Frequently Asked Questions

Answers

1.  How do I apply for a mortgage broker's license?

Download and fill out the Application for Mortgage Broker License, which includes a check list and general information.  The applicant must provide all applicable items on the check list, including the non-refundable $1,500 application fee. 

Each person who owns 25% or more of the voting stock of the company and each person who has the power to direct the management and policy of the company (such as an officer or director) must complete a Personal History Record, a Personal Financial Questionnaire, a Child Support Statement and provide two completed signed fingerprint cards. Applicants may be fingerprinted at most law enforcement agencies, such as the local police department.  All owners of the licensed entity who will conduct mortgage lending activity in Nevada on behalf of the licensed entity must provide evidence of completion of 30 hours of certified courses of pre-licensing education or, alternatively, a score card evidencing passing the state examination administered by PSI.

Applicants must designate a natural person, who meets the "prescribed standards", to serve as the qualified employee (QE) for office. The QE must complete the QE Designation Form, Personal History Record, Child Support Statement, provide two signed fingerprint cards, and proof of two year's mortgage business experience.  Proof may consist of W-2 forms, 1099 forms, and letters from prior employers detailing the individual’s duties with the company. The application must demonstrate that the proposed qualified employee will supervise the mortgage agents in the office for which a license is sought on a full time basis.  The qualified employee must reside in Nevada prior to issuance of the license and once the license is issued continue to reside in Nevada full time within a commutable distance from the licensed location. Non-owner qualified employees must also hold a mortgage agent license.  The QE’s mortgage agent application should be submitted with the mortgage broker application. See F&Q #4 for more information on applying for a mortgage agent license.
 

Although there are minimum net worth requirements if the licensee maintains trust accounts pursuant to NRS 645B.175, there is no bond required for a mortgage broker's license.  There are minimum experience requirements to be approved as a qualified employee of a mortgage broker.  The qualified employee must provide evidence of completion of 30 hours of certified courses of pre-licensing education or, alternatively, a score card evidencing passing the state examination administered by PSI.
 

Once the above documentation is submitted and reviewed, and the background investigations are completed, the Commissioner will issue an Additional Requirement Letter.  The initial review and background investigations take between 8-10 weeks to complete; the entire licensing process takes up to four months to complete.  Applicants should consider this when securing their office space.  Applicants may note “pending” for the office location when the application is initially submitted.

Some additional required items, such as the local business license and the Secretary of State filing cannot be obtained without a memorandum of approval from the Division. The Division will provide the memorandums with the Additional Requirement Letter. The additional items include, but are not limited to the following documents:

• A copy of an appropriate municipal business license for the company, if applicable, or an application for such business license evidencing it has been filed with the municipality;

• A copy of the State Business License (issued by the Nevada Department of Taxation pursuant to NRS 364A) or an exemption from such a license.  All businesses, Nevada corporations, foreign corporations and partnerships operating in Nevada are required to have a State Business License issued by the Department of Taxation. A sole proprietorship with one or more employees is also required to have the State Business License. Statute imposes a tax based on the number of employees working in Nevada or entering Nevada to work or conduct a business activity (NRS 364A);

• A copy of a recorded certificate of fictitious name if the applicant intends to conduct business under a DBA (Douglas County does not require fictitious name filings);

• A copy of the articles of incorporation, appropriate partnership, joint venture or limited liability company agreement (if applicable), and proof of compliance with Nevada corporate filing requirements as administered by the Nevada Secretary of State.

• The first year licensing fee of $1,000.

If the licensee is to be a subsidiary of a nationwide or parent organization, the applicant must disclose the percentage of ownership by the parent company. The last two fiscal year-end reports of the parent company must be provided.  These reports may be shareholder reports, CPA prepared or 10K reports, as available.

The applicant must describe the general plan and character of its business, including the anticipated source of loan funds, as well as the following:

• How the applicant will supervise the loan process and any associated mortgage agents (i.e.: lending limits, policy manual, loan approval process, scope of loan review and audit procedures, frequency of head office review, if a branch, as well as the method of handling client monies);

• The applicant must explain how appraisals will be performed (see NAC 645B.270);

• The applicant must state whether he or she will handle any trust funds, or whether any such funds are to be handled by an independent third-party escrow company.

Additional branch licenses must be applied for separately. A branch license will not be issued until the principal Nevada office has been licensed for at least six months, and an examination completed resulting in a "satisfactory" rating.

