2002 Banking and Related Legislation
Each year, the Department of Banking, with the coordination of the Government Relations and Consumer Affairs Division, conducts an active legislative program. During the 2002 session, the General Assembly enacted several bills concerning banks, credit unions, consumer credit and other issues into law. Five of these public acts were Department of Banking proposals. We've provided brief summaries of each of the department's enacted proposals, along with hyperlinks to the text of other public acts of interest. (Listings are by public act number).
Please note that the summaries on this page present certain key legal points for public information and do not represent complete statements of the law. All references on this page are to sections and titles of the Connecticut General Statutes, unless otherwise noted. Hyperlinks for each public act lead to the Connecticut General Assembly website.
Public Act 02-12
s.H.B. 5073 - An Act Concerning Prepaid Finance Charges
Effective Date: April 22, 2002
Section of Statutes Which is Amended: P.A. 01-34 § 3, P.A. 01-34 § 5, 36a-521(a)
Description of Act:
Amends § 3 of P.A. 01-34 to make a technical change to the definition of "consummation", add a definition of "interim interest" and amend the definition of "prepaid finance charge" to clarify that the term means any finance charge determined in accordance with Regulation Z, except that it includes fees and commissions for insurance products and unrelated goods or services the cost of which is prepaid from the loan proceeds and excludes premiums, fees and other amounts paid to a governmental agency, amounts required to be escrowed by a governmental agency and interim interest.
Amends § 5 of P.A. 01-34 to exclude payments required to be escrowed by a governmental agency from the prohibition against a prepayment schedule that consolidates more than two periodic payments.
Amends C.G.S. § 36a-521(a) to make the definition of "prepaid finance charge" in § 3 of P.A. 01-34, as amended by this Act, applicable to C.G.S. § 36a-521 concerning the limitation on charges and demand for payment prior to maturity for secondary mortgage loans.
Public Act 02-13
H.B. 5074 - An Act Concerning Assessments And Reports Filed With The Commissioner Of Banking
Effective Date: July 1, 2002
Section of Statutes Which is Amended: 36a-16(a)(1), 36a-65(a), 36a-65(b)
Description of Act:
Amends C.G.S. § 36a-16(a)(1) to eliminate the requirement that twice a year all Connecticut banks publish in a newspaper reports of condition and income required to be filed with the Commissioner, and to require instead that once every year mutual Connecticut banks publish in a newspaper such reports.
Amends C.G.S. § 36a-65(a) to provide that the Commissioner may reduce the assessment of a Connecticut bank up to the amount of the assessment for the same fiscal year collected from such bank by another state in which such bank has established a branch, limited branch or mobile branch.
Amends C.G.S. § 36a-65(b) to change the fee for trust department exams from $150 per day for the examiner in charge and $100 per day for each assisting examiner to the actual cost of the examination.
Public Act 02-21
s.S.B. 329 - An Act Concerning the Bankers' Bank
Effective Date: October 1, 2002
Section of Statutes Which is Amended: 36a-70(q)
Description of Act:
Amends C.G.S. § 36a-70(q) to permit a bankers' bank to: (1) provide services that indirectly benefit banks, credit unions and their directors, officers and employees, and (2) eliminate the limitation that the institutions to which a bankers' bank may provide services have their principal offices in New York or New England.
Public Act 02-31
s.H.B. 5423 - An Act Concerning Bank Parity
Effective Date: October 1, 2002
Section of Statutes Which is Amended: 36a-44
Description of Act:
Amends C.G.S. § 36a-44 to add exceptions to the provisions concerning confidentiality of financial records for disclosures made by financial institution to: (1) a broker-dealer or investment advisor engaged in a contractual networking arrangement with the financial institution provided the customer is given notice and a reasonable opportunity to opt-out; (2) a customer service representative who works or is an agent for both the financial institution and a broker-dealer or investment advisor engaged in a contractual networking arrangement; and (3) other employees or agents of a broker-dealer or investment advisor engaged in a contractual networking arrangement for the purpose of compliance with applicable laws.
Public Act 02-39
S.B. 330 - An Act Concerning Bank Conversions
Effective Date: October 1, 2002
Section of Statutes Which is Amended: P.A. 01-183 § 10
Description of Act:
Amends P.A. 01-183 § 10 to authorize any Connecticut bank, with the approval of the Commissioner, to convert to an uninsured bank.
Public Act 02-47
s.S.B. 93 - An Act Concerning Bank Powers And Transactions
Effective Date: May 10, 2002, except §§ 2 to 10 and 14 to 19 take effect October 1, 2002
Section of Statutes Which is Amended: 36a-2, 36a-23(b), 36a-65(d)(1), 36a-70, 36a-125(h), 36a-126(a)(1), 36a-135, 36a-136(d), 36a-137, 36a-145, 36a-194(e), 36a-195(d), 36a-198, 36a-220(a), 36a-250(a), 36a-252, 36a-252a, 36a-434a, P.A. 01-183 § 10(c)
Description of Act:
Section 1 of the Act amends C.G.S. § 36a-2 to add a definition for the term "subsidiary holding company", and amends the definition of "mutual holding company" to include a subsidiary holding company.
Section 2 of the Act amends C.G.S. § 36a-23(b) to permit the Commissioner to authorize the closing of all banks or Connecticut credit unions in this state or in any specified town or counties or any office of any bank or Connecticut credit union for good cause shown.
Section 3 of the Act amends C.G.S. § 36a-65(d)(1) to make technical amendments.
Section 4 of the Act amends C.G.S. § 36a-70 to add a new provision that provides that prior to the issuance of a final certificate of authority for a newly organized Connecticut bank, the organizers may (1) with the approval of the Commissioner, amend the proposed certificate of incorporation to change, among other things, the name or the type of Connecticut bank; (2) with the approval of the approving authority, amend a material provision of the proposed business plan or amend the proposed certificate of incorporation or change the minimum amount of equity capital with which the Connecticut bank will commence business; or (3) with notice to the Commissioner, amend the proposed certificate of incorporation to change the occupation or residence address of any organizer or prospective initial director of the Connecticut. Also amends C.G.S. § 36a-70 to provide procedures for the Commissioner to follow upon receipt of an application to change the name of a proposed Connecticut bank; and to require the organizers to file with the Secretary of the State any approval to amend the proposed certificate of incorporation of a proposed Connecticut bank issued pursuant to C.G.S. § 36a-70(k), and to provide that any such approved amendment shall be effective upon such filing.
Section 5 of the Act amends C.G.S. § 36a-125(h) to provide that any shareholder of a constituent bank involved in a merger or consolidation is entitled to assert appraisal rights and to obtain payment of the fair value of such shareholder's shares under C.G.S. §§ 33-855 to 33-872, inclusive.
