1301:8-7-12 Operations manager.

(A) Each registrant or applicant for a mortgage broker certificate of registration shall designate one individual to act as the company's operations manager and must grant the individual sufficient authority over the mortgage broker business to carry out the duty of ensuring the daily operations and management of the business comply with all applicable state and federal laws.

(B) Only one individual shall be designated operations manager regardless of the number of registered office locations or employees.

(C) No individual shall be permitted to act as operations manager without being approved by the superintendent of the division of financial institutions. An individual may be put in place subject to the superintendent's approval, but the superintendent must receive a complete "Request for OM Approval" form within ten business days of the appointment.

(D) The superintendent of the division of financial institutions shall be authorized to do a criminal background check, obtain a credit report, and require a financial statement and other pertinent information as the superintendent may require to satisfy the superintendent that the mortgage broker business will be operated by the individual responsibly and in compliance with sections 1322.01 to 1322.12 of the Revised Code, any regulation adopted pursuant thereto, or any other state or federal law or regulation applicable to the business of mortgage lending

(E) To qualify for approval as an operations manager, the superintendent of the division of financial institutions must find that the individual is knowledgeable about the registrant's or applicant's activities conducted under sections 1322.01 to 1322.12 of the Revised Code, has sufficient authority over the registrant's daily activities and mortgage broker business to carry out the statutory responsibilities of an operations manager, and that the individual:

(1) Holds an active loan officer license issued by the division that is not subject to suspension, revocation or non-renewal;

If the individual has simultaneously applied for a loan officer license and approval as an operations manager, successful completion of the examination requirement for operations managers under division (A) of section 1322.051 of the Revised Code shall satisfy the examination requirement for loan officers under division (B) of section 1322.051 of the Revised Code. However, successful completion of the loan officer examination requirement of division (B) of section 1322.051 of the Revised Code shall not satisfy the operations manager examination requirement of division (A) of section 1322.051 of the Revised Code.

(2) Possesses at least three years of experience in the mortgage and lending field that complies with divisions (F) and (G) of this rule;

(3) Has, where applicable, successfully completed the pre-licensing education required by division (A)(5) of section 1322.03 of the Revised Code or met the alternative educational requirements set forth in paragraph (D) of 1301:8-7-28 of the Administrative Code; and

(4) Has successfully completed the examination requirement of division (A) of section 1322.051 of the Revised Code.

(a) An individual who has submitted a request for approval as operations manager is not eligible to sit for the examination until the superintendent of the division of financial institutions has received a completed "Request for OM Approval," including a criminal records check, and any other information required by the superintendent. The superintendent may refuse to permit an individual to sit for an examination if the request or criminal records check contains any information that could disqualify the individual for approval or if the superintendent has any other information which, if true, could disqualify the individual;

(b) If the individual fails to successfully complete the examination within ninety days of being notified by the superintendent that he or she has been approved to sit for the examination, the superintendent may consider the pending application for a mortgage broker certificate of registration that is dependent on the operations manager's approval, withdrawn, or the superintendent may suspend the registrant's mortgage broker certificate of registration until an individual is approved. If a registrant is unable to designate an individual who meets the approval of the superintendent within one hundred eighty days of termination date of the individual last approved as the registrant's operations manager, the superintendent may revoke the registrant's certificate of registration for operating without an approved operations manager.

(F) For purposes of division (E)(2) of this rule and division (A)(4) of section 1322.03 of the Revised Code, satisfactory proof of experience may include but is not limited to:

(1) Copy of IRS form W-2 for the tax years covering the experience requirement;

(2) Completed and signed IRS form 4506 which enables the division to verify the W-2; and

(3) Other documents or information required by the division necessary to verify completion of the experience requirement. Experience requirement may be verified by the division directly with the employer and tax authorities.

