ARTICLE IV SUPERVISION
(205 ILCS 635/Art. IV heading)
(205 ILCS 635/4-1) (from Ch. 17, par. 2324-1)
Sec. 4-1. Commissioner of Banks and Real Estate; functions, powers, and duties. The functions, powers, and duties of the Commissioner of Banks and Real Estate shall include the following:
(a) to issue or refuse to issue any license as
provided by this Act;
(b) to revoke or suspend for cause any license issued
under this Act;
(c) to keep records of all licenses issued under this
(d) to receive, consider, investigate, and act upon
complaints made by any person in connection with any residential mortgage licensee in this State;
(f) to prescribe the forms of and receive:
(1) applications for licenses; and
(2) all reports and all books and records
required to be made by any licensee under this Act, including annual audited financial statements and annual reports of mortgage activity;
(g) to adopt rules and regulations necessary and
proper for the administration of this Act;
(h) to subpoena documents and witnesses and compel
their attendance and production, to administer oaths, and to require the production of any books, papers, or other materials relevant to any inquiry authorized by this Act;
(h-1) to issue orders against any person, if the
Commissioner has reasonable cause to believe that an unsafe, unsound, or unlawful practice has occurred, is occurring, or is about to occur, if any person has violated, is violating, or is about to violate any law, rule, or written agreement with the Commissioner, or for the purpose of administering the provisions of this Act and any rule adopted in accordance with the Act;
(h-2) to address any inquiries to any licensee, or
the officers thereof, in relation to its activities and conditions, or any other matter connected with its affairs, and it shall be the duty of any licensee or person so addressed, to promptly reply in writing to such inquiries. The Commissioner may also require reports from any licensee at any time the Commissioner may deem desirable;
(i) to require information with regard to any license
applicant as he or she may deem desirable, with due regard to the paramount interests of the public as to the experience, background, honesty, truthfulness, integrity, and competency of the license applicant as to financial transactions involving primary or subordinate mortgage financing, and where the license applicant is an entity other than an individual, as to the honesty, truthfulness, integrity, and competency of any officer or director of the corporation, association, or other entity, or the members of a partnership;
(j) to examine the books and records of every
licensee under this Act at intervals as specified in Section 4-2;
(k) to enforce provisions of this Act;
(l) to levy fees, fines, and charges for services
performed in administering this Act; the aggregate of all fees collected by the Commissioner on and after the effective date of this Act shall be paid promptly after receipt of the same, accompanied by a detailed statement thereof, into the Residential Finance Regulatory Fund under Section 4-1.5 of this Act; the amounts deposited into that Fund shall be used for the ordinary and contingent expenses of the Office of Banks and Real Estate. Nothing in this Act shall prevent continuing the practice of paying expenses involving salaries, retirement, social security, and State-paid insurance of State officers by appropriation from the General Revenue Fund.
(m) to appoint examiners, supervisors, experts, and
special assistants as needed to effectively and efficiently administer this Act;
(n) to conduct hearings for the purpose of:
(1) appeals of orders of the Commissioner;
(2) suspensions or revocations of licenses, or
fining of licensees;
(i) complaints against licensees; or
(ii) annual gross delinquency rates; and
(4) carrying out the purposes of this Act;
(o) to exercise exclusive visitorial power over a
licensee unless otherwise authorized by this Act or as vested in the courts, or upon prior consultation with the Commissioner, a foreign residential mortgage regulator with an appropriate supervisory interest in the parent or affiliate of a licensee;
(p) to enter into cooperative agreements with state
regulatory authorities of other states to provide for examination of corporate offices or branches of those states and to accept reports of such examinations;
(q) to assign an examiner or examiners to monitor the
affairs of a licensee with whatever frequency the Commissioner determines appropriate and to charge the licensee for reasonable and necessary expenses of the Commissioner, if in the opinion of the Commissioner an emergency exists or appears likely to occur;
(r) to impose civil penalties of up to $50 per day
against a licensee for failing to respond to a regulatory request or reporting requirement; and
(s) to enter into agreements in connection with the
Nationwide Multistate Licensing System and Registry.
(Source: P.A. 100-783, eff. 8-10-18; 100-1153, eff. 12-19-18; 101-81, eff. 7-12-19.)
(205 ILCS 635/4-1.5)
Sec. 4-1.5. Residential Finance Regulatory Fund.
(a) The aggregate of all moneys collected by the Secretary under this Act shall be paid promptly after receipt of the same, accompanied by a detailed statement thereof, into the State treasury and shall be set apart in the Residential Finance Regulatory Fund, formerly designated the Savings and Residential Finance Regulatory Fund, a special fund created in the State treasury. The amounts deposited into the Fund shall be used for the ordinary and contingent expenses of the Department of Financial and Professional Regulation and the Division of Banking, or their successors, in administering and enforcing the Residential Mortgage License Act of 1987 and other laws, rules, and regulations as may apply to the administration and enforcement of the foregoing laws, rules, and regulations, as amended from time to time. Nothing in this Act shall prevent continuing the practice of paying expenses involving salaries, retirement, social security, and State paid insurance of State officers by appropriation from the General Revenue Fund.
