1-1 By: McCall, et al. (Senate Sponsor - Sibley) H.B. No. 1763
1-2 (In the Senate - Received from the House April 24, 2001;
1-3 April 25, 2001, read first time and referred to Committee on
1-4 Business and Commerce; May 4, 2001, reported adversely, with
1-5 favorable Committee Substitute by the following vote: Yeas 4, Nays
1-6 0; May 4, 2001, sent to printer.)
1-7 COMMITTEE SUBSTITUTE FOR H.B. No. 1763 By: Sibley
1-8 A BILL TO BE ENTITLED
1-9 AN ACT
1-10 relating to the continuation and functions of the Finance
1-11 Commission of Texas and the regulation of certain financial
1-12 institutions and businesses.
1-13 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-14 SECTION 1. Section 11.001, Finance Code, is amended to read
1-15 as follows:
1-16 Sec. 11.001. DEFINITIONS. (a) The definitions provided by
1-17 Section 31.002 apply to this chapter.
1-18 (b) In this chapter, "finance agency" means:
1-19 (1) the Texas Department of Banking;
1-20 (2) the Savings and Loan Department; or
1-21 (3) the Office of Consumer Credit Commissioner.
1-22 SECTION 2. Subchapter A, Chapter 11, Finance Code, is amended
1-23 by adding Section 11.002 to read as follows:
1-24 Sec. 11.002. PURPOSE OF COMMISSION; STRATEGIC PLAN. (a) The
1-25 finance commission is responsible for overseeing and coordinating
1-26 the Texas Department of Banking, the Savings and Loan Department,
1-27 and the Office of Consumer Credit Commissioner and serves as the
1-28 primary point of accountability for ensuring that state depository
1-29 and lending institutions function as a system, considering the
1-30 broad scope of the financial services industry. The finance
1-31 commission is the policy-making body for those finance agencies and
1-32 is not a separate state agency. The finance commission shall carry
1-33 out its functions in a manner that protects consumer interests,
1-34 maintains a safe and sound banking system, and increases the
1-35 economic prosperity of the state.
1-36 (b) The finance commission shall prepare and periodically
1-37 update a strategic plan for coordination of the state financial
1-38 system. Each finance agency shall cooperate in preparation of the
1-39 plan.
1-40 SECTION 3. Sections 11.102(b), (c), (d), and (e), Finance
1-41 Code, are amended to read as follows:
1-42 (b) One member [Two members] of the finance commission must
1-43 be a banking executive, one member [executives and two members] of
1-44 the finance commission must be a savings executive, one member of
1-45 the finance commission must be a consumer credit executive, and one
1-46 member of the finance commission must be a mortgage broker
1-47 [executives].
1-48 (c) Five members of the finance commission must be
1-49 representatives of the general public [may not be banking
1-50 executives, savings executives, or controlling shareholders in a
1-51 bank, savings association, or savings bank but must be selected by
1-52 the governor on the basis of recognized business ability]. At
1-53 least one of those members must be a certified public accountant.
1-54 (d) A person may not be a public member of the finance
1-55 commission if the person or the person's spouse:
1-56 (1) is registered, certified, or licensed by a
1-57 regulatory agency in an industry regulated by a finance agency;
1-58 (2) is employed by or participates in the management
1-59 of a business entity or other organization regulated by or
1-60 receiving money from a finance agency;
1-61 (3) owns or controls, directly or indirectly, more
1-62 than a 10 percent interest in a business entity or other
1-63 organization regulated by or receiving money from a finance agency;
1-64 or
2-1 (4) uses or receives a substantial amount of tangible
2-2 goods, services, or money from a finance agency other than
2-3 compensation or reimbursement authorized by law for finance
2-4 commission membership, attendance, or expenses. [A member or
2-5 employee of the finance commission may not be:]
2-6 [(1) an officer, employee, or paid consultant of a
2-7 trade association representing an industry regulated by the finance
2-8 commission, the banking commissioner, the savings and loan
2-9 commissioner, or the consumer credit commissioner;]
2-10 [(2) a person required to register as a lobbyist under
2-11 Chapter 305, Government Code, because of activities for a member of
2-12 an industry described by Subdivision (1); or]
2-13 [(3) related within the second degree by affinity or
2-14 consanguinity, as determined under Chapter 573, Government Code, to
2-15 a person who is an officer, employee, or paid consultant of a trade
2-16 association representing an industry described by Subdivision (1).]
2-17 (e) For the purposes of this section:
2-18 (1) "Banking executive" means a person who:
2-19 (A) has had five years' or more executive
2-20 experience in a bank during the seven-year period preceding the
2-21 person's appointment; and
2-22 (B) [at the time of the person's appointment] is
2-23 an officer of a state bank.
2-24 (2) "Savings executive" means a person who:
2-25 (A) has had five years' or more executive
2-26 experience in a savings association or savings bank during the
2-27 seven-year period preceding the person's appointment; and
2-28 (B) [at the time of the person's appointment] is
2-29 an officer of a state savings association or savings bank.
2-30 (3) "Consumer credit executive" means a person who:
2-31 (A) has had five years' or more executive
2-32 experience in an entity regulated by the consumer credit
2-33 commissioner during the seven-year period preceding the person's
2-34 appointment; and
2-35 (B) is an officer of an entity regulated by the
2-36 consumer credit commissioner.
2-37 (4) "Mortgage broker" means a person who:
2-38 (A) has had five years' or more experience as a
2-39 mortgage broker, as defined by Section 156.002, during the
2-40 seven-year period preceding the person's appointment; and
2-41 (B) is a mortgage broker, as defined by Section
2-42 156.002.
2-43 SECTION 4. Subchapter B, Chapter 11, Finance Code, is amended
2-44 by adding Section 11.1021 to read as follows:
2-45 Sec. 11.1021. CONFLICT OF INTEREST. (a) In this section,
2-46 "Texas trade association" means a cooperative and voluntarily
2-47 joined association of business or professional competitors in this
2-48 state designed to assist its members and its industry or profession
2-49 in dealing with mutual business or professional problems and in
2-50 promoting their common interest.
2-51 (b) A person may not be a member of the finance commission
2-52 if:
2-53 (1) the person is an officer, employee, or paid
2-54 consultant of a Texas trade association in an industry regulated by
2-55 a finance agency; or
2-56 (2) the person's spouse is an officer, manager, or
2-57 paid consultant of a Texas trade association in an industry
2-58 regulated by a finance agency.
2-59 (c) A person may not be a member of the finance commission
2-60 if the person is required to register as a lobbyist under Chapter
2-61 305, Government Code, because of the person's activities for
2-62 compensation on behalf of a profession related to the operation of
2-63 a finance agency.
2-64 SECTION 5. Section 11.103, Finance Code, is amended to read
2-65 as follows:
2-66 Sec. 11.103. REMOVAL OF MEMBERS[; VACANCIES]. (a) It is a
2-67 ground for removal from the finance commission that a member:
2-68 (1) does not have at the time of taking office the
2-69 qualifications required by Section 11.102;
3-1 (2) does not maintain during service on the finance
3-2 commission the qualifications required by Section 11.102;
3-3 (3) is ineligible for membership under Section 11.102
3-4 or 11.1021;
3-5 (4) cannot, because of illness or disability,
3-6 discharge the member's duties for a substantial part of the
3-7 member's term; or
3-8 (5) is absent from more than half of the regularly
3-9 scheduled finance commission meetings that the member is eligible
3-10 to attend during a calendar year without an excuse approved by a
3-11 majority vote of the finance commission.
3-12 (b) If the banking commissioner, savings and loan
3-13 commissioner, or consumer credit commissioner has knowledge that a
3-14 potential ground for removal exists, the banking commissioner,
3-15 savings and loan commissioner, or consumer credit commissioner
3-16 shall notify the presiding officer of the finance commission of the
3-17 potential ground. The presiding officer shall then notify the
3-18 governor and the attorney general that a potential ground for
3-19 removal exists. If the potential ground for removal involves the
3-20 presiding officer, the banking commissioner, savings and loan
3-21 commissioner, or consumer credit commissioner shall notify the next
3-22 highest ranking officer of the finance commission, who shall then
3-23 notify the governor and the attorney general that a potential
3-24 ground for removal exists.
3-25 (c) [(a) A ground for removal from the finance commission
3-26 exists if a member:]
3-27 [(1) did not have at the time of appointment the
3-28 qualifications required by Section 11.102 for appointment to the
3-29 finance commission;]
3-30 [(2) does not maintain the qualifications required by
3-31 Section 11.102 during service on the finance commission;]
3-32 [(3) violates a prohibition established by Section
3-33 11.105;]
3-34 [(4) cannot discharge the member's duties for a
3-35 substantial part of the term for which the member is appointed
3-36 because of illness or disability; or]
3-37 [(5) is absent from more than half of the regularly
3-38 scheduled finance commission meetings that the member is eligible
3-39 to attend during a calendar year unless the absence is excused by
3-40 majority vote of the finance commission.]
3-41 [(b) The governor shall appoint a qualified person to fill
3-42 any vacancy that occurs on the finance commission for the unexpired
3-43 term.]
3-44 [(c) The executive director of the finance commission shall
3-45 notify the presiding officer of the finance commission of any
3-46 potential ground for removal of which the executive director has
3-47 knowledge. The presiding officer then shall notify the governor
3-48 that a potential ground for removal exists.]
3-49 [(d)] The validity of an action of the finance commission is
3-50 not affected by the fact that it was taken when a ground for
3-51 removal of a member of the finance commission existed.
3-52 SECTION 6. Section 11.108, Finance Code, is amended to read
3-53 as follows:
3-54 Sec. 11.108. SUNSET PROVISION. The finance commission is
3-55 subject to Chapter 325, Government Code (Texas Sunset Act). Unless
3-56 continued in existence as provided by that chapter, the commission
3-57 is abolished September 1, 2013 [2001].
