§ 5-20-106 — Licensure of student loan servicers - definition
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(1) Automatic
issuance of license for federal student loan servicing contractors. (a) A person
seeking to act within this state as a student loan servicer is exempt from the
application procedures described in subsection (2) of this section upon a
determination by the administrator that the person is a party to a contract awarded
by the United States secretary of education under 20 U.S.C. sec. 1078, 1087f, or
1087hh, as amended. The administrator shall prescribe the procedure to document
eligibility for the exemption.
(b) Automatic license. With regard to a person deemed exempt by this
subsection (1), the administrator shall:
(I) Automatically issue a license upon payment of the fees required by
section 5-20-107 (1)(a);
(II) Automatically issue a renewal license upon payment of the fees required
by section 5-20-107 (1)(b); and
(III) Deem the person to have met all requirements set forth in subsection (2)
of this section.
(c) Procedural exemptions. A person issued a license pursuant to this
subsection (1) is exempt from subsections (3) to (9) and (11) of this section. A person
issued a license pursuant to this subsection (1) shall comply with the record
requirements in subsection (10) of this section except to the extent that the
requirements are inconsistent with federal law.
(d) Notice. A person issued a license pursuant to this subsection (1) shall
provide the administrator with written notice within seven days after notification of
the expiration, revocation, or termination of any contract awarded by the United
States secretary of education under 20 U.S.C. sec. 1087f. The person has thirty days
after notification to satisfy all requirements established under subsection (2) of this
section in order to continue to act within this state as a student loan servicer. At the
expiration of the thirty-day period, if the person seeking to act within this state as a
student loan servicer has not satisfied the requirements of subsection (2) of this
section, the administrator shall summarily suspend any license granted to the
person under this section in accordance with section 24-4-104 (4); except that the
full investigation requirement specified in section 24-4-104 (4)(a) does not apply.
(e) Preservation of authorities. With respect to student loan servicing not
conducted pursuant to a contract awarded by the United States secretary of
education under 20 U.S.C. sec. 1087f, nothing in this section prevents the
administrator from issuing, or filing a civil action for, an order to temporarily or
permanently prohibit or bar any person from acting as a student loan servicer or
violating applicable law.
(2) Other student loan servicers. (a) A person seeking to act within this
state as a student loan servicer, other than a person deemed exempt by the
administrator pursuant to subsection (1) of this section, must apply to the
administrator for an initial license in the form the administrator prescribes. The
application must be accompanied by:
(I) A financial statement prepared by a certified public accountant or a
public accountant, a general partner if the applicant is a partnership, a corporate
officer if the applicant is a corporation, or a member duly authorized to execute
financial statements if the applicant is a limited liability company or association;
(II) Information regarding the history of criminal convictions of the following:
(A) The applicant;
(B) Partners of the applicant, if the applicant is in a partnership;
(C) Members of the applicant, if the applicant is a limited liability company or
association; or
(D) Officers, directors, and principal employees of the applicant, if the
applicant is a corporation.
(b) The information submitted pursuant to subsection (2)(a)(II) of this section
must be sufficient, as determined by the administrator, to make the findings
required under this section.
(3) Investigation of applicant. (a) Upon the filing of an application for an
initial license and the payment of the fees for licensing and investigation pursuant
to section 5-20-107, the administrator shall investigate the financial condition and
responsibility, financial and business experience, character, and general fitness of
the applicant.
(b) The administrator may issue a license pursuant to this section if the
administrator finds that:
(I) The applicant's financial condition is sound;
(II) The applicant's business will be conducted honestly, fairly, equitably,
carefully, and efficiently within the purposes and intent of this part 1 and in a
manner commanding the confidence and trust of the community;
(III) If the applicant is:
(A) An individual, the individual is in all respects properly qualified and of
good character;
(B) A partnership, each partner is in all respects properly qualified and of
good character;
(C) A limited liability company or association, each member is in all respects
properly qualified and of good character; or
(D) A corporation, the president, chair of the executive committee, senior
officer responsible for the corporation's business, chief financial officer or any
other person who performs similar functions as determined by the administrator,
each director, each trustee, and each shareholder owning ten percent or more of
each class of the securities of the corporation are in all respects properly qualified
and of good character;
(IV) No person acting on behalf of the applicant knowingly has made an
incorrect statement of a material fact in the application or in any report or
statement made pursuant to this part 1; and
(V) The applicant has met any other requirements as determined by the
administrator.
(4) License expiration. A license issued pursuant to this section expires each
January 31 unless renewed or earlier surrendered, suspended, or revoked pursuant
to this part 1. No later than fifteen days after a licensee ceases to engage in the
business of servicing in this state for any reason, including a business decision to
terminate operations in this state, license revocation, bankruptcy, or voluntary
dissolution, the licensee shall provide written notice of surrender to the
administrator and shall surrender to the administrator its license for each location
in which the licensee has ceased to engage in servicing. The written notice of
surrender must identify the location where the records of the licensee will be
stored and the name, address, and telephone number of a person authorized to
provide access to the records. The surrender of a license does not reduce or
eliminate the licensee's civil or criminal liability arising from acts or omissions
occurring before the surrender of the license, including any administrative actions
undertaken by the administrator to revoke or suspend a license, assess a civil
penalty, order restitution, or exercise any other authority provided to the
administrator.