(b) Moneys in the Residential Finance Regulatory Fund may be transferred to the Professions Indirect Cost Fund, as authorized under Section 2105-300 of the Department of Professional Regulation Law of the Civil Administrative Code of Illinois.
(c) All earnings received from investments of funds in the Residential Finance Regulatory Fund shall be deposited into that Fund and may be used for the same purposes as fees deposited into that Fund.
(Source: P.A. 98-1081, eff. 1-1-15.)
(205 ILCS 635/4-2) (from Ch. 17, par. 2324-2)
Sec. 4-2. Examination; prohibited activities.
(a) The business affairs of a licensee under this Act shall be examined for compliance with this Act as often as the Secretary deems necessary and proper. The Secretary shall promulgate rules with respect to the frequency and manner of examination. The Secretary shall appoint a suitable person to perform such examination. The Secretary and his appointees may examine the entire books, records, documents, and operations of each licensee and its subsidiary, affiliate, or agent, and may examine any of the licensee's or its subsidiary's, affiliate's, or agent's officers, directors, employees and agents under oath. For purposes of this Section, "agent" includes service providers such as accountants, closing services providers, providers of outsourced services such as call centers, marketing consultants, and loan processors, even if exempt from licensure under this Act. This Section does not apply to an attorney's privileged work product or communications.
(b) The Secretary shall prepare a sufficiently detailed report of each licensee's examination, shall issue a copy of such report to each licensee's principals, officers, or directors and shall take appropriate steps to ensure correction of violations of this Act.
(c) Affiliates of a licensee shall be subject to examination by the Secretary on the same terms as the licensee, but only when reports from, or examination of a licensee provides for documented evidence of unlawful activity between a licensee and affiliate benefiting, affecting or deriving from the activities regulated by this Act.
(d) The expenses of any examination of the licensee and affiliates shall be borne by the licensee and assessed by the Secretary as established by regulation.
(e) Upon completion of the examination, the Secretary shall issue a report to the licensee. All confidential supervisory information, including the examination report and the work papers of the report, shall belong to the Secretary's office and may not be disclosed to anyone other than the licensee, law enforcement officials or other regulatory agencies that have an appropriate regulatory interest as determined by the Secretary, or to a party presenting a lawful subpoena to the Office of the Secretary. The Secretary may immediately appeal to the court of jurisdiction the disclosure of such confidential supervisory information and seek a stay of the subpoena pending the outcome of the appeal. Reports required of licensees by the Secretary under this Act and results of examinations performed by the Secretary under this Act shall be the property of only the Secretary, but may be shared with the licensee. Access under this Act to the books and records of each licensee shall be limited to the Secretary and his agents as provided in this Act and to the licensee and its authorized agents and designees. No other person shall have access to the books and records of a licensee under this Act. Any person upon whom a demand for production of confidential supervisory information is made, whether by subpoena, order, or other judicial or administrative process, must withhold production of the confidential supervisory information and must notify the Secretary of the demand, at which time the Secretary is authorized to intervene for the purpose of enforcing the limitations of this Section or seeking the withdrawal or termination of the attempt to compel production of the confidential supervisory information. The Secretary may impose any conditions and limitations on the disclosure of confidential supervisory information that are necessary to protect the confidentiality of such information. Except as authorized by the Secretary, no person obtaining access to confidential supervisory information may make a copy of the confidential supervisory information. The Secretary may condition a decision to disclose confidential supervisory information on entry of a protective order by the court or administrative tribunal presiding in the particular case or on a written agreement of confidentiality. In a case in which a protective order or agreement has already been entered between parties other than the Secretary, the Secretary may nevertheless condition approval for release of confidential supervisory information upon the inclusion of additional or amended provisions in the protective order. The Secretary may authorize a party who obtained the records for use in one case to provide them to another party in another case, subject to any conditions that the Secretary may impose on either or both parties. The requestor shall promptly notify other parties to a case of the release of confidential supervisory information obtained and, upon entry of a protective order, shall provide copies of confidential supervisory information to the other parties.
(f) The Secretary, deputy commissioners, and employees of the Office of Banks and Real Estate shall be subject to the restrictions provided in Section 2.5 of the Division of Banking Act including, without limitation, the restrictions on (i) owning shares of stock or holding any other equity interest in an entity regulated under this Act or in any corporation or company that owns or controls an entity regulated under this Act; (ii) being an officer, director, employee, or agent of an entity regulated under this Act; and (iii) obtaining a loan or accepting a gratuity from an entity regulated under this Act.
