USA Statutes : nevada
Title : Title 56 - OTHER FINANCIAL INSTITUTIONS
Chapter : CHAPTER 677 - THRIFT COMPANIES
This chapter may be cited as the Nevada
Thrift Companies Act.
(Added to NRS by 1975, 1829)
As used in this chapter, unless the
context otherwise requires, the words and terms defined in NRS 677.030
to 677.140 , inclusive, have the meanings ascribed to them
in those sections.
(Added to NRS by 1975, 1829; A 1979, 995; 1983, 1817; 1985, 2196;
1987, 1997; 1997, 1014)
“Amount of cash
advance” means the amount of cash or its equivalent actually received by
a borrower or paid out at his direction or on his behalf.
(Added to NRS by 1975, 1829)
“Amount of loan
obligation” means the amount of cash advance plus the aggregate of
charges added thereto pursuant to authority of this chapter.
(Added to NRS by 1975, 1829)
“Borrowings” means liability to
any thrift investor or financial institution.
(Added to NRS by 1975, 1829)
“Charges” include:
1. The aggregate interest, fees, bonuses, commissions, brokerage,
discounts, expenses and other forms of costs charged, contracted for or
received by a licensee or any other person in connection with the
investigating, arranging, negotiating, procuring, guaranteeing, making,
servicing, collecting or enforcing of a loan, or for forbearance of
money, credit, goods, things in action or any other service or services
rendered; and
2. Any profit or advantage of any kind that any person may
contract for, collect, receive or in any manner obtain by a collateral
sale, purchase or agreement in connection with negotiating, making or
otherwise in connection with any loan, except commissions received on
insurance sold.
(Added to NRS by 1975, 1829)
“Commissioner” means the
Commissioner of Financial Institutions.
(Added to NRS by 1987, 1997)
“Community” means a contiguous
area of the same economic unit or metropolitan area, as determined by the
Commissioner, and may include all or part of a city or several towns or
cities.
(Added to NRS by 1975, 1829; A 1983, 1817; 1987, 1997)
1. “Deposit” means that part of the liability of a licensee which
is credited to the account of a depositor.
2. The term includes a time deposit evidenced by a certificate of
deposit, but does not include an obligation evidenced by a thrift
certificate.
(Added to NRS by 1985, 2193; A 1987, 1244)
“Gross amount” means the
total amount or value advanced to or on behalf of the borrower, including
all payments for interest, principal, expenses and charges of any nature
taken substantially contemporaneously with the making of the loan.
(Added to NRS by 1975, 1829)
“License” means a license, issued
under the authority of this chapter, to accept deposits and make loans in
accordance with the provisions of this chapter, at a single place of
business.
(Added to NRS by 1975, 1830; A 1985, 2196)
“Licensee” means a person to whom
one or more licenses have been issued.
(Added to NRS by 1975, 1830)
“Loan” does not include a bona fide
conditional contract of sale.
(Added to NRS by 1979, 995)
“Stockholders’
equity” means the capital, surplus and retained earnings of a licensee.
(Added to NRS by 1997, 1014)
“Thrift certificate”
means a chose in action, in passbook or certificate form, evidencing the
obligation of the licensee to pay money and does not include subordinate
debt securities.
(Added to NRS by 1975, 1830; A 1979, 995)
“Unpaid principal
balance” means the net amount of money, credit, goods or things in action
received by the borrower at the time of entering into the transaction and
the decreasing balances thereof after application of each payment made on
the obligation.
(Added to NRS by 1975, 1830)
1. Except as provided in subsections 3 and 4, an officer or
employee of the Division of Financial Institutions shall not:
(a) Be directly or indirectly interested in or act on behalf of any
licensee;
(b) Receive, directly or indirectly, any payment from any licensee;
(c) Be indebted to any licensee;
(d) Engage in the negotiation of loans for others with any
licensee; or
(e) Obtain credit or services from a licensee conditioned upon a
fraudulent practice or undue or unfair preference over other customers.
2. An employee of the Division in the unclassified service of the
State shall not obtain new extensions of credit from a licensee while in
office.
3. Any officer or employee of the Division of Financial
Institutions may be indebted to a licensee on the same terms as are
available to the public generally upon:
(a) A mortgage loan on his own real property.
(b) A secured installment debt.
(c) An unsecured debt.
4. Any officer or employee of the Division of Financial
Institutions may establish and maintain savings deposits with licensees
to the greatest amount insured, receive interest on those deposits and
borrow money secured by a pledge of those deposits.
5. If an officer or employee of the Division of Financial
Institutions has a service, a preferred consideration, an interest or a
relationship prohibited by this section at the time of his appointment or
employment, or obtains it during his employment, he shall terminate it
within 120 days after the date of his appointment or employment or the
discovery of the prohibited act.
(Added to NRS by 1983, 1816)
The
provisions of chapters 78 and 92A of NRS that are not in conflict with this chapter
are hereby adopted as part of this chapter.
(Added to NRS by 1997, 1014)
FORMATION
If authorized by the
Commissioner, as provided in this chapter, a corporation may be formed in
accordance with the laws of this state to engage in business under this
chapter.
(Added to NRS by 1975, 1830; A 1983, 1817; 1987, 1997; 1997, 1014)
1. The request for authority to engage in business pursuant to
this chapter must be set forth in an application in such form and
containing such information as the Commissioner requires.
2. The filing fees are:
(a) For filing an original application, not more than $2,000 for
the principal office and not more than $300 for each branch office. The
applicant shall also pay such additional expenses incurred in the process
of investigation as the Commissioner deems necessary. All money received
by the Commissioner pursuant to this paragraph must be placed in the
Investigative Account created by NRS 232.545 .
(b) If the license is approved for issuance, not more than $1,000
for the principal office and not more than $200 for each branch office
before issuance.
3. The Commissioner shall adopt regulations establishing the
amount of the fees required pursuant to this section.
4. The Commissioner shall consider an application to be withdrawn
if the Commissioner has not received all information and fees required to
complete the application within 12 months after the date the application
is first submitted to the Commissioner or within such later period as the
Commissioner determines in accordance with any existing policies of joint
regulatory partners. If an application is deemed to be withdrawn pursuant
to this subsection or if the applicant otherwise withdraws the
application, the Commissioner may not issue a license to the applicant
unless the applicant submits a new application and pays any required fees.
(Added to NRS by 1975, 1830; A 1983, 1327, 1817; 1987, 1997; 1991,
1816; 2005, 1888 )
A licensee which proposes to accept
deposits shall file with the Commissioner a fidelity bond providing
fidelity coverage on each officer, director and employee of at least
$100,000. The fidelity bond may be either a banker’s blanket bond or a
finance company’s blanket bond, but must be written by an insurer who has
been approved by the Commissioner.
(Added to NRS by 1975, 1830; A 1977, 1045; 1983, 1605, 1637, 1817;
1985, 2196, 2197; 1987, 1998)
If the Commissioner finds that a
bond filed pursuant to NRS 677.170 is
not sufficient to protect the interests of the public, he shall require
the applicant to deposit an additional bond.