Section 6 of the Act amends C.G.S. § 36a-126(a)(1) to make conforming amendments with respect to appraisal rights.
Section 7 of the Act amends C.G.S. § 36a-135 to require the filing of a proposed amended certificate of incorporation instead of a proposed certificate of incorporation with the Commissioner and with the Secretary of the State in connection with any mutual to mutual bank conversion.
Section 8 of the Act amends C.G.S. § 36a-136(d) to require the filing of a proposed amended certificate of incorporation instead of a proposed certificate of incorporation with the Commissioner in connection with any mutual to stock bank conversion.
Section 9 of the Act amends C.G.S. § 36a-137 to require the filing of a proposed amended certificate of incorporation instead of a proposed certificate of incorporation with the Commissioner in connection with any capital stock to capital stock bank conversion; to require the converting bank to file the Commissioner's approval and its amended certificate of incorporation with the Secretary of the State; and to provide that any shareholder of the converting bank is entitled to assert appraisal rights and to obtain payment of the fair value of such shareholder's shares under C.G.S. §§ 33-855 to 33-872, inclusive.
Section 10 of the Act amends C.G.S. § 36a-145 to provide that a Connecticut bank may, with the approval of the Commissioner, establish in this state a limited branch, either de novo or resulting from the conversion of a branch. Also amends C.G.S. § 36a-145 to authorize any Connecticut bank, with the approval of the Commissioner, to relocate outside of this state any branch or limited branch established outside of this state, in accordance with such notice requirements as the Commissioner may prescribe, and to authorize any Connecticut bank, with the approval of the Commissioner, to sell a branch, limited branch or mobile branch established outside of this state, provided the selling Connecticut bank must have been in existence for at least five years, unless the Commissioner waives this requirement.
Section 11 of the Act amends C.G.S. § 36a-194(e) to provide that if at any time a mutual holding company that does not control a subsidiary holding company of a reorganized savings institution sells or otherwise disposes of ordinarily voting shares in the reorganized savings institution and, as a result, such mutual holding company no longer owns at least 51 percent of such shares, the Commissioner may seek the appointment of a receiver for such mutual holding company.
Section 12 of the Act amends C.G.S. § 36a-195(d) to conform its requirements to amendments made to C.G.S. § 36a-198.
Section 13 of the Act amends C.G.S. § 36a-198 to authorize a mutual holding company to establish a subsidiary holding company as a direct subsidiary to hold 100 percent of the stock of its reorganized savings institution, subject to the approval of and in accordance with any conditions or limitations imposed by the Commissioner. Also amends C.G.S. § 36a-198 to provide that, for purposes of C.G.S. § 36a-196, the subsidiary holding company shall be treated as a reorganized savings institution issuing stock and shall be subject to the requirements of that section, and to limit the aggregate amount of outstanding common stock of the subsidiary holding company owned or controlled by persons other than its mutual holding company to be less than 51 percent of such subsidiary holding company's total outstanding common stock.
Section 14 of the Act amends C.G.S. § 36a-220(a) to provide that if it appears to the Commissioner that, among other things, the FDIC or its successor agency has terminated insurance of the insurable accounts or deposits of any Connecticut bank, then the Commissioner shall seek the appointment of a conservator or receiver for such Connecticut bank, unless such bank has filed an application with the Commissioner to convert to an uninsured bank pursuant to § 10 of P.A. 01-183.
Section 15 of the Act amends C.G.S. § 36a-250(a)(41) to expand the wildcard authority to authorize a Connecticut bank to engage in any activity that a federal bank or an out-of-state bank may be authorized to engage in under federal or state law, provided the Connecticut bank shall file with the Commissioner prior written notice of its intention to engage in such activity.
Section 16 of the Act amends C.G.S. § 36a-252 to require that a community bank that proposes to convert to a general Connecticut bank file with the Commissioner a copy of the proposed amended certificate of incorporation instead of a proposed certificate of incorporation and a secretary's certificate that the proposed plan and proposed amended certificate of incorporation have been approved by the governing board and its shareholders.
Section 17 of the Act amends C.G.S. § 36a-252a to require that any Connecticut bank that is an uninsured bank or any Connecticut bank that functions solely in a fiduciary capacity that proposes to convert to a Connecticut bank that is authorized to accept retail deposits file with the Commissioner, among other things, a copy of the proposed amended certificate of incorporation instead of a proposed certificate of incorporation. Also amends C.G.S. § 36a-252a to provide that any shareholder of such Connecticut bank that objects to such conversion shall have the same rights as those of a shareholder that asserts appraisal rights with respect to the merger of two or more capital stock Connecticut banks.
Section 18 of the Act amends C.G.S. § 36a-434a to provide that the Commissioner shall approve or disapprove the application of any out-of-state trust company to establish and maintain an office in this state to act as a fiduciary or engage in the trust business in this state within 30 days after the application has been filed with the Commissioner.
Section 19 of the Act amends subsection (c) of § 10 of P.A. 01-183 to require a proposed amended certificate of incorporation instead of a proposed certificate of incorporation.
Public Act 02-68
s.S.B. 561 - An Act Concerning the Connecticut Uniform Electronic Transactions Act
Effective Date: October 1, 2002
Section of Statutes Which is Amended: NEW, 1-260, 1-261, 1-262, 1-263, 1-264, 1-265
Description of Act:
Section 1 of the Act provides that this Act shall be known and may be cited as the "Connecticut Uniform Electronic Transactions Act".
Section 2 of the Act contains definitions for several terms used in the Act, including the terms "automated transaction", "electronic record", "electronic signature" and "transaction".
Section 3 of the Act provides that, with certain exceptions, the Act applies to electronic records and electronic signatures relating to a transaction.
Section 4 of the Act provides that the Act applies to any electronic record or electronic signature created, generated, sent, communicated, received or stored on or after October 1, 2002.
Section 5 of the Act provides that the Act does not require a record or signature to be created, generated, sent, communicated, received, stored or otherwise processed or used by electronic means or in electronic form. This section also makes the Act applicable only to transactions between parties each of which has agreed to conduct transactions by electronic means and allows for variations by agreement, and provides that the legal consequences of an electronic record or electronic signature is determined by the Act and other applicable law.
Section 6 of the Act provides that the Act shall be construed to, among other things, effectuate the general purpose to make uniform the law with respect to the subject of the Act among states enacting such law.
Section 7 of the Act provides, among other things, that a record or signature may not be denied legal effect or enforceability solely because the record or signature is in electronic form.
Section 8 of the Act provides that if the parties to a transaction have agreed to conduct the transaction by electronic means and the law requires a person to provide information in writing, the requirement is satisfied if the information is provided in an electronic record capable of retention by the recipient, and establishes rules governing situations where a law other than the Act requires a record to be transmitted by a specific method.
