ENROLLED
Senate Bill No. 6
(By Senators Tomblin, Mr. President, and Boley,
By Request of the Executive)
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[Passed July 15, 1996; in effect from passage.]
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AN ACT to amend and reenact sections one, two, four, five, six,
eight, nine, ten, eleven, twelve, thirteen, fourteen,
fifteen, sixteen and eighteen, article seventeen, chapter
thirty-one of the code of West Virginia, one thousand nine
hundred thirty-one, as amended; to further amend said
article by adding thereto a new section, designated section
twenty; to amend and reenact sections six and seven, article
two, chapter thirty-one-a of said code; to further amend
said article by adding thereto a new section, designated
section sixteen; and to amend and reenact section one
hundred five, article one, chapter forty-six-a of said code,
all generally relating to licensure of consumer lending offices, banking institutions and secondary mortgage
companies operating in West Virginia; changing definitions;
clarifying that license requirements for lenders or brokers
do not apply to federally insured depository institutions;
requiring annual license renewal; removing residence
requirements for licensure of lenders and brokers and
establishing licensing requirements for out-of-state lenders
and brokers wishing to do business in West Virginia;
modifying the allowable amount of finance and other charges
and extending the maximum time period for second mortgage
loans; requiring the banking commissioner to study the
effect of extending the maximum time period for second
mortgage loans; prohibiting certain charges from being
assessed if second mortgage is refinanced or another loan is
obtained on same property within twenty-four months and
modifying allowable charges for secondary mortgages;
requiring lender to provide proof of insurance to borrower
within thirty days; allowing lenders to provide revolving
lines of credit in certain circumstances; prohibiting
brokers from receiving payment prior to completion of services unless all requirements of article six, chapter
forty-six-a of this code are met; making the annual review
of licensee's books and accounts by the commissioner
discretionary; making it grounds to revoke or suspend
licenses if lender makes consumer loans with intent to
acquire secured property; modifying licensee's duty to
relinquish license following suspension or revocation;
modifying hearing requirements; providing that the penalties
in article seventeen, chapter thirty-one of this code are
cumulative; changing the periodic examination requirements
for financial institutions; making the effective date of the
amendments to chapters thirty-one and thirty-one-a of this
code the seventh day of June, one thousand nine hundred
ninety-six; establishing a per hour fee amount that the
commissioner of banking may charge financial institutions
for periodic record reviews; and exempting secondary
mortgage lender and broker licensees from the provisions of
chapter forty-six-a of this code when those provisions
conflict with the provisions of chapter thirty-one or
thirty-one-a of this code.
Be it enacted by the Legislature of West Virginia:
That sections one, two, four, five, six, eight, nine, ten,
eleven, twelve, thirteen, fourteen, fifteen, sixteen and
eighteen, article seventeen, chapter thirty-one of the code of
West Virginia, one thousand nine hundred thirty-one, as amended,
be amended and reenacted; that said article be further amended by
adding thereto a new section, designated section twenty; that
sections six and seven, article two, chapter thirty-one-a of said
code be amended and reenacted; that said article be further
amended by adding thereto a new section, designated section
sixteen; and that section one hundred five, article one, chapter
forty-six-a of said code be amended and reenacted, all to read as
follows:
CHAPTER 31. CORPORATIONS.
ARTICLE 17. SECONDARY MORTGAGE LOANS.
§31-17-1. Definitions and general provisions.
As used in this article:
(1) "Secondary mortgage loan" means a loan made to an
individual or partnership which is secured in whole or in part by
a mortgage or deed of trust upon any interest in real property
used as a dwelling with accommodations for not more than four families, which property is subject to the lien of one or more
prior recorded mortgages, deeds of trust or vendor's liens.
(2) "Person" means an individual, partnership, association,
trust, corporation or any other legal entity, or any combination
thereof.
(3) "Lender" means any person who makes or offers to make or
accepts or offers to accept any secondary mortgage loan in the
regular course of business. A person shall be deemed to be
acting in the regular course of business if he or she makes or
accepts, or offers to make or accept, more than five secondary
mortgage loans in any one calendar year.
(4) "Broker" means any person who, for a fee or commission
or other consideration, negotiates or arranges, or who offers to
negotiate or arrange, a secondary mortgage loan between a lender
and a borrower.
(5) "Brokerage fee" means the fee or commission or other
consideration charged by a broker for the services described in
subdivision (4) of this section.
