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Current Obligations
A. Develop Policies & Procedures
B. Identify Your Institution’s NMLS System Administrator(s)
C. Identify Mortgage Loan Originators (MLOs)
D. How to Register A. Develop Policies and Procedures
Institutions that employ MLOs must adopt and follow written policies
and procedures designed to assure compliance with the final rule,
which sets minimum standards,
as follows:
- The policies and procedures must be appropriate to the nature,
size, complexity, and scope of the bank’s mortgage lending activities,
and apply only to those employees acting within the scope of
their employment at the bank.
- At a minimum, institutions must establish processes, procedures
and systems to
- Identify which employees should be registered;
- Inform and instruct
MLOs about SAFE Act registration requirements and compliance
procedures;
- Secure and provide unique identifiers;
- Confirm the adequacy
and accuracy of employee registrations, including updates
and renewals, by comparing information
with their own records;
- Monitor compliance with registration
and renewal requirements and procedures;
- Conduct annual
independent compliance testing;
- Effect appropriate action
if an employee fails to comply with the registration requirements
of the Act, rule or
bank’s
policies and procedures, including prohibiting employees
from acting as MLOs;
- Review employee criminal history
background reports, take appropriate action consistent
with applicable
Federal law,
including Section
19 of the Federal
Deposit Insurance Act, and maintain records of the
reports and response; and
- Ensure that any third party
with which the bank has arrangements related to mortgage
loan origination has appropriate registration,
licensing
and other compliance policies and procedures.
B. Identify Your Institution’s NMLS
System Administrator(s)
Each federally-regulated institution will establish a ‘base’ record
in the NMLS in order to facilitate the confirmation, management and oversight
of registrations of MLOs employed by that institution. Once the system
becomes operational, the institution will need to request an account and
establish
at least one Account Administrator to handle the administrative processes
on behalf of the institution. Per section 365.103(e)(1)(F) of the rule,
the Account
Administrator may not be an MLO unless the institution has 10 or less full
time employees.
Per section 365.103(e)(1)(F) of the rule, the Account Administrator may
not be an MLO unless the institution has 10 or less full time employees.
The Agencies recognize that in very small institutions with few employees,
the basic internal control provided by a separation of duties can be difficult
to reasonably accomplish. Although the Agencies provide some relief from
this separation of duties requirement through Sec.365.103(e)(1)(i)(F),
qualifying institutions will be expected to implement alternative controls
to ensure that a mortgage loan originator is performing these administrative
duties appropriately, given the level of access they will have to co-workers
confidential information.
Specific instructions for creating a base record and establishing institution
administrators are available on the NMLS website at:
http://mortgage.nationwidelicensingsystem.org/fedreg/Pages/default.aspx
C. Identify Mortgage Loan Originators (MLO)
The registration of mortgage loan originators employed by Agency-regulated
institutions is explicitly required by the SAFE Act.
Pursuant to Section 1507 of the SAFE Act, an MLO must be Federally-registered
if that individual
is an employee of a depository institution, an employee of any subsidiary
owned and controlled by a depository institution and regulated
by a Federal banking
agency, or an employee of an institution regulated by the FCA.
There are distinct differences under the SAFE Act between registration
requirements applicable to employees of entities that are regulated
by the FDIC, and the state licensing requirements applicable to other
mortgage loan originators. The definition of ‘‘depository institution’’ in
the FDI Act and in the SAFE Act
does not include bank or savings association holding companies or
their non-depository subsidiaries. Employees of these
entities who act as mortgage loan originators are not covered by
the Federal registration requirement and, therefore, must comply
with State licensing
and registration requirements.
An MLO that previously was licensed under state law will need to update
his or her record in accordance with section 365.103(a)(4) of the FDIC's
rule.
The rules include an exception for mortgage loan originators that originated five or fewer mortgage loans during the previous 12 months and who have never been registered; they would not be required to complete the federal registration process.
Individuals convicted of crimes involving dishonesty, breach of
trust, or money laundering, are prohibited from participating, directly
or indirectly, in the
affairs of a bank without the written consent of the FDIC. Refer to Section
19 of the Federal Deposit Insurance Act (http://www.fdic.gov/regulations/laws/rules/1000-2100.html#fdic1000sec19)
for full and specific discussion of the prohibition, exceptions, and penalties
for violation.
The NMLS will include a batch-upload capability to facilitate
the registration of multiple MLOs from a single institution;
details will be posted
to the NMLS website. D. How to Register
Further information regarding the registry and the registration process is available at the registry's website:
http://mortgage.nationwidelicensingsystem.org/fedreg/Pages/default.aspx
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