(Added to NRS by 1983, 1605; A 1983, 1644; 1985, 2197; 1987, 1998)
Upon the
filing of an application, the Commissioner shall make or cause to be made
a careful investigation and examination relative to the following:
1. Character, reputation and financial standing of the organizers
or incorporators.
2. The need for a thrift company or an additional thrift company,
as the case may be, in the community where the proposed licensee is to be
located, giving particular consideration to the adequacy of existing
thrift company services and the need for additional services of this kind
in the community.
3. The ability of the community to support the proposed licensee,
giving consideration to:
(a) The competition offered by existing licensees;
(b) Whether a thrift company has previously operated in the
community; and
(c) The opportunities for profitable employment of the licensee’s
money as indicated by the average demand for credit, the number of
potential investors, the volume of transactions where the services of a
thrift company would be appropriate, and the business and industries of
the community with particular regard to their stability, diversification
and size.
4. The character, banking, industrial loan, finance or thrift
company or other experience and business qualifications of the proposed
officers and managers of the licensee.
5. The character, financial responsibility, business experience
and standing of the proposed stockholders and directors.
6. Any other facts and circumstances bearing on the proposed
licensee as in the opinion of the Commissioner may be relevant.
(Added to NRS by 1975, 1830; A 1979, 995; 1983, 1818; 1987, 1998)
The
Commissioner shall not approve the application unless he ascertains to
his satisfaction:
1. That the public convenience and advantage will be promoted by
the establishment of the proposed corporation.
2. That the corporation is being formed for no other purpose than
the legitimate objectives contemplated by this chapter.
3. That the proposed capital structure is adequate.
4. That the financial responsibility, character and general
fitness of the proposed officers, directors, stockholders and other
investors are such as to command the confidence of the community and to
warrant belief that the business will be operated honestly and fairly
within the purpose of this chapter, and that the proposed officers and
directors have sufficient banking, industrial loan or other experience,
ability and standing to afford reasonable promise of successful operation.
5. That the applicant has complied with all the applicable
provisions of this chapter.
(Added to NRS by 1975, 1831; A 1983, 1818; 1985, 2197; 1987, 1999;
1997, 1014)
The president of the corporation must have not less than 10
years of experience in a regulated financial institution in this state,
or in any other state or the District of Columbia. The manager of the
principal office and any branch office must have not less than 2 years of
experience in a regulated financial institution in this state, or in any
other state or the District of Columbia.
(Added to NRS by 1975, 1831; A 1977, 1045; 1985, 2198; 1995, 1564;
1997, 1014)
The
stockholders’ equity of any corporation formed to do business under this
chapter must not be less than $325,000, plus an additional $25,000 for
each of its branch offices.
(Added to NRS by 1975, 1833; A 1997, 1015)
If
the Commissioner approves an application for authority to form a
corporation to engage in business under this chapter, he shall issue a
certificate in duplicate authorizing the organization of the corporation
and the operation of a thrift company, specifying the date on which and
the conditions under which its place of business may be opened, including
the place where it will be located. The Commissioner shall deliver one
copy to the applicant and retain the other copy.
(Added to NRS by 1975, 1831; A 1983, 1819; 1987, 1999)
1. Except as otherwise provided in subsection 2, the Commissioner
may establish the basis upon which reasonable and adequate reserves must
be created and maintained, which must be no less than 3 percent of the
deposits, in:
(a) Cash and due from federally insured financial institutions in
this state, financial institutions insured by a private insurer approved
pursuant to NRS 678.755 , or any Federal
Reserve Bank;
(b) United States treasury bills or notes;
(c) Short-term obligations of the federal or state government; or
(d) Money deposited in federally insured financial institutions in
this state, financial institutions insured by a private insurer approved
pursuant to NRS 678.755 , or any Federal
Reserve Bank.
Ê For the purposes of this subsection, “short-term” means having a
maturity of 2 years or less.
2. The Commissioner shall require a licensee who is insured by the
Federal Deposit Insurance Corporation to comply with the reserve
requirements established by that insurer.
(Added to NRS by 1975, 1833; A 1979, 996; 1983, 1819; 1985, 2198;
1987, 1999; 1989, 1097; 1993, 2815; 1999, 1451 )
If a
licensee desires to change its place of business to a street address
other than that designated in its authorization, it shall give written
notice to the Commissioner who shall issue his written authorization of
the change, if the Commissioner finds such change of place of business
would not justify a negative finding.
(Added to NRS by 1975, 1831; A 1983, 1819; 1987, 1999)
PROTECTION OF INVESTORS
Subject to the prior approval of the Commissioner, a licensee
may, by a majority vote of its board of directors:
1. Enter into a contract, incur an obligation and perform other
acts necessary to obtain a membership or other benefit that is available
to a thrift company or its customers, stockholders, conservators,
receivers or liquidators pursuant to the provisions of:
(a) The Federal Deposit Insurance Act (12 U.S.C. §§ 1811 et seq.);
or
(b) The National Housing Act (12 U.S.C. §§ 1701 to 1743, inclusive).
2. Subscribe for and acquire any stock, debentures, bonds or other
types of securities of the Federal Deposit Insurance Corporation.
(Added to NRS by 1985, 2193; A 1987, 2000; 1997, 1015)
1. Each licensee shall maintain a record that includes for each
employee:
(a) His full name;
(b) The address of each place at which he has resided during the
previous 10 years;
(c) The name and address of each employer during the previous 10
years;
(d) A recent photograph of the employee measuring 3 by 5 inches; and
(e) Any alias used by the employee.
2. A licensee may comply with the provisions of subsection 1 by
maintaining the employee identification information required pursuant to
26 C.F.R. Part 31.
3. The information contained in the record required pursuant to
this section must be provided to the Commissioner upon his request, but
is otherwise confidential.
(Added to NRS by 1985, 2193; A 1987, 2000; 1997, 1015)
1. Unless the licensee has received a written waiver from the
Commissioner, the total amount of money that the licensee has advanced or
committed for the real property that it has developed or constructed may
not exceed twice the sum of its stockholders’ equity and any other
reserves required by the Commissioner.
2. If a licensee acquires title to any real property pursuant to
the provisions of subsection 1 of NRS 677.630 , the deed or other document representing the
transaction must be recorded within a reasonable time after the
acquisition of that property.
3. An account must be established for the acquired property with a
separate subsidiary ledger or other appropriate record. The amount
carried in the account must be the sum of the unpaid principal balance of
any loan made by the licensee that was secured by the foreclosed property
plus the cost of the foreclosure less any advance payments held in the
account for loans in progress at the time of acquisition, together with:
(a) Any amount paid after acquisition for taxes on the property
that accrued before the acquisition;
(b) Assessments that are due or delinquent at the time of
acquisition;
(c) Any other costs of acquisition; and
(d) The cost of insurance on the property.
4. The subsidiary ledger or other appropriate record must indicate
as to each property:
(a) The type and character of the property;
(b) All the capitalized items of investment and their cost; and
(c) The account number of the former loan or contract of sale.
(Added to NRS by 1985, 2193; A 1987, 2000; 1997, 1015)
1. Except as otherwise provided in subsection 2, an applicant for
an authorization to engage in the business regulated pursuant to this
chapter must obtain:
(a) The insurance of deposits provided pursuant to the provisions
of the Federal Deposit Insurance Act (12 U.S.C. §§ 1811 et seq.); or
(b) The insurance of deposits provided pursuant to the provisions
of the National Housing Act (12 U.S.C. §§ 1701 to 1743, inclusive).
