Unlicensed mortgage operators penalized

Tuesday, March 30, 2004 | 11:08 a.m.

CARSON CITY -- In a crackdown on mortgage businesses and an unlicensed agent, the state announced Monday it has penalized three companies and the agent, all in Las Vegas.

Commissioner Scott Bice of the state Mortgage Lending Division said his office is receiving more calls from citizens and individuals in the industry alerting regulators about unlicensed companies.

These consumers are more aware of potential risks in doing business with and through unlicensed operators, he said.

A $5,000 fine has been assessed against Brian Martin and he has been ordered to stop conducting mortgage activity without a license.

Bice said Martin acted as a broker for Cornerstone Mortgage and Western Horizon Mortgage. Martin hired, trained and supervised loan officers for Cornerstone.

He said Cornerstone Mortgage became aware of the state's order against Martin but continued to allow him to conduct business at an unlicensed branch at 7380 West Sahara.

Cornerstone agreed to pay $7,500 to the state for investigative and lawyer costs. It also agreed to stop doing business at the unlicensed location, stop employing Martin and take other steps to comply with the law. Utah Financial Inc. of Salt Lake City was penalized $5,000 for conducting unlicensed business in Nevada. It sent a solicitation to a resident of Nevada in an attempt to obtain an application for a loan secured by real estate.

Bice also said the company distributed an advertisement that was not approved by his division.

Star Funding was penalized $7,500 for conducting business at an unlicensed office at 1621 Eastern Avenue in Las Vegas. Bice issue a cease and desist order against the firm until it secures a license.

Bice said, "We have seen tremendous support from people who alert our office to potential unlicensed mortgage activities." He said he gets calls from consumers and professionals in the mortgage lending business asking whether companies and individuals are licensed.

"It is of paramount importance for our agency to be accessible and proactive in order to escort unlicensed or misleading operators out of Nevada," said Bice.

The 2003 Legislature created the new Division of Mortgage Lending. The regulation was formerly under the state Division of Financial Institutions. But Assemblyman David Goldwater, D-Las Vegas, who sponsored the legislation, said there was not enough policing of the industry.

Bice, a former branch chief in the U.S. Department of Housing and Urban Development in California, was hired in October.