HF 1824

as introduced - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

A bill for an act
relating to commerce; regulating the investment
authority of, and annual reporting required for,
certain financial institutions; removing obsolete
references to the credit union advisory task force;
regulating residential mortgage originators; providing
for insurance license renewals; regulating for the
voluntary dissolution of fraternal benefit societies;
amending Minnesota Statutes 2004, sections 47.10,
subdivision 1; 48.10; 52.062, subdivision 2; 60A.13,
subdivision 5; 64B.30, by adding a subdivision;
proposing coding for new law in Minnesota Statutes,
chapter 58; repealing Minnesota Statutes 2004,
sections 52.062, subdivision 3; Minnesota Rules, part
2675.2610, subpart 5.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2004, section 47.10,
subdivision 1, is amended to read:

Subdivision 1.

Authority, approval, limitations.

(a)
Except as otherwise specially provided, the net book value of
land and buildings for the transaction of the business of the
corporation, including parking lots and premises leased to
others, shall not be more than as follows:

(1) for a bank, trust company, savings bank, or stock
savings association, if investment is for acquisition and
improvements to establish a new deleted text begin bank deleted text end new text begin banking office new text end , or is for
improvements to existing property or acquisition and
improvements to adjacent property, approval by the commissioner
of commerce is not required if the total investment does not
exceed 50 percent of its existing capital stock and paid-in
surplus. Upon written prior approval of the commissioner of
commerce, a bank, trust company, savings bank, or stock savings
association may invest in the property and improvements in
clause (1) or for acquisition of nonadjacent property for
expansion or future use, if the aggregate of all such
investments does not exceed 100 percent of its existing capital
stock and paid-in surplus;

(2) for a mutual savings association, five percent of its
net assets.

(b) For purposes of this subdivision, an intervening
highway, street, road, alley, other public thoroughfare, or
easement of any kind does not cause two parcels of real property
to be nonadjacent.

Sec. 2.

Minnesota Statutes 2004, section 48.10, is amended
to read:

48.10 ANNUAL AUDIT; REPORT.

The board of directors of a bank, bank and trust, or trust
company shall annually examine its books, either in person, or
by appointing an examining committee, or an auditor, who may be
an independent auditor or accountant. The examining committee
or auditor shall be solely responsible to the directors. A
report shall be made to the directors as to the scope of the
examination or audit, and also to show those assets, excluding
marketable securities and fixed assets, which are carried on the
books for more than actual value. This report shall be retained
as a permanent record or incorporated in the minutes of the
meeting deleted text begin , and a copy of the report shall be sent to the
commissioner of commerce deleted text end .

Sec. 3.

Minnesota Statutes 2004, section 52.062,
subdivision 2, is amended to read:

Subd. 2.

Suspension.

The commissioner of commerce may
suspend the operation of the credit union by giving notice to
its board of directors by certified mail deleted text begin with a copy to the
advisory council deleted text end . Said notice shall include a list of reasons
for said suspension and a list of any specific violations of
law, bylaw, or rule, and shall specify which operations of the
credit union may be continued during the period of suspension.
The notice shall also fix a time and place for a hearing before
the commissioner of commerce or such person or persons as the
commissioner of commerce may designate. The hearing shall be
held within 60 days of the notice of suspension deleted text begin , and the
advisory council shall sit at such hearing for the purpose of
providing advice and counsel to the commissioner of commerce or
a representative deleted text end . Evidence may be produced at said hearing by
any party thereto, and the commissioner of commerce shall base
the decision as to the continued suspension of operation of the
credit union upon said evidence. If the commissioner of
commerce decides to continue the suspension, the commissioner
shall give notice of the decision to the board of directors of
the credit union.