All mortgage brokers licensed for less than one year must submit advertisements to the Commissioner for approval before they are used. All advertising by mortgage brokers and mortgage bankers must comply with NAC 645B.240 and NAC 645E.285 respectively.  Requests to approve television and/or radio advertisements must include a transcript; the videotape or tape recording will not be accepted. A hard copy of all proposed Internet web pages must be submitted for approval. All requests for approval of proposed advertisements must be submitted over the signature of the "qualified employee" of the mortgage broker.  Proposed advertisements may be submitted by facsimile to 702-486-0785, emailed to MLDTempReceptionist@mld.nv.gov or mailed to the Division's Las Vegas office.

Mortgage broker licensees are prohibited from acting as an escrow agent, or otherwise controlling funds which are the subject of completed construction loans (construction control accounts). (Attorney General's Opinion #89-6)

Multiple DBA's/Fictitious Names

Current regulations do not permit a mortgage broker to conduct business under more than one fictitious name, or "DBA;" however, the Division will permit the same company to obtain multiple licenses, each with its own DBA.  The Division will consider the corporate entity holding the licenses to be responsible for the conduct of each of its licensed offices and DBA's.
 

Sharing Offices and Qualified Employees

Pursuant to NRS 645B.035 a licensed mortgage broker may hold a mortgage banker's license and, pursuant to NRS 645E.230, a licensed mortgage banker may hold a mortgage broker's license.  Each type of licensee may conduct business from the same location or place of business as the other.  If otherwise qualified, the Division will authorize the same person to act as the qualified employee on behalf of both types of licensees operating at the same place of business provided both licensees share common ownership.

Pursuant to NAC 645B.032, a mortgage brokers may also share premises with  another business if they maintain separate space and signage, and can ensure the confidentiality of records are maintained by having locking doors and file cabinets and a separate fax machine.  However, mortgage brokers may only share premises with real estate companies if the mortgage broker and real estate company are under common ownership and control.

A mortgage broker may operate from the qualified employee’s home under specific guidelines.  The Home-Based Business Affidavit  details the requirements.

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2.  How do I apply for a mortgage banker's license?

The application procedure for mortgage bankers is the same as that for mortgage brokers; however, only licensed mortgage bankers may license branch locations outside Nevada pursuant to NRS 645E.200.  To apply for mortgage banker license, download and complete the Application for Mortgage Banker License.

Currently, owners, qualified employees and loan officers of a mortgage banker are not required to meet the pre-licensing education-test requirements.  Additionally, mortgage bankers are required to maintain signage as prescribed in NAC 645E.231, which would limit the ability to have a home based business in most counties in Nevada. 

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3.  Must I establish and maintain a physical office location in Nevada in order to become licensed as a mortgage broker or banker?

All companies seeking a mortgage brokers or mortgage bankers license must maintain at least one office in this state.  Licenses must be obtained for all additional branch offices in this state that will engage in activity for which a license is required.  Mortgage Brokers must do business in this state from an office located in this state.  Mortgage Bankers must maintain their principal Nevada office in this state, but may conduct business from properly licensed branch offices outside the state.  See NRS 645E.200(5).

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4.  How do I apply for a mortgage agent's license?

Download and complete the Application for Mortgage Agent License, which includes a check list and general information.  The applicant must provide all applicable items on the check list.  Applicants must provide evidence of completion of 30 hours of certified courses of pre-licensing education or, alternatively, a score card evidencing passing the state examination administered by PSI.

Applicants may be fingerprinted at most law enforcement agencies, such as the local police department. The mortgage agent application fee is $185. The annual renewal fee is $170; however the Division currently charges $100. The applicant’s background investigation must be completed prior to the issuance of a mortgage agent license.  An applicant may not conduct any licensable activities prior to issuance of the license.

A mortgage agent may be licensed as an LLC or Professional Corporation (PC) provided the individual is the manager of the LLC or sole shareholder of the PC. The LLC or PC name as registered with the Secretary of State may only be in the mortgage agent’s legal name followed by LLC or PC, as applicable. Mortgage agents that are currently licensed as a natural person and choose to change the licensed name to an artificial entity must submit an Affidavit of  LLC or PC  and an Intent to Employ Agent form along with the documentation stated on the form.

Non-owner Qualified Employees must also hold a mortgage agent license. If a qualified employee chooses to be paid as an artificial entity, the individual must apply for a mortgage agent license as shown above and submit an “Intent to Employ Agent” form signed by the Mortgage Broker as well as the required affidavit.

