§14A-6-105. Administrative enforcement powers with respect to
1,772 words·~8 min read·
/ok/title-14a-consumer-credit-code/14a-6-105A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
supervised financial institutions.
(1)With respect to supervised financial organizations, the powers of examination and investigation under Sections 3-506 and 6- 106 of this title and administrative enforcement under Section 6-108 of this title shall be exercised by the official or agency to whose supervision the organization is subject. All other powers of the Administrator under this title may be exercised by the Administrator with respect to a supervised financial organization.
(2)If the Administrator receives a complaint or other information concerning noncompliance with this title by a supervised financial organization, the Administrator shall inform the official or agency having supervisory authority over the organization concerned. The Administrator may request information about supervised financial organizations from the officials or agencies supervising them.
(3)The Administrator and any official or agency of this state having supervisory authority over a supervised financial organization are authorized and directed to consult and assist one another in maintaining compliance with this title. They may jointly pursue investigations, prosecute suits, and take other official action, as they deem appropriate, if either of them is otherwise empowered to take the action.
(a)In carrying out their enforcement activities each
agency having administrative responsibility with
respect to persons subject to this title, including
the Administrator, in cases where an annual percentage
rate or finance charge was inaccurately disclosed,
shall notify the creditor of such disclosure error and
are authorized in accordance with the provisions of
this subsection to require the creditor to make an
adjustment to the account of the person to whom credit
was extended, to assure that such person will not be
required to pay a finance charge in excess of the
finance charge actually disclosed or the dollar
equivalent of the annual percentage rate actually
disclosed, whichever is lower. For the purposes of
this subsection, except where such disclosure error
resulted from a willful violation which was intended
to mislead the person to whom credit was extended, in
determining whether a disclosure error has occurred
and in calculating any adjustment:
(i)each agency shall apply:
(aa)with respect to the annual percentage rate,
a tolerance of one-quarter of one percent
(1/4 of 1%) more or less than the actual
rate, determined without regard to tolerance
rules for other purposes, and
(bb)with respect to the finance charge, a
corresponding numerical tolerance as
generated by the tolerance provided under
this subsection for the annual percentage
rate; except that:
(ii)with respect to transactions consummated after
two
(2)years following March 31, 1980, each
agency shall apply:
(aa)for transactions that have a scheduled
amortization of ten
(10)years or less, with
respect to the annual percentage rate, a
tolerance not to exceed one-quarter of one
percent (1/4 of 1%) more or less than the
actual rate, determined without regard to
tolerance rules for other purposes, but in
no event a tolerance of less than the
tolerances allowed for other purposes,
(bb)for transactions that have a scheduled
amortization of more than ten
(10)years,
with respect to the annual percentage rate,
only such tolerances as are allowed for
other purposes, and
(cc)for all transactions, with respect to the
finance charge, a corresponding numerical
tolerance as generated by the tolerances
provided under this subsection for the
annual percentage rate.
(iii)In connection with credit transactions not under
an open-end credit plan that are secured by real
property or a dwelling, the disclosure of the
finance charge and other disclosures affected by
any finance charge:
(aa)shall be treated as being accurate for
purposes of this title if the amount
disclosed as the finance charge:
does not vary from the actual finance
charge by more than One Hundred Dollars
($100.00), or
(II)is greater than the amount required to
be disclosed under this title, and
(bb)shall be treated as being accurate for
purposes of Section 5-204 of this title if:
(I)except as provided in subparagraph
of this paragraph, the amount disclosed
as the finance charge does not vary
from the actual finance charge by more
than an amount equal to one-half of one
percent (1/2 of 1%) of the total amount
of credit extended, or
(II)in the case of a transaction, other
than a subsection 10 mortgage referred
to in subsection
(10)of Section 1-301
of this title, which:
(A)is a refinancing of the principal
balance then due and any accrued
and unpaid finance charges of a
residential mortgage transaction
as defined in subsection
(17)of
Section 1-301 of this title, or is
any subsequent refinancing of such
a transaction, and
(B)does not provide any new
consolidation or new advance,
if the amount disclosed as the finance charge does not
vary from the actual finance charge by more than an
amount equal to one percent (1%) of the total amount
of credit extended.
(b)Each agency shall require such an adjustment when it
determines that such disclosure error resulted from:
(i)a clear and consistent pattern or practice of
violations,
(ii)gross negligence, or
(iii)a willful violation which was intended to mislead
the person to whom the credit was extended.