3-58 SECTION 7. Subchapter B, Chapter 11, Finance Code, is amended
3-59 by adding Sections 11.109-11.112 to read as follows:
3-60 Sec. 11.109. STANDARDS OF CONDUCT. The presiding officer of
3-61 the finance commission or the presiding officer's designee shall
3-62 provide to members of the finance commission, as often as
3-63 necessary, information regarding the requirements for office under
3-64 this title, including information regarding a person's
3-65 responsibilities under applicable laws relating to standards of
3-66 conduct for state officers.
3-67 Sec. 11.110. TRAINING. (a) A person who is appointed to and
3-68 qualifies for office as a member of the finance commission may not
3-69 vote, deliberate, or be counted as a member in attendance at a
4-1 meeting of the finance commission until the person completes a
4-2 training program that complies with this section.
4-3 (b) The training program must provide the person with
4-4 information regarding:
4-5 (1) the legislation that created the finance agencies
4-6 and the finance commission;
4-7 (2) the programs operated by the finance agencies;
4-8 (3) the role and functions of the finance agencies;
4-9 (4) the rules of the finance commission with an
4-10 emphasis on the rules that relate to disciplinary and investigatory
4-11 authority;
4-12 (5) the current budget for the finance agencies;
4-13 (6) the results of the most recent formal audit of the
4-14 finance agencies;
4-15 (7) the requirements of:
4-16 (A) the open meetings law, Chapter 551,
4-17 Government Code;
4-18 (B) the public information law, Chapter 552,
4-19 Government Code;
4-20 (C) the administrative procedure law, Chapter
4-21 2001, Government Code; and
4-22 (D) other laws relating to public officials,
4-23 including conflict-of-interest laws; and
4-24 (8) any applicable ethics policies adopted by the
4-25 finance commission or the Texas Ethics Commission.
4-26 (c) A person appointed to the finance commission is entitled
4-27 to reimbursement, as provided by the General Appropriations Act,
4-28 for the travel expenses incurred in attending the training program
4-29 regardless of whether the attendance at the program occurs before
4-30 or after the person qualifies for office.
4-31 Sec. 11.111. SEPARATION OF FUNCTIONS. The finance commission
4-32 shall develop and implement policies that clearly separate the
4-33 policymaking responsibilities of the finance commission and the
4-34 management responsibilities of the banking commissioner, savings
4-35 and loan commissioner, and consumer credit commissioner and staff
4-36 of the finance agencies.
4-37 Sec. 11.112. PUBLIC TESTIMONY. The finance commission shall
4-38 develop and implement policies that provide the public with a
4-39 reasonable opportunity to appear before the finance commission and
4-40 to speak on any issue under the jurisdiction of the finance
4-41 agencies.
4-42 SECTION 8. Section 11.202, Finance Code, is amended to read
4-43 as follows:
4-44 Sec. 11.202. HEARINGS OFFICER AND AUDITOR. (a) The finance
4-45 commission shall direct a finance agency to [may] employ [a
4-46 hearings officer and] an internal auditor to provide services to
4-47 and facilitate commission oversight and control over the finance
4-48 agencies [Texas Department of Banking, Savings and Loan Department,
4-49 and Office of Consumer Credit Commissioner].
4-50 (b) The Texas Department of Banking may employ a hearings
4-51 officer to serve the finance agencies as determined by interagency
4-52 agreement. For the purposes of Section 2003.021, Government Code, a
4-53 hearings officer employed under this section is considered to be an
4-54 employee of each agency for which hearing services are provided.
4-55 The hearings officer's only duty is to preside over matters related
4-56 to contested cases before a finance [the] agency or the finance
4-57 commission.
4-58 SECTION 9. Section 11.203, Finance Code, is amended to read
4-59 as follows:
4-60 Sec. 11.203. LIMITATION ON DIRECTION OF AUDITOR [STAFF]. The
4-61 [executive director, hearings officer,] internal auditor reports to
4-62 the finance commission and is[, and any other staff employed under
4-63 this subchapter are] not subject to direction by the employing
4-64 finance agency [Texas Department of Banking, Savings and Loan
4-65 Department, or Office of Consumer Credit Commissioner].
4-66 SECTION 10. Section 11.204, Finance Code, is amended to read
4-67 as follows:
4-68 Sec. 11.204. SHARING OF STAFF, EQUIPMENT, AND FACILITIES;
4-69 ALLOCATION OF COSTS. (a) The finance commission shall use the
5-1 [reduce administrative costs by sharing of support] staff,
5-2 equipment, and facilities of [among] the finance agencies [Texas
5-3 Department of Banking, Savings and Loan Department, and Office of
5-4 Consumer Credit Commissioner] to the extent necessary to carry out
5-5 the finance commission's duties. To reduce administrative costs,
5-6 the finance agencies shall share staff, equipment, and facilities
5-7 to the extent that the sharing contributes to cost efficiency
5-8 without detracting from the staff expertise needed for individual
5-9 areas of agency responsibility. [The finance commission may employ
5-10 staff and purchase equipment and facilities to meet these
5-11 objectives and pay for its activities from appropriations or as
5-12 provided by Chapter 771, Government Code.]
5-13 (b) An interagency agreement [regarding shared staff] must
5-14 provide that the cost of staff used by the finance commission,
5-15 including the internal auditor, [each member of shared staff other
5-16 than the executive director] is to be charged to the finance
5-17 agencies [Texas Department of Banking, Savings and Loan Department,
5-18 or Office of Consumer Credit Commissioner] in proportion to the
5-19 amount of time devoted to each agency's business. All other costs
5-20 of operation of the finance commission are [The cost of the
5-21 executive director and the unallocated cost of operation of the
5-22 finance commission is] to be shared by and included in the budgets
5-23 of the finance agencies [department, Savings and Loan Department,
5-24 and Office of Consumer Credit Commissioner] in proportion to the
5-25 amount of cash receipts of each of those agencies.
5-26 SECTION 11. Section 11.305, Finance Code, is amended by
5-27 amending Subsections (a) and (b) and adding Subsection (d) to read
5-28 as follows:
5-29 (a) The finance commission shall assign the banking
5-30 commissioner, savings and loan commissioner, or consumer credit
5-31 commissioner to conduct research on:
5-32 (1) the availability, quality, and prices of financial
5-33 services, including lending and depository services, offered in
5-34 this state to agricultural businesses, small businesses, and
5-35 individual consumers in this state; and
5-36 (2) the practices of business entities in this state
5-37 that provide financial services to agricultural businesses, small
5-38 businesses, and individual consumers in this state.
5-39 (b) The banking commissioner, savings and loan commissioner,
5-40 or consumer credit commissioner [finance commission] may:
5-41 (1) apply for and receive public and private grants
5-42 and gifts to conduct the research authorized by this section; and
5-43 (2) contract with public and private entities to carry
5-44 out studies and analyses under this section.
5-45 (d) The Texas Department of Banking and the Savings and Loan
5-46 Department shall jointly conduct a continuing review of the
5-47 condition of the state banking system. The review must include a
5-48 review of all available national and state economic forecasts and
5-49 an analysis of changing banking practices and new banking
5-50 legislation. Periodically the departments shall submit a report to
5-51 the finance commission on the results of the review, including
5-52 information relating to the condition of the state banking system
5-53 at the time of the report and the predicted condition of that
5-54 system in the future.
5-55 SECTION 12. Section 11.306, Finance Code, is amended to read
5-56 as follows:
5-57 Sec. 11.306. MORTGAGE BROKER RULES [BROKERS]. The finance
5-58 commission may adopt mortgage broker rules as provided by[:]
5-59 [(1) review any action or rule adopted by the savings
5-60 and loan commissioner under Chapter 156; and]
5-61 [(2) direct the savings and loan commissioner to
5-62 adopt, repeal, or amend any rule or other action the savings and
5-63 loan commissioner may undertake under] Chapter 156.
5-64 SECTION 13. Subchapter D, Chapter 11, Finance Code, is
5-65 amended by adding Section 11.307 to read as follows:
5-66 Sec. 11.307. RULES RELATING TO CONSUMER COMPLAINTS. (a) The
5-67 finance commission shall adopt rules applicable to each entity
5-68 regulated by the Texas Department of Banking or the Savings and
5-69 Loan Department specifying the manner in which the entity provides
6-1 consumers with information on how to file complaints with the
6-2 appropriate agency.
6-3 (b) The finance commission shall adopt rules applicable to
6-4 each entity regulated by a finance agency requiring the entity to
6-5 include information on how to file complaints with the appropriate
6-6 agency in each privacy notice that the entity is required to
6-7 provide consumers under law, including Pub. L. No. 106-102.
6-8 SECTION 14. Section 12.101(a), Finance Code, is amended to
6-9 read as follows:
6-10 (a) The banking commissioner is the chief executive officer
6-11 of the Texas Department of Banking. The finance commission, by at
6-12 least five affirmative votes, shall appoint the banking
6-13 commissioner. The banking commissioner serves at the will of the
6-14 finance commission[, is an employee of the finance commission,] and
6-15 is subject to the finance commission's orders and directions.
6-16 SECTION 15. Section 13.002(a), Finance Code, is amended to
6-17 read as follows:
6-18 (a) The savings and loan commissioner is the chief executive
6-19 officer of the Savings and Loan Department. The finance
6-20 commission, by at least five affirmative votes, shall appoint the
6-21 savings and loan commissioner. The savings and loan commissioner
6-22 serves at the will of the finance commission[, is an employee of
6-23 the finance commission,] and is subject to the finance commission's
6-24 orders and direction.
6-25 SECTION 16. Section 13.008(a), Finance Code, is amended to
6-26 read as follows:
6-27 (a) The [savings and loan commissioner and the] finance
6-28 commission shall establish reasonable and necessary fees for the
6-29 administration of Subtitles B and C, Title 3, and for the support
6-30 of the finance commission as provided by Subchapter C, Chapter 11.
6-31 SECTION 17. Section 14.051(b), Finance Code, is amended to
6-32 read as follows:
6-33 (b) The commissioner:
6-34 (1) [is an employee of the finance commission;]
6-35 [(2)] serves at the will of the commission; and
6-36 (2) [(3)] is subject to orders and directions of the
6-37 commission.