A mortgage agent affiliated with an FHA approved mortgage broker must be licensed as a natural person. FHA requires all employees of mortgage brokers to be W-2 employees. An FHA mortgage broker allowing licensing and payment of compensation to an artificial entity will be cited for violating FHA guidelines. In addition, the activity may be reported to HUD for investigation.

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5.  Who must obtain a license as a mortgage agent?

A mortgage agent is defined by NRS 645B.0125 as a person who is "an employee or independent contractor of a mortgage broker who is ..." licensed pursuant to NRS Chapter 645B and is "authorized by the mortgage broker to engage in, on behalf of the mortgage broker, any activity that would require the person, if he were not an employee or independent contractor of the mortgage broker, to be licensed as a mortgage broker ..."  The term does not include a person licensed as a mortgage broker or a person who performs only clerical or ministerial tasks for a mortgage broker.

An Applicant is eligible to receive a license if the applicant:

(1) Has not been convicted of, or entered a plea of nolo contendere to, a felony relating to the practice of mortgage agents or any crime involving fraud, misrepresentation or moral turpitude;

(2) Has not had a financial services license suspended or revoked within the immediately preceding 10 years;

(3) Has not made a false statement of material fact on his application;

(4) Has not violated any provision of this chapter or chapter 645E of NRS, a regulation adopted pursuant thereto or an order of the Commissioner; and

(5) Has a good reputation for honesty, trustworthiness and integrity and displays competence to transact the business of a mortgage agent in a manner which safeguards the interests of the general public. The applicant must submit satisfactory proof of these qualifications to the Commissioner.

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6.  What is required of a mortgage agent and a mortgage broker when a mortgage agent terminates his association or employment with the mortgage broker, changes brokers or renews his license?

Termination

Pursuant to NRS 645B.450(3), when a mortgage agent terminates his association or employment with a mortgage broker for any reason, including quitting, resigning or being fired, the mortgage broker must, within three business days of the termination, provide written notice to both the Division and the mortgage agent, at the agent’s last known address, using the prescribed Mortgage Agent Termination or Disassociation form. The form is available on the Division’s website, mld.nv.gov, under the Forms link, and may be faxed or mailed to the Division. Failure to comply with the provisions of NRS 645B.450 could subject the mortgage broker to administrative action and/or fines.

Changes of Brokers

Once a mortgage agent has terminated his association with one mortgage broker, he may associate with a new mortgage broker. It is the responsibility of both the mortgage agent and the new mortgage broker to ensure that the Division is in physical receipt of the completed Mortgage Agent Change of Broker form created by the Division (as executed by the new mortgage broker) and applicable $10 fee before the mortgage agent conducts mortgage activities with the new mortgage broker. The Division will accept a completed Mortgage Agent Change of Broker form and applicable $10 fee in advance of the Mortgage Agent Termination or Disassociation form.
 

License Renewal

Mortgage agents are required to renew their license annually. The annual renewal date is the month and day the license was initially issued. Renewals may be submitted up to 45 days prior to the annual renewal date. Individual mortgage agent renewal dates and histories may be verified on the Division’s website, mld.nv.gov, under Licensee Records. In order to renew his license, a mortgage agent must submit to the Division a completed Application for Renewal of Mortgage Agent License form and provide proof of completion of 10 hours of certified courses of continuing education (see Frequently Asked Question No. 7 below) during the 12 months immediately preceding the date on which the license expires, together with the $100 non-refundable renewal fee. Mortgage brokers should carefully monitor their agents’ compliance with this requirement. If a mortgage agent fails to timely renew his license, his license will be cancelled and he must immediately cease conducting mortgage activities. Agents may make application to reinstate their license up 6 months after their expiration date. To reinstate a license, an agent must comply with the renewal requirements listed above and pay an additional $75 reinstatement fee. After the 6-month period, the mortgage agent must submit a new Application for Mortgage Agent License. The Division will consider any mortgage activity conducted by a mortgage agent following his failure to timely renew to be a violation of statute and may subject both the mortgage broker and the mortgage agent to administrative action and/or fines.

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7.  What are the educational requirements for  mortgage brokers and mortgage agents to obtain and renew their licenses?

