MA 'Predatory' Law Grants New Powers

Under the new Massachusetts predatory lending law, the Massachusetts Division of Banks can now impose penalties on lenders or mortgage brokers who have violated the law and can bar individuals from doing business in the state, according to a division official.David Cotney, deputy commissioner of the MDOB, told a regulatory compliance seminar near Boston that the division plans to use its new authority sparingly. "We did this because of the risk posed to the industry from a band of rogue players who move from place to place to set up shop," he said. Mr. Cotney said Community Reinvestment Act requirements are likely to pass, something many lenders don't want to hear. The division plans to begin fair-lending examinations in midyear for institutions that close at least 50 loans in a year. Mr. Cotney said lenders should make sure to set up procedures to verify Home Mortgage Disclosure Act data. The Regulatory Compliance Seminar was hosted by the Massachusetts Mortgage Bankers Association and the Massachusetts Mortgage Association in Braintree, Mass.