SUBTITLE . 15
(B) A LICENSEE SHALL MAINT AIN AND UPDATE THE I NFORMATI ON IN 16
NMLS ASSOCIATED WITH THE LICENSEE’S LICENSE TO REFLECT ACCURATELY AT 17
ALL TIMES THE INFORM ATION REQUIRED BY SU BSECTION (A) OF THIS SECTION. 18
(C) THE UNIQUE IDENTIFIER ASSIGNED BY NMLS TO A LICENSEE SHALL 19
CONSTITUTE THE LICEN SEE’S LICENSE NUMBER . 20
(D) A LICENSE AUTHORIZES T HE LICENSEE TO DO BU SINESS UNDER THE 21
LICENSE AT ANY LICEN SED LOCATION AND UND ER ANY LICENSED NAME , OR AS 22
OTHERWISE AUTHORIZED BY THE COMMISSIONER THROUGH REGULATION . 23
[(c)] (E) A license may not be transferred, assigned, or pledged. 24
[(d)] (F) Each licensee shall conspicuously post, in 48 point or larger type, at 25
[the licensee’s] EACH licensed location the following information: 26
(1) The licensee’s unique identifier; and 27
(2) A statement advising consumers of the availability of the NMLS 28
Consumer Access website to verify the licensing status of the licensee. 29
[(e)] (G) Each licensee shall conspicuously display the following information on 30
the licensee’s website, any software application accessible to the public and used to provide 31 68 HOUSE BILL 686
debt management services, and profile page within each social media platform the licensee 1
uses: 2
(1) The licensee’s unique identifier; 3
(2) A link to the NMLS Consumer Access website; and 4
(3) A notice stating, “The Commissioner of Financial Regulation for the 5
State of Maryland will accept any questions and complaints from Maryland residents 6
regarding (name and unique identifier of the debt management services provider) at 7
(address of Commissioner), phone (toll–free number of the Commissioner). 8
[(f) Only one location may be maintained under any one license.] 9
[(g)] (H) A licensee is not required to post the information required in subsection 10
[(d)] (F) of this section AT A LICENSED LOCATI ON if the licensee does not regularly grant 11
access to [the] THAT licensed location to members of the general public. 12
12–914. 13
(b) (2) The bond shall be: 14
(i) In an amount [not less than $10,000 and not more than 15
$1,000,000, as set] DETERMINED by the Commissioner UNDER SUBSECTION (F) OF THIS 16
SECTION; 17
[(8) In setting the amount of the surety bond, the Commissioner shall 18
consider: 19
(i) The financial condition and business experience of the applicant 20
or licensee and the agent of the applicant or licensee; 21
(ii) For an applicant, the projected monthly and annual volume of 22
debt management services to be provided in the State; 23
(iii) For a licensee, the average monthly and annual volume of debt 24
management services provided in the State during the previous 12–month period; 25
(iv) The potential loss to consumers who remit funds to the applicant 26
or licensee if the applicant or licensee becomes financially impaired; and 27
(v) Any other factor the Commissioner considers appropriate.] 28
(F) (1) THE AMOUNT OF THE SUR ETY BOND UNDER SUBSE CTION (B) OF 29
THIS SECTION SHALL BE IN AN AMOUNT OF NOT LES S THAN $10,000 AND NOT MORE 30
THAN $1,000,000, AS DETERMINED BY THE COMMISSIONER FOR EACH LICENSEE. 31 HOUSE BILL 686 69
(2) IN SETTING THE AMOUNT OF THE SURETY BOND , THE 1
COMMISSIONER MAY CONS IDER: 2
(I) THE NATURE AND VOLUME OF THE BUSINESS OR PROPOSED 3
BUSINESS OF THE LICE NSEE OR APPLICANT ; 4
(II) THE FINANCIAL CONDITI ON OF THE LICENSEE O R 5
APPLICANT, INCLUDING: 6
1. THE AMOUNT, NATURE, QUALITY, AND LIQUIDITY OF 7
THE ASSETS OF THE LI CENSEE OR APPLICANT ; 8
2. THE AMOUNT AND NATU RE OF THE LIABILITIE S, 9
INCLUDING CONTINGENT LIABILITIES, OF THE LICENSEE OR A PPLICANT; 10
3. THE HISTORY OF AND PR OSPECTS FOR THE LICE NSEE 11
OR APPLICANT TO EARN AND RETAIN INCOME ; AND 12
4. THE POTENTIAL HARM TO CONSUMERS IF THE 13
APPLICANT OR LICENSE E BECOMES FINANCIALLY IMPAIRED; 14
(III) THE QUALITY OF THE OP ERATIONS OF THE LICE NSEE OR 15
APPLICANT; 16
(IV) THE QUALITY OF THE MA NAGEMENT OF THE LICE NSEE OR 17
APPLICANT; 18
(V) THE NATURE AND QUALIT Y OF THE PERSON THAT HAS 19
CONTROL OF THE LICEN SEE OR APPLIC ANT; AND 20
(VI) ANY OTHER FACTOR THAT THE COMMISSIONER CONSIDER S 21
RELEVANT. 22
12–915. 23
(a) (1) [A] EXCEPT FOR A CHANGE O F A LICENSED LOCATIO N MADE IN 24
COMPLIANCE WITH SUBS ECTION (D) OF THIS SECTION, A licensee shall update through 25
NMLS any change in the information required to be included in the licensee’s application 26
under § 12–908(b)(1) [and (2)] of this subtitle at least 30 days before the change is effective. 27
(2) The licensee shall ensure that, after the change described in this 28
subsection, the licensee will continue to satisfy the surety bond requirement under § 29
