MORTGAGE LOAN ORIGINATORS OVER SAFE ACT EDUCATION REQUIREMENTS
STATE REGULATORS TAKE ACTION AND RESOLVE ISSUES WITH HUNDREDS OF MORTGAGE LOAN ORIGINATORS OVER SAFE ACT EDUCATION REQUIREMENTS
Washington joins 41 others in multi-state enforcement action
Olympia – The Washington State Department of Financial Institutions (DFI) and financial regulatory agencies from 41 other states reached settlements with 441 mortgage loan originators (MLOs) nationwide who deceptively claimed to have completed annual continuing education as required under state and federal law.
“By requiring Washington's MLOs to meet both pre-licensing and annual education requirements, including state-specific requirements, we protect consumers, and create a level playing field for mortgage professionals,” DFI Director Charlie Clark said. “We do not tolerate MLOs shirking their education requirements. Our strong multi-state regulatory system caught the sophisticated cheating scheme.”
“In Washington’s robust housing market, hundreds of MLOs come into the market monthly and 105 individuals tried to short-cut their education requirements,” DFI Consumer Services Director Lucinda Fazio added.
Through the settlements, the mortgage loan originators agreed to surrender their licenses for a period of three months, pay a fine of $1,000 for each state in which they were issued a license and take continuing education beyond Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act) requirements.
Congress enacted the SAFE Act to enhance consumer protection and reduce fraud through minimum standards for the licensing and registration of state-licensed mortgage loan originators. The states implement and enforce these standards, and every state requires mortgage loan originators to have at least 20 hours of pre-licensing education, and a minimum of an annual eight hours of continuing education.
Danny Yen, owner of Carlsbad, Calif.-based course provider Real Estate Educational Services, is facing administrative enforcement actions for both providing false certificates and taking courses on behalf of mortgage loan originators through other education providers in violation of the SAFE Act.
The irregular education activity was discovered through a gesture-driven authentication tool called BioSig-ID, which is used to monitor all online courses approved under the SAFE Act mandate.
About DFI ▪ www.dfi.wa.gov ▪ 360-902-8700 ▪ 877-RINGDFI (746-4334)
The Washington State Department of Financial Institutions regulates a variety of financial service providers such as banks, credit unions, mortgage brokers, consumer loan companies, payday lenders and securities brokers and dealers. The department also works to improve financial education throughout Washington through its outreach programs and online clearinghouse www.dfi.wa.gov/financial-education. In addition to posting information about licensees and administrative actions, DFI uses the Web and social media to provide financial education information: www.twitter.com/DFIConsumers ■ https://dfi.wa.gov/financial-education/blog ■ https://www.youtube.com/user/WADFI ■ www.homeownership.wa.gov ■ www.instagram.com/wastatedfi/ ■ www.linkedin.com/company/state-of-washington-department-of-financial-institutions/
About the Division of Consumer Services ▪ www.dfi.wa.gov/cs ▪ 360-902-8703 ▪ 877-746-4334, x 8703 The mission of the Division of Consumer Services is to protect consumers from illegal and fraudulent lending practices. The division accomplishes its mission through licensing, licensee examinations, investigations, and enforcing selected state and federal statutes and rules. Consumer Services regulates the business activities of consumer loan companies, mortgage brokers, money transmitters and currency exchangers, as well as check cashers and sellers, also known as "payday lenders." The Division is entirely self-supporting, with funding provided by licensing, auditing, and policing of regulated businesses and individuals. No money is received from the state General Fund or other public revenue source.