(6) "Principal" or "principal sum" means the total of:
(a) The net amount paid to, receivable by or paid or payable for the account of the debtor;
(b) The amount of any discount excluded from the loan
finance charge; and
(c) To the extent that payment is deferred:
(i) Amounts actually paid or to be paid by the lender for
registration, certificate of title or license fees if not
included in paragraph (a) of this subdivision; and
(ii) Additional charges permitted by this article.
(7) "Additional charges" means every type of charge arising
out of the making or acceptance of a secondary mortgage loan,
except finance charges, including, but not limited to, official
fees and taxes, reasonable closing costs and certain documentary
charges and insurance premiums and other charges which definition
is to be read in conjunction with, and permitted by section one
hundred nine, article three, chapter forty-six-a of this code.
(8) "Finance charge" means the sum of all interest and
similar charges payable directly or indirectly by the debtor
imposed or collected by the lender incident to the extension of
credit, as coextensive with the definition of "loan finance
charge" set forth in section one hundred two, article one, chapter forty-six-a of this code.
(9) "Commissioner" means the commissioner of banking of this
state.
(10) "Applicant" means a person who has applied for a
lender's or broker's license.
(11) "Licensee" means any person duly licensed by the
commissioner under the provisions of this article as a lender or
broker.
(12) "Amount financed" means the total of the following
items to the extent that payment is deferred:
(a) The cash price of the goods, services or interest in
land, less the amount of any down payment, whether made in cash
or in property traded in;
(b) The amount actually paid or to be paid by the seller
pursuant to an agreement with the buyer to discharge a security
interest in or a lien on property traded in; and
(c) If not included in the cash price:
(i) Any applicable sales, use, privilege, excise or
documentary stamp taxes;
(ii) Amounts actually paid or to be paid by the seller for registration, certificate of title or license fees; and
(iii) Additional charges permitted by this article.
§31-17-2. License required for lender or broker; exemptions.
(a) No person shall engage in this state in the business of
lender or broker unless and until he or she shall first obtain a
license to do so from the commissioner, which license remains
unexpired, unsuspended and unrevoked, and no foreign corporation
shall, notwithstanding the provisions of section seventy-nine-a,
article one of this chapter, engage in such business in this
state unless it shall qualify to hold property and transact
business in this state.
(b) The provisions of this article do not apply to loans
made by banking institutions, trust companies, savings and loan
associations, industrial loan companies, insurance companies,
credit unions or any federally insured depository institution, or
to loans made by any other lender licensed by and under the
supervision of any agency of the federal government, or to loans
made by, or on behalf of, any agency or instrumentality of this
state or federal government or by a nonprofit community
development organization which loans are subject to federal or
state government supervision and oversight.
§31-17-4. Applications for licenses; requirements; bonds; fees;
renewals.
(a) Application for a lender's or broker's license shall
each year be submitted in writing under oath, in the form
prescribed by the commissioner, and shall contain the full name
and address (both of the residence and place of business) of the
applicant and, if the applicant is a partnership or association,
of every member thereof, and, if a corporation, of each officer,
director and owner of five percent or more of the capital stock
thereof, and such further information as the commissioner may
reasonably require. Any application shall also disclose the
location in this state at which the business of lender or broker
is to be conducted.
(b) At the time of making application for a lender's
license, the applicant therefor shall:
(1) If a foreign corporation, submit a certificate from the
secretary of state certifying that such applicant has qualified
to hold property and transact business in this state;
(2) Submit proof that he or she has available for the
operation of the business at the location specified in the
application net assets of at least two hundred fifty thousand dollars;
(3) File with the commissioner a bond in favor of the state
in the amount of one hundred thousand dollars, in such form and
with such conditions as the commissioner may prescribe, and
executed by a surety company authorized to do business in this
state;
(4) Pay to the commissioner a license fee of one thousand
dollars and an investigation fee of two hundred fifty dollars. If
the commissioner shall determine that an investigation outside
this state is required to ascertain facts or information relative
to the applicant or information set forth in the application, the
applicant may be required to advance sufficient funds to pay the
estimated cost of the investigation. An itemized statement of
the actual cost of the investigation outside this state shall be
furnished to the applicant by the commissioner, and the applicant
shall pay or shall have returned to him or her, as the case may
be, the difference between his or her payment in advance of the
estimated cost and the actual cost of the investigation; and
(5) Submit proof that the applicant is a business in good
standing in its state of incorporation, or if not a corporation, its state of business registration, and a full and complete
disclosure of any litigation or unresolved complaint filed by a
governmental authority or class action lawsuit on behalf of
consumers relating to the operation of the license applicant.