2. A person who:
(a) Is licensed pursuant to this chapter before October 1, 1997; and
(b) Has not obtained the insurance of deposits provided in
subsection 1,
Ê may obtain a contract for the insurance of deposits that is issued by a
private insurer. The contract must be approved by the Commissioner and
the Commissioner of Insurance.
3. The Commissioner shall adopt regulations prescribing the
requirements that must be complied with before a contract issued pursuant
to subsection 2 will be approved by him.
(Added to NRS by 1985, 2194; A 1987, 2001; 1997, 1016)
BRANCH OFFICES
When authorized by the
Commissioner as provided in this chapter, a licensee, pursuant to a
resolution of its board of directors, may establish and maintain one or
more branch offices within or outside the State.
(Added to NRS by 1975, 1832; A 1983, 1819; 1987, 2002; 1997, 1017)
1. The Commissioner shall not approve an application for a branch
office until he has ascertained to his satisfaction that the facts set
forth in the application are true and:
(a) That public convenience and advantage will be promoted by the
establishment of the proposed branch office.
(b) That the licensee has the stockholders’ equity required by this
chapter.
2. The Commissioner must give his approval or denial for an
application for a branch office to the licensee within 45 days after the
date of application to open a branch office unless the Commissioner gives
notice within the original 45-day period that he is extending the period
for decision for a period not to exceed an additional 45 days.
(Added to NRS by 1975, 1832; A 1979, 996; 1983, 1819; 1987, 2002;
1997, 1017)
The failure of a licensee
to open and operate a branch office within 6 months after the
Commissioner approves the application therefor automatically terminates
the right of the licensee to open the branch office.
(Added to NRS by 1975, 1832; A 1979, 996; 1983, 1820; 1987, 2002)
When authorized by the Commissioner, a licensee may change
the location of a branch office from one location to another. The
Commissioner must give his approval or denial to the licensee within 25
days from the date of application for a change in branch location unless
the Commissioner gives notice within the original 25-day period that he
is extending the period for decision for a term not to exceed an
additional 25 days. Every licensee shall keep posted in a conspicuous
place in each branch office the certificate issued by the Commissioner
permitting the operating of the branch office.
(Added to NRS by 1975, 1832; A 1979, 997; 1983, 1820; 1987, 2002)
A licensee which maintains a branch office or branch
offices shall give to each branch office maintained by it a specified
designation by name or number and include in the designation the word
“branch” or the word “office” and shall prominently display the
designation at the place of business of the branch.
(Added to NRS by 1975, 1832)
1. With the prior written approval of the Commissioner, a licensee
may close or discontinue the operation of any branch office if public
notice thereof is given in such manner as the Commissioner directs at
least 30 days before the date of closing or discontinuance.
2. After a branch office has been closed or discontinued it may
not be reopened without the approval of the Commissioner.
(Added to NRS by 1975, 1832; A 1983, 1820; 1987, 2003)
1. The Commissioner may authorize a licensee to operate a mobile
office.
2. A mobile office must serve its designated area at least once
each 30 days. Each mobile office must be licensed as a branch office.
3. Each application for authority to operate a mobile office must
specify the permanent office of the licensee, either its main office or
one of its branches, at which the records of the mobile office will be
kept.
(Added to NRS by 1975, 1833; A 1979, 557; 1983, 1820; 1985, 2198;
1987, 2003)
LICENSING
1. Except as otherwise provided in NRS 677.545 and chapter 666 of
NRS, no person doing business under the law of:
(a) Any other state; or
(b) The United States if the principal office of the business is
not located in Nevada,
Ê relating to banks, savings and loan associations or persons licensed
under chapter 675 of NRS is eligible to
become a licensee under this chapter. This chapter does not apply to any
business transacted by any such person under the authority of and as
permitted by any such law.
2. Except as otherwise provided in subsection 3 and chapter 666
of NRS, a subsidiary of a parent corporation:
(a) One or more of whose other subsidiaries is engaged in any of
the activities listed in subsection 1; or
(b) Whose parent corporation is prohibited from obtaining a license
under this chapter,
Ê is not eligible to be licensed under this chapter.
3. Subsection 2 does not apply to a bank which is doing business
under the law of the United States if its principal office is located in
Nevada.
(Added to NRS by 1975, 1833; A 1981, 1594; 1983, 153, 1606; 1985,
2159, 2199; 1995, 1564)
The provisions of this chapter apply to any person who seeks to evade
its application by any device, subterfuge or pretense whatever,
including, but not thereby limiting the generality of the foregoing:
1. The loan, forbearance, use or sale of credit as guarantor,
surety, endorser, comaker or otherwise, money, goods or things in action.
2. The use of collateral or related sales or purchases of goods or
services, or agreements to sell or purchase, whether real or pretended.
3. Receiving or charging compensation for goods or services,
whether or not sold, delivered or provided.
4. The real or pretended negotiation, arrangement or procurement
of a loan through any use or activity of a third person, whether real or
fictitious.
(Added to NRS by 1975, 1834)
The provisions of this chapter do not prohibit a licensee
or a person owning an interest in a licensee from obtaining a license or
owning an interest in a corporation licensed under chapter 659 or 673 of NRS.
(Added to NRS by 1983, 1605)
1. A license expires on December 31 of each year. On or before
that date, each licensee must pay to the Commissioner a fee not more than
$1,000 for the renewal of each license held by him. The Commissioner may
reinstate an expired license upon receipt of the fee for renewal and a
fee of not more than $400 for reinstatement.
2. The Commissioner shall adopt regulations establishing the
amount of the fees required pursuant to this section.
(Added to NRS by 1975, 1834; A 1979, 962; 1983, 1328, 1821; 1987,
2003; 1989, 923; 2005, 1888 )
1. Each licensee shall conspicuously post each license in the
place of business to which it pertains.
2. No license is transferable or assignable without the permission
of the Commissioner.
(Added to NRS by 1975, 1834; A 1983, 1821; 1987, 2003)
1. In addition to any other requirements set forth in this
chapter, each applicant must submit:
(a) Proof satisfactory to the Commissioner that the applicant:
(1) Has a good reputation for honesty, trustworthiness and
integrity and is competent to transact the business for which the
applicant seeks to be licensed in a manner which protects the interests
of the general public.
(2) Has not made a false statement of material fact on the
application for the license.
(3) Has not committed any of the acts specified in
subsection 2.
(4) Has not had a license issued pursuant to this chapter
suspended or revoked within the 10 years immediately preceding the date
of the application.
(5) Has not been convicted of, or entered a plea of nolo
contendere to, a felony or any crime involving fraud, misrepresentation
or moral turpitude.
(b) A complete set of his fingerprints and written permission
authorizing the Division of Financial Institutions of the Department of
Business and Industry to forward the fingerprints to the Central
Repository for Nevada Records of Criminal History for submission to the
Federal Bureau of Investigation for its report.
2. In addition to any other lawful reasons, the Commissioner may
refuse to issue a license to an applicant if the applicant:
(a) Has committed or participated in any act which, if committed or
done by a holder of a license, would be grounds for the suspension or
revocation of the license.