6-38 SECTION 18. Section 14.107, Finance Code, is amended to read
6-39 as follows:
6-40 Sec. 14.107. FEES. The finance commission [commissioner]
6-41 shall establish reasonable and necessary fees for carrying out the
6-42 commissioner's powers and duties under this chapter, Title 4, and
6-43 Chapters 392 and 394 and under Chapters 38-41, Business & Commerce
6-44 Code.
6-45 SECTION 19. Section 14.157, Finance Code, is amended to read
6-46 as follows:
6-47 Sec. 14.157. RULES. The finance commission [commissioner]
6-48 shall adopt rules governing the custody and use of information
6-49 obtained under this subchapter.
6-50 SECTION 20. Section 14.206(b), Finance Code, is amended to
6-51 read as follows:
6-52 (b) A witness required to attend a hearing before the
6-53 commissioner shall receive for each day's attendance a fee and a
6-54 travel and transportation allowance as authorized by law or a rule
6-55 adopted by the finance commission [commissioner].
6-56 SECTION 21. Section 33.007(a), Finance Code, is amended to
6-57 read as follows:
6-58 (a) If the banking commissioner believes that a person has
6-59 violated or is about to violate this subchapter or a rule of the
6-60 finance commission or order of the banking commissioner pertaining
6-61 to this subchapter, the attorney general on behalf of the banking
6-62 commissioner may apply to a district court of Travis County for an
6-63 order enjoining the violation and for other equitable relief the
6-64 nature of the case requires.
6-65 SECTION 22. Section 61.007, Finance Code, is amended to read
6-66 as follows:
6-67 Sec. 61.007. FEES. The [commissioner and] finance commission
6-68 by rule shall:
6-69 (1) set the amount of fees the commissioner charges
7-1 for:
7-2 (A) supervision and examination of associations;
7-3 (B) filing an application or other documents;
7-4 and
7-5 (C) other services the commissioner performs;
7-6 and
7-7 (2) specify the time and manner of payment of the
7-8 fees.
7-9 SECTION 23. Section 62.001(b), Finance Code, is amended to
7-10 read as follows:
7-11 (b) An application must contain:
7-12 (1) two copies of the association's articles of
7-13 incorporation identifying:
7-14 (A) the name of the association;
7-15 (B) the location of the principal office; and
7-16 (C) the names and addresses of the initial
7-17 directors;
7-18 (2) two copies of the association's bylaws;
7-19 (3) data sufficiently detailed and comprehensive to
7-20 enable the commissioner to make a determination under Section
7-21 62.007, including statements, exhibits, and maps;
7-22 (4) other information relating to the association and
7-23 its operation that the [commissioner and the] finance commission by
7-24 rule requires [require]; and
7-25 (5) financial information about each applicant,
7-26 incorporator, director, or shareholder that the finance commission
7-27 by rule requires.
7-28 SECTION 24. Section 62.052(b), Finance Code, is amended to
7-29 read as follows:
7-30 (b) The application must include information required by
7-31 [the commissioner or by] rule of the [commissioner and the] finance
7-32 commission.
7-33 SECTION 25. Section 62.152, Finance Code, is amended to read
7-34 as follows:
7-35 Sec. 62.152. MINIMUM NET WORTH REQUIREMENT. An association
7-36 shall meet minimum net worth requirements prescribed by rule of the
7-37 [commissioner and the] finance commission.
7-38 SECTION 26. Section 62.553(c), Finance Code, is amended to
7-39 read as follows:
7-40 (c) Unless the commissioner expressly waives a requirement
7-41 of this subsection, the application must contain:
7-42 (1) the identity, personal history, business
7-43 background and experience, and financial condition of each person
7-44 by whom or on whose behalf the acquisition is to be made, including
7-45 a description of:
7-46 (A) the managerial resources and future
7-47 prospects of each acquiring party; and
7-48 (B) any material pending legal or administrative
7-49 proceedings to which the person is a party;
7-50 (2) the terms of any proposed acquisition and the
7-51 manner in which the acquisition is to be made;
7-52 (3) the identity, source, and amount of the money or
7-53 other consideration used or to be used in making the acquisition
7-54 and, if any part of the money or other consideration has been or
7-55 will be borrowed or otherwise obtained for the purpose of making
7-56 the acquisition, a description of the transaction, the names of the
7-57 parties, and arrangements, agreements, or understandings with the
7-58 parties;
7-59 (4) any plan or proposal of an acquiring party to
7-60 liquidate the association, sell the association's assets, merge the
7-61 association with another company, or make other major changes in
7-62 the association's business or corporate structure or management;
7-63 (5) the terms of any offer, invitation, agreement, or
7-64 arrangement under which a voting security will be acquired and any
7-65 contract affecting that security or its financing after it is
7-66 acquired;
7-67 (6) information establishing that the requirements
7-68 under Section 62.555(b) are satisfied; and
7-69 (7) other information [the commissioner]:
8-1 (A) the finance commission by rule requires to
8-2 be furnished in an application; or
8-3 (B) the commissioner orders to be included in a
8-4 particular application.
8-5 SECTION 27. Section 62.560(a), Finance Code, is amended to
8-6 read as follows:
8-7 (a) The attorney general on behalf of the commissioner may
8-8 apply for equitable relief, including an order enjoining a
8-9 violation, if the commissioner believes a person has violated or is
8-10 about to violate this subchapter or a rule of the finance
8-11 commission or order of the commissioner adopted under this
8-12 subchapter.
8-13 SECTION 28. Section 64.001(a), Finance Code, is amended to
8-14 read as follows:
8-15 (a) The [commissioner and the] finance commission shall
8-16 adopt rules relating to the power of associations operating under
8-17 this subtitle to make loans and investments.
8-18 SECTION 29. Section 64.083, Finance Code, is amended to read
8-19 as follows:
8-20 Sec. 64.083. RULES. The [commissioner and the] finance
8-21 commission shall adopt rules to implement this subchapter,
8-22 including rules that define the categories of loans and investments
8-23 described by Section 64.081.
8-24 SECTION 30. Section 65.009(c), Finance Code, is amended to
8-25 read as follows:
8-26 (c) An association shall compute and pay interest and
8-27 dividends according to rules of the [commissioner and the] finance
8-28 commission.
8-29 SECTION 31. Section 66.002, Finance Code, is amended to read
8-30 as follows:
8-31 Sec. 66.002. ADOPTION OF RULES. The [commissioner and the]
8-32 finance commission may adopt rules relating to:
8-33 (1) the minimum amounts of capital stock and paid-in
8-34 surplus required for incorporation as a capital stock association;
8-35 (2) the minimum amounts of savings liability and
8-36 expense funds required for incorporation as a mutual association;
8-37 (3) the fees and procedures for processing, hearing,
8-38 and deciding applications filed with the commissioner or the
8-39 Savings and Loan Department under this subtitle;
8-40 (4) the books and records that an association is
8-41 required to keep and the location at which the books and records
8-42 are required to be maintained;
8-43 (5) the accounting principles and practices that an
8-44 association is required to observe;
8-45 (6) the conditions under which records may be copied
8-46 or reproduced for permanent storage before the original records are
8-47 destroyed;
8-48 (7) the form, contents, and time of publication of
8-49 statements of condition;
8-50 (8) the form and contents of annual reports and other
8-51 reports that an association is required to prepare and publish or
8-52 file;
8-53 (9) the manner in which assets, liabilities, and
8-54 transactions in general are to be described when entered in the
8-55 books of an association, so that the entry accurately describes the
8-56 subject matter of the entry; and
8-57 (10) the conditions under which the commissioner may
8-58 require an asset to be charged off or reserves established by
8-59 transfer from surplus or paid-in capital because of the
8-60 depreciation of or overstated value of the asset.
8-61 SECTION 32. Section 89.004, Finance Code, is amended to read
8-62 as follows:
8-63 Sec. 89.004. INITIATION OF RULEMAKING BY ASSOCIATIONS. The
8-64 finance commission [commissioner] shall initiate rulemaking
8-65 proceedings if at least 20 percent of the associations petition the
8-66 finance commission [commissioner] in writing requesting the
8-67 adoption, amendment, or repeal of a rule.
8-68 SECTION 33. Section 91.002(20), Finance Code, is amended to
8-69 read as follows:
9-1 (20) "Regulatory capital" means a common stockholders'
9-2 equity, including retained earnings, noncumulative perpetual
9-3 preferred stock and related earnings, minority interests in the
9-4 equity accounts of fully consolidated subsidiaries, and other
9-5 elements established by rules of the [commissioner and the] finance
9-6 commission.
9-7 SECTION 34. Section 91.007, Finance Code, is amended to read
9-8 as follows:
9-9 Sec. 91.007. FEES. The [commissioner and the] finance
9-10 commission by rule shall:
9-11 (1) set the amount of fees the commissioner charges
9-12 for:
9-13 (A) supervision and examination of savings
9-14 banks;
9-15 (B) filing an application or other documents;
9-16 (C) conducting a hearing; and
9-17 (D) other services the commissioner performs;
9-18 and
9-19 (2) specify the time and manner of payment of the
9-20 fees.
9-21 SECTION 35. Section 92.051(b), Finance Code, is amended to
9-22 read as follows:
9-23 (b) An application must contain:
9-24 (1) two copies of the savings bank's articles of
9-25 incorporation identifying:
9-26 (A) the name of the savings bank;
9-27 (B) the location of the principal office; and
9-28 (C) the names and addresses of the initial
9-29 directors;
9-30 (2) two copies of the savings bank's bylaws;
9-31 (3) data sufficiently detailed and comprehensive to
9-32 enable the commissioner to make findings under Section 92.058,
9-33 including statements, exhibits, and maps;
9-34 (4) other information relating to the savings bank and
9-35 its operation that the [commissioner and the] finance commission by
9-36 rule requires [require]; and
9-37 (5) financial information about each applicant,
9-38 incorporator, director, officer, or shareholder that the
9-39 [commissioner and the] finance commission by rule requires
9-40 [require].
