Under the Residential Mortgage Lending Act (RMLA), the Commissioner of Business Oversight (the “Commissioner”) of the State of California has multiple functions, powers, and duties (Cal. Fin. Code §50301). The Commissioner may also review the business dealings of any residential mortgage lender and servicer California licensee for compliance with the RMLA (Cal. Fin. Code §50302).
The Commissioner may levy fees, fines, and charges in an amount sufficient to cover the cost of the services performed in administering the laws, rules and regulations contained in the California RMLA. She may appoint examiners, supervisors, experts, and special assistants as needed to effectively and efficiently administer the California Residential Mortgage Lending Act.
She may receive applications for licenses as well as issue, refuse to issue, revoke or suspend any license. A license may only be revoked or suspended for cause. The Commissioner may require information about a license applicant she deems necessary, with the public’s interest of paramount consideration, to ascertain various moral, professional, and ethical traits of the licensee.
These traits include the experience, background, honesty, truthfulness, integrity, and competency of the license applicant for financial transactions that involve primary or subordinate mortgage financing. If the license applicant is an entity other than an individual, the Commissioner must ascertain the honesty, truthfulness, integrity, and competency of an officer or director of the corporation, association, or other entity, or the members of a partnership.
Further functions of the Commissioner include recordkeeping as all records related to licenses issued by the State of California must be maintained. Another function is prescribing any required forms, reports, books and records related to a licensee or license application, including annual audited financial statements.
The Commissioner may enforce by order any provision of the RMLA. In turn, she may receive, consider, investigate, and act upon complaints made regarding a licensee. She may also administer oaths as well as subpoena witnesses and compel their attendance at hearings. The Commissioner may also compel the production of documents such as books, papers, or other materials relevant to any inquiry authorized by the RMLA.
As often as the Commissioner deems necessary and appropriate, but at least once every 48 months, she must examine the affairs of each residential mortgage lender and servicer licensee for compliance with the RMLA. The Commissioner and suitable appointees may examine the books, records, and documents of the licensee, and may examine the licensee’s officers, directors, employees, or agents under oath relating to the licensee’s operations. The commissioner may cooperate with any agency of the state or federal government, other states, agencies, the Federal National Mortgage Association, or the Federal Home Loan Mortgage Corporation.
These functions, powers, and duties of the Commissioner are provided “without limitation” by the language of the statute (Cal. Fin. Code §50301). Jan Lynn Owen was appointed the first Commissioner of the Department of Business Oversight (DBO) by Governor Brown in 2013 when the DBO was created in a merger of the departments of Corporations and Financial Institutions.
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