(c) At the time of making application for a broker's
license, the applicant therefor shall:
(1) If a foreign corporation, submit a certificate from the
secretary of state certifying that the applicant has qualified to
hold property and transact business in this state;
(2) Submit proof that he or she has available for the
operation of the business at the location specified in the
application net assets of at least ten thousand dollars;
(3) File with the commissioner a bond in favor of the state
in the amount of one hundred thousand dollars, in such form and
with such conditions as the commissioner may prescribe, and
executed by a surety company authorized to do business in this
state;
(4) Pay to the commissioner a license fee of one hundred
dollars and an investigation fee of fifty dollars; and
(5) Submit proof that the applicant is a business in good standing in its state of incorporation, or if not a corporation,
its state of business registration, and a full and complete
disclosure of any litigation or unresolved complaint filed by a
governmental authority or class action lawsuit on behalf of
consumers relating to the operation of the license applicant.
(d) The aggregate liability of the surety on any bond given
pursuant to the provisions of this section shall in no event
exceed the amount of such bond.
(e) Nonresident lenders and brokers licensed under this
article by their acceptance of such license acknowledge that they
are subject to the jurisdiction of the courts of West Virginia
and the service of process pursuant to section one hundred
thirty-seven, article two, chapter forty-six-a of this code and
section thirty-three, article three, chapter fifty-six of this
code.
§31-17-5. Refusal or issuance of license.
(a) Upon an applicant's full compliance with the provisions
of section four of this article, the commissioner shall
investigate the relevant facts with regard to the applicant and
his or her application for a lender's or broker's license, as the
case may be. Upon the basis of the application and all other information before him or her, the commissioner shall make and
enter an order denying the application and refusing the license
sought if the commissioner finds that:
(1) The applicant does not have available the net assets
required by the provisions of section four of this article;
(2) The applicant, individually, if an individual, or the
partners, if a partnership, or the officers and directors, if a
corporation, is of such character and reputation as reasonably to
warrant the belief that the business will not be operated
lawfully and properly in accordance with the provisions of this
article;
(3) The applicant has habitually defaulted on financial
obligations; or
(4) The applicant has done any act or has failed or refused
to perform any duty or obligation for which the license sought
could be suspended or revoked were it then issued and
outstanding.
Otherwise, the commissioner shall issue to the applicant a
lender's or broker's license which shall entitle the applicant to
engage in the business of lender or broker, as the case may be, during the period, unless sooner suspended or revoked, for which
the license is issued.
(b) Every application for a lender's or broker's license
shall be passed upon and the license issued or refused within
forty-five days after the applicant therefor has fully complied
with the provisions of section four of this article. Under no
circumstances whatever shall the same person hold both a lender's
and a broker's license. Whenever an application for a lender's
or broker's license is denied and the license sought is refused,
which refusal has become final, the commissioner shall retain the
investigation fee or fees but shall return the license fee to the
applicant.
§31-17-6. Minimum net assets to be maintained; bond to be kept
in full force and effect; foreign corporation to
remain qualified to do business in this state.
At all times, a licensee shall: (1) Have available the net
assets required by the provisions of section four of this
article; (2) keep the bond required by said section in full force
and effect; and (3) if the licensee be a foreign corporation,
remain qualified to hold property and transact business in this
state.
§31-17-8. Maximum period of loan; maximum interest and charge
or charges; insurance; other prohibitions.
