Lawmakers review bills to regulate mortage investments

Thursday, Feb. 18, 1999 | 9:06 a.m.

Assemblywoman Barbara Buckley, who heads the Assembly Commerce and Labor Committee, said AB64 and AB72 are needed to protect consumers - "but we don't want to rush into things and hurt legitimate businesses."

No committee action on the bills is likely for another couple of weeks, Buckley, D-Las Vegas, added Wednesday at the end of a hearing that drew numerous opponents and proponents.

Assemblywoman Barbara Cegavske, R-Las Vegas, argued for AB64, which would provide numerous protections to prevent a reoccurence of financial debacles like the 1997 collapse of the Harley Harmon Mortgage Co. in Las Vegas.

Assemblyman David Goldwater, D-Las Vegas, also urged the committee to approve AB64, along with AB72, a related bill aimed at protecting consumers against mortgage firm fraud.

Proponents also included Assemblyman Tom Collins, D-North Las Vegas, who said the measures might not help people burned in past scams, but will help future investors.

Also arguing for the measures was Dan Gray of Henderson, who lost money in mortage loans made by Harmon. Gray led a grass-roots campaign for the legislation.

Critics of the measures included mortage company representatives who said the state has adequate laws already and that the key is to make sure the state acts swiftly.

That didn't happen when the state Financial Institutions Division was looking into the Harmon case, they added.

Harmon Mortgage had more than $20 million invested for 700 investors when it failed.

Several million dollars of Harmon loans have been paid off, but Gray has estimated that $16.7 million in loans have turned bad. The money was loaned mostly for residental developments.