New York Codes, Rules and Regulations
Title 3 - BANKING
Chapter III - SUPERINTENDENT'S REGULATIONS
Subchapter B - NON-BANKING ORGANIZATIONS
Part 409 - STUDENT LOAN SERVICERS
Section 409.7 - Suspension and revocation of a license
Universal Citation: 3 NY Comp Codes Rules and Regs ยง 409.7
Current through Register Vol. 46, No. 12, March 20, 2024
(a) After a hearing. After notice and hearing, the superintendent may revoke or suspend any license to engage in the business of servicing student loans if she finds that:
(1) a student loan servicer has violated any
provision of Article 14-A of the banking law, any provision of this part, or
any other applicable law;
(2) any
fact or condition exists which, if it had existed at the time of the original
application for such license, would have warranted the superintendent refusing
originally to issue such license;
(3) a student loan servicer does not
cooperate with an examination or investigation by the superintendent;
(4) a student loan servicer engages in fraud,
intentional misrepresentation, or gross negligence in servicing a student
loan;
(5) the competence,
experience, character, or general fitness of the student loan servicer, a
person controlling, directly or indirectly, ten percent or more of the
outstanding interests, or any person responsible for servicing a student loan
for the student loan servicer indicates that it is not in the public interest
to permit the student loan servicer to continue servicing student
loans;
(6) the student loan
servicer engages in an unsafe or unsound practice;
(7) the student loan servicer is insolvent,
suspends payment of its obligations, or makes a general assignment for the
benefit of its creditors;
(8) a
student loan servicer has violated the laws of this state, any other state or
any federal law involving fraudulent or dishonest dealing, or a final judgement
has been entered against a student loan servicer in a civil action upon grounds
of fraud, misrepresentation or deceit;
(9) a student loan servicer fails to comply
with any of the servicing standards set forth in section 409.8 of this part;
or
(10) a student loan servicer
engages in a prohibited practice in violation of section 409.9 of this part.
(b) Emergency Suspension.
(1) The
superintendent may suspend a student loan servicer license on an emergency
basis for a period not exceeding thirty days if:
(i) the superintendent finds that there is a
substantial risk of public harm; or
(ii) the superintendent finds that there is
good cause for such a suspension on the basis that:
(a) the student loan servicer has defaulted
or is likely to default in performing its financial engagements; or
(b) the student loan servicer has engaged, or
is engaging, in dishonest or inequitable practices which may cause substantial
harm to borrowers or the student loan servicer market, including by taking any
action prohibited by subdivision (a) of section 409.9 of this part.
(2) When the
superintendent suspends a license pursuant to this subdivision she shall
thereafter provide notice to the licensee.
(3) The superintendent may renew an emergency
suspension under this subdivision if such additional emergency suspension is
accompanied by notice of a hearing to be conducted under subdivision (a) of
this section within the period of such additional suspension. If such a hearing
is delayed at the request or with the consent of the licensee, the licensee
shall be deemed to consent to the continuation of the emergency suspension
during the ensuing period ending upon a determination on the hearing.
Disclaimer: These regulations may not be the most recent version. New York may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
This site is protected by reCAPTCHA and the Google
Privacy Policy and
Terms of Service apply.