Notwithstanding the preceding sentence, except where
such disclosure error resulted from a willful
violation which was intended to mislead the person to
whom credit was extended, an agency need not require
such an adjustment if it determines that such
disclosure error:
(aa)resulted from an error involving the
disclosure of a fee or charge that would
otherwise be excludable in computing the
finance charge, including but not limited to
violations involving the disclosures
concerning consumer credit insurance,
property and liability insurance, and
official fees, in which event the agency may
require such remedial action as it
determines to be equitable, except that for
transactions consummated after two
(2)years
following March 31, 1980, such an adjustment
shall be ordered for violations of
disclosure of consumer credit insurance,
(bb)involved a disclosed amount which was ten
percent (10%) or less of the amount that
should have been disclosed and in cases
where the error involved a disclosed finance
charge, the annual percentage rate was
disclosed correctly, and in cases where the
error involved a disclosed annual percentage
rate, the finance charge was disclosed
correctly; in which event the agency may
require such adjustment as it determines to
be equitable,
(cc)involved a total failure to disclose either
the annual percentage rate or the finance
charge, in which event the agency may
require such adjustment as it determines to
be equitable, or
(dd)resulted from any other unique circumstance
involving clearly technical and
nonsubstantive disclosure violations that do
not adversely affect information provided to
the buyer, debtor or lessee and that have
not misled or otherwise deceived the buyer,
debtor or lessee.
In the case of other such disclosure errors, each
agency may require such an adjustment.
(c)Notwithstanding the provisions of paragraph
(b)of
this subsection, no adjustment shall be ordered:
(i)if it would have a significantly adverse impact
upon the safety or soundness of the creditor, but
in any such case, the agency may require a
partial adjustment in an amount which does not
have such an impact except that with respect to
any transaction consummated after March 1, 1980,
the agency shall require the full adjustment, but
permit the creditor to make the required
adjustment in partial payments over an extended
period of time which the agency considers to be
reasonable,
(ii)if the amount of the adjustment would be less
than One Dollar ($1.00), except that if more than
one
(1)year has elapsed since the date of the
violation, the agency may require that such
amount be paid to the Administrator, or
(iii)except where such disclosure error resulted from
a willful violation which was intended to mislead
the person to whom credit was extended, in the
case of an open-end credit plan, more than two
(2)years after the violation, or in the case of
any other extension of credit, as follows:
(aa)with respect to creditors that are subject
to examination by the agencies referred to
in this section, except in connection with
violations arising from practices identified
in the current examination and only in
connection with transactions that are
consummated after the date of the
immediately preceding examination, except
that where practices giving rise to
violations identified in earlier
examinations have not been corrected,
adjustments for those violations shall be
required in connection with transactions
consummated after the date of the
examination in which such practices were
first identified,
(bb)with respect to creditors that are not
subject to examination, except in connection
with transactions that are consummated after
May 10, 1978, and
(cc)in no event after the later of the
expiration of the life of the credit
extension, or two
(2)years after the
agreement to extend credit was consummated.
(d)Notwithstanding any other provision of this
subsection, an adjustment under this subsection may be
required by an agency only by an order issued in
accordance with cease and desist procedures either as
prescribed in a statute governing that agency or in
Section 6-108 of this title.
(e)Except as otherwise specifically provided in this
subsection, no agency may require a creditor to make
dollar adjustments for disclosure errors in any
requirements under this title.
(f)A creditor shall not be subject to an order to make an
adjustment, if within sixty
(60)days after
discovering a disclosure error, whether pursuant to a
final written examination report or through the
creditor's own procedures, the creditor notifies the
person concerned of the error and adjusts the account
so as to assure that such person will not be required
to pay a finance charge in excess of the finance
charge actually disclosed or the dollar equivalent of
the annual percentage rate actually disclosed,
whichever is lower.
(g)Notwithstanding the second sentence of paragraph
of this subsection and divisions
(aa)and
(bb)of
subparagraph
(iii)of paragraph
(c)of this
subsection, each agency shall require an adjustment
for an annual percentage rate disclosure error that
exceeds a tolerance of one-quarter of one percent (1/4
of 1%) less than the actual rate, determined without
regard to tolerance rules for other purposes, except
in the case of an irregular mortgage lending
transaction, with respect to any transaction
consummated between January 1, 1977, and April 1,
1980.
(h)The Administrator may prescribe guidelines and
interpretations to govern agency action under this
subsection. Added by Laws 1969, c. 352, § 6-105, eff. July 1, 1969. Amended by Laws 1982, c. 335, § 56, operative Oct. 1, 1982; Laws 2000, c. 217, § 23, eff. July 1, 2000.