(g) After the initial examination for those licensees whose only mortgage activity is servicing fewer than 1,000 Illinois residential loans, the examination required in subsection (a) may be waived upon submission of a letter from the licensee's independent certified auditor that the licensee serviced fewer than 1,000 Illinois residential loans during the year in which the audit was performed.
(h) An exempt entity under subsection (a-1) of Section 1-3 of this Act shall cooperate with the Secretary in the examination and investigation of its sponsored and licensed mortgage loan originators at a frequency determined by the Secretary. The exempt entity under subsection (a-1) of Section 1-3 of this Act shall cooperate with the Secretary in providing mortgage loan originator documents and access to mortgage loan originator offices for the purposes of examination and investigation. The activities of the exempt entity shall not relieve a mortgage loan originator of his or her individual requirements under Section 7-15 of this Act. An exempt entity under subsection (a-1) of Section 1-3 of this Act shall pay to the Department any examination fees invoiced by the Secretary for examination of its sponsored mortgage loan originators. The Secretary shall have the authority to make oral or written inquiries regarding the management of an exempt entity under subsection (a-1) of Section 1-3 of this Act and it shall be the duty of the exempt entity to promptly reply by telephone, in writing, or other means to the inquiry.
(Source: P.A. 98-492, eff. 8-16-13.)
(205 ILCS 635/4-3) (from Ch. 17, par. 2324-3)
Sec. 4-3. Subpoena power of the Commissioner. (a) The Commissioner shall have the power to issue and to serve subpoenas and subpoenas duces tecum to compel the attendance of witnesses and the production of all books, accounts, records and other documents and materials relevant to an examination or investigation. The Commissioner or his or her duly authorized representative, shall have power to administer oaths and affirmations to any person.
(b) In the event of noncompliance with a subpoena or subpoena duces tecum issued or caused to be issued by the Commissioner, the Commissioner may petition the circuit court of the county in which the person subpoenaed resides or has its principal place of business for an order requiring the subpoenaed person to appear and testify and to produce such books, accounts, records and other documents as are specified in the subpoena duces tecum. The court may grant injunctive relief restraining the person from advertising, promoting, soliciting, entering into, offering to enter into, continuing, or completing any residential mortgage financing transaction or residential mortgage servicing transaction. The court may grant such other relief, including, but not limited to, the restraint, by injunction or appointment of a receiver, of any transfer, pledge, assignment or other disposition of the person's assets or any concealment, alteration, destruction or other disposition of books, accounts, records or other documents and materials as the court deems appropriate, until the person has fully complied with the subpoena or subpoena duces tecum and the Commissioner has completed an investigation or examination.
(c) When it shall appear to the Commissioner that the compliance with a subpoena or subpoena duces tecum issued or caused to be issued by the Commissioner pursuant to this Section is essential to an investigation or examination, the Commissioner, in addition to the other remedies provided for herein, may apply for relief to the circuit court of the county in which the subpoenaed person resides or has its principal place of business. The court shall thereupon direct the issuance of an order against the subpoenaed person requiring sufficient bond conditioned on compliance with the subpoena or subpoena duces tecum. The court shall cause to be endorsed on the order a suitable amount of bond or payment pursuant to which the person named in the order shall be freed, having a due regard to the nature of the case.
(d) In addition, the Commissioner may seek a writ of attachment or an equivalent order from the circuit court having jurisdiction over the person who has refused to obey a subpoena, who has refused to give testimony or who has refused to produce the matters described in the subpoena duces tecum.
(Source: P.A. 85-735.)
(205 ILCS 635/4-4) (from Ch. 17, par. 2324-4)
Sec. 4-4. Report Required of Licensee; False Statements; Delay; Penalties.(a) In addition to any reports required under this Act, every licensee shall file such other reports as the Commissioner shall request.
(b) Any licensee or any officer, director, employee or agent of any licensee who shall fail to file any reports required by this Act, including those under subsection (a) above, or who shall deliberately, wilfully or knowingly make, subscribe to or cause to be made any false entry with intent to deceive the Commissioner or his or her appointees or who shall purposely cause unreasonable delay in filing such reports, shall be guilty of a Class 4 Felony.
(Source: P.A. 85-735.)
(205 ILCS 635/4-5) (from Ch. 17, par. 2324-5)
Sec. 4-5. Suspension, revocation of licenses; fines.
(a) Upon written notice to a licensee, the Commissioner may suspend or revoke any license issued pursuant to this Act if he or she shall make a finding of one or more of the following in the notice that:
(1) Through separate acts or an act or a course of
conduct, the licensee has violated any provisions of this Act, any rule or regulation promulgated by the Commissioner or of any other law, rule or regulation of this State or the United States.
(2) Any fact or condition exists which, if it had
existed at the time of the original application for such license would have warranted the Commissioner in refusing originally to issue such license.
