A savings and loan association shall become and participate as a member in and have its savings accounts insured by the Maryland Deposit Insurance Fund Corporation or the Federal Savings and Loan Insurance Corporation. If membership in both corporations ceases, the association shall be placed in receivership in accordance with § 9-708 of this title.

If a savings and loan association rejects an application for a residential mortgage, the association shall give the applicant, on request, written notice of the rejection.

If a savings and loan association holds a first mortgage on residential property, and the mortgage is partially insured by a private mortgage insurance company, the association shall eliminate all charges to the mortgagor for mortgage insurance premiums when the mortgage is reduced to the level at which the federal Homeowners Protection Act of 1998 requires termination of the private mortgage insurance insuring the mortgage.

The sale of savings accounts of any savings and loan association in this State is exempt from all provisions of law of this State that provide for the supervision and regulation of the sale of securities. The sale of any accounts does not require any action by any official who supervises the sale of securities.

The Division Director shall regulate promotional activities by savings and loan associations. An association may not publish or cause to be published any misleading advertisement, notice, or announcement of any type or format.

An association or related entity may not require as a condition of making a loan that the borrower contract with any specific individual, corporation, business entity, or organization for particular services.

Subject to the evaluation and reestablishment provisions of the Program Evaluation Act, the provisions of this title that relate to the Division of Savings and Loan Associations and that relate to the regulation of savings and loan associations are of no effect and may not be enforced after July 1, 1992.

In this section, “payor institution” means a bank, credit union, or savings and loan association by which an item is payable as drawn or accepted. As to each account of each depositor in a savings and loan association, the savings and loan association shall give to the customer, on opening of the account and on any later demand of the customer, written notice of the time after which the funds represented by an item deposited to the account shall be available for withdrawal as of right, for each of the situations where the association: Is also the payor institution; Is located in the same state as the payor institution; and Is located in a different state from that in which the payor institution is located. The notice shall also state the time after which the funds represented by an item become available for withdrawal as of right where the item is issued by: The Maryland State Government or any agency thereof; The United States Treasury; and Any agency of the federal government. The notice shall be printed in type no smaller than elite typewriter characters.

Except with the written consent of the Division Director, a person who has been convicted, or who is convicted, of any crime involving dishonesty or a breach of trust, may not ever serve as an officer or director of an association. However, the pendency of an appeal from the conviction stays the operation of the prohibition of subsection (a) of this section until the appeal is decided or dismissed.

Any director, officer, controlling person, or employee of a savings and loan association or related entity who is found to have violated any provision of this title or Title 8 of this article, whether willfully or as a result of gross negligence or recklessness, may be ordered to pay a civil penalty to the State of up to $10,000 for each violation. In determining the amount of financial penalty to be imposed, the Division Director shall consider the following: The seriousness of the violation; The good faith of the violator; The violator’s history of previous violations; The deleterious effect of the violation on the public and the savings and loan industry; and The assets of the violator. Prior to assessing a civil penalty, the Division Director shall serve by certified mail, return receipt requested, on the person to be charged, a notice containing: The specifications of the charge; and The time and place for a hearing to be held with respect to the charges, which may be not less than 20 days from the date of mailing the notice. The Division Director shall conduct a hearing on the charges in accordance with the terms of § 8-402 of this article and rules adopted by the Division Director. Following the hearing, or if the person charged does not appear, following the date of the hearing, the Division Director shall issue a final order pursuant to § 8-402 of this article. An appeal may be taken from a final order of the Division Director to the Circuit Court for Baltimore City. In addition to any of the other penalties and remedies set forth in this section, any person who is found to have financially gained from the violation of any provision of this title or Title 8 of this article, or regulations adopted by the Division Director, shall be required to forfeit the gain. This section may not be construed to prevent any person damaged by a director, officer, controlling person, or employee of an association from bringing a separate cause of action in a court of competent jurisdiction.

Except as otherwise provided in this section and in this title, any violation of any provision of this title or any regulation adopted in accordance with this title by a director, officer, controlling person, or employee of an association is punishable by a fine not to exceed $10,000, or imprisonment in the penitentiary for not more than 18 months, or both. In addition to any of the remedies provided by this title or Title 8 of this article, the willful omission, making, or concurrence in making or publishing a written report, exhibit, or entry in a financial statement on the books of the association, which contains a material statement known to be false, upon conviction, is punishable by a fine not more than $100,000, or imprisonment in the penitentiary for not more than 10 years, or both. For purposes of this subsection, “material” means “substantial and important as to influence a reasonable and prudent businessman or investor”. In addition to any other remedies provided by this title or Title 8 of this article, the knowing declaration of a dividend in violation of § 9–324 of this title, upon conviction, is punishable by a fine not more than $100,000, or imprisonment in the penitentiary for not more than 10 years, or both. Any officer, director, controlling person, agent, or employee of an association who makes a loan for his own use and benefit with an attempt to conceal that from the Division of Savings and Loan Associations, upon conviction, shall be fined not more than $100,000, or imprisoned in the penitentiary for not more than 10 years, or both. Any officer, director, controlling person, agent, or employee connected in any capacity with an association who makes a false statement to an employee or agent of the Division of Savings and Loan Associations with the intent to deceive, upon conviction, shall be fined not more than $100,000, or imprisoned in the penitentiary for not more than 10 years, or both. Any person who aids or abets any other person in the violation of the provisions of this title or Title 8 of this article as described in subsections (b), (c), (d), and (e) of this section, upon conviction, shall be fined not more than $10,000, or imprisoned in the penitentiary for not more than 1 year, or both. The Division Director shall furnish to the Attorney General, or the proper prosecuting attorney, information obtained by the Division Director evidencing a violation of the laws relating to savings and loan associations and related entities.

A controlling person, officer, or director may not withdraw funds or cause his funds or those of his immediate family or any other depositor to be withdrawn knowing that due to financial difficulties the association is about to suspend operations or go into conservatorship, receivership, reorganization, or liquidation. Any controlling person, officer, or director who violates subsection (a) of this section, upon conviction, shall: Be sentenced to imprisonment in the penitentiary for not more than 10 years; Be fined not more than $100,000; and Make full restitution.

In any appeal of an order of the Division Director under this title or Title 8 of this article, the Division Director shall be considered a party and has the right to appeal any decision to the Appellate Court of Maryland or petition the Supreme Court of Maryland for a writ of certiorari. Whether or not a hearing has been held on an order issued by the Division Director, the scope of judicial review of an appeal of an order of the Division Director shall be the same as provided in § 10–215 of the State Government Article.

Notwithstanding any provision of law, a savings and loan association, holding company, or subsidiary may not indemnify any person who is fined under any criminal penalty provision of this title or Title 8 of this article or subject to any civil penalty under this title or Title 8 of this article.

In the interpretation and construction of this title and Title 8 of this article: A reference to a statute or to a regulation issued by a government agency includes the statute or regulation with all amendments and supplements to the statute and any new statute or regulation substituted for such statute or regulation, as in force at the time of application of the provision in which such reference is made, unless the specific language or the context of the reference clearly includes only the statute or regulation as in force on the effective date of this section. A power of an association provided in this title and Title 8 of this article that is subject to regulation of the Division Director may be exercised, subject to the provisions of this title and Title 8 of this article, in the absence of such regulation. A power of an association provided in this title and Title 8 of this article that is subject to approval of the Division Director may not be exercised in the absence of such written approval.

On June 1, 1992 any savings and loan association that is chartered under the provisions of this title shall be placed in receivership in accordance with § 9-708 of this title.