NY A08204

Creates new Banking Law Section 78-a requiring the Department of Financial Services' financial frauds and consumer protection unit to refer instances of unauthorized banking entities to the Attorney General and other enforcement agencies, with the Attorney General providing written status updates at least every six months.

Adds Banking Law Section 590(e) prohibiting mortgage bankers, brokers, and exempt organizations from conducting business with unlicensed or unregistered mortgage entities and requiring prompt notification to the department of such unlicensed operations.

Increases civil penalties for unlicensed or unregistered persons engaging in mortgage banking activities from a maximum of four times the money involved up to ten times the money involved when the person continues unauthorized activities after receiving a cease and desist notice from the superintendent.

Expands Penal Law Article 187 mortgage fraud provisions to apply to all mortgage loans (not just residential mortgages) and allows prosecution of fraud involving loans to entities in addition to individuals, maintaining existing felony classifications for fraud amounts exceeding $1,000, $3,000, $50,000, and $1,000,000.

Effective date is thirty days after the bill becomes law.