(3) If a licensee is other than an individual, any
ultimate equitable owner, officer, director, or member of the licensed partnership, association, corporation, or other entity has so acted or failed to act as would be cause for suspending or revoking a license to that party as an individual.
(b) No license shall be suspended or revoked, except as provided in this Section, nor shall any licensee be fined without notice of his or her right to a hearing as provided in Section 4-12 of this Act.
(c) The Commissioner, on good cause shown that an emergency exists, may suspend any license for a period not exceeding 180 days, pending investigation. Upon a showing that a licensee has failed to meet the experience or educational requirements of Section 2-2 or the requirements of subsection (g) of Section 3-2, the Commissioner shall suspend, prior to hearing as provided in Section 4-12, the license until those requirements have been met.
(d) The provisions of subsection (e) of Section 2-6 of this Act shall not affect a licensee's civil or criminal liability for acts committed prior to surrender of a license.
(e) No revocation, suspension or surrender of any license shall impair or affect the obligation of any pre-existing lawful contract between the licensee and any person.
(f) Every license issued under this Act shall remain in force and effect until the same shall have expired without renewal, have been surrendered, revoked or suspended in accordance with the provisions of this Act, but the Commissioner shall have authority to reinstate a suspended license or to issue a new license to a licensee whose license shall have been revoked if no fact or condition then exists which would have warranted the Commissioner in refusing originally to issue such license under this Act.
(g) Whenever the Commissioner shall revoke or suspend a license issued pursuant to this Act or fine a licensee under this Act, he or she shall forthwith execute a written order to that effect. The Commissioner shall post notice of the order on an agency Internet site maintained by the Commissioner or on the Nationwide Multistate Licensing System and Registry and shall forthwith serve a copy of such order upon the licensee. Any such order may be reviewed in the manner provided by Section 4-12 of this Act.
(h) When the Commissioner finds any person in violation of the grounds set forth in subsection (i), he or she may enter an order imposing one or more of the following penalties:
(1) Revocation of license;
(2) Suspension of a license subject to reinstatement
upon satisfying all reasonable conditions the Commissioner may specify;
(3) Placement of the licensee or applicant on
probation for a period of time and subject to all reasonable conditions as the Commissioner may specify;
(4) Issuance of a reprimand;
(5) Imposition of a fine not to exceed $25,000 for
each count of separate offense, provided that a fine may be imposed not to exceed $75,000 for each separate count of offense of paragraph (2) of subsection (i) of this Section; and
(6) Denial of a license.
(i) The following acts shall constitute grounds for which the disciplinary actions specified in subsection (h) above may be taken:
(1) Being convicted or found guilty, regardless of
pendency of an appeal, of a crime in any jurisdiction which involves fraud, dishonest dealing, or any other act of moral turpitude;
(2) Fraud, misrepresentation, deceit or negligence in
any mortgage financing transaction;
(3) A material or intentional misstatement of fact on
an initial or renewal application;
(4) Failure to follow the Commissioner's regulations
with respect to placement of funds in escrow accounts;
(5) Insolvency or filing under any provision of the
Bankruptcy Code as a debtor;
(6) Failure to account or deliver to any person any
property such as any money, fund, deposit, check, draft, mortgage, or other document or thing of value, which has come into his or her hands and which is not his or her property or which he or she is not in law or equity entitled to retain, under the circumstances and at the time which has been agreed upon or is required by law or, in the absence of a fixed time, upon demand of the person entitled to such accounting and delivery;
(7) Failure to disburse funds in accordance with
(8) Any misuse, misapplication, or misappropriation
of trust funds or escrow funds;
(9) Having a license, or the equivalent, to practice
any profession or occupation revoked, suspended, or otherwise acted against, including the denial of licensure by a licensing authority of this State or another state, territory or country for fraud, dishonest dealing or any other act of moral turpitude;
(10) Failure to issue a satisfaction of mortgage when
the residential mortgage has been executed and proceeds were not disbursed to the benefit of the mortgagor and when the mortgagor has fully paid licensee's costs and commission;
(11) Failure to comply with any order of the
Commissioner or rule made or issued under the provisions of this Act;
(12) Engaging in activities regulated by this Act
without a current, active license unless specifically exempted by this Act;
(13) Failure to pay in a timely manner any fee,
charge or fine under this Act;
(14) Failure to maintain, preserve, and keep
available for examination, all books, accounts or other documents required by the provisions of this Act and the rules of the Commissioner;
(15) Refusing, obstructing, evading, or unreasonably
delaying an investigation, information request, or examination authorized under this Act, or refusing, obstructing, evading, or unreasonably delaying compliance with the Director's subpoena or subpoena duces tecum;
(16) A pattern of substantially underestimating the
maximum closing costs;
(17) Failure to comply with or violation of any
provision of this Act;
(18) Failure to comply with or violation of any
provision of Article 3 of the Residential Real Property Disclosure Act.