Section 9 of the Act establishes when an electronic record or electronic signature is attributable to a person.
Section 10 of the Act establishes rules governing the situations where a change or error in an electronic record occurs in a transmission between parties to a transaction.
Section 11 of the Act provides that if a law requires a signature or a record to be notarized, the requirement is satisfied if the electronic signature of the notary public, together with all other information required to be included by other applicable law, is attached to or logically associated with the signature or record.
Section 12 of the Act establishes how an electronic record may be used to satisfy a legal requirement to retain a record.
Section 13 of the Act provides that in a proceeding, evidence of a record or signature may not be excluded solely because such record or signature is in electronic form.
Section 14 of the Act establishes rules governing automated transactions.
Section 15 of the Act establishes rules governing when an electronic record is deemed sent or received.
Section 16 of the Act establishes rules governing electronic records that are "transferable records" for purposes of Article 3 or 7 of Title 42a of the C.G.S.
Section 17 of the Act provides that except as otherwise required by the State Librarian or the Public Records Administrator, each governmental agency in Connecticut shall determine whether and the extent to which it will create and retain electronic records and convert written records to electronic records.
Section 18 of the Act requires each governmental agency in Connecticut to determine whether and the extent to which it will send and accept electronic records and electronic signatures and otherwise rely upon such records and signatures. This section also provides that to the extent an executive agency of Connecticut uses electronic records and electronic signatures, the Department of Information Technology may adopt regulations and specifies the parameters for such regulations.
Section 19 of the Act defines the term "consumer" for purposes of this section and creates a statutory presumption of when it is presumed that an electronic record is not sent to or received by a consumer.
Section 20 of the Act provides that if any provision of the Act is held invalid or inconsistent with the federal Electronic Signatures in Global and National Commerce Act, such invalidity or inconsistency would not affect other provisions of this Act.
Section 21 of the Act provides that the Act conforms to the requirements of the federal Electronic Signatures in Global and National Commerce Act, which governs electronic signatures and electronic records in interstate commerce, and supersedes said federal act.
Section 22 repeals C.G.S. §§ 1-260 to 1-265, inclusive.
Public Act 02-73
s.H.B. 5316 - An Act Concerning Credit Union Modernization
Effective Date: October 1, 2002
Section of Statutes Which is Amended: 36a-2, 36a-3, 36a-17, 36a-53, NEW, 36a-65(a), 36a-65(b), 36a-44, 36a-216, 36a-219, 36a-220, 36a-222, 36a-223, 36a-224, 36a-225, 36a-226, 36a-227, 36a-228, 36a-229, 36a-230, 36a-231(a), 36a-233, 36a-234, 36a-235, 36a-237, 36a-238, 36a-239, 36a-291, 36a-292, 36a-293, 36a-294, 36a-295, 36a-297, 36a-24a(b), 36a-65(d)(1)(J), 36a-316(18), 36a-265(a), 51-344a(a), P.A. 01-9 § 2(2), P.A. 01-9 § 3(a), P.A. 01-9 § 6, 36a-136(a), 36a-316(17), 36a-596(10), 19a-343a(g), 36a-435 to 36a-475, inclusive
Description of Act:
Section 1 of the Act amends C.G.S. § 36a-2 to add definitions for the terms "Connecticut credit union service organization" and "credit union service organization", and amend the definition of "Connecticut credit union".
Section 2 of the Act amends C.G.S. § 36a-3 to add cross-references to various terms used in this Act and to make technical revisions.
Section 3 of the Act amends C.G.S. § 36a-17 to require any Connecticut credit union or Connecticut credit union service organization which causes any electronic data processing services to be performed for such credit union or service organization to enter into a written contract with such servicer, such contract to require the servicer to allow the Commissioner to examine such servicer's books, records and computer systems.
Section 4 of the Act amends C.G.S. § 36a-53 to authorize the Commissioner to seek the removal of and impose a civil penalty on any officer or director of any Connecticut credit union or any officer, director, manager or general partner of a Connecticut credit union service organization for the reasons and in the manner set forth in this section.
Section 5 of the Act adds a new section that authorizes the Commissioner to enter into one or more stipulations and agreements or memoranda of understanding with a Connecticut bank or enter into one or more letters of understanding and agreement or memoranda of understanding with a Connecticut credit union or Connecticut credit union service organization for certain specified reasons.
Section 6 of the Act amends C.G.S. § 36a-65(a) to provide that the Commissioner shall not collect an annual assessment from a newly organized Connecticut credit union until July 1st following the third full calendar year after issuance by the Commissioner of such credit union's certificate of authority, and to provide that the Commissioner may reduce any such assessment collected from a Connecticut credit union up to an amount of any assessment for the same fiscal year collected from such credit union by another state in which such credit union has established a branch.
Section 7 of the Act amends C.G.S. § 36a-65(b) to provide that the fee for an examination of a Connecticut credit union service organization is the actual cost of the examination, as such cost is determined by the Commissioner, and to relocate the examination fee provisions dealing with Consumer Credit Division licensees into this fee section.
Section 8 of the Act amends C.G.S. § 36a-44 to exclude from the prohibition on the disclosure of financial records by a financial institution contained in C.G.S. § 36a-41, disclosures to an insurance company for purposes of risk assessment in connection with obtaining or maintaining a surety bond or fraud investigations.
Section 9 of the Act amends C.G.S. § 36a-216 to authorize the Commissioner to, among other things, order any one or more Connecticut credit unions to restrict all or any part of their business and limit or postpone the payment of deposits whenever, in the opinion of the Commissioner, general financial conditions are such that the public interest requires limitation on withdrawal of funds from Connecticut credit unions, or the assets of any Connecticut credit union are in such non-liquid condition that the interests of depositors or shareholders may be jeopardized.
Section 10 of the Act amends C.G.S. § 36a-219 to, among other things, authorize the Commissioner to issue a temporary order restraining any Connecticut credit union or out-of-state credit union that maintains in Connecticut a branch from paying out any funds or receiving deposits or, in the case of a Connecticut credit union or Connecticut credit union service organization, appoint a conservator whenever in the opinion of the Commissioner or the governing board, or in the case of a Connecticut credit union service organization, the Commissioner or the governing board, managers or general partners, it may be necessary to preserve assets or protect share account holders.
Section 11 of the Act amends C.G.S. § 36a-220 to provide that if it appears to the Commissioner that the certificate of authority of any Connecticut credit union or out-of-state credit union that maintains in Connecticut a branch is forfeited, the public is in danger of being defrauded by such credit union or such credit union is insolvent, or the NCUA has terminated the deposit insurance of such credit union, the Commissioner shall seek an injunction against such credit union, or the appointment of a conservator or receiver.
