Chapter 02. General Regulations

“Assessment” means the annual assessment authorized under Financial Institutions Article, §2-120, Annotated Code of Maryland.

“Commissioner” has the meaning stated in Financial Institutions Article, §1-101(g), Annotated Code of Maryland.

“Licensed location” means any location listed by the licensee in NMLS.

“Licensed person” has the meaning stated in Financial Institutions Article, §2-120, Annotated Code of Maryland.

“Mobile unit” has the meaning stated in Financial Institutions Article, §12-101, Annotated Code of Maryland.

“NMLS” has the meaning stated in Financial Institutions Article, §1-101, Annotated Code of Maryland.

“Regulated person” has the meaning stated in Financial Institutions Article, §2-120, Annotated Code of Maryland.

In this regulation the following term has the meaning indicated.

Term Defined. “Loan” means:

Loan Register. All loans shall be listed in a register in numerical order showing, in addition to the loan number, the date of loan, name of principal borrower, and amount of loan.

Individual Ledger Record. A separate ledger record shall be maintained for each borrower, showing the loan number, borrower's name and address, names of endorsers, comakers, guarantors or sureties, the amount of loan, the schedule of payments, and the type of security. In addition, the record shall show the date and amount of all payments of interest and principal as well as the principal balance due.

File of Original Papers. For each borrower or loan account, a separate file shall be maintained containing all papers relating to the borrower or the loan, except that promissory notes and security instruments may be kept in a separate legal paper file bearing the same account number. If notes have been hypothecated, the file shall reveal where and to whom these notes are hypothecated.

Receipts and Disbursement Record. All receipts from or for the account of borrowers and all disbursements to or for the account of borrowers shall be clearly recorded in a manner that makes the transactions readily identifiable.

Index of Obligors. An alphabetical index of all borrowers, endorsers, guarantors, or comakers shall be maintained, showing the related loan numbers.

Litigation and Repossession Records. The records of the licensee (individual ledger record or similar record) shall show all essential details with respect to litigation or repossession, or both. This detail with respect to litigation shall include the amount and date of judgments and any costs charged to the borrowers. With respect to repossession, the record shall include the date, amount then due, type of security repossessed, and the amount realized from sale of the security.

Acceptance of Equivalent Records. Records and accounting systems maintained in whole or in part by mechanical or electronic data processing methods may be used instead of the books and records required by this regulation if they contain equivalent information.

Credit Life Claim Register. Each licensee shall maintain a register of death claims showing the following minimum information:

Accident and Health Claim Register. Each license shall maintain a register of claims involving accident and health insurance showing the following minimum information:

Purchased Loan Account Register. Within 30 days after the purchase of loan accounts from another licensee, the purchasing licensee shall maintain a list of these purchased accounts. The licensee shall also keep a list of “double loan” accounts resulting from the purchase, including the borrower's name, address, account number, and the amount of loan outstanding. The licensee shall maintain this register in compliance with Financial Institutions Article, §11-213, Annotated Code of Maryland.

Each consumer loan licensee shall comply with all provisions of Regulation Z, promulgated under the Federal Consumer Credit Protection Act, Truth-in-Lending, that relate to the advertising of credit terms.

A consumer loan licensee may not use blind advertisements, such as giving only telephone numbers or box number addresses. A licensee may not advertise that any loan business will be conducted at any place other than the licensed address.

A consumer loan licensee may not advertise or otherwise communicate to any borrower that payments will be waived for any contingency without also advising the borrower that daily interest charges will continue during the waiver period, if this is the fact.

Loans may not be contracted for by a licensee who knows that the borrower is purchasing the merchandise under duress or misrepresentation connected with the financing of the merchandise.

A licensee may not compel the borrower to use the proceeds of the loan for the prospective purchase. A check will not be made payable to the merchant, or endorsed payable to the merchant at the direction of the licensee.

A licensee may not pay to or accept from a merchant anything of value for making a loan to a borrower referred to the licensee by a merchant.

At least 10 days before the hearing; or

If the parties have agreed to a date for which 10 days notice cannot be given, at the earliest time possible.

At least 30 days before the hearing; or

If the parties have agreed to a date for which 30 days notice cannot be given, at the earliest time possible.

At least 15 days before the hearing; or

If the parties have agreed to a date for which 15 days notice cannot be given, at the earliest time possible.

This regulation governs the conduct of any employee operating from a location other than that which appears on the employer’s license or licenses.

Notwithstanding §A(1) of this regulation, this regulation does not apply to the conduct of an employee if:

Nothing contained in this regulation shall be deemed to prohibit an employee of a licensee from conducting any business for which a license is required at a location other than the locations set forth on the employer’s license or licenses if applicable law or regulation does not limit that conduct to the location shown on the license.

A licensee may not use this regulation to evade the requirements of any applicable law or regulation.

Terms Defined.

In this regulation, the following terms have the meanings indicated.