(j) A licensee shall be subject to the disciplinary actions specified in this Act for violations of subsection (i) by any officer, director, shareholder, joint venture, partner, ultimate equitable owner, or employee of the licensee.
(k) Such licensee shall be subject to suspension or revocation for unauthorized employee actions only if there is a pattern of repeated violations by employees or the licensee has knowledge of the violations, or there is substantial harm to a consumer.
(l) Procedure for surrender of license:
(1) The Commissioner may, after 10 days notice by
certified mail to the licensee at the address set forth on the license, stating the contemplated action and in general the grounds therefor and the date, time and place of a hearing thereon, and after providing the licensee with a reasonable opportunity to be heard prior to such action, fine such licensee an amount not exceeding $25,000 per violation, or revoke or suspend any license issued hereunder if he or she finds that:
(i) The licensee has failed to comply with any
provision of this Act or any order, decision, finding, rule, regulation or direction of the Commissioner lawfully made pursuant to the authority of this Act; or
(ii) Any fact or condition exists which, if it
had existed at the time of the original application for the license, clearly would have warranted the Commissioner in refusing to issue the license.
(2) Any licensee may submit application to surrender
a license, but upon the Director approving the surrender, it shall not affect the licensee's civil or criminal liability for acts committed prior to surrender or entitle the licensee to a return of any part of the license fee.
(Source: P.A. 99-15, eff. 1-1-16; 100-1153, eff. 12-19-18.)
(205 ILCS 635/4-6) (from Ch. 17, par. 2324-6)
Sec. 4-6. Investigation of Complaints. The Commissioner shall at all times maintain staff and facilities adequate to receive, record and investigate complaints and inquiries made by any person concerning this Act and any licensees under this Act. Each licensee shall open its books, records, documents and offices wherever situated to the Commissioner or his or her appointees as needed to facilitate such investigations.
(Source: P.A. 85-735.)
(205 ILCS 635/4-7)
Sec. 4-7. Additional investigation and examination authority. In addition to any authority allowed under this Act, the Director shall have the authority to conduct investigations and examinations as follows:
(a) For purposes of initial licensing, license renewal, license suspension, license conditioning, license revocation or termination, or general or specific inquiry or investigation to determine compliance with this Act, the Commissioner shall have the authority to access, receive, and use any books, accounts, records, files, documents, information, or evidence including, but not limited to, the following:
(1) criminal, civil, and administrative history
information, including nonconviction data as specified in the Criminal Code of 2012;
(2) personal history and experience information,
including independent credit reports obtained from a consumer reporting agency described in Section 603(p) of the federal Fair Credit Reporting Act; and
(3) any other documents, information, or evidence
the Commissioner deems relevant to the inquiry or investigation regardless of the location, possession, control, or custody of the documents, information, or evidence.
(b) For the purposes of investigating violations or complaints arising under this Act, or for the purposes of examination, the Commissioner may review, investigate, or examine any licensee, individual, or person subject to this Act, as often as necessary in order to carry out the purposes of this Act. The Commissioner may direct, subpoena, or order the attendance of and examine under oath all persons whose testimony may be required about the loans or the business or subject matter of any such examination or investigation, and may direct, subpoena, or order the person to produce books, accounts, records, files, and any other documents the Commissioner deems relevant to the inquiry.
(c) Each licensee, individual, or person subject to this Act shall make available to the Commissioner upon request the books and records relating to the operations of such licensee, individual, or person subject to this Act. The Commissioner shall have access to such books and records and interview the officers, principals, mortgage loan originators, employees, independent contractors, agents, and customers of the licensee, individual, or person subject to this Act concerning their business.
(d) Each licensee, individual, or person subject to this Act shall make or compile reports or prepare other information as directed by the Commissioner in order to carry out the purposes of this Section including, but not limited to:
(1) accounting compilations;
(2) information lists and data concerning loan
transactions in a format prescribed by the Commissioner; or
(3) other information deemed necessary to carry out
the purposes of this Section.
(e) In making any examination or investigation authorized by this Act, the Commissioner may control access to any documents and records of the licensee or person under examination or investigation. The Commissioner may take possession of the documents and records or place a person in exclusive charge of the documents and records in the place where they are usually kept. During the period of control, no individual or person shall remove or attempt to remove any of the documents and records except pursuant to a court order or with the consent of the Commissioner. Unless the Commissioner has reasonable grounds to believe the documents or records of the licensee have been, or are at risk of being altered or destroyed for purposes of concealing a violation of this Act, the licensee or owner of the documents and records shall have access to the documents or records as necessary to conduct its ordinary business affairs.