(a) The maximum rate of finance charges and maximum total
additional charges on or in connection with any secondary
mortgage loan shall be as follows:
(1) The maximum rate of finance charge shall not exceed
eighteen percent per year on the unpaid balance of the amount
financed: Provided, That the borrower shall have the right to
prepay his or her debt in whole or in part at any time and shall
receive a rebate for any unearned finance charge, exclusive of
any points, investigation fees and loan origination fees, which
rebate shall be computed in accordance with section one hundred
eleven, article three, chapter forty-six-a of this code:
Provided, however, That the sum of any points, investigation fees
and loan origination fees charged may not exceed five percent of
the amount financed;
(2) A secondary mortgage loan shall be payable over a period
not to exceed sixty months. This sixty-month maximum loan period
is temporarily extended, as of the effective date of this
section, to one hundred twenty months until the first day of
July, two thousand, at which time it reverts to the sixty-month maximum loan limit time period. The commissioner shall report to
the Legislature by the first day of July, one thousand nine
hundred ninety-nine, on the impact of this extended loan time
period upon the citizens of this state. The report shall include
analysis of the impact of this loan period extension on the
secondary mortgage industry in this state, impacts of this
extension on various socio-economic classes of citizens of this
state, statistics regarding the number of homes which have been
foreclosed upon based on this extension and the effect of this
extension to any other citizens of this state. The commissioner
may require any licensee to provide the commissioner with any
information necessary to make this report;
(3) The total of additional charges as permitted by this
section and by section one hundred nine, article three, chapter
forty-six-a of this code, excluding official fees and taxes, and
insurance, may equal, but shall not be in excess of, ten percent
of the principal sum: Provided, That where the principal sum at
the inception of the secondary mortgage loan is one thousand five
hundred dollars or less, the total additional charge or charges,
excluding official fees, taxes and insurance, may exceed said ten percent, but shall not be in excess of one hundred fifty dollars:
Provided, however, That no additional charges other than official
fees, taxes and hazard insurance may be required by the same or
affiliated lender more often than once each twenty-four months by
renewal of a secondary mortgage loan or an additional secondary
mortgage loan secured by the same residential property;
(4) Where loan origination fees, investigation fees or
points have been charged by the licensee, such fees may not be
imposed again by the same or affiliated lender in any refinancing
of that loan or any additional loan on that property made within
twenty-four months thereof, unless these earlier charges have
been rebated by payment or credit to the consumer under the
actuarial method, or the total of the earlier and current changes
does not exceed the five percent amount.
(b) Notwithstanding the provisions of subsection (a) of this
section, a delinquent or "late charge" may be charged on any
installment made ten or more days after the regularly scheduled
due date in accordance with section one hundred twelve or one
hundred thirteen, article three, chapter forty-six-a of this
code, whichever is applicable. The charge may be made only once on any one installment during the term of the secondary mortgage
loan.
(c) Hazard insurance may be required by the lender of the
borrower, as provided in section one hundred nine, article three,
chapter forty-six-a of this code. Decreasing term life insurance,
in an amount not exceeding the amount of the secondary mortgage
loan and for a period not exceeding the term of the loan, and
accident and health insurance in an amount sufficient to make the
monthly payments due on said loan in the event of the disability
of the borrower and for a period not exceeding the life of said
loan, may also be offered by the lender to the borrower and the
premium therefor may be financed. The charges for any insurance
shall not exceed the standard rate approved by the insurance
commissioner for such insurance. Proof of all insurance in
connection with secondary mortgage loans subject to this article
shall be furnished to the borrower within thirty days from and
after the date of application therefor by said borrower.
(d) No application fee may be allowed whether or not the
secondary mortgage loan is consummated; however, the borrower may
be required to reimburse the lender for actual expenses incurred by the lender after acceptance and approval of a secondary
mortgage loan proposal made in accordance with the provisions of
this article which is not consummated because of:
(1) The borrower's willful failure to close said loan; or
(2) The borrower's false or fraudulent representation of a
material fact which prevents closing of said loan as proposed.
(e) No licensee shall make, offer to make, accept or offer
to accept, any secondary mortgage loan except on the terms and
conditions authorized in this article.
(f) No licensee shall induce or permit any husband and wife,
jointly and severally, to become obligated to the licensee under
this article, directly or contingently, or both, under more than
one secondary mortgage loan at the same time for the purpose or
with the result of obtaining greater charges than would otherwise
be permitted under the provisions of this article.
(g) No instrument evidencing or securing a secondary
mortgage loan shall contain:
(1) Any acceleration clause under which any part or all of
the unpaid balance of the obligation not yet matured may be
declared due and payable because the holder deems himself to be insecure;
(2) Any power of attorney to confess judgment or any other
power of attorney;
(3) Any provision whereby the borrower waives any rights
accruing to him under the provisions of this article;
(4) Any requirement that more than one installment be
payable in any one installment period, or that the amount of any
installment be greater or less than that of any other
installment, except for the final installment which may be in a
lesser amount, or unless the loan is structured as a revolving
line of credit having no set final payment date; or
(5) Any assignment of or order for the payment of any
salary, wages, commissions or other compensation for services, or
any part thereof, earned or to be earned.
(h) No broker licensee shall charge a borrower or receive
from a borrower money or other valuable consideration before
completing performance of all services the broker has agreed to
perform for the borrower, unless the licensee also registers and
complies with all requirements set forth for credit service
organizations in article six-c, chapter forty-six-a of this code, including all additional bonding requirements as may be
established therein.