(5) License renewal - annual report. (a) A license issued pursuant to this
section may be renewed for the ensuing twelve-month period upon the filing of an
application containing all required records and fees, including renewal fees as
established by the administrator in accordance with section 5-20-107. A renewal
application must be filed on or before January 31 of the year in which the license
expires. The administrator may establish a late fee for any renewal applications
submitted after January 31.
(b) If an application for a renewal license has been filed with the
administrator on or before the date the license expires, the license sought to be
renewed continues in effect until the issuance by the administrator of the renewal
license applied for or until the administrator has notified the licensee in writing of
the administrator's refusal to issue the renewal license together with the grounds
upon which the refusal is based.
(c) The administrator may refuse to issue a renewal license on any ground on
which the administrator may refuse to issue an initial license.
(d) Along with the application for renewal, every licensee shall file with the
administrator, in the form and manner determined by the administrator, an annual
report concerning loans serviced by the licensee. Information included in an annual
report filed pursuant to this subsection (5)(d) is confidential and may be published
only in aggregate form, with no personal identifying information included.
(6) Dishonored check. If a check filed with the administrator to pay a license,
investigation, or renewal fee under this section is dishonored, the administrator
shall summarily suspend the license or the renewal license that has been issued but
is not yet effective in accordance with section 24-4-104 (4); except that the full
investigation requirement specified in section 24-4-104 (4)(a) does not apply. The
administrator shall give the licensee notice of the summary suspension pending
proceedings for revocation or refusal to renew and an opportunity for a hearing on
the actions in accordance with section 5-20-113.
(7) Update application information. An applicant or licensee under this
section shall notify the administrator, in writing, of any change in the information
provided in its initial application for a license or its most recent renewal application
for a license, as applicable, not later than ten business days after the occurrence of
the event that results in the change.
(8) Incomplete application. The administrator may consider an application
for a license under this section abandoned if the applicant fails to respond to any
request for information required under this part 1 or any rules adopted pursuant to
this part 1, as long as the administrator notifies the applicant, in writing, that the
application will be considered abandoned if the applicant fails to submit the
information within sixty days after the date on which the request for information
was made. Abandonment of an application pursuant to this subsection (8) does not
preclude the applicant from submitting a new application for a license under this
part 1.
(9) Change of license notification. (a) A licensee under this section shall not
act within this state as a student loan servicer under any name or at any place of
business other than those named in the license. A licensee shall give prior written
notice to the administrator of a change of business location. A licensee shall not
operate more than one place of business under the same license, but the
administrator may issue more than one license to a licensee that complies with this
part 1 as to each license. A license is not transferable or assignable.
(b) (I) Subject to rules adopted by the administrator, nothing in subsection
(9)(a) of this section prohibits a licensee from permitting its employees to work from
a remote location so long as the licensee:
(A) Ensures that no in-person customer interactions are conducted at the
remote location and does not designate the remote location to consumers as a
business location;
(B) Maintains appropriate safeguards for licensee and consumer data,
information, and records, including the use of secure virtual private networks, also
known as VPNs, where appropriate;
(C) Employs appropriate risk-based monitoring and oversight processes of
work performed from a remote location and maintains records of the monitoring
and oversight processes;
(D) Ensures consumer information and records are not maintained at a
remote location;
(E) Ensures consumer and licensee information and records remain
accessible and available for regulatory oversight and examination; and
(F) Provides appropriate employee training to ensure employees working
from a remote location keep all conversations about and with consumers that are
conducted from the remote location confidential, as if conducted from a
commercial location, and to ensure that employees working at a remote location
work in an environment that is conducive and appropriate to ensuring privacy and
confidential conversations.
(II) As used in this subsection (9)(b), remote location means a private
residence of an employee of a licensee or another location selected by the
employee and approved by the licensee.
(10) Records retention - records request. A student loan servicer shall
maintain adequate records of each student education loan transaction and all
communications in connection with student education loan servicing for not less
than two years after the final payment on the student education loan or the
assignment of the student education loan, whichever occurs first, except as
otherwise required by federal law, a federal student education loan agreement, or a
contract between the federal government and a licensee. Upon request by the
administrator, a student loan servicer shall make the records available or shall send
the records to the administrator by registered or certified mail, return receipt
requested, or by any express delivery carrier that provides a dated delivery receipt,
not later than five business days after requested by the administrator. Upon a
licensee's request, the administrator may grant the licensee additional time to
make the records available or to send the records to the administrator.
(11) License suspension and revocation - refusal to renew. (a) The
administrator may suspend, revoke, annul, limit, modify, or refuse to renew a license
issued pursuant to subsection (2) of this section or take any other action in
accordance with this part 1 if the administrator finds one or more of the following:
(I) The licensee has violated any provision of this part 1 or any rule lawfully
adopted or order lawfully issued pursuant to and within the authority of this part 1;
or
(II) Any fact or condition exists that, if it had existed at the time of the
original application for the license, clearly would have warranted a denial of the
license.
(b) An abatement of the license fee may not be made if the license is
surrendered, revoked, or suspended.
Colorado § 5-20-106 (Licensure of student loan servicers - definition) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.