Sec. 4.

new text begin [58.125] PROHIBITION ON SERVICE AS A RESIDENTIAL
MORTGAGE ORIGINATOR.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) "Dishonesty" means
directly or indirectly to cheat or defraud; to cheat or defraud
for monetary gain or its equivalent; or to wrongfully take
property belonging to another in violation of any criminal
statute. Dishonesty includes acts involving want of integrity,
lack of probity, or a disposition to distort, cheat, or act
deceitfully or fraudulently, and may include crimes which
federal, state, or local laws define as dishonest.
new text end

new text begin (b) "Breach of trust" means a wrongful act, use,
misappropriation, or omission with respect to any property or
fund which has been committed to a person in a fiduciary or
official capacity, or the misuse of one's official or fiduciary
position to engage in a wrongful act, use, misappropriation, or
omission.
new text end

new text begin Subd. 2. new text end

new text begin Generally. new text end

new text begin Except with the prior written
consent of the commissioner under subdivision 4, any individual,
who has been convicted of a criminal offense involving
dishonesty or a breach of trust or money laundering, or has
agreed to or entered into a pretrial diversion or similar
program in connection with a prosecution for such offense, may
not serve as a residential mortgage originator or be employed in
that capacity by a person licensed as a mortgage originator.
new text end

new text begin Subd. 3. new text end

new text begin De minimis offenses. new text end

new text begin Approval is automatically
granted and an application will not be required if the covered
offense is considered de minimis because it meets all of the
following criteria:
new text end

new text begin (1) there is only one conviction or program entry of record
for a covered offense;
new text end

new text begin (2) the offense was punishable by imprisonment for a term
of less than one year and/or a fine of less than $1,000, and the
individual did not serve time in jail;
new text end

new text begin (3) the conviction or program was entered at least five
years before the date an application would otherwise be
required; and
new text end

new text begin (4) the offense did not involve a financial institution or
residential mortgage loans.
new text end

new text begin Subd. 4. new text end

new text begin Prior consent. new text end

new text begin An application for prior consent
of the commissioner under this section must be in writing, under
oath, and on a form obtained from and prescribed by the
commissioner. The following factors must be considered by the
commissioner when reviewing an application:
new text end

new text begin (1) the specific nature of the offense and the
circumstances surrounding the offense;
new text end

new text begin (2) evidence of rehabilitation since the offense;
new text end

new text begin (3) the age of the person at the time of conviction; and
new text end

new text begin (4) whether or not restitution has been made.
new text end

Sec. 5.

Minnesota Statutes 2004, section 60A.13,
subdivision 5, is amended to read:

Subd. 5.

Renewal license deleted text begin based on approved statement deleted text end .

deleted text begin Upon the approval of the statement the commissioner shall issue
a renewal license for the succeeding year beginning June first.
Any license to a company or its agent, issued after the approval
of the statement, shall expire May 31 of the year
following. deleted text end new text begin The license issued by the commissioner is perpetual
and is considered renewed annually on June 1 upon payment of the
renewal license fee, the annual filing fee, and all other fees
required by section 60A.14.
new text end

Sec. 6.

Minnesota Statutes 2004, section 64B.30, is
amended by adding a subdivision to read:

new text begin Subd. 3. new text end

new text begin Voluntary dissolution. new text end

new text begin Upon application to the
commissioner, a domestic society may request that it be
dissolved and that its existence be terminated. Such
application shall demonstrate that the applicant has satisfied
its members' policy obligations or that it has transferred such
obligations to another society, domestic or foreign, by means of
assumption or bulk reinsurance or otherwise, that the
applicant's supreme governing body has approved such termination
and dissolution and that the application includes such other
information that the commissioner requires. Any limitation in
section 64B.13 related to reinsurance by a domestic society with
another society shall not apply to reinsurance entered into in
conjunction with the transfer of member policy obligations as a
part of a voluntary dissolution. Upon the approval of the
application by the commissioner, the society shall be deemed
dissolved and its existence terminated upon the date set forth
in the application.
new text end

Sec. 7. new text begin REPEALER.
new text end

new text begin (a) Minnesota Statutes 2004, section 52.062, subdivision 3,
is repealed.
new text end

new text begin (b) Minnesota Rules, part 2675.2610, subpart 5, is repealed.
new text end

Sec. 8. new text begin EFFECTIVE DATE.
new text end

new text begin Section 4 is effective January 1, 2006.
new text end