The bill amends Section 19-14-1 of the General Laws in Chapter 19-14, titled "Licensed Activities," to establish new definitions related to nonbank mortgage servicers and their operations. Key insertions include definitions such as "Board of directors," "Corporate governance," "Covered mortgage servicer," and "Risk management program," among others. These updates aim to clarify the roles and responsibilities of entities involved in financial services, particularly concerning corporate governance and mortgage servicing.

The bill establishes requirements for capital, liquidity, and corporate governance specifically for covered mortgage servicers, defined as nonbank mortgage servicers with servicing portfolios of 2,000 or more one to four unit residential mortgage loans and operating in two or more states. Covered mortgage servicers are required to maintain adequate capital and liquidity, develop written compliance policies and procedures, and conduct annual risk management assessments. A board of directors is mandated to oversee operations and ensure adherence to the corporate governance framework.

Additionally, the bill specifies that covered mortgage servicers must receive an external audit annually and establish a risk management program to identify, measure, monitor, and control risks. It also outlines the responsibilities of the board of directors, including establishing a corporate governance framework and ensuring compliance with regulatory reporting requirements.

Exclusions from these requirements apply to not-for-profit servicers and those solely engaged in reverse mortgage servicing. The bill empowers the director or their designee to adopt necessary rules for implementation and to assess the risk levels of covered mortgage servicers, allowing for tailored regulatory responses to enhance stability and accountability in the sector.

Statutes affected:
7867: 19-14-1