Lawsuit over copyrighted mortgage licensing exam questions settled

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A Conference of State Bank Supervisors subsidiary settled a lawsuit with defendants who allegedly misused and reproduced copyrighted questions from a national exam mortgage loan officers take to obtain licenses.

In line with the settlement, the subsidiary that operates the Nationwide Multistate Licensing System barred individual defendants from taking on certain professional roles either temporarily or permanently, and revoked their company’s approved course-provider status, according to CSBS.

One defendant, Don Exley, was barred from ever being associated with any NMLS-approved course provider. Another defendant, Billy Glenn “Bart” Bartholomew, was barred from associating with approved providers for five years. Both worked for a Colorado-based company called MTI. A third defendant, Carey Green, had his access to the system established under the Secure and Fair Enforcement of Mortgage Licensing Act suspended indefinitely.

Exley and Bartholomew admitted practice tests included questions "substantially similar" to those on the actual exam content, and Green acknowledged some of the MLO test prep questions sold on his website infringed on the State Regulatory Registry’s copyright, but denied that he knew questions belonged to SRR, CSBS said.

"SRR takes the security of test questions and other aspects of the SAFE MLO test security very seriously. We will not hesitate to appropriately defend our copyrighted materials," Bill Matthews, SRR president and CEO, said in a press release.

"The integrity of the SAFE Act test is integral to ensuring that state-licensed mortgage loan originators understand the laws and regulations they operate under and to protecting consumers," John DuCrest, SRR board chairman and Louisiana Office of Financial Institutions commissioner, said in the release.

SRR takes steps to protect the confidentiality of exam questions, including storing them in database protected by security measures, and video and audio surveillance of test takers, according to CSBS.

There are more than 165,000 licensed morgage loan officers working at nonbanks in the United States.

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State regulators Originations Exams Certifications and licensing CSBS Nonbank