(f) In order to carry out the purposes of this Section, the Commissioner may:
(1) retain attorneys, accountants, or other
professionals and specialists as examiners, auditors, or investigators to conduct or assist in the conduct of examinations or investigations;
(2) enter into agreements or relationships with
other government officials or regulatory associations in order to improve efficiencies and reduce regulatory burden by sharing resources, standardized or uniform methods or procedures, and documents, records, information or evidence obtained under this Section;
(3) use, hire, contract, or employ public or
privately available analytical systems, methods, or software to examine or investigate the licensee, individual, or person subject to this Act;
(4) accept and rely on examination or investigation
reports made by other government officials, within or without this State; or
(5) accept audit reports made by an independent
certified public accountant for the licensee, individual, or person subject to this Act in the course of that part of the examination covering the same general subject matter as the audit and may incorporate the audit report in the report of the examination, report of investigation, or other writing of the Commissioner.
(g) The authority of this Section shall remain in effect, whether such a licensee, individual, or person subject to this Act acts or claims to act under any licensing or registration law of this State, or claims to act without the authority.
(h) No licensee, individual, or person subject to investigation or examination under this Section may knowingly withhold, abstract, remove, mutilate, destroy, or secrete any books, records, computer records, or other information.
(Source: P.A. 96-112, eff. 7-31-09; 97-1150, eff. 1-25-13.)
(205 ILCS 635/4-8) (from Ch. 17, par. 2324-8)
Sec. 4-8. Delinquency; examination.
(b) The Secretary shall conduct as part of an examination of each licensee a review of the licensee's loan delinquency data.
This subsection shall not be construed as a limitation of the Secretary's examination authority under Section 4-2 of this Act or as otherwise provided in this Act. The Secretary may require a licensee to provide loan delinquency data as the Secretary deems necessary for the proper enforcement of the Act.
(c) The purpose of the examination under subsection (b) shall be to determine whether the loan delinquency data of the licensee has resulted from practices which deviate from sound and accepted mortgage underwriting practices, including, but not limited to, credit fraud, appraisal fraud, and property inspection fraud. For the purpose of conducting this examination, the Secretary may accept materials prepared for the U.S. Department of Housing and Urban Development.
(d) The Secretary, at his or her discretion, may hold public hearings. Such testimony shall be by a homeowner or mortgagor or his agent, whose residential interest is affected by the activities of the residential mortgage licensee subject to such hearing. At such public hearing, a witness may present testimony on his or her behalf concerning only his or her home or home mortgage, or a witness may authorize a third party to appear on his or her behalf. The testimony shall be restricted to information and comments related to a specific residence or specific residential mortgage application or applications for a residential mortgage or residential loan transaction. The testimony must be preceded by either a letter of complaint or a completed consumer complaint form prescribed by the Secretary.
(e) The Secretary shall, at the conclusion of the public hearings, release his or her findings and shall also make public any action taken with respect to the licensee. The Secretary shall also give full consideration to the findings of this examination whenever reapplication is made by the licensee for a new license under this Act.
(f) A licensee that is examined pursuant to subsection (b) shall submit to the Secretary a plan which shall be designed to reduce that licensee's loan delinquencies. The plan shall be implemented by the licensee as approved by the Secretary. A licensee that is examined pursuant to subsection (b) shall report monthly, for a one year period, one, 2, and 3 month loan delinquencies.
(g) Whenever the Secretary finds that a licensee's loan delinquencies on insured mortgages is unusually high within a particular geographic area, he or she shall require that licensee to submit such information as is necessary to determine whether that licensee's practices have constituted credit fraud, appraisal fraud or property inspection fraud. The Secretary shall promulgate such rules as are necessary to determine whether any licensee's loan delinquencies are unusually high within a particular area.
(Source: P.A. 100-783, eff. 8-10-18; 100-1153, eff. 12-19-18; 101-81, eff. 7-12-19.)
(205 ILCS 635/4-8.1)
Sec. 4-8.1. Confidential information. In hearings conducted under this Act, information presented into evidence that was acquired by the licensee when serving any individual in connection with a residential mortgage, including all financial information of the individual, shall be deemed strictly confidential and shall be made available only as part of the record of a hearing under this Act or otherwise (i) when the record is required, in its entirety, for purposes of judicial review or (ii) upon the express written consent of the individual served, or in the case of his or her death or disability, the consent of his or her personal representative.
(Source: P.A. 93-561, eff. 1-1-04.)
(205 ILCS 635/4-8.1A)
Sec. 4-8.1A. Confidentiality.
(a) In order to promote more effective regulation and reduce regulatory burden through supervisory information sharing, except as otherwise provided in federal Public Law 110-289, Section 1512, the requirements under any federal law or state law regarding the privacy or confidentiality of any information or material provided to the Nationwide Multistate Licensing System and Registry, and any privilege arising under federal or state law, including the rules of any federal or state court, with respect to such information or material, shall continue to apply to information or material after the information or material has been disclosed to the Nationwide Multistate Licensing System and Registry. The information and material may be shared with all state and federal regulatory officials with mortgage industry oversight authority without the loss of privilege or the loss of confidentiality protections provided by federal law or state law.
