# COMAR Title 09 — Maryland Department of Labor

## Subtitle 03 — Commissioner of Financial Regulation

### Chapter 06 — Mortgage Lenders

#### Regulation .16 Bonds, Letters of Credit, and Trust Accounts.

*COMAR 09.03.06.16*

A. The required amount of a bond, letter of credit, or trust account established to meet the requirements of Financial Institutions Article, §11-508, Annotated Code of Maryland, shall be subject to recalculation at the time a license is renewed.

B. Restitution awarded and to be paid from a letter of credit or trust account shall be paid as follows:

  (1) Awards resulting from individual complaints shall be paid in the order in which they are received by the Commissioner;

  (2) Awards resulting from an examination by the Commissioner that will exceed the total available under the letter of credit or trust account shall be paid on a pro rata basis;

  (3) Claims against a letter of credit or trust account shall be filed by a claimant with the Commissioner within 3 years after the occurrence from which the claim arises; and

  (4) Notwithstanding §C(1) of this regulation, if the aggregate amount of all pending claims exceeds the amount of the letter of credit or trust account, the Commissioner may require a prorated distribution.

C. The Commissioner may require part or all of the funds in a letter of credit or trust account to remain on deposit if:

  (1) There are unresolved pending claims against the account or letter of credit, which were timely filed; and

  (2) The amount required by the Commissioner to be maintained is reasonably calculated to cover the payment of those claims.

D. Claims against a bond, letter of credit, or trust account may not include:

  (1) Attorneys' fees;

  (2) Damages for personal injury; or

  (3) Punitive damages.

E. A surety under a bond issued under Financial Institutions Article, §11-508, Annotated Code of Maryland, shall:

  (1) Pay directly to a claimant any meritorious claim; and

  (2) Immediately notify the Commissioner when it pays a claim to a claimant.