(i) No lender licensee shall make revolving loans secured by
a secondary mortgage lien for the retail purchase of consumer
goods and services by use of a lender credit card.
§31-17-9. Disclosure; closing statements; other records
required.
(a) Any licensee or person making on his own behalf, or as
agent, broker or in other representative capacity on behalf of
any other person, a secondary mortgage loan, whether lawfully or
unlawfully, shall at the time of the closing furnish to the
borrower a complete and itemized closing statement which shall
show in detail:
(1) The amount and date of the note or secondary mortgage
loan contract and the date of maturity;
(2) The nature of the security;
(3) The finance charge rate per annum and the itemized
amount of finance charges and additional charges;
(4) The amount financed and total of payments;
(5) Disposition of the principal;
(6) A description of the payment schedule;
(7) The terms on which additional advances, if any, will be
made;
(8) The charge to be imposed for past-due installments;
(9) A description and the cost of insurance required by the
lender or purchased by the borrower in connection with the
secondary mortgage loan;
(10) The name and address of the borrower and of the lender;
and
(11) That the borrower may prepay the secondary mortgage
loan in whole or in part on any installment date, and that the
borrower will receive a rebate in full for any unearned finance
charge.
Such detailed closing statement shall be signed by the
lender or his representative, and a completed and signed copy
thereof shall be retained by the lender and made available at all
reasonable times to the borrower, the borrower's successor in
interest to the residential property, or the authorized agent of
the borrower or the borrower's successor, until the time as the
indebtedness shall be satisfied in full.
The commissioner may, from time to time, by rules prescribe additional information to be included in a closing statement.
(b) Upon written request from the borrower, the holder of a
secondary mortgage loan instrument shall deliver to the borrower,
within ten days from and after receipt of the written request, a
statement of the borrower's account showing the date and amount
of all payments made or credited to the account and the total
unpaid balance. Not more than two statements shall be requested
in any twelve-month period.
(c) Upon satisfaction of a secondary mortgage loan
obligation in full, the holder of the instrument evidencing or
securing the obligation shall deliver to the borrower a
recordable release and all writings signed by the borrower which
were incident to applying for and obtaining the secondary
mortgage loan.
§31-17-10. Advertising requirements.
It shall be unlawful and an unfair trade practice for any
person to cause to be placed before the public in this state,
directly or indirectly, any false, misleading or deceptive
advertising matter pertaining to secondary mortgage loans or the
availability thereof: Provided, That this section shall not
apply to the owner, publisher, operator or employees of any publication or radio or television station which disseminates
such advertising matter without actual knowledge of the false or
misleading character thereof.
§31-17-11. Records and reports; examination of records; analysis.
(a) Every licensee shall maintain at his or her place of
business in this state, if any, or if he or she has no place of
business in this state at his or her principal place of business
outside this state, such books, accounts and records relating to
all transactions within this article as are necessary to enable
the commissioner to enforce the provisions of this article. All
the books, accounts and records shall be preserved, exhibited to
the commissioner and kept available as provided herein for the
reasonable period of time as the commissioner may by rules
require. The commissioner is hereby authorized to prescribe by
rules the minimum information to be shown in the books, accounts
and records.
(b) Each licensee shall file with the commissioner on or
before the fifteenth day of April of each year a report under
oath or affirmation concerning his or her business and operations
in this state for the preceding license year in the form
prescribed by the commissioner, which shall show the annual volume and outstanding amounts of secondary mortgage loans, the
classification of the secondary mortgage loans by size and by
security, and the gross income from, and expenses properly
chargeable to, such secondary mortgage loans.
(c) The commissioner may, at his or her discretion, make or
cause to be made an examination of the books, accounts and
records of every licensee pertaining to secondary mortgage loans
made in this state under the provisions of this article, for the
purpose of determining whether each licensee is complying with
the provisions hereof and for the purpose of verifying each
licensee's annual report. If the examination is made outside
this state, the licensee shall pay the cost thereof in like
manner as applicants are required to pay the cost of
investigations outside this state.
(d) The commissioner shall publish annually an analysis of
the information furnished in accordance with the provisions of
subsection (b) of this section, but the individual reports shall
not be public records and shall not be open to public inspection.
§31-17-12. Grounds for suspension or revocation of license;
suspension and revocation generally; reinstatement
or new license.