(b) In order to promote more effective regulation and reduce regulatory burden through supervisory information sharing, the Director is authorized to enter agreements or sharing arrangements with other governmental agencies, the Conference of State Bank Supervisors, the American Association of Residential Mortgage Regulators or other associations representing governmental agencies as established by rule, regulation or order of the Director. The sharing of confidential supervisory information or any information or material described in subsection (a) of this Section pursuant to an agreement or sharing arrangement shall not result in the loss of privilege or the loss of confidentiality protections provided by federal law or state law.
(c) In order to promote more effective regulation and reduce regulatory burden through supervisory information sharing, information or material that is subject to a privilege or confidentiality under subsection (a) of this Section shall not be subject to the following:
(1) disclosure under any State law governing the
disclosure to the public of information held by an officer or an agency of the State; or
(2) subpoena or discovery, or admission into
evidence, in any private civil action or administrative process, unless with respect to any privilege held by the Nationwide Multistate Licensing System and Registry with respect to the information or material, the person to whom such information or material pertains waives, in whole or in part, in the discretion of that person, that privilege.
(d) In order to promote more effective regulation and reduce regulatory burden through supervisory information sharing, other law relating to the disclosure of confidential supervisory information or any information or material described in subsection (a) of this Section that is inconsistent with subsection (a) of this Section shall be superseded by the requirements of this Section to the extent the other law provides less confidentiality or a weaker privilege.
(e) In order to promote more effective regulation and reduce regulatory burden through supervisory information sharing, this Section shall not apply to the employment history of a mortgage loan originator, and the record of publicly adjudicated disciplinary and enforcement actions against a mortgage loan originator.
(Source: P.A. 100-1153, eff. 12-19-18.)
(205 ILCS 635/4-8.2)
Sec. 4-8.2. Reports of violations. Any person licensed under this Act or any other person may report to the Commissioner any information to show that a person subject to this Act is or may be in violation of this Act. A licensee who files a report with the Department of Financial and Professional Regulation that another licensee is engaged in one or more violations pursuant to this Act shall not be the subject of disciplinary action by the Department, unless the Department determines, by a preponderance of the evidence available to the Department, that the reporting person knowingly and willingly participated in the violation that was reported.
(Source: P.A. 97-891, eff. 8-3-12.)
(205 ILCS 635/4-8.3)
Sec. 4-8.3. Annual report. On or before March 1 of each year or the date selected for Mortgage Call Reports under Section 4-9.1 of this Act, each licensee shall file a report with the Secretary that discloses such information as the Secretary requires. A licensee filing a Mortgage Call Report is not required to file an annual report. Exempt entities as defined in subsection (d) of Section 1-4 shall not file the annual report of mortgage and servicing activity required by this Section.
(Source: P.A. 100-1153, eff. 12-19-18.)
(205 ILCS 635/4-9) (from Ch. 17, par. 2324-9)
Sec. 4-9. (Repealed).
(Source: P.A. 89-355, eff. 8-17-95. Repealed by 90-301, eff. 8-1-97.)
(205 ILCS 635/4-9.1)
Sec. 4-9.1. Mortgage call reports. Each residential mortgage licensee shall submit to the Nationwide Multistate Licensing System and Registry reports of condition, which shall be in the form and shall contain the information that the Nationwide Multistate Licensing System and Registry may require.
(Source: P.A. 100-1153, eff. 12-19-18.)
(205 ILCS 635/4-10) (from Ch. 17, par. 2324-10)
Sec. 4-10. Rules and regulations of the Commissioner.
(a) In addition to such powers as may be prescribed by this Act, the Commissioner is hereby authorized and empowered to promulgate regulations consistent with the purposes of this Act, including, but not limited to:
(1) such rules and regulations in connection with the
activities of licensees as may be necessary and appropriate for the protection of consumers in this State;
(2) such rules and regulations as may be necessary
and appropriate to define improper or fraudulent business practices in connection with the activities of licensees in making mortgage loans;
(3) such rules and regulations as may define the
terms used in this Act and as may be necessary and appropriate to interpret and implement the provisions of this Act; and
(4) such rules and regulations as may be necessary
for the enforcement of this Act.
(b) The Commissioner is hereby authorized and empowered to make such specific rulings, demands, and findings as he or she may deem necessary for the proper conduct of the mortgage lending industry.
(c) A person or entity may make a written application to the Department for a written interpretation of this Act. The Department may then, in its sole discretion, choose to issue a written interpretation. To be valid, a written interpretation must be signed by the Secretary, or his or her designated Director of Financial and Professional Regulation, and the Department's General Counsel. A written interpretation expires 2 years after the date that it was issued.
