IDFPR | Illinois Joins Multistate Enforcement Action for SAFE Act Violation

CHICAGO - A mortgage loan originator ("MLO") has received serious sanctions and fines from the Illinois Department of Financial and Professional Regulation (IDFPR) and 20 additional state financial regulatory agencies that accused him of directing another person to take required education on his behalf and taking the credit for himself.

Under the settlement, Patrick Terrance Donlon (NMLS ID 785311), who worked for Trusted American Mortgage LLC (NMLS ID 1329867), is barred from practicing from most of the states, is restricted from practicing in others, and is required to pay a fine totaling $31,000.

"The Department takes misconduct by licensees very seriously and will act to ensure Illinois residents are protected from unlawful practices," said IDFPR Secretary Mario Treto, Jr. "When individuals misrepresent their qualifications or evade required standards, the Department will hold them fully accountable."

The MLO agreed to surrender his Illinois MLO License, to be permanently barred from being an Illinois MLO Licensee, and is prohibited from being a control person for an Illinois Residential Mortgage Licensee for a period of two years. Additionally, the MLO must pay a fine to the State of Illinois.

"We require that licensed professionals complete their continuing education to ensure our licensees have the highest levels of competence and ethics," said Division of Banking Acting Director Susana Soriano. "With this action, the residential real estate market in Illinois has been protected and consumers can continue to expect the highest levels of professional service from their licensed mortgage loan originators."

MLOs are licensed through the Nationwide Multistate Licensing System (NMLS), which is owned and operated on behalf of state financial supervisors by the Conference of State Bank Supervisors (CSBS). Donlon was licensed to practice as a mortgage loan originator in 19 states and had pending licenses in two additional states.

By claiming credit for the education classes he did not take, the state financial regulators alleged Donlon violated the SAFE Act, which Congress enacted to enhance consumer protection and reduce fraud through minimum standards for the licensing of mortgage loan originators. The law calls on the states to implement and enforce these standards, and every state has enacted its own version of the SAFE Act that requires mortgage loan originators to have at least 20 hours of pre-licensing education and an annual eight hours of continuing education.

State financial regulators in Arkansas, Colorado, Florida, Iowa, Kansas, and Texas led the investigation.

In addition to Illinois, states that entered into the agreement include: Arizona, Arkansas, California, Colorado, Florida, Idaho, Iowa, Kansas, Maryland, Michigan, Minnesota, Montana, New Mexico, Oklahoma, Ohio, Oregon, South Carolina, South Dakota, and Texas.

Per the terms of the settlement agreement, Colorado and Florida will receive $7,000 each. Maryland and New Mexico will not receive fines because Donlon's had pending license applications in those states. The rest of the states will receive $1,000.

Donlon is permanently barred from licensure as a mortgage loan originator in all the participating states with the exception of Colorado and Florida, where he may reapply for a license in two years if he pays all administrative penalties and completes additional education requirements.

Additionally, Donlon cannot be a Qualified Individual or Control Person of any financial services entity registered with NMLS for two years and has been removed as a Qualified Individual and Control Person of Trusted American Mortgage LLC.