9-41 SECTION 36. Section 92.052(b), Finance Code, is amended to
9-42 read as follows:
9-43 (b) Before approving the application of a capital stock
9-44 savings bank, the commissioner shall require the savings bank to
9-45 have an aggregate amount of capital in the form of stock and
9-46 paid-in surplus the [commissioner and the] finance commission by
9-47 rule specifies [specify].
9-48 SECTION 37. Section 92.053(b), Finance Code, is amended to
9-49 read as follows:
9-50 (b) Before approving the articles of incorporation of a
9-51 mutual savings bank, the commissioner shall require the savings
9-52 bank to have subscriptions for an aggregate amount of deposit
9-53 accounts and an expense fund in an aggregate amount the
9-54 [commissioner and the] finance commission by rule establishes
9-55 [establish] as necessary for the successful operation of a mutual
9-56 savings bank.
9-57 SECTION 38. Section 92.054(a), Finance Code, is amended to
9-58 read as follows:
9-59 (a) The [commissioner and the] finance commission by rule
9-60 shall set the minimum initial capital of a savings bank in an
9-61 amount not less than the greater of:
9-62 (1) the amount required to obtain insurance of deposit
9-63 accounts by the Federal Deposit Insurance Corporation; or
9-64 (2) the amount required of a national bank.
9-65 SECTION 39. Section 92.057(a), Finance Code, is amended to
9-66 read as follows:
9-67 (a) On the filing of a complete application to incorporate,
9-68 as defined by rules adopted by the [commissioner and the] finance
9-69 commission, the commissioner shall:
10-1 (1) issue public notice of the application; and
10-2 (2) give any interested person an opportunity to
10-3 appear, present evidence, and be heard for or against the
10-4 application.
10-5 SECTION 40. Sections 92.063(a) and (b), Finance Code, are
10-6 amended to read as follows:
10-7 (a) Only with the prior approval of the commissioner given
10-8 in accordance with rules of the [commissioner and the] finance
10-9 commission may a savings bank:
10-10 (1) establish an office other than the principal
10-11 office stated in the savings bank's articles of incorporation;
10-12 (2) move an office from its immediate vicinity; or
10-13 (3) change the savings bank's name.
10-14 (b) The commissioner may permit a savings bank to establish
10-15 additional offices in this state or another state in accordance
10-16 with rules of the [commissioner and the] finance commission.
10-17 SECTION 41. Section 92.102(b), Finance Code, is amended to
10-18 read as follows:
10-19 (b) The application must include information required by the
10-20 commissioner or by rule of the [commissioner and the] finance
10-21 commission.
10-22 SECTION 42. Sections 92.155(a) and (b), Finance Code, are
10-23 amended to read as follows:
10-24 (a) Except as the [commissioner and the] finance commission
10-25 by rule provides [provide], a director or officer may not:
10-26 (1) receive directly or indirectly a commission on or
10-27 benefit from a loan made by the savings bank;
10-28 (2) pay for services rendered to a borrower from the
10-29 savings bank in connection with a loan;
10-30 (3) direct or require a borrower on a mortgage to
10-31 negotiate an insurance policy on the mortgage property through a
10-32 particular insurance company;
10-33 (4) attempt to divert to a particular insurance broker
10-34 the business of borrowers from the savings bank;
10-35 (5) refuse to accept an insurance policy on the
10-36 mortgaged property because the policy was not negotiated through a
10-37 particular insurance broker;
10-38 (6) become an obligor, including an endorser, surety,
10-39 or guarantor, on a loan made by the savings bank;
10-40 (7) borrow or use, individually or as agent or partner
10-41 of another, directly or indirectly, money of the savings bank;
10-42 (8) become the owner of real property on which the
10-43 savings bank holds a mortgage unless the loan is fully secured by:
10-44 (A) a first-lien mortgage on property that:
10-45 (i) is to be occupied as the director's or
10-46 officer's primary residence; and
10-47 (ii) is specifically approved in writing
10-48 by the board; or
10-49 (B) a deposit maintained by the officer or
10-50 director with the savings bank; or
10-51 (9) engage in any other activity [the commissioner
10-52 and] the finance commission by rule prohibits [prohibit].
10-53 (b) Except as the [commissioner and the] finance commission
10-54 by rule provides [provide], a savings bank may not make a loan to a
10-55 corporation in which:
10-56 (1) a director or officer of the savings bank holds
10-57 stock, options, or warrants to purchase stock in the amount of five
10-58 percent or more of the outstanding stock; or
10-59 (2) the directors of the savings bank together hold
10-60 stock, options, or warrants to purchase stock in the amount of five
10-61 percent or more of the outstanding stock.
10-62 SECTION 43. Section 92.201, Finance Code, is amended to read
10-63 as follows:
10-64 Sec. 92.201. BOOKS AND RECORDS. A savings bank shall
10-65 maintain its books and records according to generally accepted
10-66 accounting principles and to rules adopted by the [commissioner and
10-67 the] finance commission.
10-68 SECTION 44. Section 92.202, Finance Code, is amended to read
10-69 as follows:
11-1 Sec. 92.202. LIQUIDITY. Unless approved in advance by the
11-2 commissioner, a savings bank shall maintain an amount equal to at
11-3 least 10 percent of its average daily deposits for the most
11-4 recently completed calendar quarter in:
11-5 (1) cash;
11-6 (2) balances in a federal reserve bank or passed
11-7 through a federal home loan bank or another depository institution
11-8 to a federal reserve bank under the Federal Reserve Act (12 U.S.C.
11-9 Section 221 et seq.); or
11-10 (3) other readily marketable investments, including
11-11 unencumbered federal government sponsored enterprises securities,
11-12 as allowed by rules adopted by the [commissioner and the] finance
11-13 commission.
11-14 SECTION 45. Section 92.203, Finance Code, is amended to read
11-15 as follows:
11-16 Sec. 92.203. REGULATORY CAPITAL. A savings bank shall
11-17 maintain regulatory capital in the amount prescribed by rule of the
11-18 [commissioner and the] finance commission. The amount may not be
11-19 less than the amount of regulatory capital required for a
11-20 corresponding national bank.
11-21 SECTION 46. Section 92.209(d), Finance Code, is amended to
11-22 read as follows:
11-23 (d) The extent to which preferred stock may be included as
11-24 regulatory capital of a savings bank is subject to the rules
11-25 adopted by the [commissioner and the] finance commission.
11-26 SECTION 47. Section 92.303(b), Finance Code, is amended to
11-27 read as follows:
11-28 (b) After the examination, the commissioner shall approve
11-29 the conversion without a hearing if the commissioner determines
11-30 that the converting financial institution is in sound condition and
11-31 meets all requirements of Subchapter B and relevant rules of the
11-32 [commissioner and the] finance commission.
11-33 SECTION 48. Section 92.553(c), Finance Code, is amended to
11-34 read as follows:
11-35 (c) Unless the commissioner expressly waives a requirement
11-36 of this subsection, the application must contain:
11-37 (1) the identity, history, business background and
11-38 experience, and financial condition of each person by whom or on
11-39 whose behalf the acquisition is to be made, including a description
11-40 of:
11-41 (A) the managerial resources and future
11-42 prospects of each acquiring party; and
11-43 (B) any material pending legal or administrative
11-44 proceedings to which the applicant is a party;
11-45 (2) the terms of any proposed acquisition and the
11-46 manner in which the acquisition is to be made;
11-47 (3) the identity, source, and amount of the money or
11-48 other consideration used or to be used in making the acquisition
11-49 and, if any part of the money or other consideration was or is to
11-50 be borrowed or otherwise obtained for the purpose of making the
11-51 acquisition, a description of the transaction, the names of the
11-52 parties, and arrangements, agreements, or understandings with those
11-53 parties;
11-54 (4) any plan or proposal of an acquiring party to
11-55 liquidate the savings bank, sell the savings bank's assets, merge
11-56 the savings bank with another company, or make other major changes
11-57 in the savings bank's business, corporate structure, or management;
11-58 (5) the terms of any offer, invitation, agreement, or
11-59 arrangement under which a voting security of the savings bank will
11-60 be acquired and any contract affecting that security or its
11-61 financing after it is acquired;
11-62 (6) information establishing that the requirements
11-63 under Section 92.556(a) are satisfied; and
11-64 (7) other information that [the commissioner]:
11-65 (A) the finance commission by rule requires; or
11-66 (B) the commissioner orders to be included in a
11-67 particular application.
11-68 SECTION 49. Section 92.560(a), Finance Code, is amended to
11-69 read as follows:
12-1 (a) The attorney general on behalf of the commissioner may
12-2 apply for equitable relief as the case may require, including an
12-3 order prohibiting the violation, if it appears to the commissioner
12-4 that a person has violated or is about to violate this subchapter
12-5 or a rule of the finance commission or order of the commissioner
12-6 adopted under this subchapter.
12-7 SECTION 50. Section 93.001(c), Finance Code, is amended to
12-8 read as follows:
12-9 (c) A savings bank may:
12-10 (1) sue and be sued in its corporate name;
12-11 (2) adopt and operate a reasonable bonus plan,
12-12 profit-sharing plan, stock bonus plan, stock option plan, pension
12-13 plan, or similar incentive plan for its directors, officers, or
12-14 employees, subject to any limitations under this subtitle or rules
12-15 adopted under this subtitle;
12-16 (3) make reasonable donations for the public welfare
12-17 or for a charitable, scientific, religious, or educational purpose;
12-18 (4) pledge its assets to secure deposits of public
12-19 money of the United States, if required by the United States,
12-20 including revenue and money the deposit of which is subject to
12-21 control or regulation of the United States;
12-22 (5) pledge its assets to secure deposits of public
12-23 money of any state or of a political corporation or political
12-24 subdivision of any state;
12-25 (6) become a member of or deal with any corporation or
12-26 agency of the United States or this state, to the extent that the
12-27 corporation or agency assists in furthering the purposes or powers
12-28 of savings banks, and for that purpose may purchase stock or
12-29 securities of the corporation or agency or deposit money with the
12-30 corporation or agency and may comply with any other condition of
12-31 membership credit;
12-32 (7) become a member of a federal home loan bank or the
12-33 Federal Reserve System;
12-34 (8) hold title to any assets acquired because of the
12-35 collection or liquidation of a loan, investment, or discount and
12-36 may administer those assets as necessary;
12-37 (9) receive and repay any deposit or account in
12-38 accordance with this subtitle and rules of the finance commission
12-39 [and the commissioner]; and
12-40 (10) lend and invest its money as authorized by this
12-41 subtitle and rules of the finance commission [and the
12-42 commissioner].