(b) Has previously been refused a license pursuant to this chapter
or has had such a license suspended or revoked.
(c) Has participated in any act which was a basis for the refusal
or revocation of a license pursuant to this chapter.
(d) Has falsified any of the information submitted to the
Commissioner in support of the application for the license.
(Added to NRS by 2005, 1886 )
In addition to any other lawful reasons, the Commissioner may
suspend or revoke a license if the licensee has engaged in any act that
would be grounds for denying a license pursuant this chapter.
(Added to NRS by 2005, 1887 )
ADMINISTRATION AND ENFORCEMENT
Generally
1. The Commissioner may adopt regulations and make orders for the
administration and enforcement of this chapter, in addition to and not
inconsistent with this chapter.
2. Any ruling, demand, requirement or similar administrative act
may be promulgated by an order.
3. Every order must be in writing, must state its effective date
and the date of its promulgation, and must be entered in an indexed
permanent book which is a public record.
4. A copy of every order containing a requirement of general
application must be mailed to each licensee at least 20 days before the
effective date thereof.
(Added to NRS by 1975, 1834; A 1983, 1822; 1987, 2003)
Except as otherwise provided in NRS 677.160 , all fees and charges collected under the
provisions of this chapter must be deposited in the State Treasury
pursuant to the provisions of NRS 658.091 .
(Added to NRS by 1975, 1834; A 1977, 102; 1983, 1328; 1985, 2199;
2003, 3234 )
Reports, Examinations and Audits
1. Annually, on or before May 15, unless the Commissioner grants a
written extension, each licensee shall file with the Commissioner a
report of operations of the licensed business for the preceding calendar
year.
2. The report must give information with respect to the financial
condition of the licensee, including, without limitation:
(a) Balance sheets at the beginning and end of the year;
(b) A statement of income and expenses for the period;
(c) A reconciliation of the surplus or net worth with the balance
sheets;
(d) A schedule of the assets used and useful in the licensed
business;
(e) The size of loans and an analysis of charges, including the
monthly average number and amount of loans outstanding;
(f ) An analysis of delinquent accounts;
(g) Any court actions undertaken to effect collection; and
(h) Any further statistical information reasonably prescribed by
the Commissioner.
3. The report must be made under oath and be in the form
prescribed by the Commissioner.
4. If any person or affiliated group holds more than one license
in this state, that person or group may file a composite annual report,
if a short form of report applicable to each licensed office accompanies
the report.
5. A licensee may comply with the provisions of this section by
filing with the Commissioner a copy of the annual audit report filed by
the licensee with the Federal Deposit Insurance Corporation pursuant to
12 U.S.C. § 1831m.
(Added to NRS by 1975, 1837; A 1979, 997; 1983, 1822; 1987, 2003;
1997, 1017)
1. The annual reports and financial statements required by this
chapter must be prepared in accordance with generally accepted accounting
principles and must be accompanied by a report, certificate, or opinion
of an independent certified public accountant or independent public
accountant, and must contain such relevant information as the
Commissioner may require. The audits must be conducted in accordance with
generally accepted auditing standards and the regulations of the
Commissioner.
2. A licensee shall make other special reports to the Commissioner
as the Commissioner may from time to time require.
3. For good cause and upon written request, the Commissioner may
extend the time for compliance with the provisions of this chapter.
4. If the report, certificate or opinion of the independent
accountant is in any way qualified, the Commissioner may require the
company to take such action as he deems appropriate to permit an
independent accountant to remove such qualification from the report,
certificate or opinion.
(Added to NRS by 1975, 1838; A 1983, 1822; 1987, 2004)
1. A licensee shall notify the Commissioner of any change in the
ownership of 10 percent or more of the outstanding voting stock of the
licensee within 3 business days after the licensee has knowledge of the
change.
2. An application for approval must be submitted to the
Commissioner by a person who acquires:
(a) At least 25 percent of a licensee’s outstanding voting stock; or
(b) Any outstanding voting stock of a licensee if the change will
result in a change in the control of the licensee.
Ê Except as otherwise provided in subsection 4, the Commissioner shall
conduct an investigation in accordance with NRS 677.180 . If the Commissioner denies the application,
he may forbid the applicant from participating in the business of the
licensee.
3. The licensee with which the applicant is affiliated shall pay
such a portion of the cost of the investigation as the Commissioner
requires. All money received by the Commissioner pursuant to this
subsection must be placed in the Investigative Account created by NRS
232.545 .
4. A licensee may submit a written request to the Commissioner to
waive an investigation pursuant to subsection 2. The Commissioner may
grant a waiver if the applicant has undergone a similar investigation by
a state or federal agency in connection with the licensing of or his
employment with a financial institution.
(Added to NRS by 1975, 1838; A 1983, 1823; 1985, 1348; 1987, 2004;
1991, 1816; 1997, 1018)
1. At least once each year, the Commissioner or his authorized
representatives shall make an examination of the place of business of
each licensee and of the loans, transactions, books, papers and records
of such licensee so far as they pertain to the business licensed under
this chapter.
2. For each examination the Commissioner shall charge and collect
from the licensee a fee for conducting the examination and preparing and
typing the report of the examination at the rate established pursuant to
NRS 658.101 .
(Added to NRS by 1975, 1835; A 1977, 102; 1983, 1823; 1987, 2005,
2227 )
Each licensee shall pay the assessment levied
pursuant to NRS 658.055 and cooperate
fully with the audits and examinations performed pursuant thereto.
(Added to NRS by 1987, 827)
1. For the purpose of discovering violations of this chapter or of
securing information lawfully required under this chapter, the
Commissioner or his duly authorized representatives may at any time
investigate the business and examine the books, accounts, papers and
records used therein of:
(a) A licensee;
(b) Any other person engaged in the business described in this
chapter, participating in the business as a principal, agent, broker or
otherwise;
(c) Any other person engaged in an activity for which a license is
required pursuant to the provisions of this chapter;
(d) Any person whom the Commissioner has reasonable cause to
believe is violating or is about to violate any provision of this
chapter, whether or not the person claims to be within the authority or
beyond the scope of this chapter; and
(e) Any company which is a subsidiary of, affiliated with or owned
or controlled by a licensee.
2. For the purpose of examination, the Commissioner or his
authorized representatives shall have and be given free access to the
offices and places of business, files, safes and vaults of such persons.
3. The Commissioner may require the attendance of any person and
examine him under oath regarding:
(a) Any transaction or business regulated pursuant to the
provisions of this chapter; or
(b) The subject matter of any audit, examination, investigation or
hearing.
(Added to NRS by 1975, 1834; A 1983, 1606, 1637, 1823; 1987, 2005;
2005, 1887 )
The Commissioner may require the
attendance of any person and may examine him under oath relative to loans
or business regulated by this chapter or the subject matter of any
examination, investigation or hearing, and may require the production of
books, accounts, papers and records.
(Added to NRS by 1975, 1835; A 1983, 1823; 1987, 2005)
The
Commissioner may provide by regulation or order for the charging off of
assets considered to be of little or no value.