Mortgage broker licenses expire annually on June 30. Renewals must be submitted to the Division annually by May 31. NRS 645B.051 requires the broker to provide satisfactory proof at renewal that the licensee attended at least 10 hours of certified courses of continuing education during the 12 months immediately preceding the date on which the license expires. For purposes of NRS 645B.051 the term “licensee” includes the qualified employee and/or any owner or officer conducting business on behalf of the licensee in Nevada. In addition, if the licensed entity was issued a mortgage broker license after September 30, 2005, then by June 1, 2009, all owners of the licensed entity who conduct mortgage lending activity in Nevada on behalf of the licensed entity must provide evidence of completion of 30 hours of certified courses of pre-licensing education or, alternatively, a score card evidencing passing the state examination administered by PSI. If a qualified employee was approved as a qualified employee after September 30, 2005, then by June 1, 2009, the qualified employee must provide evidence of completion of 30 hours of certified courses of pre-licensing education or, alternatively, a score card evidencing passing the state examination administered by PSI.

A mortgage agent license issued pursuant to NRS 645B.410 expires 1 year after the date the license is issued. Individual agent renewal dates may be verified in the mortgage agent search section of our website. NRS 645B.430 requires the agent to provide satisfactory proof at renewal that the agent attended at least 10 hours of certified courses of continuing education during the 12 months immediately preceding the date on which the license expires. In addition, if the agent was issued a mortgage agent license after September 30, 2004, then by June 1, 2009, the agent must provide evidence of completion of 30 hours of certified courses of pre-licensing education or, alternatively, a score card evidencing passing the state examination administered by PSI.

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8.  How do I file a complaint against a mortgage broker, mortgage banker, mortgage agent or escrow agency or agent?

The Mortgage Lending Division will accept and investigate all complaints filed against any company or individual under our regulatory authority. Refer to our licensing records for a complete list of companies and individuals under our jurisdiction.  Complaints must be received in writing and may be submitted directly via this form or faxed or mailed to the addresses listed on our home page.  Copies of any documentation in support of your complaint should be included with the submission. The division will correspond with all complainants upon completion of the investigation.

Refer to question ten for assistance in determine the appropriate regulatory agency for companies not directly regulated by the Mortgage Lending Division.
 

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9.  Does Nevada have a usury law?

Nevada does not have a usury law.  There are limits on interest and fees that can be charged in a pawn transaction; however, NRS 99.050 requires only that the rate and terms of a loan must be specified in writing and agreed to by all parties.  There are no Nevada statutory limits on any fees that may be charged in a mortgage transaction so long as all parties have agreed to those fees in writing.  Applicable mortgage loans must comply with all federal laws including, but not limited to, The Real Estate Settlement Act and Regulation Z, Truth in Lending.

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10.  What other regulatory agencies govern the lending business?

Consumers having mortgage questions or complaints regarding companies not regulated by the Mortgage Lending Division may contact the following appropriate agencies for assistance:

Nevada Financial Institutions Division
(Regulates State chartered banks, credit unions, thrifts and check cashing companies)
1179 Fairview Dr. Ste 201
Carson City, Nevada 89701
Phone: (775) 687-5522
Fax: (775) 687-5523

Nevada Financial Institutions Division
2785 E. Desert Inn Rd., Ste 180
Las Vegas, Nevada 89121
Phone: (702) 486-4120
Fax: (702) 486-4563
e-mail http://fid.state.nv.us/contact.htm
Internet http://fid.state.nv.us.

Office of the Comptroller of the Currency
(Regulates national banks)

Customer Assistance Group
1301 McKinney Street
Suite 3450
Houston, TX 77010
1-800-613-6743
E-mail: Customer.Assistance@occ.treas.gov
Internet: http://www.occ.treas.gov
 

The Office of Thrift Supervision
(Regulates federal savings and loans (S&Ls) and federally chartered savings banks ("FSB's"))

Office of Consumer Programs
1700 G Street, NW
Washington, DC 20552
(202) 906-6237
1-800-842-6929
E-mail: consumer.complaint@ots.treas.gov
Internet: http://www.ots.treas.gov

The Federal Reserve Board
(Regulates state banks that are members of the Federal Reserve System)

Division of Consumer and Community Affairs
Federal Reserve Board
Washington, DC 20551
(202) 452-3946
Internet: http://www.federalreserve.gov

The Federal Deposit Insurance Corporation
(Regulates Federally insured state banks that are not members of the Federal Reserve System)

Division of Compliance and Consumer Affairs
550 17th Street, NW
Washington, DC 20429
(202) 942-3100
1-800-934-FDIC
Email: consumer@fdic.gov
Internet: http://www.fdic.gov