12–914 of this subtitle. 30 70 HOUSE BILL 686
(b) Unless approved by the Commissioner through NMLS, a licensee may not 1
change a control person of the licensee, or an agent who is acting on behalf of the licensee 2
to manage a trust account, listed on the licensee’s application under § 12–908(b)(3) and (6) 3
of this subtitle. 4
(c) (1) To request approval of a proposed change described in subsection (b) of 5
this section, the licensee shall notify the Commissioner through NMLS of the proposed 6
change and submit any information that the Commissioner requires. 7
(2) For a proposed change in owner or agent acting on behalf of the licensee 8
to manage a trust account, the Commissioner may determine that the filing of a new 9
application for the issuance of a license is warranted. 10
(3) Unless the Commissioner notifies the licensee that a different time 11
period is necessary, the Commissioner shall approve or deny a request for a change 12
described in subsection (b) of this section within 60 days after the date the Commissioner 13
receives all information required under paragraph (1) of this subsection. 14
(D) (1) A LICENSEE MAY NOT ADD , DELETE, OR MODIFY A LOCATION 15
REQUIRED TO BE LISTE D IN NMLS UNDER § 12–911(A)(2) OR (3) OF THIS SUBTITLE 16
UNLESS: 17
(I) THE LICENSEE PROVIDES TO THE COMMISSIONER , 18
THROUGH NMLS AND IN ACCORDANCE WI TH ANY REGULATIONS T HE 19
COMMISSIONER ADOPTS , NOTICE OF THE ADDITI ON, DELETION, OR MODIFICATION ; 20
(II) THE ADDITION , DELETION, OR MODIFICATION OF T HE 21
LOCATION IS RECORDED WITH THE INFORMATION ASSOCIAT ED WITH THE 22
LICENSEE’S LICENSE IN NMLS; AND 23
(III) THE ADDITION , DELETION, OR MODIFICATION OF T HE 24
LOCATION OTHERWISE C OMPLIES WITH THIS SU BTITLE. 25
(2) THE LICENSEE MAY NOT DO BUSINESS AT A LOC ATION REQUIRED 26
TO BE LISTED IN NMLS BY § 12–911(A)(2) OR (3) OF THIS SUBTITLE UNT IL THE 27
LOCATION IS RECORDED WITH THE INFORMATION ASSOCIATED WITH THE 28
LICENSEE’S LICENSE IN NMLS. 29
12–923. 30
(b) For the purposes of this section, the Commissioner: 31
(1) Shall be given access to [the] ANY LICENSED LOCATIO N OR OTHER 32
place of business AND ALL books, papers, records, safes, and vaults of the person under 33 HOUSE BILL 686 71
investigation; and 1
12–924. 2
(a) The Commissioner may conduct an [on–site] examination of a licensee with 3
or without prior notice. 4
(c) [An on–site] ANY examination may be conducted in conjunction with an 5
examination performed by a representative of a responsible supervisory agency of another 6
state. 7
(d) (1) The Commissioner, in lieu of an [on–site] examination, may accept the 8
examination report of a responsible supervisory agency of another state. 9
(2) A report accepted under paragraph (1) of this subsection is considered 10
for all purposes as an official report of the Commissioner. 11
12–1007. 12
(a) All revenue received for the registration of persons under this subtitle and, 13
except as provided in subsection (b) of this section, any other fee, examination assessment, 14
or revenue received by the Commissioner under this subtitle shall be: 15
(1) Credited to the [Nondepository] NON–DEPOSITORY Special Fund 16
established under [§ 11–610] § 2–120 of this article; and 17
(2) Used in accordance with [§ 11–610(c)] § 2–120(D) of this article. 18
Article – State Finance and Procurement 19
6–226. 20
(a) (2) (i) Notwithstanding any other provision of law, and unless 21
inconsistent with a federal law, grant agreement, or other federal requirement or with the 22
terms of a gift or settlement agreement, net interest on all State money allocated by the 23
State Treasurer under this section to special funds or accounts, and otherwise entitled to 24
receive interest earnings, as accounted for by the Comptroller, shall accrue to the General 25
Fund of the State. 26
(ii) The provisions of subparagraph (i) of this paragraph do not apply 27
to the following funds: 28
170. the Cannabis Public Health Fund; [and] 29
171. the Community Reinvestment and Repair Fund; AND 30
72 HOUSE BILL 686
172. THE NON–DEPOSITORY SPECIAL FUND. 1
SECTION 2. AND BE IT FURTHER ENACTED, That Section(s) 12 –401(f) through 2
(k) and (l) through (v) of Article – Financial Institutions of the Annotated Code of Maryland 3
be renumbered to be Section(s) 12–401(e) through (j) and (n) through (x), respectively. 4
SECTION 3. AND BE IT FURTHER ENACTED, That this Act shall take effect July 5
1, 2023. 6
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
Speaker of the House of Delegates.
________________________________________________________________________________
President of the Senate.