(Added to NRS by 1975, 1834; A 1983, 1824; 1987, 2006)
In addition to the annual fee provided by this chapter, the Commissioner
shall assess and collect from each licensee the reasonable cost of
auditing the books and records of a licensee.
(Added to NRS by 1975, 1834; A 1983, 1824; 1987, 2006)
Remedial Actions
If it appears to the Commissioner any
company is conducting business in an unsafe or injurious manner, he may
by written order direct the discontinuance of any unsafe or injurious
practices.
(Added to NRS by 1975, 1835; A 1983, 1824; 1987, 2006)
Any licensee may surrender any license
by delivering it to the Commissioner with written notice of its
surrender, but a surrender does not affect his civil or criminal
liability for acts committed before the surrender.
(Added to NRS by 1975, 1835; A 1983, 1824; 1987, 2006)
If the Commissioner finds that probable
cause for revocation of any license exists and that enforcement of this
chapter requires immediate suspension of a license pending investigation,
he may, upon 5 days’ written notice and without a hearing, enter an order
suspending a license for a period not exceeding 20 days pending the
holding of a hearing.
(Added to NRS by 1975, 1835; A 1977, 96; 1983, 1824; 1987, 2006)
1. If the Commissioner has reason to believe that grounds for
revocation or suspension of a license exist, he shall give 20 days’
written notice to the licensee stating the contemplated action and, in
general, the grounds therefor and set a date for a hearing.
2. At the conclusion of a hearing, the Commissioner shall:
(a) Enter a written order either dismissing the charges, or
revoking the license, or suspending the license for a period of not more
than 60 days, which period must include any prior temporary suspension. A
copy of the order must be sent by registered or certified mail to the
licensee.
(b) Impose upon the licensee an administrative fine of not more
than $10,000 for each violation by the licensee of any provision of this
chapter or any lawful regulation adopted pursuant thereto.
(c) If a fine is imposed pursuant to this section, enter such order
as is necessary to recover the costs of the proceeding, including his
investigative costs and attorney’s fees.
3. The grounds for revocation or suspension of a license are that:
(a) The licensee has failed to pay the annual license fee;
(b) The licensee, either knowingly or without any exercise of due
care to prevent it, has violated any provision of this chapter, or any
lawful regulation adopted pursuant thereto;
(c) The licensee has failed to pay a tax as required pursuant to
the provisions of chapter 363A of NRS;
(d) Any fact or condition exists which would have justified the
Commissioner in denying the licensee’s original application for a license
hereunder; or
(e) The applicant failed to open an office for the conduct of the
business authorized under this chapter within 120 days after the date the
license was issued, or has failed to remain open for the conduct of the
business for a period of 120 days without good cause therefor.
4. Any revocation or suspension applies only to the license
granted to a person for the particular office for which grounds for
revocation or suspension exist.
5. An order suspending or revoking a license becomes effective 5
days after being entered unless the order specifies otherwise or a stay
is granted.
(Added to NRS by 1975, 1836; A 1983, 1824; 1987, 2006; 1993, 902;
2003, 20th Special Session, 227 ; 2005, 1888 )
The revocation,
suspension, expiration or surrender of any license does not impair or
affect the obligation of any preexisting lawful contract between the
licensee and any obligors. Such a contract and all lawful charges thereon
may be collected by the licensee, its successors or assigns.
(Added to NRS by 1975, 1837; A 1989, 923)
1. Whenever the Commissioner has reasonable cause to believe that
any person is violating or is threatening to or intends to violate any
provision of this chapter, he may, in addition to all actions provided
for in this chapter and without prejudice thereto, enter an order
requiring the person to desist or to refrain from such violation.
2. An action may be brought on the relation of the Attorney
General and the Commissioner to enjoin a person from engaging in or
continuing a violation or from doing any act or acts in furtherance
thereof. In any such action, an order or judgment may be entered awarding
such preliminary or final injunction as may be deemed proper.
3. In addition to all other means provided by law for the
enforcement of a restraining order or injunction, the court in which an
action is brought may impound, and appoint a receiver for, the property
and business of the defendant, including books, papers, documents and
records pertaining thereto, or so much thereof as the court deems
reasonably necessary to prevent violations of this chapter through or by
means of the use of the property and business. Such receiver, when
appointed and qualified, has such powers and duties as to custody,
collection, administration, winding up and liquidation of such property
and business as are from time to time conferred upon him by the court.
(Added to NRS by 1975, 1835; A 1983, 1825; 1987, 2007)
Whenever it appears to the
Commissioner that:
1. The stockholders’ equity of any licensee is less than its
initial stockholders’ equity;
2. Any licensee has violated its articles of incorporation or any
law of this state;
3. Any licensee is conducting its business in an unsafe or
unauthorized manner;
4. Any licensee refuses to submit its books, papers and affairs to
the inspection of any examiner;
5. Any officer of any licensee refuses to be examined upon oath
touching the concerns of the licensee;
6. Any licensee has suspended payment of its obligations;
7. Any licensee is in a condition that it is unsound or unsafe for
it to transact business;
8. Any licensee neglects or refuses to observe any order of the
Commissioner made pursuant to this chapter unless the enforcement of the
order is restrained in a proceeding brought by the licensee;
9. Any licensee has accepted deposits in violation of the
provisions of this chapter; or
10. Any fact or condition exists which, if it had existed at the
time of the original application for authority to organize and establish
a corporation to engage in business under this chapter, it reasonably
would have warranted the disapproval of the application by the
Commissioner,
Ê the Commissioner may forthwith take possession of the property and
business of the licensee and retain possession until it resumes business
or its affairs are finally liquidated as provided in this chapter. The
licensee, with the consent of the Commissioner, may resume business upon
such conditions as the Commissioner may prescribe.
(Added to NRS by 1975, 1836; A 1983, 1825; 1985, 2199, 2200; 1987,
2007; 1997, 1018)
1. Except as limited by subsection 2, if the Commissioner has
taken possession of the property and business of a corporation licensed
under this chapter pursuant to NRS 677.540 , or a receiver, other than the State, has been
appointed for and taken possession of the property and business of a
corporation, the Commissioner may solicit offers from and authorize or
require the acquisition of the corporation by or its merger with another
institution or company in the following order of priority:
(a) A corporation which is licensed pursuant to this chapter.
(b) Any other depository institution licensed under the laws of
this state or of the United States if its principal office is located in
this state, including institutions whose parent corporation has offices
or operations in other states.
(c) A bank, savings and loan association or thrift company, or its
parent corporation, licensed pursuant to the laws of the United States or
of another state, whose operations are principally conducted within the
state of Alaska, Arizona, Colorado, Hawaii, Idaho, Montana, New Mexico,
Oregon, Utah, Washington or Wyoming.
(d) A bank, savings and loan association or thrift company, or its
parent corporation, licensed pursuant to the laws of the United States or
of another state, whether or not its principal place of business is in
another state.
Ê The Commissioner shall solicit written offers from all eligible
institutions, regardless of the order of priority established by this
subsection, and wait at least 30 days after solicitation before selecting
the institution to be approved.
