Hope fades in committee for mortgage bill

Thursday, April 29, 1999 | 9:06 a.m.

Morse Arberry, D-Las Vegas, chairman of the Ways and Means Committee, says there aren't enough votes to pass AB72 out of committee. "There's no appetite for it," he said.

The committee last week approved a companion bill, AB64, which gives added powers to the state Financial Institutions Division and Attorney General Frankie Sue Del Papa. The committee didn't vote on the Heller bill.

The apparent demise of AB72 irks Heller, who said without the bill it will "be very difficult to protect senior citizens from what has been happening."

"If the legislators don't have any appetite for the bill, I suggest they come down to my office for a week and sit down and listen to complaints from those who lost money," he said.

But a Las Vegas-based lending corporation says Heller's bill would "force most mortgage investment companies out of business and eliminate as much as $500 million from the state's economy."

In a press release, Tom Hantges, chairman of USA Capital, said the Legislature should not rush to approve bills that will damage the industry. Hantges said AB72 would make it difficult, if not impossible, to expedite loans.

Several bills before the Legislature, Hantges said, "will limit the ability to expedite loans but will not protect private investors from fraud, criminal intent or bad business. In essence no one wins."

But Heller said Nevada is the only state that doesn't have such regulations, "and to say the industry is going to collapse is basically untrue."

A securities law has been in effect for 11 years that has exempted mortgage investments. Heller's office wants to remove that exemption so such investments would have to be registered with his office and the backers would have to make numerous disclosures to allow the public to judge whether the transactions are worthy.

The bills were prompted by the Harmon case in southern Nevada, where hundreds of investors lost millions of dollars.

Gov. Kenny Guinn, through a spokesman, said these bills could be vetoed because they would impose fees. Guinn has threatened to veto any new or increased taxes or fees.