12-43 SECTION 51. Section 93.004, Finance Code, is amended to read
12-44 as follows:
12-45 Sec. 93.004. POWER TO BORROW. (a) A savings bank may borrow
12-46 and give security, subject to rules adopted by the finance
12-47 commission [and the commissioner].
12-48 (b) A savings bank at any time through action of its board
12-49 may issue a capital note, debenture, or other capital obligation
12-50 authorized by rules adopted by the finance commission [and the
12-51 commissioner].
12-52 SECTION 52. Section 93.008, Finance Code, is amended to read
12-53 as follows:
12-54 Sec. 93.008. POWERS RELATIVE TO OTHER FINANCIAL
12-55 INSTITUTIONS. Subject to limitations prescribed by rule of the
12-56 finance commission [and the commissioner], a savings bank may make
12-57 a loan or investment or engage in an activity permitted:
12-58 (1) under state law for a bank or savings and loan
12-59 association; or
12-60 (2) under federal law for a federal savings and loan
12-61 association, savings bank, or national bank if the financial
12-62 institution's principal office is located in this state.
12-63 SECTION 53. Section 94.001(a), Finance Code, is amended to
12-64 read as follows:
12-65 (a) The [commissioner and the] finance commission by rule
12-66 may limit loans to one borrower. Those limits may not be less
12-67 restrictive than the limits imposed on savings associations under
12-68 Section 5(u), Home Owners' Loan Act (12 U.S.C. Section 1464(u)).
12-69 SECTION 54. Section 94.002(a), Finance Code, is amended to
13-1 read as follows:
13-2 (a) Subject to rules adopted by the [commissioner and the]
13-3 finance commission, a savings bank may lend or invest not more than
13-4 40 percent of the savings bank's total assets in commercial loans.
13-5 SECTION 55. Section 94.203, Finance Code, is amended to read
13-6 as follows:
13-7 Sec. 94.203. RULES. The [commissioner and the] finance
13-8 commission shall adopt rules to implement this subchapter,
13-9 including rules that define the categories of loans and investments
13-10 described by Section 94.201.
13-11 SECTION 56. Section 94.251(a), Finance Code, is amended to
13-12 read as follows:
13-13 (a) A savings bank or a subsidiary may not invest in an
13-14 equity security unless the security qualifies as an investment
13-15 grade security under rules adopted by the [commissioner and the]
13-16 finance commission.
13-17 SECTION 57. Section 94.253, Finance Code, is amended to read
13-18 as follows:
13-19 Sec. 94.253. RULES. The [commissioner and the] finance
13-20 commission may adopt rules necessary to implement this subchapter,
13-21 including rules relating to eligible investment criteria,
13-22 investment diversification, and resource management requirements.
13-23 SECTION 58. Section 94.301, Finance Code, is amended to read
13-24 as follows:
13-25 Sec. 94.301. AUTHORIZATION. With the prior consent of the
13-26 commissioner and subject to rules adopted by the [commissioner and
13-27 the] finance commission, a savings bank may invest in a subsidiary
13-28 corporation created under general corporation law.
13-29 SECTION 59. Section 94.304, Finance Code, is amended to read
13-30 as follows:
13-31 Sec. 94.304. RULES. The [commissioner and the] finance
13-32 commission shall adopt rules on permitted activities of a
13-33 subsidiary corporation in which a savings bank invests under
13-34 Section 94.301.
13-35 SECTION 60. Section 95.007(b), Finance Code, is amended to
13-36 read as follows:
13-37 (b) A savings bank shall compute and pay interest and
13-38 dividends according to rules adopted by the [commissioner and the]
13-39 finance commission.
13-40 SECTION 61. Section 96.002(a), Finance Code, is amended to
13-41 read as follows:
13-42 (a) The [commissioner and the] finance commission may adopt
13-43 rules necessary to supervise and regulate savings banks and to
13-44 protect public investment in savings banks, including rules
13-45 relating to:
13-46 (1) the minimum amounts of capital required to
13-47 incorporate and operate as a savings bank, which may not be less
13-48 than the amounts required of corresponding national banks;
13-49 (2) the fees and procedures for processing, hearing,
13-50 and deciding applications filed with the commissioner or the
13-51 Savings and Loan Department under this subtitle;
13-52 (3) the books and records that a savings bank is
13-53 required to keep and the location at which the books and records
13-54 are required to be maintained;
13-55 (4) the accounting principles and practices that a
13-56 savings bank is required to observe;
13-57 (5) the conditions under which records may be copied
13-58 or reproduced for permanent storage before the originals are
13-59 destroyed;
13-60 (6) the form, content, and time of publication of
13-61 statements of condition;
13-62 (7) the form and content of annual reports and other
13-63 reports that a savings bank is required to prepare and publish or
13-64 file;
13-65 (8) the manner in which assets, liabilities, and
13-66 transactions in general are to be described when entered in the
13-67 books of a savings bank, so that the entry accurately describes the
13-68 subject matter of the entry;
13-69 (9) the conditions under which the commissioner may
14-1 require an asset to be charged off or reserves established by
14-2 transfer from surplus or paid-in capital because of depreciation of
14-3 or overstated value of the asset;
14-4 (10) the change of control of a savings bank;
14-5 (11) the conduct, management, and operation of a
14-6 savings bank;
14-7 (12) the withdrawable accounts, bonuses, plans, and
14-8 contracts for savings programs;
14-9 (13) the merger, consolidation, reorganization,
14-10 conversion, and liquidation of a savings bank;
14-11 (14) the establishment of an additional office or the
14-12 change of office location or name of a savings bank;
14-13 (15) the requirements for a savings bank's holding
14-14 companies, including those relating to:
14-15 (A) registration and periodic reporting of a
14-16 holding company with the commissioner; and
14-17 (B) transactions between a holding company, an
14-18 affiliate of a holding company, or a savings bank; and
14-19 (16) the powers of a savings bank to make loans and
14-20 investments that contain provisions reasonably necessary to ensure
14-21 that a loan made by a savings bank is consistent with sound lending
14-22 practices and that the savings bank's investment will promote the
14-23 purposes of this subtitle, including provisions governing:
14-24 (A) the type of loans and the conditions under
14-25 which a savings bank may originate, make, or sell loans;
14-26 (B) the conditions under which a savings bank
14-27 may purchase or participate in a loan made by another lender;
14-28 (C) the conditions for the servicing of a loan
14-29 for another lender;
14-30 (D) the conditions under which a savings bank
14-31 may lend money on the security of a loan made by another person;
14-32 (E) the conditions under which a savings bank
14-33 may pledge loans held by it as collateral for borrowing by the
14-34 savings bank;
14-35 (F) the conditions under which a savings bank
14-36 may invest in securities and debt instruments;
14-37 (G) the documentation that a savings bank must
14-38 have in its files at the time of funding or purchase of a loan, an
14-39 investment, or a participation in a loan;
14-40 (H) the form and content of statements of
14-41 expenses and fees and other charges that are paid by a borrower or
14-42 that a borrower is obligated to pay;
14-43 (I) the title information that must be
14-44 maintained;
14-45 (J) the borrower's insurance coverage of
14-46 property securing a loan;
14-47 (K) an appraisal report;
14-48 (L) the financial statement of a borrower;
14-49 (M) the fees or other compensation that may be
14-50 paid to a person in connection with obtaining a loan for a savings
14-51 bank, including an officer, director, employee, affiliated person,
14-52 consultant, or third party;
14-53 (N) the conditions under which the savings bank
14-54 may advance money to pay a tax, assessment, insurance premium, or
14-55 other similar charge for the protection of the savings bank's
14-56 interest in property securing the savings bank's loans;
14-57 (O) the terms under which a savings bank may
14-58 acquire and deal in real property;
14-59 (P) the valuation on a savings bank's books of
14-60 real property held by the savings bank;
14-61 (Q) the terms governing the investment by a
14-62 savings bank in a subsidiary, the powers that may be exercised by a
14-63 subsidiary, and the activities that may be engaged in by a
14-64 subsidiary; and
14-65 (R) any other matter considered necessary to
14-66 administer each type of transaction.
14-67 SECTION 62. Section 96.051(c), Finance Code, is amended to
14-68 read as follows:
14-69 (c) The [commissioner and the] finance commission may adopt
15-1 rules as necessary to implement this section.
15-2 SECTION 63. Section 97.001, Finance Code, is amended to read
15-3 as follows:
15-4 Sec. 97.001. RULES. (a) The [commissioner and the] finance
15-5 commission shall adopt rules:
15-6 (1) providing for the registration of and reporting by
15-7 holding companies;
15-8 (2) setting limitations on the activities and
15-9 investments of holding companies; and
15-10 (3) concerning other matters as appropriate under this
15-11 chapter.
15-12 (b) The [commissioner and the] finance commission may adopt
15-13 rules governing transactions between a subsidiary savings bank of a
15-14 holding company and an affiliate of the subsidiary.
15-15 SECTION 64. Section 119.006, Finance Code, is amended to
15-16 read as follows:
15-17 Sec. 119.006. INITIATION OF RULEMAKING BY SAVINGS BANKS.
15-18 The finance commission [commissioner] shall initiate rulemaking
15-19 proceedings under Chapter 2001, Government Code, if at least 20
15-20 percent of the savings banks petition the finance commission
15-21 [commissioner] in writing requesting the adoption, amendment, or
15-22 repeal of a rule.
15-23 SECTION 65. Section 152.102(b), Finance Code, is amended to
15-24 read as follows:
15-25 (b) The commission [commissioner] may adopt and enforce
15-26 reasonable rules to prevent unsafe and unsound practices with
15-27 respect to a permissible investment required by this chapter.