2. The selection of an institution must be made in accordance with
the order of priority established in subsection 1 only if a selection
affords the greatest financial recovery by the corporation’s depositors
of all offers received. The Commissioner may not accept any offer which
affords the corporation’s depositors a smaller financial recovery than
they would receive if the corporation were liquidated. If the
commissioner receives one or more acceptable offers he may negotiate with
the institutions submitting acceptable offers, following that order of
priority, and accept that offer which would afford the greatest financial
recovery by the corporation’s depositors.
(Added to NRS by 1985, 2195; A 1987, 1315, 2008)
1. The Commissioner may order a licensee to suspend the payment of
its liabilities or limit the payment of its liabilities in such manner as
he prescribes, if it appears to the Commissioner that this action is
necessary for the protection of the licensee, its depositors or
creditors, or in the public interest. The order is effective upon receipt
of notice by the licensee and continues in effect until rescinded or
modified by the Commissioner in a writing delivered to the manager or
executive officer of the licensee.
2. Subsection 1 does not affect the right of any licensee to pay
its current operating expenses and liabilities incurred during the period
of suspension or limitation.
3. After an order suspending or limiting the payment of
liabilities is effective and until that order is rescinded, the licensee
shall make no assignment or hypothecation of any indebtedness due to it
from a depositor without first crediting thereon the liability of the
licensee to the depositor.
4. The authority granted to the Commissioner by this section may
be exercised by him in conjunction with all other powers granted by this
chapter, or independently from them.
(Added to NRS by 1975, 1837; A 1983, 1826; 1985, 2200, 2201; 1987,
2009)
Whenever the Commissioner has taken possession of the property and
business of any licensee, a licensee, within 10 days after a taking, if
it deems itself aggrieved thereby, may apply to the district court in the
county in which the main office of the licensee is located to enjoin
further proceedings. The court, after citing the Commissioner to show
cause why further proceedings should not be enjoined and after a hearing
and a determination of the facts upon the merits may dismiss such
application or enjoin the Commissioner from further proceedings and
direct him to surrender the property and business to such licensee, or
make such further order as may be just.
(Added to NRS by 1975, 1837; A 1983, 1826; 1987, 2009)
When the Commissioner takes possession of the property and
business of any company for the purpose of liquidation or conservation,
he may liquidate or conserve the company. In such a liquidation or
conservation the Commissioner has the same authority with reference to
licensees as are vested in the Commissioner by title 55 of NRS with
reference to banks and in addition may deposit money coming into his
hands in the course of liquidation in one or more state or national banks
or credit unions.
(Added to NRS by 1975, 1837; A 1983, 1827; 1987, 2010; 1999, 1452
)
GENERAL REGULATIONS
A holding company or any other device may not be used for
the purpose of evading or avoiding any of the provisions of this chapter.
This section does not affect the right of a company to issue preferred
stock or debentures when permitted to do so under the laws of this state.
(Added to NRS by 1975, 1838)
1. Except as otherwise provided in subsection 2, this chapter does
not permit a licensee to issue thrift certificates.
2. A licensee who maintains a branch office located outside this
state may issue thrift certificates and any other securities that are
permitted to be issued by a licensee pursuant to the laws of the state in
which the branch office is located.
(Added to NRS by 1975, 1844; A 1985, 2201; 1997, 1019)
A licensee shall not
deposit any of its money with any other moneyed corporation, unless that
corporation has been designated as a depository by a majority vote of the
directors or the executive committee, exclusive of any director who is an
officer, director or trustee of the depository so designated. Such a
depository must be a federally insured financial institution, a financial
institution insured by a private insurer approved pursuant to NRS 678.755
or any Federal Reserve Bank.
(Added to NRS by 1975, 1844; A 1985, 2202; 1997, 1019; 1999, 1452
)
A licensee shall not invest
any of its money, except:
1. As authorized in this chapter;
2. In legal investments for banks, credit unions or savings
associations; or
3. To the extent of 5 percent or less of its total assets, in
preferred stock of corporations which have been given a rating of “A” or
better by a national rating service and which are not in default in the
payment of dividends.
(Added to NRS by 1975, 1844; A 1981, 1025; 1987, 1244; 1999, 1452
)
1. A deposit may be made with a licensee by any administrator,
executor or guardian of an estate, a trustee or other fiduciary in trust
for a named beneficiary or beneficiaries.
2. The fiduciary may make additional deposits and withdraw the
deposit, in whole or in part.
3. The withdrawal value of the deposit and the interest thereon,
or other rights relating to the deposit, may be paid or delivered to the
fiduciary, and the payment or delivery to the fiduciary or a receipt or
acquittance signed by the fiduciary to whom any payment or delivery of
rights is made, is a valid and sufficient release and discharge of the
licensee for the payment or delivery so made.
(Added to NRS by 1987, 1243)
1. If a person who has made a deposit as a trustee or other
fiduciary, in trust for a named beneficiary or beneficiaries, dies and no
written notice of the revocation or termination of the trust relationship
has been given to the licensee, the withdrawal value of the deposit and
the interest thereon or other right relating to the deposit may, at the
option of the licensee, be paid or delivered, in whole or in part, to the
named beneficiary or beneficiaries of the trust.
2. The payment or delivery to the beneficiary or beneficiaries is
a release and discharge of the licensee for the payment or delivery of
the deposit.
(Added to NRS by 1987, 1243)
1. If a deposit is made with a licensee by a minor, the licensee
may pay to the depositor such sums as may be due him, and the receipt of
the minor to the licensee is valid.
2. A licensee may operate a deposit account in the name of a minor
or in the name of two or more persons one or more of whom are minors with
the same effect upon its liability as if the minors were of lawful age.
(Added to NRS by 1987, 1243)
1. Except as otherwise provided in subsections 2 and 3, a licensee
shall not have at any time deposits in an aggregate sum in excess of 10
times the aggregate amount of its stockholders’ equity.
2. A licensee insured by the Federal Deposit Insurance Corporation
shall comply with the limits imposed by that insurer, if any.
3. If a licensee has operated under this chapter for 1 year or
more and during its most recent fiscal year has been profitable, the
Commissioner may increase the ratio of deposits to stockholders’ equity
prescribed in subsection 1 to not more than the greatest net worth to
savings ratio permitted for any savings and loan association operating in
this state. The Commissioner shall give his approval or denial of the
application for an increased ratio to the licensee in writing with
supporting reasons within 30 days after the date of the application
submitted by the licensee unless the Commissioner gives notice within the
original 30-day period that he is extending the period for decision for a
period not to exceed an additional 30 days. The Commissioner may, for
reasonable cause, decrease the ratio authorized under this subsection at
any time, but not below the ratio prescribed in subsection 1.
4. A licensee may not have total borrowings, exclusive of
deposits, which exceed the larger of:
(a) Five times its stockholders’ equity; or
(b) The face amount of total deposits at the time a borrowing is
made.
5. A licensee may borrow money from a Federal Home Loan Bank.
Money borrowed pursuant to this subsection shall not be deemed borrowed
money for the purposes of the limitations prescribed in subsection 4. A
licensee may pledge any of its assets as collateral security for money
borrowed pursuant to this subsection.
