State Regulators Act With Mortgage Originators On Security Education Requirements – Lewis-Clark Valley Community

Washington State Department of Financial Institutions

OLYMPIA- The Washington State Department of Financial Institutions (DFI) and financial regulatory agencies in 41 other states have reached settlements with 441 mortgage originators (MLOs) nationwide who falsely claim to have followed a annual continuing education as required by federal and state law.

“By requiring Washington MLOs to meet both pre-licensing and annual training requirements, including state-specific requirements, we are protecting consumers and creating a level playing field for mortgage professionals,” said DFI director Charlie Clark. “We do not tolerate MLOs evading their education requirements. Our strong multi-state regulatory system caught the sophisticated cheating scheme.

“In Washington’s robust housing market, hundreds of MLOs hit the market each month and 105 people have attempted to shorten their education requirements,” added Lucinda Fazio, director of consumer services at DFI.

Through the settlements, mortgage originators agreed to waive their licenses for a period of three months, pay a $1,000 fine for each state in which they were issued a license, and undergo ongoing training at beyond the Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act).

Congress enacted the SAFE Act to strengthen consumer protections and reduce fraud through minimum standards for licensing and registration of state-licensed mortgage originators. States implement and enforce these standards, and each state requires mortgage originators to have completed at least 20 hours of pre-licensing training and a minimum of eight hours of annual continuing education.

Danny Yen, owner of Carlsbad, Calif., course provider Real Estate Educational Services, is facing administrative enforcement action for providing false certificates and taking courses on behalf of mortgage originators through other education providers in violation of the SAFE Act.

The irregular educational activity was uncovered through a gesture authentication tool called BioSig-ID, which is used to monitor all online courses approved under the SAFE Act mandate.



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