BANKING AND MORTGAGE BANKING UPDATE
Here is an update of some of the major issues affecting banking institutions and nondepository mortgage companies. This Update is created and provided to you by Shumaker Williams, P.C.
Financial Reform Bill Offered by Senator Dodd Passes Banking Committee.
Senator Dodd's version of financial reform was passed on a partisan vote by the Senate Banking Committee on 3.22.2010. The bill now moves to the full Senate for consideration. It is expected that the bill will be the subject of many amendments on the floor of the Senate.
Federal Reserve Pushing Against Too Big To Fail Doctrine.
Federal Reserve Chairman Ben Bernanke delivered a speech on 3.22.2010 in which he argued for elimination of the "too big to fail" doctrine that constitutes government protection of large financial institutions in danger of failure. Earlier in the same week, another Federal Reserve Board member delivered a speech arguing that another alternative to bailout or bankruptcy is needed The alternative promoted was a new resolution process for winding down a systemically important firm in an orderly manner while still imposing loses on shareholders and creditors.
Mortgage Professionals Must Pass S.A.F.E. Licensing Act Test to Stay in Business.
Mortgage professionals individually "licensed" in Pennsylvania who work for nondepository mortgage lenders or brokers have until 4.30.2010 to pass their national and state mortgage tests. Otherwise, they could lose their licenses. Pursuant to the federal S.A.F.E. Act and the Pennsylvania Mortgage Licensing Act, the initial mortgage education classes and test requirements are not applicable to mortgage professionals who work for banks. Bankers who work as mortgage professionals must "register" with the National Mortgage Licensing System & Registry.
New Federal National Health Care Law.
The President signed the landmark legislation into law today (3.23.2010). The Pennsylvania Office of Attorney General announced the same day that the federal health bill that at the time was set to become law will be unconstitutional. The AG's Office indicated it will sue to have the law declared unconstitutional. State Attorneys General in other States may join in this lawsuit strategy. A reconciliation bill passed by the House awaits consideration in the Senate.
Pennsylvania Robbery Law Amended to Specifically Cover Bank Robbery.
The criminal law against robbery was amended by Pennsylvania Act 11 of 2010. Effective sixty days from 3.16.2010, oral or verbal demand followed by taking money without authorization specifically from a financial institution is a felony in Pennsylvania.
ACORN Is Closing Its Doors.
The community activist group Association of Community Organizations for Reform Now, also known by the acronym ACORN, is closing its operations.
The Name Matters.
Maryland Association of Mortgage Brokers has changed its name to: Maryland Association of Mortgage Professionals.
Other Items of Note:
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New Federal Reserve overdraft "choice" opt-in rules regarding ATM or Debit Cards take effect 7.1.2010.
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TILA and Regulation Z have undergone multiple amendments. Among them, effective 4.1.2010 escrow is required for certain higher-priced mortgages.
For more information or for financial services, business, or individual legal services, please contact Keith Clark, Paul Adams, or Reginald Evans, at 717.763.1121, or Steve Lovejoy or Marty Ellis at 410.825.5223.
This Legal Alert should not be construed as providing specific legal advice.
©Shumaker Williams, P.C. 2010
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