(Added to NRS by 1975, 1844; A 1977, 1045; 1979, 997; 1981, 1025;
1983, 1607, 1638, 1827; 1985, 2202, 2203; 1987, 2010; 1989, 1098; 1993,
2816; 1997, 1019)
1. A licensee may purchase, hold, develop and convey real
property, including apartments and other buildings, for the following
purposes only:
(a) Real property conveyed to it in satisfaction of debts
contracted in the course of its business.
(b) Real property purchased at sale under judgments, decrees or
mortgage foreclosures or foreclosures of or trustees’ sales under deeds
of trust, or pursuant to an order of a bankruptcy court. A licensee shall
not bid against its debtor at any such sale in a larger amount than is
necessary to satisfy its debt and costs.
(c) Real property necessary as premises for the transaction of its
business. A licensee shall not invest directly or indirectly an amount
exceeding one-third of its stockholders’ equity in the lot and building
in which the business of the company is carried on, furniture and
fixtures, and vaults, necessary and proper to carry on its business.
(d) Real property purchased or held for the purpose of development.
An investment for this purpose must not exceed the market value of the
property as evidenced by an appraisal prepared by a member of the
American Institute of Real Estate Appraisers, the National Association of
Review Appraisers and Mortgage Underwriters, the Society of Real Estate
Appraisers or the Independent Fee Appraisers Society or an appraiser
approved by the commissioner. Within 120 days after the investment is
made:
(1) The licensee shall provide the Commissioner with a
certified copy of one or more appraisal reports and a report from a title
insurer which shows, for not less than the immediately preceding 3 years,
the chain of title and the amount of consideration for which the title
was transferred, if that information is available.
(2) The Commissioner may require a statement from the
licensee disclosing whether any director, officer or employee of the
licensee has, or has had within the immediately preceding 3 years, any
direct or indirect interest in the property. For the purposes of this
subparagraph, “interest” includes ownership of stock in a corporation
which has an interest in the property.
Ê If the total amount to be invested in real property for residential
development, excluding any real property which is mortgaged to the
licensee as security for money owing to the licensee, exceeds the
stockholders’ equity of the licensee, the investment may not be made
without the written approval of the Commissioner. Any person who fails to
make a disclosure required by this section is guilty of a misdemeanor.
2. No real estate acquired pursuant to paragraph (a) or (b) of
subsection 1 may be held for a longer period than 5 years unless it has
been improved by the licensee and is producing a fair income based upon
the appraised value.
(Added to NRS by 1975, 1844; A 1981, 1026; 1983, 1828; 1985, 2204,
2205; 1987, 1244, 2011; 1989, 1099; 1997, 1020)
A licensee shall not make loans or accept deposits under this
chapter:
1. Within any office, suite, room or place of business in which
any other business is solicited or engaged in, except an insurance agency
or notary public, or in association or conjunction with any other
business unless authority to do so is given by the Commissioner.
2. Under any name or at any place other than that stated in the
license.
Ê This section does not prevent the making of loans by mail or prohibit
accommodations to individual borrowers when necessitated by hours of
employment, sickness or other emergency situations.
(Added to NRS by 1975, 1832; A 1983, 1828; 1985, 2205, 2206; 1987,
2011)
1. A licensee must obtain the approval of the Commissioner before
using or changing a business name.
2. A licensee shall not:
(a) Use any business name which is identical or similar to a
business name used by another licensee under this chapter or which may
mislead or confuse the public.
(b) Use any printed forms which may mislead or confuse the public.
(Added to NRS by 2005, 1887 )
1. Except as otherwise provided in subsection 2, a licensee shall
not directly or indirectly make any loan to, or purchase a contract or
chose in action from:
(a) A person who is an officer, director or holder of record or
beneficiary of 10 percent or more of the shares of the licensee;
(b) A person in which an officer, director or holder of record or
beneficiary of 10 percent or more of the shares of the licensee directly
or indirectly is financially interested; or
(c) A person who acquired the contract directly or indirectly or
through intervening assignments from a person described in paragraph (a)
or (b),
Ê unless the licensee has been authorized by the Commissioner to make
that loan or purchase that contract or chose in action from that person.
2. Loans may be made to an officer, director or stockholder of the
licensee, upon collateral of his deposits with the licensee, of not more
than 90 percent of the amount of his deposits, at the same rates of
interest and under the same terms as loans secured by deposits are
offered to members of the general public.
3. Any officer, director or stockholder of a licensee who:
(a) Knowingly and intentionally makes or procures or participates
in making or procuring, directly or indirectly, a loan or contract in
violation of this section; or
(b) Knowingly approves a loan or contract in violation of this
section,
Ê is personally liable for any loss resulting to the licensee from the
loan or contract, in addition to any other penalties provided by law.
(Added to NRS by 1975, 1845; A 1981, 1027; 1985, 2206; 1997, 1021)
1. A person shall not advertise, print, display, publish,
distribute or broadcast or cause or permit to be advertised, printed,
displayed, published, distributed or broadcast, in any manner, any
statement or representation with regard to the rates, terms or conditions
for making or negotiating loans, or with regard to deposits, which is
false, misleading or deceptive.
2. Except as otherwise provided in this subsection, a licensee
shall not use any advertising or make any representations which indicate,
imply or might lead a person to believe that it is a bank, a thrift
company or a savings bank, unless it is insured by the Federal Deposit
Insurance Corporation. The provisions of this subsection do not apply to
a thrift company that does not accept money for deposit.
3. A licensee whose deposits are insured by the Federal Deposit
Insurance Corporation shall include that information in its advertising
relating to deposits.
(Added to NRS by 1975, 1844; A 1985, 348, 2207; 1989, 1099; 1993,
2817; 1997, 1022)
A corporation authorized to engage
in business pursuant to this chapter may form a bank pursuant to the
provisions of subsection 2 of NRS 659.015 .
(Added to NRS by 1997, 1014)
LOANS; POWERS AND PRIVILEGES
1. Every licensee shall:
(a) Deliver to the borrower, or if more than one, to one of them,
at the time of making a loan under this chapter a copy of the loan
obligation or, in lieu thereof, a statement showing in clear and distinct
terms the date of the loan and amount of loan obligation and the date of
its maturity, the nature of the security, if any, for the loan, the name
and address of the borrower and of the licensee, and the description or
schedule of payments on the loan.
(b) Except as otherwise provided in subsection 2, give to the
person making any cash payment on account of any loan a receipt at the
time the payment is made, which receipt must show the balance due, if
any, after application of the payment. A receipt for the amount of the
payment only may be given temporarily and replaced within a reasonable
time with a receipt as prescribed in this paragraph.
(c) Permit payment in advance in an amount equal to one or more
full installments at any time during the regular business hours of the
licensee.
(d) Upon repayment of a loan in full, mark plainly every note or
other evidence of the indebtedness or assignment signed by any obligor
with the word “paid” or “cancelled,” and release or provide the borrower
with evidence to release any mortgage or security instrument no longer
securing any indebtedness to the licensee.
2. In lieu of the receipt mentioned in paragraph (b) of subsection
1, the licensee may issue a coupon payment book to the borrower setting
forth the amount and due date of each installment and containing a
payment record stub corresponding to each coupon.
(Added to NRS by 1975, 1842; A 1989, 1100)
A licensee may lend
any amount of money:
1. At any rate of interest;
2. Subject to the imposition of any charge in any amount; and
3. Upon any schedule of repayment,
Ê to which the parties may agree.