The National Credit Union Administration
(Regulates federal credit unions)

1775 Duke Street
Alexandria, VA 22314-3428
(703) 518-6300
Internet: http://www.ncua.gov
 

Federal Trade Commission
(Regulates other lenders)

Consumer Response Center
6th and Pennsylvania Avenue, N.W.
Washington, DC 20580
(202) 326-2222
Email: consumerline@ftc.gov
Internet: http://www.ftc.gov

Department of Housing and Urban Development (HUD)
(Enforces Fair Housing Act and RESPA)

Office of Fair Housing and Equal Opportunity
451 Seventh Street, S.W., Room 5100
Washington, DC 20410
(202) 708-4252
1-800-669-9777
Internet: http://www.hud.gov
http://www.hud.gov/complaints/index.cfm

 

Most mortgage transactions must comply with federal as well as state laws and regulations. Two federal laws that apply in many such transactions are the Real Estate Settlement Procedures Act and Federal Regulation Z Truth in Lending regulation.

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11.  May I make a "single" or "occasional" loan in Nevada without first obtaining a license or exemption certificate?

Due to the passage of AB375 in the 2007 Legislative Session, effective 10/1/07 the provisions of NRS 80.015 are amended to limit the unsolicited origination of mortgage loans in Nevada by unlicensed/non-exempt companies to commercial properties only. After 10/1/07 all Nevada 1 to 4 family residence mortgage loan originations will be subject to all applicable licensing or exemption requirements prescribed by law.

NRS 80.015 contains a list of activities that do not constitute “doing business” in this state including “[c]reating or acquiring indebtedness, mortgages and security interests in real or personal property.” NRS 80.015(1)(g). However, a person is considered doing business in Nevada and is subject to applicable licensing requirements pursuant to chapter 645A, 645B or 645E of NRS or title 55 or 56 of NRS if the person:

“(a) Maintains an office in this state for the transaction of business;

(b) Solicits or accepts deposits in the State, except pursuant to the provisions of chapter 666 or 666A of NRS;

((c) & (d) added pursuant to AB 375, effective 10-1-07)

(c) Solicits business for the activities of a mortgage broker as defined by NRS 645B.0127 or the activities of a mortgage banker as defined by NRS 645E.100; or

(d) Arranges a mortgage loan secured by real property which is not commercial property as defined by NRS 645E.040"

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12.  How do I obtain a Category 1 Exemption?

The “Category 1” exemption is set forth in NRS 645B.015(1), which provides in part that the provisions of the mortgage broker law do not apply to:

1. Any person doing business under the laws of this State, any other state or the United States relating to banks, savings banks, trust companies, savings and loan associations, consumer finance companies, industrial loan companies, credit unions, thrift companies or insurance companies, including, without limitation, a subsidiary or a holding company of such a bank, company, association or union.

A similar provision exists with respect to mortgage bankers. See NRS 645E.150(1).

Businesses attempting to qualify for this exemption are required to apply for and receive an exemption certificate pursuant to NRS 645B.016 (645E.160 for mortgage bankers) by submitting a written application, the fee required by NRS 645B.050 (645E.280 for mortgage bankers), and satisfactory proof that the business meets the requirements for the exemption.

Businesses specifically covered by a Federal preemption to applicable state licensing requirements are not required to apply for an exemption certificate and may conduct mortgage business in Nevada to the extent covered by the preemption.

The Mortgage Lending Division requires as satisfactory proof of qualification for a Category 1 exemption (1) Written evidence that the business is of a type described in the exemption, and (2) A letter from the government entity which regulates the business confirming that its business in this state will be subject to its jurisdiction and it will investigate complaints against the entity filed by Nevada citizens.

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13.  Are Internet-based mortgage brokers/bankers required to be licensed pursuant to NRS645B or NRS645E to transact business in Nevada?

NRS 645B and 645E require a license or exemption certificate when conducting or soliciting mortgage business within or into Nevada. The Division views applications obtained through the Internet as solicited transactions. Only licensed brokers/bankers may accept application requests by Nevada residents obtained via an Internet site. The Division considers unlicensed companies conducting mortgage business via Internet sites as violations of NRS 645B.690 and transacting such business will subject companies to administrative sanctions and/or fines not to exceed $10,000 per violation.