Section 12 of the Act amends C.G.S. § 36a-222 to detail the duties of a receiver or conservator of a Connecticut credit union.
Section 13 of the Act amends C.G.S. § 36a-223 to allow the Superior Court, at the request of the Commissioner, to appoint the NCUA as a receiver or conservator of a Connecticut credit union.
Section 14 of the Act amends C.G.S. § 36a-224 to allow a Connecticut credit union placed in receivership to be reopened for business, and to permit share account holders of such credit union to examine the records of the credit union for the purpose of preparing a plan of refinancing or reorganization.
Section 15 of the Act amends C.G.S. § 36a-225 to authorize the Superior Court to limit the time within which all claims may be filed against a Connecticut credit union in receivership.
Section 16 of the Act amends C.G.S. § 36a-226 to require the receiver of a Connecticut credit union to, among other things, make such inventories and appraisal of assets and render such reports of the receiver's activities and statements of accounts as are necessary for the information of the Superior Court.
Section 17 of the Act amends C.G.S. § 36a-227 governing the attachment of or against the estate of any Connecticut credit union and the duties of the Commissioner after the granting of an injunction against or the appointment of a receiver of a Connecticut credit union.
Section 18 of the Act amends C.G.S. § 36a-228 to authorize the Commissioner or the receiver, within six months after the appointment of a receiver, to terminate any executory contract for services or advertising to which the Connecticut credit union is a party or any obligation of the credit union as a lessee.
Section 19 of the Act amends C.G.S. § 36a-229 to require that any person who wilfully neglects or refuses to deliver to the receiver or conservator of any Connecticut credit union any books, paper or evidence of title or debt or property belonging to such receivership or conservatorship shall be fined not more than $10,000 or imprisoned not more than three years or both.
Section 20 of the Act amends C.G.S. § 36a-230 to provide that no claim in favor of a Connecticut credit union in receivership, not barred by the statute of limitations, shall be barred against the receiver in any suit for recovery of such claim.
Section 21 of the Act amends C.G.S. § 36a-231(a) to require the receiver or conservator of any Connecticut credit union to file with the clerk of the Superior Court a detailed statement on a semi-annual basis.
Section 22 of the Act amends C.G.S. § 36a-233 to prohibit the funds and property in possession of a receiver of any Connecticut credit union to be subject to process of foreign attachment.
Section 23 of the Act amends C.G.S. § 36a-234 to authorize a receiver of a Connecticut credit union to seek the dissolution of any injunction restraining the receiver from disposing of any of the trust estate.
Section 24 of the Act amends C.G.S. § 36a-235 to provide that all payments or conveyances made by any Connecticut credit union in contemplation of insolvency with fraudulent intent are void and that no execution shall be issued against any Connecticut credit union before a final judgment.
Section 25 of the Act amends C.G.S. § 36a-237 to prioritize the liquidation of the assets of a Connecticut credit union.
Section 26 of the Act amends C.G.S. § 36a-238 to grant the NCUA the right of subrogation to the rights of the owners of share accounts that the NCUA pays or makes available for payment.
Section 27 of the Act amends C.G.S. § 36a-239 to provide that if no plan of refinancing or reorganization has been approved by the court for a Connecticut credit union in receivership, its certificate of authority shall be forfeited upon the discharge of the receiver, and to provide for the discharge of a conservator upon certain conditions.
Section 28 of the Act amends C.G.S. § 36a-291 to authorize the pledging of the interest of any named owner in a share account established or maintained at any Connecticut credit union, with certain exceptions.
Section 29 of the Act amends C.G.S. § 36a-292 to establish a right of survivorship for joint account holders of a share account.
Section 30 of the Act amends C.G.S. § 36a-293 to make the provisions governing adverse claims to the balance of a deposit account held in a bank also applicable to share accounts in a Connecticut credit union or federal credit union.
Section 31 of the Act amends C.G.S. § 36a-294 to make the provisions governing a lost, stolen or destroyed passbook, certificate or instrument issued by a Connecticut bank applicable to Connecticut credit unions.
Section 32 of the Act amends C.G.S. § 36a-295 to provide that if a Connecticut credit union has rendered a statement or delivered a passbook to a share account holder, the statement or passbook is deemed accurate and complete upon the expiration of seven years from the date of the rendering or delivery, unless a court determines otherwise.
Section 33 of the Act amends C.G.S. § 36a-297 to authorize a minor to establish a share account with any Connecticut credit union or federal credit union.
Section 34 of the Act provides that §§ 34 to 73, inclusive of the Act shall be known as the "Connecticut Credit Union Act".
Section 35 of the Act contains definitions for many of the terms used in §§ 34 to 73, inclusive, of the Act.
Section 36 of the Act establishes the fees payable to the Secretary of the State, including a $13 franchise and filing fee for the certificate of authority of a newly incorporated Connecticut credit union, a $13 filing and certification fee for the filing and certification of certain documents in transactions involving a Connecticut credit union, a $20 fee for a copy of each document filed, and a $5 fee for affixing the Secretary of the State's seal.
Section 37 of the Act prohibits any person from engaging in the business of a Connecticut credit union until such person has obtained a certificate of authority to engage in such business from the Commissioner, and prohibits the use of the phrase "credit union" or "mutual benefit association" by other than a Connecticut credit union, a federal credit union or a credit union otherwise authorized to engage in business in Connecticut. The section also provides for the issuance and revocation of a certificate of authority.
Section 38 of the Act establishes the application and approval process for the organization of a Connecticut credit union including a credit union that will offer "basic services", and requires the organizers of such a credit union to hold an organization meeting to elect directors within a reasonable time after the issuance of the credit union's certificate of authority. This section also establishes the process for amending the certificate of authority and bylaws of a Connecticut credit union and provides that any amendment to the bylaws shall become effective when adopted, except amendments requiring the approval of the Commissioner shall become effective upon such approval.
Section 39 of the Act establishes the parameters for the field of membership of a Connecticut credit union, establishes the process by which any such credit union may expand its field of membership, and authorizes the Commissioner to withhold or condition an approval of an amendment to the bylaws sought by a community credit union.
Section 40 of the Act establishes the procedure for a Connecticut credit union to admit new members, expel any member, and cancel the shares of any member who is expelled.
Section 41 of the Act requires a Connecticut credit union to hold annual and special meetings as provided in its bylaws, and details how such meetings shall be noticed and the rights of members to vote at such meetings.
Section 42 of the Act requires a Connecticut credit union to submit a written report to the Commissioner annually on February 1 and August 1 and otherwise as often as the Commissioner deems necessary, requires several other filings with the Commissioner, and requires any such credit union to establish and maintain records, accounting systems and procedures which reflect its operations and enable the Commissioner to readily ascertain its true financial condition.