(a) The commissioner may suspend or revoke any license
issued hereunder if he or she finds that the licensee and/or any
owner, director, officer, member, partner, stockholder, employee
or agent of such licensee:
(1) Has knowingly violated any provision of this article or
any order, decision or rule of the commissioner lawfully made
pursuant to the authority of this article; or
(2) Has knowingly made any material misstatement in the
application for such license; or
(3) Does not have available the net assets required by the
provisions of section four of this article; or
(4) Has failed or refused to keep the bond required by
section four of this article in full force and effect; or
(5) In the case of a foreign corporation, does not remain
qualified to do business in this state; or
(6) Has committed any fraud or engaged in any dishonest
activities with respect to such secondary mortgage loan business
in this state, or failed to disclose any of the material
particulars of any secondary mortgage loan transaction in this
state to anyone entitled to the information; or
(7) Has otherwise demonstrated bad faith, dishonesty or any
other quality indicating that the business of the licensee in
this state has not been or will not be conducted honestly or
fairly within the purpose of this article. It shall be a
demonstration of bad faith and an unfair or deceptive act or
practice to engage in a pattern of making loans where the
consumer has insufficient sources of income to timely repay the
debt, and the lender had the primary intent to acquire the
property upon default rather than to derive profit from the loan.
This section shall not limit any right the consumer may have to
bring an action for a violation of section one hundred four,
article six, chapter forty-six-a of this code in an individual
case.
The commissioner may also suspend or revoke the license of
a licensee if he or she finds the existence of any ground upon
which the license could have been refused, or any ground which
would be cause for refusing a license to such licensee were he
then applying for the same. The commissioner may also suspend or
revoke the license of a licensee pursuant to his or her authority
under section thirteen, article two, chapter thirty-one-a of this code.
(b) The suspension or revocation of the license of any
licensee shall not impair or affect the obligation of any
preexisting lawful secondary mortgage loan between such licensee
and any obligor.
(c) The commissioner may reinstate a suspended license, or
issue a new license to a licensee whose license has been revoked,
if the grounds upon which any such license was suspended or
revoked have been eliminated or corrected and the commissioner is
satisfied that the grounds are not likely to recur.
§31-17-13. Notice of refusal, or suspension or revocation, of
license; relinquishing license.
(a) Whenever the commissioner shall refuse to issue a
license, or shall suspend or revoke a license, he shall make and
enter an order to that effect and shall cause a copy of such
order to be served in person or by certified mail, return receipt
requested, or in any other manner in which process in a civil
action in this state may be served, on the applicant or licensee,
as the case may be.
(b) Whenever a license is suspended or revoked, the
commissioner shall in the order of suspension or revocation direct the licensee to return to the commissioner its license. It
shall be the duty of the licensee to comply with any such order:
(i) Immediately if the license was suspended either following a
hearing or for failure to keep the bond required by the
provisions of section four of this article in full force and
effect; or otherwise (ii) following expiration of the period
provided in section fourteen of this article in which such
licensee, if not previously provided the opportunity to a hearing
on the matter, may demand a hearing before the commissioner
without such demand having been timely made.
§31-17-14. Hearing before commissioner; provisions pertaining
to hearing.
(a) Any applicant or licensee, as the case may be, adversely
affected by an order made and entered by the commissioner in
accordance with the provisions of section thirteen of this
article, if not previously provided the opportunity to a hearing
on the matter, may in writing demand a hearing before the
commissioner. The written demand for a hearing must be filed
with the commissioner within thirty days after the date upon
which the applicant or licensee was served with a copy of such
order. The timely filing of a written demand for hearing shall stay or suspend execution of the order in question, pending a
final determination, except for an order suspending a license for
failure of the licensee to maintain the bond required by section
four of this article in full force and effect. If a written
demand is timely filed as aforesaid, the aggrieved party shall be
entitled to a hearing as a matter of right.
(b) All of the pertinent provisions of article five, chapter
twenty-nine-a of this code shall apply to and govern the hearing
and the administrative procedures in connection with and
following such hearing, with like effect as if the provisions of
said article were set forth in extenso in this subsection.
(c) For the purpose of conducting any such hearing
hereunder, the commissioner shall have the power and authority to
issue subpoenas and subpoenas duces tecum, in accordance with the
provisions of section one, article five, chapter twenty-nine-a of
this code. All subpoenas and subpoenas duces tecum shall be
issued and served in the manner, within the time and for the fees
and shall be enforced, as specified in said section, and all of
the said section provisions dealing with subpoenas and subpoenas
duces tecum shall apply to subpoenas and subpoenas duces tecum issued for the purpose of a hearing hereunder.
(d) Any such hearing shall be held within twenty days after
the date upon which the commissioner received the timely written
demand therefor, unless there is a postponement or continuance.