15-28 SECTION 66. Section 152.103, Finance Code, is amended to
15-29 read as follows:
15-30 Sec. 152.103. EXCEPTIONS TO REQUIREMENTS. The commission
15-31 [commissioner] by rule may exempt a person from this chapter or
15-32 reduce a requirement of Section 152.102(b), 152.104, 152.205,
15-33 152.206, 152.207, 152.208(a), 152.209, 152.304(b), 152.305,
15-34 152.403, 152.503, or 152.504 if:
15-35 (1) the person does not engage in the business of
15-36 selling checks to the public and the sale of checks by the person
15-37 is:
15-38 (A) ancillary to the person's business; and
15-39 (B) limited to commercial contracts in
15-40 interstate commerce; and
15-41 (2) the commission [commissioner] determines that the
15-42 exemption or reduced requirement is in the public interest.
15-43 SECTION 67. Section 152.202(b), Finance Code, is amended to
15-44 read as follows:
15-45 (b) Notwithstanding Subsection (a)(5), a person who meets
15-46 the requirements of that subsection is subject to:
15-47 (1) any other provision of this chapter to the extent
15-48 the person engages in the business of selling checks; and
15-49 (2) rules adopted by the commission [commissioner] to
15-50 administer and carry out that subsection, including rules to:
15-51 (A) define a term used in that subsection; and
15-52 (B) establish limits or requirements on the
15-53 bonding and net worth of the person and the person's activities
15-54 relating to the sale of checks other than those specified by that
15-55 subsection.
15-56 SECTION 68. Section 153.110(c), Finance Code, is amended to
15-57 read as follows:
15-58 (c) The commission [commissioner] may adopt rules to
15-59 implement this section.
15-60 SECTION 69. Section 153.117(a), Finance Code, as amended by
15-61 Chapters 62, 344, and 356, Acts of the 76th Legislature, Regular
15-62 Session, 1999, is reenacted and amended to read as follows:
15-63 (a) The following persons are not required to be licensed
15-64 under this chapter:
15-65 (1) a federally insured financial institution, as that
15-66 term is defined by Section 201.101 [as that term is defined by
15-67 state law governing bank holding companies and interstate bank
15-68 operations], that is organized under the laws of this state,
15-69 another state, or the United States;
16-1 (2) a foreign bank branch or agency in the United
16-2 States established under the federal International Banking Act of
16-3 1978 (12 U.S.C. Section 3101 et seq.), as amended;
16-4 (3) [(2)] a license holder under Chapter 152, except
16-5 that the license holder is required to comply with the other
16-6 provisions of this chapter to the extent the license holder engages
16-7 in currency exchange, transportation, or transmission transactions;
16-8 (4) a person registered as a securities dealer under
16-9 The Securities Act (Article 581-1 et seq., Vernon's Texas Civil
16-10 Statutes);
16-11 (5) an attorney or title company that in connection
16-12 with a real property transaction receives and disburses only
16-13 domestic currency on behalf of a party to the transaction;
16-14 (6) a Federal Reserve bank;
16-15 (7) a clearinghouse exercising bank payment,
16-16 collection, and clearing functions; or
16-17 (8) another person that the commission [commissioner]
16-18 may exempt by rule if the commission [commissioner] finds that the
16-19 licensing of the person is not necessary or appropriate to achieve
16-20 the objectives of this chapter.
16-21 SECTION 70. Section 153.205(b), Finance Code, is amended to
16-22 read as follows:
16-23 (b) The commission [commissioner] by rule may establish
16-24 requirements regarding content and the size and type of lettering
16-25 used in an advertisement for prices or rates.
16-26 SECTION 71. Section 153.303(a), Finance Code, is amended to
16-27 read as follows:
16-28 (a) The commission [commissioner] shall set the license
16-29 application fees, license fees, license renewal fees, and
16-30 examination fees in amounts that are reasonable and necessary to
16-31 defray the cost of administering this chapter.
16-32 SECTION 72. Section 154.002, Finance Code, is amended to read
16-33 as follows:
16-34 Sec. 154.002. DEFINITIONS. In this chapter:
16-35 (1) "Commission" means the Finance Commission of
16-36 Texas.
16-37 (2) "Commissioner" means the banking commissioner of
16-38 Texas.
16-39 (3) [(2)] "Department" means the Texas Department of
16-40 Banking.
16-41 (4) [(3)] "Earnings" means the amount in an account in
16-42 excess of the amount paid by the purchaser of a prepaid funeral
16-43 benefits contract that is deposited in the account as provided by
16-44 Section 154.253, including accrued interest, accrued income, and
16-45 enhanced or increased value.
16-46 (5) [(4)] "Financial institution" has the meaning
16-47 assigned by Section 201.101.
16-48 (6) [(5)] "Funeral provider" means the funeral home
16-49 designated in a prepaid funeral benefits contract that has agreed
16-50 to provide the specified prepaid funeral benefits.
16-51 (7) [(6)] "Insurance policy" means a life insurance
16-52 policy or annuity contract.
16-53 (8) [(7)] "Person" means an individual, firm,
16-54 partnership, corporation, or association.
16-55 (9) [(8)] "Prepaid funeral benefits" means prearranged
16-56 or prepaid funeral or cemetery services or funeral merchandise,
16-57 including an alternative container, casket, or outer burial
16-58 container. The term does not include a grave, marker, monument,
16-59 tombstone, crypt, niche, plot, or lawn crypt unless it is sold in
16-60 contemplation of trade for a funeral service or funeral merchandise
16-61 to which this chapter applies.
16-62 (10) [(9)] "Seller" means a person selling, accepting
16-63 money or premiums for, or soliciting contracts for prepaid funeral
16-64 benefits or contracts or insurance policies to fund prepaid funeral
16-65 benefits in this state.
16-66 (11) [(10)] "Crypt," "grave," "lawn crypt," "niche,"
16-67 and "plot" have the meanings assigned by Section 711.001, Health
16-68 and Safety Code.
16-69 (12) [(11)] "Funeral merchandise" or "merchandise"
17-1 means goods sold or offered for sale on a preneed basis directly to
17-2 the public for use in connection with funeral services.
17-3 (13) [(12)] "Funeral service" or "service" means a
17-4 service sold or offered for sale on a preneed basis that may be
17-5 used to:
17-6 (A) care for and prepare a deceased human body
17-7 for burial, cremation, or other final disposition; and
17-8 (B) arrange, supervise, or conduct a funeral
17-9 ceremony or the final disposition of a deceased human body.
17-10 SECTION 73. Section 154.051(b), Finance Code, is amended to
17-11 read as follows:
17-12 (b) The commission [department] may adopt reasonable rules
17-13 concerning:
17-14 (1) fees to defray the cost of administering this
17-15 chapter;
17-16 (2) the keeping and inspection of records relating to
17-17 the sale of prepaid funeral benefits;
17-18 (3) the filing of contracts and reports;
17-19 (4) changes in the management or control of an
17-20 organization; and
17-21 (5) any other matter relating to the enforcement and
17-22 administration of this chapter.
17-23 SECTION 74. Section 154.054(a), Finance Code, is amended to
17-24 read as follows:
17-25 (a) For each examination conducted under Section 154.053,
17-26 the commissioner or the commissioner's agent shall impose on the
17-27 seller a fee in an amount set by the commission [department] under
17-28 Section 154.051 and based on the seller's total outstanding
17-29 contracts.
17-30 SECTION 75. Section 154.102, Finance Code, is amended to read
17-31 as follows:
17-32 Sec. 154.102. PERMIT APPLICATION; FEE. To obtain a permit to
17-33 sell or continue to sell prepaid funeral benefits, a person must:
17-34 (1) file an application for a permit with the
17-35 department on a form prescribed by the department;
17-36 (2) pay a filing fee in an amount set by the
17-37 commission [department] under Section 154.051; and
17-38 (3) if applicable, pay extraordinary expenses required
17-39 for out-of-state investigation of the person.
17-40 SECTION 76. Section 154.104(b), Finance Code, is amended to
17-41 read as follows:
17-42 (b) The commission [department] by rule may adopt a system
17-43 under which permits expire on various dates during the year.
17-44 SECTION 77. Section 154.108, Finance Code, is amended to read
17-45 as follows:
17-46 Sec. 154.108. RENEWAL FEE. The commission [department] shall
17-47 set the renewal fee under Section 154.051.
17-48 SECTION 78. Section 154.109(a), Finance Code, is amended to
17-49 read as follows:
17-50 (a) The commissioner by order may cancel or suspend a permit
17-51 if the commissioner finds, by examination or other credible
17-52 evidence, that the permit holder:
17-53 (1) violated this chapter or another law of this state
17-54 relating to the sale of prepaid funeral benefits, including a final
17-55 order of the commissioner or rule of the commission [commissioner
17-56 or department];
17-57 (2) misrepresented or concealed a material fact in the
17-58 permit application; or
17-59 (3) obtained, or attempted to obtain, the permit by
17-60 misrepresentation, concealment, or fraud.
17-61 SECTION 79. Section 154.111(a), Finance Code, is amended to
17-62 read as follows:
17-63 (a) The commission [department] shall adopt rules governing
17-64 the selection of a successor permit holder.
17-65 SECTION 80. Section 154.351, Finance Code, is amended to
17-66 read as follows:
17-67 Sec. 154.351. MAINTENANCE OF GUARANTY FUND. The commission
17-68 [department] by rule shall establish and the department shall
17-69 maintain a fund to guarantee performance by sellers of prepaid
18-1 funeral benefits contracts of their obligations to the purchasers
18-2 under the provisions of this chapter governing prepaid funeral
18-3 trusts.
18-4 SECTION 81. Section 154.356(b), Finance Code, is amended to
18-5 read as follows:
18-6 (b) The assessments shall be deposited in the fund and
18-7 administered by the department and the advisory council in
18-8 accordance with commission [department] rules.