Section 43 of the Act requires a Connecticut credit union to establish and maintain an allowance for loan and lease losses account and to make contributions to net worth in an amount established by the Act based upon the credit union's level of assets. This section also contains a definition for the term "net worth".
Section 44 of the Act requires that the funds of a Connecticut credit union be deposited in such depository or depositories as designated by the governing board, establishes limitations on the withdrawal of such funds, and requires every director, supervisory committee member, credit committee member, if applicable, and every employee of a Connecticut credit union who has charge or possession of funds, securities and other assets of the Connecticut credit union to be bonded by a surety company authorized to do business in Connecticut.
Section 45 of the Act establishes the authority of the governing board of a Connecticut credit union and the criteria for service on the governing board, requires that a director on the governing board of a "troubled Connecticut credit union" be approved by the Commissioner, and prohibits the receipt of compensation for services as a member of the governing board. This section also establishes procedures governing the removal of a governing board member, authorizes the governing board to suspend or remove a member of the credit union and authorizes the appointment of advisory directors and directors emeritus.
Section 46 of the Act requires the governing board of a Connecticut credit union to meet as often as necessary but at least monthly, except when the governing board delegates its authority to an executive committee. This section also permits any and all directors to participate in all except one meeting per year through the use of means of communications by which all directors may simultaneously hear each other and communicate during the meeting.
Section 47 of the Act establishes the criteria for an executive committee, if one is appointed by the governing board of a Connecticut credit union, and requires such committee to meet in accordance with § 46 of the Act and to keep complete minutes of all of its actions.
Section 48 of the Act details the composition, powers and responsibilities of the supervisory committee of a Connecticut credit union.
Section 49 of the Act authorizes the governing board of a Connecticut credit union, with certain exceptions, to delegate all or part of its lending authority to a credit committee, credit manager, loan officer or any combination thereof, and details the responsibilities of each of them.
Section 50 of the Act authorizes a Connecticut credit union, either independently or in conjunction with one or more other Connecticut credit unions, and with the approval of its governing board, to offer certain employee benefits to its active and retired employees. It also authorizes such credit union, with the approval of its governing board, to provide personal liability or indemnity insurance for its directors, credit committee and supervisory committee members. In addition, with the approval of the Commissioner, a Connecticut credit union may provide reasonable health, accident and related personal insurance for its directors, other than its emeritus directors and advisory directors.
Section 51 of the Act requires that the governing board of a Connecticut credit union adopt a written conflict of interest policy and includes various limitations on insider transactions with a Connecticut credit union.
Section 52 of the Act details the express powers of a Connecticut credit union, including trust powers and the power to sell insurance. This section also authorizes such credit unions to exercise incidental powers and to engage in closely related activities and any activity that a federal credit union or out-of-state credit union may be authorized to engage in under state or federal law.
Section 53 of the Act authorizes a Connecticut credit union, with the approval of the Commissioner, to sell all or a significant part of its assets in accordance with C.G.S. § 36a-210 and to sell a branch.
Section 54 of the Act establishes the par value of shares of a Connecticut credit union, authorizes a Connecticut credit union to receive certain payments on shares from its members and certain other payments from nonmembers, and authorizes a Connecticut credit union that has received a low-income designation from the NCUA to offer secondary capital accounts. In addition, this section requires a Connecticut credit union to maintain share insurance as required under the Federal Credit Union Act, and authorizes such credit union to obtain private excess share insurance coverage.
Section 55 of the Act contains definitions for the terms "tax and loan account" and "note account" and authorizes Connecticut credit unions to maintain tax and loan accounts.
Section 56 of the Act authorizes the governing board of a Connecticut credit union, or the executive committee or senior management if so delegated by the governing board, to declare and pay dividends, and provides certain limitations on such declaration or payment.
Section 57 of the Act requires a Connecticut credit union to adopt and implement a written loan policy, obligates such credit union to use its best efforts to make secured and unsecured extensions of credit to its members, and establishes limitations on the total direct and indirect liabilities of any one obligor to such credit union.
Section 58 of the Act authorizes a Connecticut credit union to make one or more mortgage loans to its members and contains provisions governing the making of such loans.
Section 59 of the Act contains definitions for the terms "associated member", "construction loan", "member business loan", "net worth" and "net outstanding member business loan balance". This section authorizes a Connecticut credit union to make member business loans, subject to certain conditions, and requires the governing board of a Connecticut credit union to adopt a specific member business loan policy as part of its loan policy and details what must go into such policy. The section also sets limits on the aggregate amount of secured and unsecured net outstanding member business loan balances to any one member or associated members and the total aggregate of such balances that a Connecticut credit union may extend; authorizes the Commissioner to lower any limit provided in this section, and to revoke any waiver granted under this section or revoke the credit union's approval to make member business loans if the credit union's policies or practices violate safe and sound practices; and requires Connecticut credit unions to identify member business loans in the aggregate on their financial statements.
Section 60 of the Act requires the governing board of a Connecticut credit union to adopt and implement a written investment policy and authorizes the investment officer or investment committee, if any, to act for the governing board in all matters involving the investment of the credit union's funds. This section also details the investment authority of a Connecticut credit union, dividing the investment authority into investments that may be made without the Commissioner's prior approval and riskier investments requiring such approval.
Section 61 of the Act authorizes the organization of a single corporate Connecticut credit union and contains provisions governing the field of membership of such credit union and its corporate governance. The section also details the express powers of the corporate Connecticut credit union.
Section 62 of the Act authorizes a Connecticut credit union, with the approval of the Commissioner, to establish a Connecticut credit union service organization by itself or jointly with one or more credit unions or other depository institutions, and establishes the application and approval process for such establishment. The section also requires that each Connecticut credit union service organization and each of its directors, officers, managers, general partners, employees and authorized agents who has charge or possession of funds, securities or other assets of such credit union service organization be bonded. The section also authorizes a Connecticut credit union to invest in or lend to a credit union service organization, subject to certain requirements and limitations, and authorizes the Commissioner to examine a Connecticut credit union service organization or a credit union service organization in which a Connecticut credit union has invested or to which it has lent funds.
Section 63 of the Act contains provisions governing the establishment by a Connecticut credit union of a branch within or outside of Connecticut, and the closing or relocation of such branches.
Section 64 of the Act authorizes an out-of-state, state-chartered credit union, with the prior written approval of the Commissioner, to establish a branch in Connecticut and requires the Commissioner to make certain determinations prior to granting such approval. The section also authorizes the Commissioner to examine and supervise such branches and grants the Commissioner the power to revoke or suspend any approval given pursuant to this section. In addition, the section authorizes an out-of-state, federally-chartered credit union, with prior notice to the Commissioner, to establish a branch in Connecticut, and authorizes a federal credit union, with prior notice to the Commissioner, to establish additional branches in Connecticut.