The commissioner may postpone or continue any hearing on his own
motion, or for good cause shown upon the application of the
aggrieved party. At any such hearing, the aggrieved party may
represent himself or be represented by any attorney-at-law
admitted to practice before any circuit court of this state.
(e) After such hearing and consideration of all of the
testimony, evidence and record in the case, the commissioner
shall make and enter an order affirming, modifying or vacating
his earlier order, or shall make and enter such order as is
deemed appropriate, meet and proper. Such order shall be
accompanied by findings of fact and conclusions of law as
specified in section three, article five, chapter twenty-nine-a
of this code, and a copy of such order and accompanying findings
and conclusions shall be served upon the aggrieved party and his
attorney of record, if any, in person or by certified mail,
return receipt requested, or in any other manner in which process in a civil action in this state may be served. The order of the
commissioner shall be final unless vacated or modified on
judicial review thereof in accordance with the provisions of
section fifteen of this article.
§31-17-15. Judicial review.
(a) Any person adversely affected by a final order made and
entered by the commissioner after hearing held in accordance with
the provisions of section fourteen of this article is entitled to
judicial review thereof. All of the pertinent provisions of
section four, article five, chapter twenty-nine-a of this code
shall apply to and govern such review with like effect as if the
provisions of said section were set forth in extenso in this
section.
(b) The judgment of the circuit court shall be final unless
reversed, vacated or modified on appeal to the supreme court of
appeals in accordance with the provisions of section one, article
six, chapter twenty-nine-a of this code.
(c) Legal counsel and services for the commissioner in all
appeal proceedings in any circuit court and the supreme court of
appeals shall upon request be provided by the attorney general or
his assistants, all without additional compensation.
§31-17-16. Actions to enjoin violations.
(a) Whenever it appears to the commissioner that any person
has been or is violating or is about to violate any provision of
this article, any rules of the commissioner or any final order of
the commissioner, the commissioner may apply in the name of the
state, to the circuit court of the county in which the violation
or violations, or any part thereof, has occurred, is occurring or
is about to occur, or the judge thereof in vacation, for an
injunction against such person and any other persons who have
been, are or are about to be, involved in, or in any way
participating in, any practices, acts or omissions, so in
violation, enjoining such person or persons from any such
violation or violations. Such application may be made and
prosecuted to conclusion whether or not any such violation or
violations have resulted or shall result in prosecution or
conviction under the provisions of section eighteen of this
article.
(b) Upon application by the commissioner as aforesaid, the
circuit courts of this state may by mandatory or prohibitory
injunction compel compliance with the provisions of this article,
any rules of the commissioner and all final orders of the commissioner. The court may issue a temporary injunction in any
case pending a decision on the merits of any application filed.
(c) The judgment of the circuit court upon any application
permitted by the provisions of this section shall be final unless
reversed, vacated or modified on appeal to the supreme court of
appeals. Any such appeal shall be sought in the manner and
within the time provided by law for appeals from circuit courts
in other civil cases.
(d) The commissioner shall upon request be represented in
all such proceedings by the attorney general or his assistants,
all without additional compensation.
§31-17-18. Violations and penalties.
(a) Any person, or any member, officer, director, agent or
employee of such person, who violates or participates in the
violation of this article shall be guilty of a misdemeanor, and,
upon conviction thereof, shall be fined not more than five
hundred dollars, or imprisoned in a county or regional jail for
not more than six months, or both fined and imprisoned, at the
discretion of the court.
(b) The penalties and remedies embodied in this article are
not exclusive, but are cumulative with other applicable provisions of this code, including, but not limited to, the
consumer protection laws in chapter forty-six-a of this code.
§31-17-20. Effective date.
The amendments to this article enacted during the first
extraordinary session of the Legislature in the year one thousand
nine hundred ninety-six shall be effective as of the seventh day
of June, one thousand nine hundred ninety-six.
CHAPTER 31A. BANKS AND BANKING.
ARTICLE 2. DIVISION OF BANKING.
§31A-2-6. Commissioner's examinations of financial institution;
reports; records; communications from commissioner
to institution; examination by federal agency in
lieu of commissioner's examination.