18-9 SECTION 82. Section 154.406(a), Finance Code, is amended to
18-10 read as follows:
18-11 (a) After notice and opportunity for hearing, the
18-12 commissioner may impose an administrative penalty on a person who:
18-13 (1) violates this chapter or a final order of the
18-14 commissioner or rule of the commission [commissioner or
18-15 department]; and
18-16 (2) does not correct the violation before the 31st day
18-17 after the date the person receives written notice of the violation
18-18 from the department.
18-19 SECTION 83. Section 154.407, Finance Code, is amended to
18-20 read as follows:
18-21 Sec. 154.407. INJUNCTIVE RELIEF. The commissioner may sue
18-22 in a district court in Travis County to enjoin a violation or
18-23 threatened violation of:
18-24 (1) this chapter; or
18-25 (2) a final order of the commissioner or rule of the
18-26 commission [commissioner or the department].
18-27 SECTION 84. Section 154.408(a), Finance Code, is amended to
18-28 read as follows:
18-29 (a) The commissioner may issue a cease and desist order to a
18-30 person if the commissioner finds by examination or other credible
18-31 evidence that the person has violated a law of this state relating
18-32 to the sale of prepaid funeral benefits, including a violation of
18-33 this chapter or a final order of the commissioner or rule of the
18-34 commission [commissioner or the department].
18-35 SECTION 85. Section 156.004, Finance Code, is amended to
18-36 read as follows:
18-37 Sec. 156.004. DISCLOSURE TO APPLICANT. At the time an
18-38 applicant submits an application to a mortgage broker, the mortgage
18-39 broker shall provide to the applicant a disclosure that specifies
18-40 the nature of the relationship between applicant and broker, the
18-41 duties the broker has to the applicant, and how the mortgage broker
18-42 will be compensated. The finance commission [commissioner], by
18-43 rule, shall promulgate a standard disclosure form to be used by the
18-44 mortgage broker.
18-45 SECTION 86. Section 156.102, Finance Code, is amended to
18-46 read as follows:
18-47 Sec. 156.102. RULEMAKING AUTHORITY. (a) The finance
18-48 commission [Subject to review and compliance with the directives of
18-49 the finance commission as provided by Section 11.306, the
18-50 commissioner] may adopt and enforce rules necessary for the intent
18-51 of or to ensure compliance with this chapter.
18-52 (b) The finance commission [commissioner] may adopt rules to
18-53 prohibit false, misleading, or deceptive practices by mortgage
18-54 brokers and loan officers but may not adopt any other rules
18-55 restricting competitive bidding or advertising by mortgage brokers
18-56 or loan officers. When adopting rules under this subsection, the
18-57 finance commission [commissioner] may not restrict:
18-58 (1) the use of any medium for an advertisement;
18-59 (2) the personal appearance of or voice of a person in
18-60 an advertisement;
18-61 (3) the size or duration of an advertisement; or
18-62 (4) a mortgage broker's or loan officer's
18-63 advertisement under a trade name.
18-64 (c) The finance commission [commissioner] may adopt rules
18-65 regarding books and records that a person licensed under this
18-66 chapter is required to keep, including the location at which the
18-67 books and records must be kept.
18-68 (d) The finance commission [commissioner] shall consult with
18-69 the mortgage broker advisory committee when proposing and adopting
19-1 rules under this chapter.
19-2 SECTION 87. Section 156.104(h), Finance Code, is amended to
19-3 read as follows:
19-4 (h) In addition to other powers and duties delegated to it
19-5 by the commissioner, the advisory committee shall advise the
19-6 finance commission and commissioner with respect to:
19-7 (1) the proposal and adoption of rules relating to:
19-8 (A) the licensing of mortgage brokers and loan
19-9 officers;
19-10 (B) the education and experience requirements
19-11 for licensing mortgage brokers and loan officers;
19-12 (C) conduct and ethics of mortgage brokers and
19-13 loan officers;
19-14 (D) continuing education for licensed mortgage
19-15 brokers and loan officers and the types of courses acceptable as
19-16 continuing education courses under this chapter; and
19-17 (E) the granting or denying of an application or
19-18 request for renewal for a mortgage broker license or loan officer
19-19 license;
19-20 (2) the form of or format for any applications or
19-21 other documents under this chapter; and
19-22 (3) the interpretation, implementation, and
19-23 enforcement of this chapter.
19-24 SECTION 88. Section 156.206(b), Finance Code, is amended to
19-25 read as follows:
19-26 (b) The commissioner shall obtain criminal history record
19-27 information on an applicant that is maintained by the Department of
19-28 Public Safety. By rule, the finance commission [commissioner] may
19-29 require applicants to submit information and fingerprints necessary
19-30 for the commissioner to obtain criminal background information from
19-31 the Federal Bureau of Investigation. The commissioner may also
19-32 obtain criminal history record information from any court or any
19-33 local, state, or national governmental agency.
19-34 SECTION 89. Section 156.207(c), Finance Code, is amended to
19-35 read as follows:
19-36 (c) In accordance with any rules adopted by the finance
19-37 commission under this subsection, the commissioner may issue a
19-38 provisional license to an applicant if a significant delay is
19-39 necessary to process the application, review information related to
19-40 the application, or obtain information related to the application.
19-41 The commissioner may revoke a provisional license issued under this
19-42 subsection on a ground listed under Section 156.303 or on any
19-43 ground that the commissioner could have denied issuance of the
19-44 license on the application.
19-45 SECTION 90. Sections 156.208(a), (b), (f), and (g), Finance
19-46 Code, are amended to read as follows:
19-47 (a) A mortgage broker license issued under this chapter is
19-48 valid for two years and may be renewed on or before its expiration
19-49 date if the mortgage broker:
19-50 (1) pays to the commissioner a renewal fee in an
19-51 amount determined by the commissioner not to exceed $375 and a
19-52 recovery fund fee provided by Section 156.502;
19-53 (2) has not been convicted of a felony the
19-54 commissioner determines is directly related to the occupation of a
19-55 mortgage broker under Article 6252-13c, Revised Statutes; and
19-56 (3) provides the commissioner with satisfactory
19-57 evidence that the mortgage broker:
19-58 (A) has attended, during the term of the current
19-59 license, 15 hours of continuing education courses that the
19-60 commissioner, in accordance with the rules adopted by the finance
19-61 commission under this section, has approved as continuing education
19-62 courses; or
19-63 (B) maintains an active license in this state
19-64 as:
19-65 (i) a real estate broker;
19-66 (ii) a real estate salesperson;
19-67 (iii) an attorney; or
19-68 (iv) a local recording agent or insurance
19-69 solicitor or agent for a legal reserve life insurance company under
20-1 Chapter 21, Insurance Code, or an equivalent license under Chapter
20-2 21, Insurance Code.
20-3 (b) A loan officer license issued under this chapter is
20-4 valid for two years and may be renewed on or before its expiration
20-5 date if the loan officer:
20-6 (1) pays to the commissioner a renewal fee in an
20-7 amount determined by the commissioner not to exceed $175 and a
20-8 recovery fund fee provided by Section 156.502;
20-9 (2) has not been convicted of a felony the
20-10 commissioner determines is directly related to the occupation of a
20-11 loan officer under Article 6252-13c, Revised Statutes; and
20-12 (3) provides the commissioner with satisfactory
20-13 evidence that the loan officer:
20-14 (A) has attended, during the term of the current
20-15 license, 15 hours of continuing education courses that the
20-16 commissioner, in accordance with the rules adopted by the finance
20-17 commission under this section, has approved as continuing education
20-18 courses, including courses provided by or through the licensed
20-19 mortgage broker with whom the loan officer is associated after
20-20 submission to and approval by the commission; or
20-21 (B) maintains an active license in this state
20-22 as:
20-23 (i) a real estate broker;
20-24 (ii) a real estate salesperson;
20-25 (iii) an attorney; or
20-26 (iv) a local recording agent or insurance
20-27 solicitor or agent for a legal reserve life insurance company under
20-28 Chapter 21, Insurance Code, or an equivalent license under Chapter
20-29 21, Insurance Code.
20-30 (f) The finance commission [commissioner] by rule may adopt
20-31 a system under which licenses expire on a date or dates other than
20-32 December 31. If a system is adopted under this subsection, dates
20-33 relating to expiration and issuance of licenses shall be adjusted
20-34 accordingly. For the biennium in which the license expiration date
20-35 is changed, license fees shall be prorated on a monthly basis so
20-36 that each license holder pays only that portion of the license fee
20-37 that is allocable to the number of months during which the license
20-38 is valid. On renewal of the license on the new expiration date,
20-39 the total license renewal fee is payable.
20-40 (g) The finance commission [commissioner] shall adopt rules
20-41 related to the approval of courses for continuing education credit
20-42 under this section that provide for the acceptance of continuing
20-43 education courses that are related to finance, financial
20-44 consulting, lending, real estate contracts, discrimination laws,
20-45 deceptive trade practices, real property conveyances, and other
20-46 topics that are relevant to mortgage brokers and that are
20-47 acceptable as continuing education courses to other professional
20-48 licensing agencies.
20-49 SECTION 91. Section 156.210, Finance Code, is amended to
20-50 read as follows:
20-51 Sec. 156.210. PROBATIONARY LICENSE. The commissioner may
20-52 issue a probationary license. The finance commission
20-53 [commissioner] by rule shall adopt reasonable terms and conditions
20-54 for a probationary license.