Section 65 of the Act authorizes the Commissioner to require any out-of-state credit union that maintains a branch in Connecticut to submit an annual audit report to the Commissioner, and requires any such credit union that is required under federal law to submit a net worth restoration plan to the NCUA to simultaneously submit an executed copy to the Commissioner.
Section 66 of the Act authorizes a Connecticut credit union, with the approval of the Commissioner, to relocate its main office anywhere in Connecticut and specifies the considerations that the Commissioner must make prior to granting such approval.
Section 67 of the Act authorizes a Connecticut credit union, with the approval of the Commissioner, to merge with a Connecticut credit union, a federal credit union or an out-of-state credit union and establishes an application and approval process for such mergers.
Section 68 of the Act authorizes a Connecticut credit union that has been in existence and continuously operating for at least five years to convert into a federal credit union with the approval of the Commissioner and establishes an application and approval process for such conversions.
Section 69 of the Act authorizes a federal credit union or an out-of-state credit union to convert into a Connecticut credit union and establishes an application and approval process for such conversions.
Section 70 of the Act authorizes any Connecticut credit union or federal credit union to convert into a mutual savings bank, a mutual savings and loan association, or a mutual community bank and establishes an application and approval process for such conversions.
Section 71 of the Act authorizes and establishes the procedure by which a Connecticut credit union may terminate its corporate existence and be dissolved.
Section 72 of the Act authorizes the Commissioner to adopt regulations as may be necessary for the conduct of Connecticut credit unions and the enforcement of the provisions of §§ 34 to 73, inclusive, of the Act. The section also authorizes the Commissioner to adopt regulations to establish rates to be paid as dividends on shares having an agreed maturity subject to conditions in § 56 of the Act.
Section 73 of the Act provides that nothing in §§ 34 to 73, inclusive, of the Act shall be construed to exempt Connecticut credit unions from taxation under the provisions of C.G.S. Chapter 208.
Section 74 of the Act makes technical amendments to C.G.S § 36a-24a(b).
Section 75 of the Act makes technical amendments to C.G.S. § 36a-65(d)(1)(J).
Section 76 of the Act makes technical amendments to C.G.S. § 36a-316(18).
Section 77 of the Act makes a technical amendment to C.G.S. § 36a-265(a).
Section 78 of the Act makes technical amendments to C.G.S. § 51-344a(a).
Section 79 of the Act makes a technical amendment to § 2(2) of P.A. 01-9.
Section 80 of the Act amends § 3(a) of P.A. 01-9 to require each community credit union to satisfy the credit needs of its community as opposed to its "local" community.
Section 81 of the Act makes technical and conforming amendments to § 6 of P.A. 01-9.
Section 82 of the Act makes technical amendments to C.G.S. § 36a-136(a).
Section 83 of the Act makes a technical amendment to C.G.S. § 36a-316(17).
Section 84 of the Act makes technical amendments to C.G.S. § 36a-596(10).
Section 85 of the Act makes technical amendments to C.G.S. § 19a-343a(g).
Section 86 of the Act repeals C.G.S §§ 36a-435 to 36a-475, inclusive.
Public Act 02-111
s.S.B. 231 - An Act Concerning Consumer Credit and Money Transmitter Licensees
Effective Date: October 1, 2002, except §§ 46 and 50 take effect July 1, 2002
Section of Statutes Which is Amended: 36a-3, 36a-485, 36a-486, 36a-487, 36a-488, 36a-489, 36a-490, 36a-491, 36a-492, 36a-493, 36a-494(a), 36a-496, 36a-497, 36a-498, 36a-510, 36a-511, 36a-512, 36a-513, 36a-514, 36a-515, 36a-516, 36a-517(a), 36a-519, 36a-520, 36a-521, 36a-523, 36a-524, 36a-534a, 36a-539(a), 36a-540, 36a-541, 36a-542, 36a-543, 36a-555, 36a-556, 36a-557, 36a-558(a), 36a-572, 36a-602(a), 36a-655, 36a-656, 36a-657, 36a-658, 36a-659, 36a-664, 36a-800, 36a-801, 36a-802, 36a-804, 36a-805, 36a-495, 36a-518, 36a-571, 36a-803
Description of Act:
Section 1 of the Act amends C.G.S. § 36a-3 to add and delete cross-references to various definitions.
Section 2 of the Act amends C.G.S. § 36a-485 to add definitions of "first mortgage broker", "first mortgage correspondent lender", "first mortgage lender", "originator", "table funding agreement" and "warehouse agreement", and amend and delete certain existing definitions.
Section 3 of the Act amends C.G.S. § 36a-486 to: (1) provide that a first mortgage correspondent lender shall not be deemed to be acting as a first mortgage lender by virtue of utilizing its own funds to make a loan where another person who had made a commitment to fund the loan fails to do so; (2) prohibit a licensee from employing or retaining an originator prior to registering such originator, and any individual from acting as an originator without being registered or acting as an originator for more than one person; (3) provide that registration of an originator is not effective when the originator is not associated with a licensee; and (4) require notification to the Commissioner of termination of employment of an originator.
Section 4 of the Act amends C.G.S. § 36a-487 to make technical changes.
Section 5 of the Act amends C.G.S. § 36a-488 to: (1) impose a minimum tangible net worth requirement of $250,000 for a first mortgage lender, and $25,000 for a first mortgage correspondent lender and a first mortgage broker; (2) require that mortgage lenders and first mortgage brokers have, at the licensed location, a supervisor with at least three years of relevant experience within the last five years; (3) specify the types of licenses that the Commissioner may issue and the activities authorized under certain licenses; and (4) specify additional items to be included in the license or renewal application.
Section 6 of the Act amends C.G.S. § 36a-489 concerning the standards for issuance of a first mortgage lender or broker license to: (1) add the finding that the applicant meets the net worth and experience requirements of C.G.S. § 36a-488(a) to the findings that the Commissioner must make prior to issuing a license; (2) provide that the Commissioner shall deny a license upon finding that the applicant made a material misstatement in the application; (3) provide that a denial of an application shall be subject to the provisions of C.G.S. § 46a-80; and (4) set forth the standards for registration of originators.
Section 7 of the Act amends C.G.S. § 36a-490 to require: (1) that each license be maintained at the location for which it was issued and be available for public inspection, in lieu of the requirement that each license be prominently posted; (2) prior written notice to the Commissioner, instead of approval, for a change in location; and (3) that licensees notify the Commissioner in writing of any change in the information provided in the application, and not merely changes in certain personnel and shareholders.