The commissioner of banking shall make, at least once every
eighteen months, a thorough examination of all the books,
accounts, records and papers of every depository financial
institution. He or she shall carefully examine all of the assets
of each such institution, including its notes, drafts, checks,
mortgages, securities deposited to assure the payment of debts
unto it, and all papers, documents and records showing, or in any
manner relating to, its business affairs, and shall ascertain the
full amount and the nature in detail of all of its assets and liabilities. The commissioner may also, at his or her
discretion, make or cause to be made, an annual or periodic
examination of the books, accounts, records and papers of other
financial institutions under his or her supervision for the
purposes of determining compliance with applicable consumer and
credit lending laws, and verifying information provided in any
license application or annual report submitted to the
commissioner. The commissioner may also make such examination of
any subsidiaries or affiliates of a financial institution as he
or she may deem necessary to ascertain the financial condition of
the financial institution, the relations between the financial
institution and its subsidiaries and affiliates and the effect of
the relations upon the affairs of such financial institution. A
full report of every examination shall be made and filed and
preserved in the office of the commissioner and a copy thereof
forthwith mailed to the institution examined. Every institution
shall retain all of its records of final entry for the period of
time as required in section thirty-five, article four of this
chapter for banking institutions. Unless otherwise covered by
assessments or a specific provision of this code, the cost of examinations made pursuant to this section shall be borne by the
financial institution at a rate of fifty dollars per each
examiner hour expended.
Every official communication from the commissioner to any
institution, or to any officer thereof, relating to an
examination or an investigation of the affairs of the institution
conducted by the commissioner or containing suggestions or
recommendations as to the manner of conducting the business of
the institution, shall be read to the board of directors at the
next meeting after the receipt thereof, and the president, or
other executive officer, of the institution shall forthwith
notify the commissioner in writing of the presentation and
reading of the communication and of any action taken thereon by
the institution.
The commissioner of banking, in his or her discretion, may
accept a copy of a reasonably current examination of any banking
institution made by the federal deposit insurance corporation or
the federal reserve system in lieu of an examination of the
banking institution required or authorized to be made by the laws
of this state, and the commissioner may furnish to the federal deposit insurance corporation or the federal reserve system or to
any official or examiner thereof, any copy or copies of the
commissioner's examinations of and reports on the banking
institutions; but nothing herein shall be construed to limit the
duty and responsibility of banking institutions to comply with
all provisions of law relating to examinations and reports, nor
to limit the powers and authority of the commissioner of banking
with reference to examinations and reports under existing laws.
§31A-2-7. Duties of officers, employees, etc., of financial
institution in connection with examination;
examination under oath; offenses and penalties.
All officers, directors, employees and other persons
connected with any financial institution, upon request of the
commissioner of banking, or his or her duly authorized
representative, shall furnish and give full access to all of the
books, papers, notes, bills and other evidences of debts due to
the institution; produce and furnish all documents, records,
writings and papers relating to the business of the institution
which the commissioner is authorized to examine; disclose fully,
accurately and in detail all of the debts and liabilities of the
institution; and furnish the clerical aid and assistance as may be required in the performance of the commissioner's duties as
provided by law. The commissioner or his or her representative,
as the case may be, shall have the right and authority to
administer oaths and to examine under oath each officer,
director, employee or other person connected with the institution
concerning any matter and thing pertaining to the business and
condition of the institution.
Any officer, director, employee or other person connected
with any such institution who willfully fails or refuses to so
furnish the documents, papers, materials or information as herein
required or who willfully fails to discharge any other duty or
obligation as herein provided shall be guilty of a misdemeanor,
and, upon conviction thereof, shall be subject to the penalties
provided in section fifteen, article eight of this chapter.
§31A-2-16. Effective date.
The amendments to this article enacted during the first
extraordinary session of the Legislature in the year one thousand
nine hundred ninety-six shall be effective as of the seventh day
of June, one thousand nine hundred ninety-six.
CHAPTER 46A. WEST VIRGINIA CONSUMER CREDIT
AND PROTECTION ACT.
ARTICLE 1. SHORT TITLE, DEFINITIONS AND GENERAL PROVISIONS.
§46A-1-105. Exclusions.
(a) This chapter does not apply to:
(1) Extensions of credit to government or governmental
agencies or instrumentalities;
(2) The sale of insurance by an insurer, except as otherwise
provided in this chapter;
(3) Transactions under public utility or common carrier
tariffs if a subdivision or agency of this state or of the United
States regulates the charges for the services involved, the
charges for delayed payment, and any discount allowed for early
payment; or
(4) Licensed pawnbrokers.
(b) Secondary mortgage lender and broker licensees are
excluded from the provisions of this chapter to the extent those
provisions directly conflict with any section of article
seventeen, chapter thirty-one of this code.