DEPARTMENT OF REGULATORY AGENCIES

DIVISION OF REAL ESTATE

MORTGAGE BROKERS

EMERGENCY RULE

4CCR 725-3

MORTGAGE BROKERS DUTY TO RESPOND AND PROVIDE REQUESTED DOCUMENTS FOR INVESTIGATIONS

Section 1.	Authority
Section 2.	Scope and Purpose
Section 3.	Applicability
Section 4.	Rules Regarding Mortgage Brokers Duty to Respond and 
Provide Requested Documents for Investigations
Section 5. 	Effective Date

Section 1.	Authority

The Director of the Division of Real Estate adopts the following emergency rule entitled, Mortgage Brokers Duty to Respond and Provide Requested Documents for Investigations, according to her authority as found in §§ 12-61-910.3 and 24-4-103(6), C.R.S.

Section 2.	Scope and Purpose

The Director finds that immediate adoption of this rule is imperatively necessary for the preservation of public health, safety or welfare and that compliance with the rulemaking requirements of § 24-4-103, C.R.S., would be contrary to public interest.

Section 12-61-905(7)(b), C.R.S., states the Director of the Division of Real Estate, upon his or her own motion may, and, upon the complaint in writing of any person, shall, investigate the activities of any registrant or any person who assumes to act in such capacity within the state.  The purpose of this regulation is to require mortgage brokers or other persons who assume to act in such capacity within the state to provide a written response and all requested documents to the Director or an authorized representative of the Director.  Additionally, this regulation prescribes the time period in which all persons and entities shall respond to Director inquiries, including, but not limited to, document and information requests during investigations of complaints or any other investigation conducted for the purpose of determining compliance with Colorado mortgage broker law.

Without the immediate adoption of this emergency rule, the public’s interest is not served.  Wherefore, the Director, pursuant to § 24-4-103(6), C.R.S. has an obvious and stated need to adopt this rule.

Section 3.	Applicability

This rule governs persons who broker a mortgage, offer to broker a mortgage, act as a mortgage broker, or offer to act as a mortgage broker.  “Persons” for purposes of this rule shall mean any natural person, firm, partnership, limited liability company, or association or any corporation.

Section 4.	Rules Regarding Mortgage Brokers Duty to Respond and Provide 
Requested Documents for Investigations

1.	Persons who broker a mortgage, offer to broker a mortgage, act as a mortgage broker, or offer to act as a mortgage broker shall provide the Director or his or her authorized representative with all information required by this rule, in a manner prescribed by the Director or authorized representative.  Failure to provide all information requested by the Director or his or her authorized representative within the time set by the Director, or authorized representative of the Director, shall be grounds for disciplinary action and grounds for the imposition of fines unless the Director, or authorized representative of the Director, has granted an extension of time for the response.  Failure to provide all requested information shall be grounds for disciplinary action and grounds for the imposition of fines regardless of whether the underlying complaint results in further investigation or subsequent action by the Director.

2.	The response from the person shall contain the following:

a.	If requested in the notification letter, a complete and specific answer to the factual recitations, allegations or averments made in the complaint filed against the licensee, whether made by a member of the public or on the Director’s own motion or by an authorized representative of the Director;

b.	A complete and specific response to all questions, allegations or averments presented in the notification letter;

c.	Any documents or records requested in the notification letter; and

d.	Any further information relative to the complaint that the licensee or licensee believes to be relevant or material to the matters addressed in the notification letter.

3.	A person shall be subject to disciplinary action pursuant to § 12-61-911(h) and (m), C.R.S. and may be subject to the imposition of fine(s) pursuant to § 12-61-905(7)(b), C.R.S. if such person has:

a.	Negligently made any false statement;

b.	Knowingly and willfully made any omission of material fact; or

c.	Submitted information to the Division of Real Estate in an attempt to deceive any person.

Section 5.	Effective Date

This emergency rule shall be effective November 29, 2007.