Section 8 of the Act amends C.G.S. § 36a-491 governing the licensing of first mortgage lenders and brokers to: (1) provide that a license issued under the section shall expire on September 30 of the even-numbered year following its issuance; (2) change the license fee for a first mortgage lender license or a first mortgage correspondent lender license to $800, except that the license fee will be $400 for applications filed not earlier than one year before the date such license will expire; (3) change the license fee for a first mortgage broker license to $400, except that the license fee will be $200 for applications filed not earlier than one year before the date such license will expire; (4) establish a fee of $100 for registration of an originator, except that the registration fee will be $50 for applications filed not earlier than one year before the date the license of the applicant will expire; and (5) provide that the registration of an originator shall expire when the licensee's license expires.
Section 9 of the Act amends C.G.S. § 36a-492 governing the bond requirement for first mortgage lenders and brokers to clarify that only borrowers and prospective borrowers may proceed on the bond, additionally allow the Commissioner to proceed on the bond to collect any civil penalty imposed on the licensee under C.G.S. § 36a-50, and create a statutory trust with respect to the proceeds of the bond.
Section 10 of the Act amends C.G.S. § 36a-493 to require first mortgage lender, first mortgage correspondent lender and first mortgage broker licensees: (1) to maintain records of the name and address of any broker involved in the loan transaction; (2) for loans made and serviced by the licensee, to retain records of the loan transaction for not less than two years following the final payment or the assignment of the loan, whichever occurs first, or any longer period required by law; and (3) for loans in which the licensee acts as a mortgage lender or first mortgage broker but does not service the loan, to retain records of the loan transaction for not less than two years from the date of the transaction, or any longer period required by law.
Section 11 of the Act amends C.G.S. § 36a-494(a) governing the suspension, revocation or refusal to renew a first mortgage lender or broker license to authorize the Commissioner to suspend, revoke or refuse to renew a license based on a finding that the licensee or certain related individuals misappropriated funds, violated any provision (instead of certain specified provisions) of Title 36a, or failed to perform any agreement with a licensee; and to suspend, revoke or refuse to renew a registration for certain specified grounds.
Section 12 of the Act amends C.G.S. § 36a-496 to prohibit persons engaged in the business of making first mortgage loans in Connecticut from accepting applications or referrals from, or paying a fee to, any unregistered originator.
Section 13 of the Act amends C.G.S. § 36a-497 to make technical changes.
Section 14 of the Act amends C.G.S. § 36a-498 to prohibit originators from accepting payment of any advance fee except an advance fee on behalf of a licensee.
Section 15 of the Act amends C.G.S. § 36a-510 to add definitions of "mortgage lender", "originator", "secondary mortgage broker", "secondary mortgage correspondent lender", "secondary mortgage lender", "table funding agreement" and "warehouse agreement", and amend and delete certain existing definitions.
Section 16 of the Act amends C.G.S. § 36a-511 to: (1) delete certain exclusions from what constitutes engaging in the secondary mortgage loan business for licensed real estate brokers, accountants, attorneys and beneficiaries of a licensee's estate; (2) provide that a secondary mortgage correspondent lender shall not be deemed to be acting as a secondary mortgage lender by virtue of utilizing its own funds to make a loan where another person who had made a commitment to fund the loan fails to do so; (3) prohibit a licensee from employing or retaining an originator prior to registering such originator, and any individual from acting as an originator without being registered or acting as an originator for more than one person; (4) provide that registration of an originator is not effective when the originator is not associated with a licensee; and (5) require notification to the Commissioner of termination of employment of an originator.
Section 17 of the Act amends C.G.S. § 36a-512 to make technical changes.
Section 18 of the Act amends C.G.S. § 36a-513 to: (1) impose a minimum tangible net worth requirement of $100,000 for a secondary mortgage lender, and $25,000 for a secondary mortgage correspondent lender and a secondary mortgage broker; (2) require that mortgage lenders and secondary mortgage brokers have, at the licensed location, a supervisor with at least three years of relevant experience within the last five years; (3) specify the types of licenses that the Commissioner may issue and the activities authorized under certain licenses; (4) specify additional items to be included in the license or renewal application; (5) make the standards for the issuance or denial of a license similar to those for a first mortgage license; and (6) set forth the standards for registration of an originator.
Section 19 of the Act amends C.G.S. § 36a-514 governing the licensing of secondary mortgage lenders or brokers to: (1) provide that a license issued under the section shall expire on September 30 of the even-numbered year following its issuance; (2) change the license fee for a secondary mortgage lender license or a secondary mortgage correspondent lender license to $800, except that the license fee will be $400 for applications filed not earlier than one year before the date such license will expire, and $500 for renewal of a license that expires on June 30, 2003; (3) change the license fee for a secondary mortgage broker license to $400, except that the license fee will be $200 for applications filed not earlier than one year before the date such license will expire, and $250 for renewal of a license that expires on June 30, 2003; (4) establish a fee of $100 for registration of an originator except that the registration fee will be $50 for applications filed not earlier than one year before the date the license of the applicant will expire; (5) provide that the registration of an originator shall expire when the licensee's license expires; and (6) provide that registration fees shall not be abated if a registration is surrendered, revoked or suspended prior to expiration.
Section 20 of the Act amends C.G.S. § 36a-515 governing the assignability or transferability of a secondary mortgage lender or broker license, posting and surrender of such license, and requirements regarding notification to the Commissioner of changes in personnel to make its provisions similar to the provisions of C.G.S. § 36a-490, as amended by this Act.
Section 21 of the Act amends C.G.S. § 36a-516 to: (1) specify that the required records must be maintained at the place of business named in the license or made available at such location within five days of the Commissioner's request; (2) require licensees, for loans made and serviced by the licensee, to retain records of loan transactions for not less than two years following the final payment or assignment of the loan, whichever occurs first, or any longer period required by law; and (3) require licensees, for loans in which the licensee acts as a mortgage lender or secondary mortgage broker but does not service the loan, to retain records of the loan transaction for not less than two years from the date of the loan transaction, or any longer period required by law.
Section 22 of the Act amends C.G.S. § 36a-517(a) governing the suspension, revocation and refusal to renew a secondary mortgage lender or broker license to authorize the Commissioner to suspend, revoke or refuse to renew a license based on a finding that the licensee or certain related individuals misappropriated funds, violated any provision (instead of specified provisions) of Title 36a or any other law or regulation applicable to its conduct, or failed to perform any agreement with a licensee, and to suspend, revoke or refuse to renew a registration for certain specified grounds.
Section 23 of the Act amends C.G.S. § 36a-519 to make a technical change.
Section 24 of the Act amends C.G.S. § 36a-520 to make technical changes.
Section 25 of the Act amends C.G.S. § 36a-521 to prohibit originators from accepting payment of any advance fee except an advance fee on behalf of a licensee.
Section 26 of the Act amends C.G.S. § 36a-523 to make technical changes.
Section 27 of the Act amends C.G.S. § 36a-524 to make a technical change.