20-55 SECTION 92. Section 156.303(a), Finance Code, is amended to
20-56 read as follows:
20-57 (a) The commissioner may order disciplinary action against a
20-58 licensed mortgage broker or a licensed loan officer when the
20-59 commissioner, after a hearing, has determined that the person:
20-60 (1) obtained a license under this chapter through a
20-61 false or fraudulent representation or made a material
20-62 misrepresentation in an application for a license under this
20-63 chapter;
20-64 (2) published or caused to be published an
20-65 advertisement related to the business of a mortgage broker or loan
20-66 officer that:
20-67 (A) is misleading;
20-68 (B) is likely to deceive the public;
20-69 (C) in any manner tends to create a misleading
21-1 impression;
21-2 (D) fails to identify as a mortgage broker or
21-3 loan officer the person causing the advertisement to be published;
21-4 or
21-5 (E) violates federal or state law;
21-6 (3) while performing an act for which a license under
21-7 this chapter is required, engaged in conduct that constitutes
21-8 improper, fraudulent, or dishonest dealings;
21-9 (4) failed to notify the commissioner not later than
21-10 the 30th day after the date of the final conviction if the person,
21-11 in a court of this or another state or in a federal court, has been
21-12 convicted of or entered a plea of guilty or nolo contendere to a
21-13 felony or a criminal offense involving fraud;
21-14 (5) failed to use a fee collected in advance of
21-15 closing of a mortgage loan for a purpose for which the fee was
21-16 paid;
21-17 (6) charged or received, directly or indirectly, a fee
21-18 for assisting a mortgage applicant in obtaining a mortgage loan
21-19 before all of the services that the person agreed to perform for
21-20 the mortgage applicant are completed, and the proceeds of the
21-21 mortgage loan have been disbursed to or on behalf of the mortgage
21-22 applicant, except as provided by Section 156.304;
21-23 (7) failed within a reasonable time to honor a check
21-24 issued to the commissioner after the commissioner has mailed a
21-25 request for payment by certified mail to the person's last known
21-26 business address as reflected by the commissioner's records;
21-27 (8) paid compensation to a person who is not licensed
21-28 or exempt under this chapter for acts for which a license under
21-29 this chapter is required;
21-30 (9) induced or attempted to induce a party to a
21-31 contract to breach the contract so the person may make a mortgage
21-32 loan;
21-33 (10) published or circulated an unjustified or
21-34 unwarranted threat of legal proceedings in matters related to the
21-35 person's actions or services as a mortgage broker or loan officer,
21-36 as applicable;
21-37 (11) established an association, by employment or
21-38 otherwise, with a person not licensed or exempt under this chapter
21-39 who was expected or required to act as a mortgage broker or loan
21-40 officer;
21-41 (12) aided, abetted, or conspired with a person to
21-42 circumvent the requirements of this chapter;
21-43 (13) acted in the dual capacity of a mortgage broker
21-44 or loan officer and real estate broker, salesperson, or attorney in
21-45 a transaction without the knowledge and written consent of the
21-46 mortgage applicant or in violation of applicable requirements under
21-47 federal law;
21-48 (14) discriminated against a prospective borrower on
21-49 the basis of race, color, religion, sex, national origin, ancestry,
21-50 familial status, or a disability;
21-51 (15) failed or refused on demand to:
21-52 (A) produce a document, book, or record
21-53 concerning a mortgage loan transaction conducted by the mortgage
21-54 broker or loan officer for inspection by the commissioner or the
21-55 commissioner's authorized personnel or representative;
21-56 (B) give the commissioner or the commissioner's
21-57 authorized personnel or representative free access to the books or
21-58 records relating to the person's business kept by an officer,
21-59 agent, or employee of the person or any business entity through
21-60 which the person conducts mortgage brokerage activities, including
21-61 a subsidiary or holding company affiliate; or
21-62 (C) provide information requested by the
21-63 commissioner as a result of a formal or informal complaint made to
21-64 the commissioner;
21-65 (16) failed without just cause to surrender, on
21-66 demand, a copy of a document or other instrument coming into the
21-67 person's possession that was provided to the person by another
21-68 person making the demand or that the person making the demand is
21-69 under law entitled to receive; or
22-1 (17) disregarded or violated this chapter or a rule
22-2 adopted by the finance commission [commissioner] under this
22-3 chapter.
22-4 SECTION 93. Section 156.506(d), Finance Code, is amended to
22-5 read as follows:
22-6 (d) This section does not limit the authority of the
22-7 commissioner to take disciplinary action against a mortgage broker
22-8 or loan officer for a violation of this chapter or the rules
22-9 adopted by the finance commission [commissioner] under this
22-10 chapter. The repayment in full to the fund of all obligations of a
22-11 mortgage broker or loan officer does not nullify or modify the
22-12 effect of any other disciplinary proceeding brought under this
22-13 chapter.
22-14 SECTION 94. Section 202.005(a), Finance Code, is amended to
22-15 read as follows:
22-16 (a) The commissioner may:
22-17 (1) examine a bank holding company that controls a
22-18 Texas bank to the same extent as if the bank holding company were a
22-19 Texas state bank; and
22-20 (2) bring an enforcement proceeding under Chapter 35
22-21 against a bank holding company that violates or participates in a
22-22 violation of this subtitle, an agreement filed with the
22-23 commissioner under this chapter, or a rule adopted by the finance
22-24 commission or order issued by the commissioner [or the finance
22-25 commission] under this subtitle, as if the bank holding company
22-26 were a Texas state bank.
22-27 SECTION 95. Section 273.204, Finance Code, is amended to
22-28 read as follows:
22-29 Sec. 273.204. CONDITIONS UNDER WHICH CORPORATION MAY
22-30 EXERCISE POWERS AND DUTIES. The corporation may not exercise a
22-31 power or perform a duty under Section 273.203 or 273.205 or
22-32 Subchapter E until the Office of Thrift Supervision and the Federal
22-33 Deposit Insurance Corporation have:
22-34 (1) officially recognized that the corporation in
22-35 exercising that power or performing that duty will reduce and
22-36 minimize the liability of the Federal Deposit Insurance
22-37 Corporation; and
22-38 (2) taken any necessary action to permit member
22-39 associations to use without restraint all of the operational power
22-40 the member associations have under the laws of this state,
22-41 including rules of the Finance Commission of Texas [Savings and
22-42 Loan Department].
22-43 SECTION 96. Section 345.351(b), Finance Code, is amended to
22-44 read as follows:
22-45 (b) The finance commission [commissioner] by rule may
22-46 establish procedures to facilitate the registration and collection
22-47 of fees under this section, including rules staggering throughout
22-48 the year the dates on which fees are due.
22-49 SECTION 97. Section 347.451(b), Finance Code, is amended to
22-50 read as follows:
22-51 (b) The finance commission [commissioner] by rule may
22-52 establish procedures to facilitate the registration and collection
22-53 of fees under this section, including rules staggering the due
22-54 dates of the fees throughout the year.
22-55 SECTION 98. Section 348.401(b), Finance Code, is amended to
22-56 read as follows:
22-57 (b) The finance commission [commissioner] by rule may
22-58 establish procedures to facilitate the registration and collection
22-59 of fees under this section, including rules staggering throughout
22-60 the year the dates on which fees are due.
22-61 SECTION 99. Sections 371.006(a) and (d), Finance Code, are
22-62 amended to read as follows:
22-63 (a) The Finance Commission of Texas [commissioner] may adopt
22-64 rules to enforce this chapter.
22-65 (d) On application by any person and on payment of any
22-66 associated cost, the commissioner shall furnish the person a
22-67 certified copy of a rule adopted by the Finance Commission of Texas
22-68 [commissioner].
22-69 SECTION 100. Section 371.007(a), Finance Code, is amended to
23-1 read as follows:
23-2 (a) The Finance Commission of Texas [commissioner] by rule
23-3 may adopt a system under which licenses issued under this chapter
23-4 expire on various dates during the year.
23-5 SECTION 101. Section 371.181(b), Finance Code, is amended to
23-6 read as follows:
23-7 (b) The Finance Commission of Texas [commissioner] shall
23-8 adopt rules that allow:
23-9 (1) a consumer who has filed an offense report with a
23-10 local law enforcement agency to request that a pawnbroker search
23-11 the records of the pawnshop; and
23-12 (2) the pawnbroker to assist the consumer and the
23-13 local law enforcement agency in locating and recovering stolen
23-14 property.
23-15 SECTION 102. Section 371.183, Finance Code, is amended to
23-16 read as follows:
23-17 Sec. 371.183. CONSUMER INFORMATION. The Finance Commission
23-18 of Texas [commissioner] by rule may require a pawnshop to display,
23-19 in an area in the pawnshop accessible to a consumer, materials
23-20 provided by the commissioner that are designed to:
23-21 (1) inform a consumer of the duties, rights, and
23-22 responsibilities of parties to a transaction regulated by the
23-23 commissioner; and
23-24 (2) inform and assist a robbery, burglary, or theft
23-25 victim.
23-26 SECTION 103. Section 11.201, Finance Code, is repealed.
23-27 SECTION 104. (a) The Texas Legislature shall create and
23-28 direct a committee consisting of representatives of the pawnbroker
23-29 industry, law enforcement, and the computer software industry to
23-30 study and recommend one or more standard formats for pawnbrokers to
23-31 electronically provide reportable data to law enforcement agencies.
23-32 The committee shall consider all privacy issues related to
23-33 reporting such data to ensure the protection of the financial
23-34 information of the individuals who use the services of the
23-35 pawnbroker industry.
23-36 (b) The committee shall report its findings and
23-37 recommendations to the Texas Legislature not later than June 30,
23-38 2002.
23-39 SECTION 105. A rule adopted by the Texas Department of
23-40 Banking, the Banking Commissioner of Texas, the Savings and Loan
23-41 Commissioner, or the Consumer Credit Commissioner that is in effect
23-42 on the effective date of this Act and that is not inconsistent
23-43 with this Act remains in effect as a rule or regulation of the
23-44 Finance Commission of Texas until superseded by action of the
23-45 finance commission.
23-46 SECTION 106. The changes made by this Act in the prohibitions
23-47 and qualifications applying to members of the Finance Commission of
23-48 Texas do not affect the entitlement of a member serving on the
23-49 commission immediately before the effective date of this Act to
23-50 continue to serve and function as a member of the finance
23-51 commission for the remainder of the member's term. The changes in
23-52 law apply only to a member appointed on or after the effective date
23-53 of this Act. This Act does not prohibit a person who is a member
23-54 of the finance commission on the effective date of this Act from
23-55 being reappointed to the finance commission if the person has the
23-56 qualifications required for a member under Chapter 11, Finance
23-57 Code, as amended by this Act.
23-58 SECTION 107. This Act takes effect September 1, 2001.
23-59 * * * * *