(Added to NRS by 1975, 1842; A 1979, 1000; 1985, 2208; 1989, 1100;
1997, 1022)
A licensee shall
not:
1. Take any confession of judgment or any power of attorney
running to himself or to any third person to confess judgment or to
appear for the borrower in a judicial proceeding.
2. Take any note or promise to pay which does not disclose the
date and amount of the loan obligation, a schedule or description of the
payments to be made thereon, and the rate or aggregate amount of agreed
charges.
3. Take any instrument in which blanks are left to be filled in
after the loan is made.
(Added to NRS by 1975, 1843)
1. A licensee shall not lend in the aggregate more than 10 percent
of its stockholders’ equity upon:
(a) The security of the stock of any one corporation, which stock,
except as otherwise provided in subsection 2, may not exceed 10 percent
of the outstanding stock of that corporation.
(b) The security of the bonds of any one obligor except:
(1) Bonds of the United States or for the payment of which
the credit of the United States is pledged;
(2) Bonds of the State of Nevada, or for the payment of
which the credit of the State of Nevada is pledged; and
(3) Bonds which are general obligations of any county, city,
metropolitan water district, school district or irrigation district of
the State of Nevada.
2. The stock of a corporation upon the security of which a
licensee loans money pursuant to paragraph (a) of subsection 1 may exceed
10 percent of the outstanding stock of that corporation if:
(a) The licensee has secured collateral, other than deposits with
the licensee, which has a market value of not less than 115 percent of
the amount loaned; or
(b) The loans are secured by deposits with the licensee and the
amount of the money loaned does not exceed 90 percent of the deposits
used as collateral.
(Added to NRS by 1975, 1843; A 1989, 1101; 1997, 1022)
Secured loans or obligations of any one person as
primary obligor made or held by a licensee may not, in any event, exceed
in the aggregate 25 percent of the stockholders’ equity of the licensee.
Loans secured by deposits with the licensee must not be included in
applying this limitation.
(Added to NRS by 1975, 1843; A 1985, 2208; 1987, 1245; 1989, 1101;
1993, 2817; 1997, 1023)
1. Except as provided in NRS 677.770 and 677.790 ,
a licensee may make loans to any person, secured by real or personal
property, without regard to the location or nature of the security.
2. Any loan made on property situated outside this state which is
lawful under the laws of the state in which the property is situated may
be collected or otherwise enforced in this state in accordance with its
terms.
(Added to NRS by 1975, 1843; A 1985, 2209)
Except as provided in NRS 677.770
, a licensee may:
1. Make loans secured by, and purchase, sell or discount in any
amount:
(a) Bona fide trust receipts;
(b) Secured choses in action;
(c) Chattel mortgages;
(d) Conditional sales contracts;
(e) Security agreements;
(f) Leases;
(g) Lien contracts; and
(h) Deeds of trust.
2. Accept deposits, including deposits payable on demand and time
deposits, and issue certificates of deposit.
3. Enter into leases and purchase equipment for those leases.
(Added to NRS by 1975, 1843; A 1979, 1000; 1983, 1608; 1985, 2209;
1987, 1245)
A licensee
may, with the approval of the Commissioner, exercise any authority,
right, power and privilege, and perform any act and enjoy the same
immunities as banks licensed pursuant to chapter 659 of NRS.
(Added to NRS by 1987, 1243; A 1987, 2024)
UNLAWFUL ACTS; PENALTIES
Any person and
the members, officers, directors, agents and employees thereof who
knowingly and intentionally violate or participate in the violation of
any provision of this chapter are guilty of a misdemeanor, unless a
greater penalty is provided in this chapter.
(Added to NRS by 1975, 1845; A 1997, 1023)
In addition to any other remedy
or penalty, the Commissioner may impose an administrative fine of not
more than $10,000 upon a person who, without a license, conducts any
business or activity for which a license is required pursuant to the
provisions of this chapter.
(Added to NRS by 2005, 1887 )
A director, officer or
employee of a licensee who:
1. Asks for or receives or consents or agrees to receive any
commission, emolument or gratuity or any money, property or thing of
value for procuring or endeavoring to procure for a person any loan from
the licensee, or the purchase or discount of any note, contract or other
obligation or property by the licensee;
2. Knowingly receives or possesses himself of any of its property
otherwise than in payment of a just demand, or with the intent to defraud
omits to make or cause to be made a full and true entry thereof in its
books and accounts or concurs in omitting to make any material entry
thereof;
3. Knowingly makes or concurs in making or publishing any false
entry in its books or records, any written report, exhibit or statement
of its affairs or pecuniary condition containing any material statement
which is false, or having the custody of its books willfully refuses or
neglects to make any proper entry in the books as required by law, or to
exhibit or allow them to be inspected or extracts to be taken therefrom
by the Commissioner or his deputies or investigators, or alters,
conceals, destroys or removes any book or record;
4. Embezzles, abstracts or willfully misapplies the money,
securities or credits of a licensee, or who, with the intent to injure or
defraud the licensee or a customer of the licensee:
(a) Issues or puts forth a deposit;
(b) Draws a draft, bill of exchange or mortgage; or
(c) Otherwise uses his position or employment with a licensee; or
5. Knowingly aids or abets the commission of an act prohibited by
this section,
Ê is guilty of a category C felony and shall be punished as provided in
NRS 193.130 , or by a fine of not more
than $50,000, or by both fine and the punishment provided in NRS 193.130
. In addition to any other penalty, the
court shall order the person to pay restitution.
(Added to NRS by 1975, 1845; A 1983, 1829; 1985, 2210; 1987, 2012;
1995, 1317)
Every director of a licensee who:
1. In case of the fraudulent insolvency of such company,
participated in such fraud; or
2. Willfully does any act as such director which is expressly
forbidden by law or willfully omits to perform any duty imposed upon him
as such director by law,
Ê is guilty of a misdemeanor. The insolvency of a licensee is fraudulent
for the purposes of this section, unless its affairs appear upon
investigation to have been administered clearly, legally and with the
same care and diligence that agents receiving a compensation for their
services are bound by law to observe.
(Added to NRS by 1975, 1845)
A director, officer or employee of a licensee who concurs in
any vote or act by which it is intended to make a loan or purchase a
contract in violation of this chapter is guilty of a misdemeanor.
(Added to NRS by 1975, 1846)
Any director, officer or employee of any licensee who makes or
maintains, or attempts to make or maintain, a deposit of such company’s
funds with any other person on condition, or with the understanding,
express or implied, that the person receiving such deposit make a loan or
advance, directly or indirectly, to any director, officer or employee of
the licensee so making or maintaining or attempting to make or maintain
such deposit, is guilty of a misdemeanor.
(Added to NRS by 1975, 1846)
Each officer or employee of any company
who accepts deposits knowing:
1. That the company is insolvent; or
2. That the acceptance violates any provision of this chapter or
any order or regulation of the Commissioner,
Ê is guilty of a category D felony and shall be punished as provided in
NRS 193.130 .
(Added to NRS by 1975, 1846; A 1983, 1829; 1985, 2211; 1987, 2012;
1995, 1318)
