STAND. COM. REP. NO. 2395

Honolulu, Hawaii

RE: S.B. No. 2121

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Second State Legislature

Regular Session of 2024

State of Hawaii

Sir:

Your Committee on Commerce and Consumer Protection, to which was referred S.B. No. 2121 entitled:

"A BILL FOR AN ACT RELATING TO THE MORTGAGE LOAN RECOVERY FUND,"

begs leave to report as follows:

The purpose and intent of this measure is to:

(1) Authorize consumers aggrieved by the conduct of a mortgage loan originator licensee to recover from the Mortgage Loan Recovery Fund;

(2) Allow for excess moneys in the Mortgage Loan Recovery Fund to be used for certain training and educational purposes; and

(3) Increase to $150,000 the restitution available to consumers from the Mortgage Loan Recovery Fund.

Your Committee received testimony in support of this measure from the Department of Commerce and Consumer Affairs.

Your Committee finds that a person who holds a court order against a mortgage loan originator company licensee for fraud, deceit, or misrepresentation, is eligible to receive restitution from the Mortgage Loan Recovery Fund. However, existing law does not allow a person aggrieved in a similar manner by an individual mortgage loan originator licensee--as opposed to a mortgage loan originator company licensee--to receive restitution from the Mortgage Loan Recovery Fund. Therefore, this measure clarifies that persons aggrieved by the conduct of an individual mortgage loan originator licensee may receive restitution from the fund. Further, this measure will allow a portion of the Mortgage Loan Recovery Fund to be used for certain training and educational purposes, and will increase the amount of restitution available to consumers from the Mortgage Loan Recovery Fund.

Your Committee has amended this measure by deleting $50,000 and inserting an unspecified amount of funds from the Mortgage Loan Recovery Fund's surplus balance that the Division of Financial Institutions of the Department of Commerce and Consumer Affairs may use for training and educational purposes.

As affirmed by the record of votes of the members of your Committee on Commerce and Consumer Protection that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2121, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2121, S.D. 1, and be referred to your Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committee on Commerce and Consumer Protection,

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JARRETT KEOHOKALOLE, Chair