Section 28 of the Act amends C.G.S. § 36a-534a to make technical changes.
Section 29 of the Act amends C.G.S. § 36a-539(a) to: (1) provide that a sales finance company license shall expire on September 30 of the odd-numbered year following its issuance, except that a license that is renewed effective July 1, 2003, will expire on September 30, 2005; and (2) change the license fee to $800, except that the license fee will be $400 for applications filed not earlier than one year before the date the license will expire.
Section 30 of the Act amends C.G.S. § 36a-540 concerning the location of the office of a sales finance company to make its provisions similar to the provisions of C.G.S. § 36a-490, as amended by this Act.
Section 31 of the Act amends C.G.S. § 36a-541 to make the standards for the issuance or denial of a sales finance company license similar to those for a first mortgage license.
Section 32 of the Act amends C.G.S. § 36a-542 to make the filing deadline for renewal of a sales finance company license consistent with the expiration date under C.G.S. § 36a-539, as amended by this Act, and set a license fee of $800 for renewal of a license, except that the license fee for a license that expires on June 30, 2003, will be $900.
Section 33 of the Act amends C.G.S. § 36a-543 to make technical changes and minor changes.
Section 34 of the Act amends C.G.S. § 36a-555 to make technical changes.
Section 35 of the Act amends C.G.S. § 36a-556 to delete the publication requirement for an applicant for a small loan lender license, add standards for denial of a license, and delete an obsolete provision.
Section 36 of the Act amends C.G.S. § 36a-557 to delete the provisions specifying the information that must be included in the application for a small loan lender license.
Section 37 of the Act amends C.G.S. § 36a-558(a) to: (1) provide that a small loan lender license shall expire on September 30 of the odd-numbered year following its issuance, except that a license that is renewed effective July 1, 2003, shall expire on September 30, 2005; and (2) change the license fee to $800, except that the license fee will be $400 for applications filed not earlier than one year before the date the license will expire and $900 for renewal of a license that expires on June 30, 2003.
Section 38 of the Act amends C.G.S. § 36a-572 to delete the authority of the Commissioner to revoke a small loan lender license for failure to pay the annual license fee.
Section 39 of the Act amends C.G.S. § 36a-602(a) to authorize the Commissioner to proceed on the bond to collect any civil penalty imposed on persons licensed to issue Connecticut payment instruments or engage in money transmission under C.G.S. § 36a-50.
Section 40 of the Act amends C.G.S. § 36a-655 to amend the definition of "bona fide nonprofit organization" to mean any organization that is exempt from taxation under Section 503(c)(3) of the Internal Revenue Code, and add a definition of "debtor".
Section 41 of the Act amends C.G.S. § 36a-656 to: (1) delete the provision that a debt adjuster license shall be effective as long as the licensee remains in the debt adjustment business; (2) set forth the standards for issuance and denial of a debt adjuster license; (3) set a one-time application fee of $250; (4) provide that such license shall expire on September 30 of the odd-numbered year following its issuance, except that any license issued prior to the effective date of this proposal shall expire on September 30, 2003; and (5) provide that the license fee shall not be abated if the license is surrendered, revoked or suspended prior to expiration, nor shall it be refundable.
Section 42 of the Act amends C.G.S. § 36a-657 to give the Commissioner authority to refuse to renew a debt adjuster license and make the grounds for suspension, revocation and refusal to renew similar to those for other consumer credit licenses.
Section 43 of the Act amends C.G.S. § 36a-658 concerning the posting and transferability or assignability of a debt adjuster license to make its provisions similar to the provisions of C.G.S. § 36a-490, as amended by this Act.
Section 44 of the Act amends C.G.S. § 36a-659 to make the requirement of a separate bank account applicable only to payments received from debtors who are residents of Connecticut.
Section 45 of the Act amends C.G.S. § 36a-664 to: (1) impose a bond requirement on debt adjuster licensees with the principal amount of the bond being the greater of $40,000 or twice the amount of the highest total payments received by the licensee from Connecticut debtors in any month during the preceding 12 months ending July 31 of each year; and (2) delete the prohibition against such licensees making any reference to bonding or state approval and, instead, prohibit any claim that they are endorsed, sponsored, recommended or bonded by the state.
Section 46 of the Act amends C.G.S. § 36a-800 to expand the definition of "consumer collection agency" to include a person engaged in the business of collecting, without receiving, property tax on behalf of a municipality, and add definitions of "property tax" and "property tax debtor".
Section 47 of the Act amends C.G.S. § 36a-801 to: (1) provide that a consumer collection agency license shall expire on September 30 of the odd-numbered year following its issuance, except that a license that is renewed effective May 1, 2003, shall expire on September 30, 2005; (2) change the license fee to $800 except that the license fee is $400 for applications filed earlier than one year before the date the license will expire, and $1,000 for renewal of a license that expires on April 30, 2003; (3) impose an additional $100 processing fee for applications filed by persons whose license expired less than 60 days prior to the filing of the application; (4) require prior written notice to the Commissioner of a change in the location of a licensee; and (5) provide that a license shall not be transferable or assignable.
Section 48 of the Act amends C.G.S. § 36a-802 to allow the Commissioner to proceed on the bond to collect any civil penalty imposed under C.G.S. § 36a-50 on a consumer collection agency licensee, and create a statutory trust with respect to the proceeds of the bond.
Section 49 of the Act amends C.G.S. § 36a-804 to provide grounds for the suspension, revocation or refusal to renew a consumer collection agency license and clarify the Commissioner's authority to take enforcement action under C.G.S. § 36a-50 for violation of the provisions concerning consumer collection agencies.
Section 50 of the Act amends C.G.S. § 36a-805 to prohibit consumer collection agencies from receiving any property tax on behalf of a creditor that is a municipality.
Section 51 of the Act repeals C.G.S. §§ 36a-495, 36a-518, 36a-571 and 36a-803.
Public Act 02-112
s.H.B. 5457 - An Act Concerning Payment Of Mortgage Loan Proceeds By Wire Transfer
Effective Date: October 1, 2002
Section of Statutes Which is Amended: NEW
Description of Act:
Adds a new provision that requires any person or entity engaged in the business of making first mortgage loans in this state and licensed as such that uses wire transfers to send loan proceeds to the mortgagee's attorney, to transfer such proceeds to the bank which holds the account of the mortgagee's attorney in a timely manner, but not later than the scheduled date and time of the closing, except in the case of a mortgage refinancing, where any right of rescission has terminated, such wire transfer shall be made in a timely manner, but not later than the disbursement date.
Adds a new provision which authorizes the Commissioner to suspend, revoke or refuse to renew a license of a person or entity engaged in the business of making first mortgage loans in this state that fails to comply with the wire transfer requirements above.