23 CAR § 301-404 – Background checks

(a) In connection with each application for the issuance of a loan officer license under the Fair Mortgage Lending Act, Arkansas Code § 23-39-501 et seq., the Securities Commissioner shall initiate a background check.
(b) The background check shall include:
1. (1) Fingerprints. The applicant shall submit fingerprints to the commissioner via the NMLS&R for submission to the Federal Bureau of Investigations in such a form that they may be used to review the state, federal, and international criminal background of an applicant;
2. (2) Independent credit report.
  1. (A)
(i) The applicant shall submit an authorization to the commissioner via the NMLS&R to receive and review the applicant’s credit report along with the application.
1. (ii) Review of credit report.
(a) (a) The determination to approve or deny an application shall not be solely based upon the credit report of an applicant.
(b) (b) The credit report shall be used as a factor to determine the applicant’s financial responsibility, character, and general fitness.
1. (iii)
(a) (a) For purposes of this subdivision (b)(2), disregard of the management of an applicant’s own financial condition is an indicator that the applicant does not meet the financial responsibility, character, and general fitness provisions of the Fair Mortgage Lending Act.
(b) (b) A determination that an individual has not shown financial responsibility, character, and general fitness provisions of the Fair Mortgage Lending Act may include, but is not limited to:
1. (1) (1) Bankruptcies within the past five (5) years filed by the applicant or any entity controlled by the applicant;
2. (2) (2) Current outstanding judgments, except judgments solely as a result of medical expenses;
3. (3) (3) Current outstanding tax liens or other government liens and filings;
4. (4) (4) Foreclosures within the past three (3) years; or
5. (5) (5) A pattern of seriously delinquent accounts within the past three (3) years; and
6. (3) Criminal, civil, or administrative proceedings.
  1. (A) The applicant shall disclose all criminal, civil, or administrative proceedings in which the applicant is or has been involved.
  2. (B) The information provided to the commissioner should include, but is not limited to:
    1. (i) Copies of all relevant court documents;
    2. (ii) Disposition of the case if the proceeding is concluded; and
    3. (iii) A written statement disclosing the background and any pertinent facts regarding the proceeding.
  3. (C) If the proceeding is an on-going proceeding, any relevant developments of the proceeding should be disclosed to the State Securities Department in accordance with 23 CAR § 301-1002, and Arkansas Code § 23-39-511(d).
    1. (c) The applicant or licensee shall be responsible for any fees and costs necessary to comply with this section.