(d) No provision in this Act that imposes liability or establishes violations shall apply to any act taken by a person or entity in conformity with a written interpretation of this Act that is in effect at the time the act is taken, notwithstanding whether the written interpretation is later amended, rescinded, or determined by judicial or other authority to be invalid for any reason.
(Source: P.A. 100-863, eff. 8-14-18.)
(205 ILCS 635/4-11) (from Ch. 17, par. 2324-11)
Sec. 4-11. Costs of Supervision; Examination and Investigative Fees. The expenses of administering this Act, including investigations and examinations provided for in this Act shall be borne by and assessed against entities regulated by this Act. Subject to the limitations set forth in Section 2-2 of this Act, the Secretary shall establish fees by regulation in at least the following categories:
(1) application fees;
(2) investigation of license applicant fees;
(3) examination fees;
(4) contingent fees;
and such other categories as may be required to administer this Act.
(Source: P.A. 95-1047, eff. 4-6-09.)
(205 ILCS 635/4-12) (from Ch. 17, par. 2324-12)
Sec. 4-12. Appeal and Review. (a) Any person or entity affected by a decision of the Commissioner under any provision of this Act may obtain review of such decision within the Office of the Commissioner.
(b) The Commissioner shall, in accordance with the "Illinois Administrative Procedure Act", promulgate rules and regulations to provide for review within the Office of the Commissioner (hereinafter referred to as "agency review") of his or her decisions affecting the rights of entities under this Act. Such review shall provide for, at a minimum:
(1) appointment of a hearing officer other than a regular employee of the Office of the Commissioner;
(2) appropriate procedural rules, specific deadlines for filings, and standards of evidence and of proof;
(3) provision for apportioning costs among parties to the appeal.
(c) All final agency determinations of appeals to decisions of the Commissioner may be reviewed in accordance with and under the provisions of the "Administrative Review Law". Appeals from all final orders and judgments entered by a court in review of any final administrative decision of the Commissioner or of any final agency review of a decision of the Commissioner may be taken as in other civil cases.
(Source: P.A. 85-735.)
(205 ILCS 635/4-13) (from Ch. 17, par. 2324-13)
Sec. 4-13. Violations of this Act; Commissioner's Orders. If the Commissioner finds, as the result of examination, investigation or review of reports submitted by a licensee that the business and affairs of a licensee are not being conducted in accordance with this Act, the Commissioner shall notify the licensee of the correction necessary. Should a licensee fail to correct such violations, the Commissioner shall issue an order requiring immediate correction and compliance with this Act, specifying a reasonable date for performance.
The Commissioner shall promulgate rules and regulations to provide for an orderly and timely appeal of all orders within the Office of the Commissioner. Such rules shall include provision for assessment of fees and costs.
(Source: P.A. 85-735.)
(205 ILCS 635/4-14) (from Ch. 17, par. 2324-14)
Sec. 4-14. Collection of fees. Unless exempt from licensure under this Act, no person engaged in or offering to engage in any act or service, for which a license under this Act is required, may bring or maintain any action in any court of this State to collect compensation for the performance of the licensable services without alleging and proving that he or she was the holder of a valid Residential Mortgage License under this Act at all times during the performance of those services.
(Source: P.A. 87-642.)
(205 ILCS 635/4-15)
Sec. 4-15. Enforcement and reporting provisions. The Attorney General may enforce any violation of Section 5-6, 5-7, 5-8, 5-9, 5-10, 5-11, 5-12, 5-14, or 5-15 of this Act as an unlawful practice under the Consumer Fraud and Deceptive Business Practices Act.
(Source: P.A. 95-691, eff. 6-1-08.)
(205 ILCS 635/4-16)
Sec. 4-16. Private right of action. A borrower injured by a violation of the standards, duties, prohibitions, or requirements of Sections 5-6, 5-7, 5-8, 5-9, 5-10, 5-11, 5-12, 5-14, 5-15, and 5-16 of this Act shall have a private right of action.
(a) A licensee is not liable for a violation of this Act if:
(1) within 30 days of the loan closing and prior to
receiving any notice from the borrower of the violation, the licensee has made appropriate restitution to the borrower and appropriate adjustments are made to the loan; or
(2) the violation was not intentional and resulted
from a bona fide error in fact, notwithstanding the maintenance of procedures reasonably adopted to avoid such errors, and within 60 days of the discovery of the violation and prior to receiving any notice from the borrower of the violation, the borrower is notified of the violation, appropriate restitution is made to the borrower, and appropriate adjustments are made to the loan.
(b) The remedies and rights provided for in this Act are not exclusive, but cumulative, and all other applicable claims are specifically preserved.
(Source: P.A. 95-691, eff. 6-1-08.)