13-05-06. Powers of the department of financial institutions.
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Insofar as consistent with other provisions of law, the department of financial institutions has the power to:
1. Determine the qualifications of all applicants based on financial responsibility, financial
condition, business experience, character, and general fitness which must reasonably
warrant the belief that the applicant's business will be conducted lawfully and fairly. In
determining whether this qualification is met, and for the purpose of investigating
compliance with this chapter, the commissioner may review and consider the relevant
business records and capital adequacy of the applicant and the competence,
experience, integrity, and financial ability of a person who is a member, partner,
director, officer, or twenty-five percent or more shareholder of the applicant. 2. Conduct investigations and make an examination of any licensee or licensee's place of
business, including all records of such business, and to subpoena witnesses anytime it
has reason to believe such is necessary to ensure and enforce compliance with state
and federal rules and regulations. The licensee shall pay an examination or visitation
fee and must be charged by the department of financial institutions at an hourly rate to
be set by the commissioner, sufficient to cover all reasonable expenses of the
department associated with the examination or visitation provided for by this section.
Fees must be paid to the state treasurer and deposited in the financial institutions
regulatory fund. 3. Establish codes of ethical conduct for licensees. 4. Adopt any and all rules and regulations necessary to carry out the purpose of this
chapter. 5. Issue and serve upon any person or licensed collection agency an order to cease and
desist to take corrective action when the department has reason to believe the person
or agency is violating, has violated, or is about to violate the provisions of this chapter.
An interested party may appeal issuance of a cease and desist order under the
provisions of chapter 28-32 by filing written notice of appeal within twenty days after
service of the order. 6. If the commissioner determines a licensee is insolvent, or the license has expired or
terminated for any reason, the commissioner, on determining such action necessary to
protect the public interest, may apply to the district court for the county in which the
main office of such licensee is located for appointment of a receiver to receive the
assets of the licensee for the purpose of liquidating its business or for such other relief
as the nature of the case and the interest of the claimants may require. The
reasonable and necessary expenses of the receivership shall constitute the first claim
on the bond.
13-05-06.1. Suspension and removal of collection agency officers or employees. 1. The commissioner of financial institutions may issue and serve upon any current or
former collection agency officer or employee and upon the collection agency involved
an order stating:
a. That the current or former officer or employee is willfully engaging or has willfully
engaged in any of the following conduct:
(1)Violating any law, rule, order, or written agreement with the commissioner.
(2)Engaging in any harassment or abuse, the making of false or misleading
representations, or engaging in unfair practices involving collection activity.
(3)Performing any act of commission or omission or practice which is a breach
of trust or a breach of fiduciary duty.
b. The term of the suspension or removal from employment and participation within
the conduct or the affairs of a collection agency. 2. The order must contain a notice of opportunity for hearing pursuant to chapter 28-32. 3. If no hearing is requested within twenty business days of the date the order is served,
or if a hearing is held and the commissioner finds that the record so warrants, the
commissioner may enter a final order suspending or removing the current or former
officer or employee. The current or former officer or employee shall have the
opportunity to request a termination of the final order after a period of no less than
three years. 4. A contested or default suspension or removal order is effective immediately upon
service of the final order on the current or former officer or employee and upon the
collection agency. A consent order is effective as agreed. Any current or former officer
or employee suspended or removed from employment and participation within the
conduct or the affairs of a collection agency pursuant to this section is not eligible,
while under suspension or removal, to be employed or otherwise participate in the
affairs of any financial corporation, financial institution, credit union, or any other entity
licensed by the department of financial institutions. 5. When any current or former officer or employee, or other person participating in the
conduct of the affairs of a collection agency is charged with a felony in state or federal
court which involves dishonesty or breach of trust, the commissioner may immediately
suspend the person from office or prohibit the person from any further participation in
the collection agency's affairs, or both. The order is effective immediately upon service
of the order on the collection agency and the person charged and remains in effect
until the criminal charge is finally disposed of or until modified by the commissioner. If
a judgment of conviction, federal pretrial diversion, or similar state order or judgment is
entered, the commissioner may order that the suspension or prohibition be made
permanent. A finding of not guilty or other disposition of the charge does not preclude
the commissioner from pursuing administrative or civil remedies. 6. Under this section, a person engages in conduct "willfully" if the person acted
intentionally in the sense that the person was aware of what the person was doing.
13-05-06.2. Investigations and subpoenas. 1. The department of financial institutions may:
a. Make such public or private investigation within or outside this state as it deems
necessary to determine whether a person has violated or is about to violate a
provision of this chapter or a rule or order under this chapter, or to aid in the
enforcement of this chapter or in the adopting of rules and forms under this
chapter.
b. Require or permit a person to file a statement in writing, under oath or otherwise
as the department determines, as to all the facts and circumstances concerning
the matter to be investigated.
c. Publish information concerning a violation of this chapter or a rule or order under
this chapter. 2. For the purpose of an investigation or proceeding under this chapter, the department
of financial institutions may administer oaths and affirmations, subpoena witnesses,
compel their attendance, take evidence, and require the production of books, papers,
correspondence, memoranda, agreements, or other documents or records which the
department deems relevant or material to the inquiry. 3. In case of contumacy by, or refusal to obey a subpoena issued to, a person, the district
court, upon application by the department of financial institutions, may issue to the
person an order requiring the person to appear before the department, there to
produce documentary evidence if so ordered or to give evidence touching the matter
under investigation or in question. Failure to obey the order of the court may be
punished by the court as a contempt of court. 4. A person is not excused from attending and testifying or from producing a document or
record before the department of financial institutions, or in obedience of the subpoena
of the department or in a proceeding instituted by the department, on the grounds that
the testimony or evidence, documentary or otherwise, required of the person may tend
to incriminate the person or subject the person to a penalty or forfeiture; but an
individual may not be prosecuted or subjected to a penalty or forfeiture for or on
account of a transaction, matter, or thing concerning which the person is compelled,
after claiming the privilege against self-incrimination, to testify or produce evidence,
documentary or otherwise, except that the individual testifying is not exempt from
prosecution and punishment for perjury or contempt committed in testifying. 5. In making any examination or investigation authorized by this chapter, the
commissioner may control access to any documents and records of the licensee or
person under examination or investigation. The commissioner may take possession of
the documents and records or place a person in exclusive charge of the documents
and records in the place where they are usually kept. During the period of control, no
individual or person shall remove or attempt to remove any of the documents and
records except pursuant to a court order or with the consent of the commissioner.
Unless the commissioner has reasonable grounds to believe any of the documents
and records of the licensee have been, or are at risk of being altered or destroyed for
purposes of concealing a violation of this chapter, the licensee or owner of the
documents and records shall have access to the documents and records as necessary
to conduct its ordinary business affairs. All records controlled by the commissioner
under the authority of this subsection shall be exempt under the open records law.
6. In order to carry out the purposes of this section, the commissioner may:
a. Retain accountants or other professionals and specialists as examiners, auditors,
or investigators to conduct or assist in the conduct of examinations or
investigations; and
b. Use, hire, contract, or employ publicly or privately available analytical systems,
methods, or software to examine or investigate the licensee, individual, or person
subject to this chapter.
7. The authority of this section remains in effect, whether such a licensee, individual, or
person subject to this chapter acts or claims to act under any licensing or registration
law of this state or claims to act without such authority.