Colorado Agency Seeks Regulation of Brokers

The Colorado Department of Regulatory Agencies is recommending that the state legislature require all brokers working in Colorado to register with the director of the Division of Real Estate.In a new report, DORA says all candidates should submit to criminal history and regulatory background checks and post bonds worth $100,000. The director of DER would be able to deny or revoke registration if a broker is found convicted of any crime involving mortgage fraud. DORA also wants to make it a class 1 misdemeanor to practice as a broker without being registered and to grant the state attorney general jurisdiction over such offenses. "DORA, after reviewing our application and gathering data on their own, decided to take more drastic actions to cut down on crime," said Bart Bartholomew, president of the Colorado Association of Mortgage Brokers, which requested the legislation. "CAMB is in favor of anything to help reduce mortgage fraud in Colorado." Chris Holbert, president of the Colorado Mortgage Lenders Association, said registration of nonexempt brokers is not the answer to combating fraud. What the industry needs is aggressive enforcement, he said. "Regulation is threatening to mortgage brokers," Mr. Holbert said. "If it reduces the number of mortgage brokers in Colorado, it will very likely decrease business for wholesale lenders. .... Such regulation is anti-competitive." Colorado is one of only two states that does not regulate brokers.