The Division agrees that using the Internet as a form of solicitation that may be accessed by Nevada residents does not in itself require companies to obtain a license. However, pursuant to NRS 645B and 645E, holding yourself out as being able to conduct mortgage business in Nevada is subject to licensing requirements.

Companies wishing to accept mortgage loan submissions from Nevada residents via the Internet must first comply with all applicable licensing requirements pursuant to NRS 645B and 645E. Please refer to Frequently Asked Question #1 for information on obtaining a license. If you have any additional questions, please contact the licensing staff in Carson City at (775) 684-7060.

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14. How do I obtain authorization to file as a corporation, limited liability company or foreign corporation with the State of Nevada Secretary of State’s office using the word “mortgage” in the name or if the business purpose relates to the mortgage business?

NRS 78.045 provides in relevant part:

2. The Secretary of State shall not accept for filing any articles of incorporation or any certificate of amendment of articles of incorporation of any corporation formed pursuant to the provisions of this chapter if it appears from the articles or the certificate of amendment that the business to be carried on by the corporation is subject to supervision by the Commissioner of Insurance or by the Commissioner of Financial Institutions, unless the articles or certificate of amendment is approved by the Commissioner who will supervise the business of the corporation.

Before accepting a filing for authority to do business, the Secretary of State requires an approval letter from the Division of Mortgage Lending if the filing includes the word “financial” or “mortgage” or the business purpose is related to mortgages. Companies must request the approval letter in writing to the Division specifying the purpose of the filing, the name, address, contact name and phone number for the company wishing to do business in Nevada. If the company plans to conduct mortgage activity in Nevada pursuant to NRS 645B.0127 or NRS 645E.100, the Division will not provide an approval until the applicable license application has been submitted to the Division and the company found suitable to hold a license. Once the required documentation is submitted and reviewed, the Commissioner will issue a conditional approval letter. This letter may then be provided to the Secretary of State to authorize the filing. Requests may be sent or emailed to Mortgage Lending Division, 400 W. King St Suite 101, Carson City, NV 89703, clinch@mld.nv.gov or Faxed to 775-684-7061. For information on reserving a name from the Secretary of State, Commercials Filings Division please visit the http://sos.state.nv.us.

15.  Does conducting institutional wholesale mortgage business in Nevada trigger licensing requirements with the Mortgage Lending Division?

Pursuant to NAC 645B.017 & NAC 645E.270, a company that only provides a funding source for a loan originated by a licensed broker or a company exempt from licensing does not conduct licensable activity. Additionally, institutions that purchase closed loans on the secondary market are not subject to licensure. Such activity may, however, trigger other licensing or registration requirements such as filing requirements with the Secretary of State, State Taxation or local business licensing authorities. In order to respond to consumer complaints against wholesale lenders, the Division requests wholesale lenders doing business in Nevada to provide us with the name, address and telephone number of a contact person to whom such complaints may be referred.

16.  After a mortgage agent who holds an active mortgage agent license terminates his affiliation with a mortgage broker, may he conduct mortgage agent activities with a new mortgage broker before the Division is in physical receipt of his completed Change of Broker form (as signed by the new mortgage broker) and applicable fee?

No. It is the responsibility of both the mortgage agent and the new mortgage broker to ensure that the Division is in physical receipt of the completed Change of Broker form and applicable fee before the mortgage agent conducts mortgage agent activities with a new mortgage broker. If the mortgage agent conducts mortgage agent activities before the Division is in physical receipt of the completed Change of Broker form and applicable fee, the activities are citable on an examination and may result in the imposition of administrative fine(s). An agent’s broker affiliation and history may be viewed on the Division’s website, mld.nv.gov, under the Licensee Records link.

17.  I’ve heard about so called “red flag rules”. What are they and do I need to comply with them?

Answer: The "red flags rule" was the name given to the written Identity Theft Prevention Program which was mandated last year by the Federal Trade Commission and the various federal banking agencies. These rules require, in part, that all mortgage brokers, mortgage bankers and escrow agencies design and implement ID theft prevention programs that are appropriate to their size and complexity, as well as the nature of their operations. The implementation date was extended to August 1, 2009. For licensees who have not yet adopted ID theft prevention programs, the Guidelines issued by the FTC should be helpful in assisting licensees in designing them. A supplement to the Guidelines identifies 26 possible red flags. These red flags are not a checklist, but rather, are examples that licensees may want to use as a starting point. As part of the Division's examination process, the licensee's "red flag rules" must be made available for review.

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