(G) For purposes of division (E)(2) of this rule and division (A)(4) of section 1322.03 of the Revised Code, the three years, or thirty-six months, of experience must have been gained lawfully within the six years preceding request for approval, but does not need to have been gained during consecutive months. The division counts each month toward the three year requirement. A fractional month of experience, at least twenty days long, qualifies as a full month. The experience must have been gained by directly soliciting, processing, placing and negotiating mortgage loans for or as a mortgage broker, or with a financial institution, mortgage lending institution, or other lending institution. The individual must have had direct contact and interaction with buyers during all phases of making or brokering real estate mortgage loans, and not compartmentalized experience in one phase, such as processing. Other experience related specifically to the business of mortgage loans may qualify, but will not include the following types of employment:

(1) Real estate salesperson or broker;

(2) Real estate appraiser;

(3) Real estate developer or contractor;

(4) Real estate owner or investor;

(5) Commercial or consumer lender;

(6) Title or escrow agent, owner or company;

(7) Certified Public Accountant, Public Accountant, Accountant, Controller, Comptroller, or Fiscal Officer;

(8) Certified Financial Planner or similar designation;

(9) Professor, teacher, or presenter of classes, courses, or seminars regarding mortgage lending;

(10) Board member or senior officer of a financial or mortgage lending institution;

(11) Shareholder, partner, or member of a financial or mortgage lending institution;

(12) Insurance salesperson or broker;

(13) Securities salesperson, broker, or principal;

(14) Department store credit department, including retail and wholesale stores;

(15) School, college, or university credit or student loan department;

(16) Automobile, motorcycle, boat, or recreational vehicle dealer credit department. Mobile home or manufactured housing home-only lending or credit department.

(H) Any individual who wishes to present experience and or education which is not in accord with divisions (F) and (G) of this rule may petition the superintendent to consider alternative education or experience which the individual feels would satisfy the experience requirement. Such petition shall include documentation of the experience at issue and its relationship to mortgage activities.

(I) If the individual designated as the operations manager ceases to act as the operations manager for any reason, including division (N) of this rule, the registrant shall:

(1) Within thirty days, designate another individual as the operations manager;

(2) Within ten days after the designation described in division (I)(1) of this rule, notify the superintendent of the division of financial institutions by submitting a "Request for OM Approval" form to the division.

(J) Once the individual has been approved as the registrant's operations manager, the registrant shall receive from the superintendent of the division of financial institutions an approval letter indicating the name of the licensed loan officer who has been approved as the registrant's operations manager and the effective date of the approval. The approval letter shall be conspicuously posted in each of the registrant's registered offices.

(K) While acting as an operations manager, the individual is prohibited from working for any registrant in any capacity other than the registrant for which the individual has been designated as the operations manager.

(L) An operations manager shall record his or her loan officer identification number on mortgage loan origination disclosure statements in accord with division (A)(2) of rule 1301:8-7-15 of the Administrative Code.

(M) An operations manager is under a continuing duty to update the information contained in the request for approval as operations manager and any notification requirements of licensure under chapter 1322. of the Revised Code or this chapter.

(N) An individual acting as an operations manager must hold an active loan officer license at all times while serving as operations manager. Should the individual's license cease to be active for any reason, the individual's operations manager approval is automatically terminated.

(O) An individual approved as an operations manager must complete a minimum of six hours of approved continuing education every calendar year in compliance with section 1322.052 of the Revised Code and rule 1301:8-7-18 of the Administrative Code.

(P) If an individual is approved to act as an operations manager for a registrant and subsequently ceases serving in that capacity for any reason, but later desires to be reapproved, the individual shall submit a new "Request for OM Approval" form. The superintendent may waive re-submission of some or all documentation required for approval.

(Q) Those individuals approved by the superintendent of the division of financial institutions as an operations manager as of the effective date of this rule shall be issued, without charge, a loan officer license within sixty (60) days of the effective date of this rule; shall not be required to sit for a loan officer license examination under division (B) of section 1322.051 of the Revised Code, as the successful completion of the examination requirement of division (A) of section 1322.051 of the Revised Code shall satisfy the requirement of division (B) of that section; and shall be subject to the loan officer license renewal requirements of section 1322.041 of the Revised Code and rule 1301:8-7-10 of the Administrative Code.

Effective: 06/01/2007
R.C. 119.032 review dates: 11/15/2009
Promulgated Under: 119.03
Statutory Authority: 1322.12
Rule Amplifies: 1322.03 , 1322.031 , 1322.04 , 1322.051 , 1322.052
Prior Effective Dates: 9-1-06