May not be owned or leased by the licensee or an affiliate of a licensee, or for the benefit of the licensee or an affiliate of the licensee;

May not be a location that offers temporary office space unless the employee is using the location on a temporary basis due to the unavailability of the employee’s regular work location;

May not be held out to the public by use of signage, advertisement, or other means, as a location at which the licensee conducts business for which a license is required;

May not provide work space, telephone service, or internet service maintained in the name of the licensee or an affiliate and that is not intended primarily for the purpose of conducting business for which a license is required;

May not be a location where the employee will meet in person with nonemployees in connection with the business for which a license is required;

May not be a location that will receive or dispense cash, negotiable instruments, or other monetary value in connection with the business for which a license is required, other than compensation paid to the employee by the licensee;

May not be used for the receipt of mail relating to business for which a license is required;

May not be used for storage of books or records, in any form, relating to business for which a license is required unless:

Shall provide a workspace that is secure, provide for appropriate protection of personal information as required under applicable law, and have the appropriate technological security measures and physical safeguards in place to protect personal information;

Shall be a location used only by a single employee unless:

May not be used to conduct a specific act that applicable law or regulation requires be conducted only at specified locations; and

Shall be authorized by the licensee as a location from which the employee may work.

A licensee that allows any employee to work at a location authorized by this section shall develop, implement, and maintain a security program that is consistent with all applicable laws and regulations, meets or exceed standards of the industry in which the licensee conducts its business, addresses known vulnerabilities, and is commensurate with the licensee’s size and complexity.

The licensee’s security program may be part of the licensee’s comprehensive data and cyber security program.

A licensee’s security program shall consider the following objectives:

A licensee shall have an established governance process in place to control and monitor the security program which shall include, as appropriate for the size and complexity of the licensee and its information technology systems, other systems, and data:

In connection with the security program, a licensee shall complete a comprehensive remote access and data security risk assessment, including:

A licensee shall perform periodic testing and monitoring of the security program as appropriate for the size and complexity of the licensee’s information technology and other systems, including:

A licensee shall review the security program at least annually and make changes necessary to achieve the objectives of the security program.

A licensee that adequately demonstrates compliance with standards issued by the National Institute of Standards and Technology, United States Department of Commerce, relating to remote workers and remote access, as such may be revised from time to time, shall be deemed to be in compliance with this section.

A licensee shall at all times reasonably and adequately supervise the work-related activities of each employee working at a location authorized by this section.

If the Commissioner determines that the licensee does not provide reasonable and adequate supervision of the employee, after written notice from the Commissioner, and within 5 business days of receiving such notice, the licensee will terminate the employee’s eligibility to work at a location provided for under this regulation.

A licensee shall maintain and update, as appropriate, written records with respect to an employee working from locations provided for in this section, including the initial authorization to work from any such location, any updated authorization, and information regarding the location and any due diligence the license has undertaken to ensure compliance with this regulation.

The licensee shall retain the records required by §F(3) of this regulation for the greater of 2 years from the date the employee ceases using such location in connection with the business for which a license is required or any retention period required by applicable law or regulation.

Upon learning of the breach of the security of a system, the employee shall immediately notify the licensee;

Upon learning of the breach of the security of a system, the licensee shall within 72 hours notify the Commissioner and make any other notifications that may be required under applicable law or regulation;

The licensee shall investigate the breach of the security of a system and document its findings, including the remedial steps, if any, that have been undertaken by the licensee to remediate any harm to consumers and to update policies, procedures, and processes as a result of the findings; and

If requested by the Commissioner, the licensee shall provide a copy of the documentation of the investigation required in this section.

A regulated person who wishes to add, delete, or change the address of a licensed location shall provide the Commissioner notice of the addition, deletion, or change of address through NMLS.

Any addition, deletion, or change of address of a licensed location will be deemed approved by the Commissioner no less than 30 days after it is provided through NMLS unless the Commissioner has either requested additional information or denied the addition, deletion, or change of address.

A regulated person may not delete or change the address of its principal executive office as designated within the person’s NMLS Form MU1 except by amending the address within the person’s NMLS Form MU1, or such form as NMLS may prescribe to replace Form MU1 for this purpose, in the manner prescribed by NMLS.

The licensee has 15 days after the Commissioner requests any additional information to provide that information or the regulated person’s application to add, delete, or change an address may be deemed withdrawn.

A regulated person who wishes to add, delete, or change a trade name shall provide the Commissioner with notice of the addition, deletion, or change through NMLS and comply with the provisions of Financial Institutions Article, §2-121, Annotated Code of Maryland.

No later than 30 days after the information is provided through NMLS, the Commissioner shall respond to the regulated person with an approval, denial, or request for additional information.

The licensee has 15 days after the Commissioner requests any additional information to provide that information or the regulated person’s application to add, delete or change a trade name may be deemed withdrawn.

The Commissioner shall notify licensed persons of an assessment no earlier than May 1 or later than June 1 of each year regardless of whether any sum is due.

The assessment shall be based on information available to the Commissioner at the time of the assessment.

The amount of the assessment, if any, due that year;

The means the Commissioner used in calculating the licensed person’s assessment; and

How the licensee can dispute the amount of assessment if they believe it was calculated incorrectly.

A licensee incurs an obligation to pay an assessment on January 1 of the year in which the assessment is imposed or on the date in which the licensee becomes licensed, if not licensed on January 1.

Surrender of a license does not relieve a licensee of their obligation to pay an assessment.

In this regulation, the following term has the meaning indicated.

Term Defined. “Licensee” has the meaning stated in Financial Institutions Article, §12-101, Annotated Code of Maryland.

In this regulation, the following terms have the meanings indicated.

Terms Defined.