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Financial Services Law Insights and Observations

Nevada amends licensing and regulation provisions

Licensing State Issues State Legislation Nevada

On June 15, the Nevada governor signed SB 355 (the “Act”) to amend several provisions relating to existing state law, which provides for the licensure and regulation of various financial institutions by the Commissioner of Financial Institutions. Among other things, the Act prohibits the commissioner “from requiring an applicant for a license to establish a new depository institution to identify the physical address of the proposed depository institution in the application for the license.” Additionally, while the Act requires data collectors that own, license, or maintain personal information to provide notice to the state attorney general and certain other persons of certain breaches of security involving personal information, the amendments now exempt persons licensed to engage in the business of lending in Nevada from these requirements.

The Act sets forth numerous other provisions, including (i) removing the requirement that debt collection agencies notify a medical debtor via registered or certified mail before taking any action to collect a medical debt; (ii) authorizing certain financial institution employees to temporarily delay certain financial transactions involving the suspected exploitation of an older person or vulnerable person (and setting forth certain liability exemptions); and (iii) authorizing an employee of a licensee to engage in the business of lending in the state at a remote location if authorized by the licensee and specific criteria are met (the Act also outlines prohibited conduct for persons working remotely). Remote work provisions apply to employees of a mortgage company, including mortgage loan originators, so long as the mortgage company provides authorization. The Act also exempts remote locations from certain mortgage transaction recordkeeping requirements, and instead stipulates that a mortgage company must “keep and maintain records of all mortgage transactions made by an employee at a remote location in accordance with the requirements established by the Commissioner of Mortgage Lending by regulation.”

The Act becomes effective immediately for the purpose of adopting any regulations and performing any preparatory administrative tasks that are necessary to carry out the provisions of the Act.  The remaining provisions take effect October 1, 2023, and January 1, 2024.