H.B. No. 716
 
 
 
 
AN ACT
  relating to mortgage fraud; providing criminal penalties.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subchapter B, Chapter 343, Finance Code, is
  amended by adding Section 343.105 to read as follows:
         Sec. 343.105.  NOTICE OF PENALTIES FOR MAKING FALSE OR
  MISLEADING WRITTEN STATEMENT. (a)  A lender, mortgage banker, or
  licensed mortgage broker shall provide to each applicant for a home
  loan a written notice at closing.
         (b)  The notice must:
               (1)  be provided on a separate document;
               (2)  be in at least 14-point type; and
               (3)  have the following or substantially similar
  language:
         "Warning: Intentionally or knowingly making a materially
  false or misleading written statement to obtain property or
  credit, including a mortgage loan, is a violation of Section
  32.32, Texas Penal Code, and, depending on the amount of the
  loan or value of the property, is punishable by imprisonment
  for a term of 2 years to 99 years and a fine not to exceed
  $10,000.
         "I/we, the undersigned home loan applicant(s), represent
  that I/we have received, read, and understand this notice of
  penalties for making a materially false or misleading written
  statement to obtain a home loan.
         "I/we represent that all statements and representations
  contained in my/our written home loan application, including
  statements or representations regarding my/our identity,
  employment, annual income, and intent to occupy the
  residential real property secured by the home loan, are true
  and correct as of the date of loan closing."
         (c)  On receipt of the notice, the loan applicant shall
  verify the information and execute the notice.
         (d)  The failure of a lender, mortgage banker, or licensed
  mortgage broker to provide a notice complying with this section to
  each applicant for a home loan does not affect the validity or
  enforceability of the home loan by any holder of the loan.
         SECTION 2.  Subchapter B, Chapter 402, Government Code, is
  amended by adding Sections 402.031 and 402.032 to read as follows:
         Sec. 402.031.  REPORTING FRAUDULENT ACTIVITIES. (a)  In
  this section:
               (1)  "Authorized governmental agency" means:
                     (A)  the attorney general;
                     (B)  a local or state law enforcement agency of
  this state or a federal law enforcement agency;
                     (C)  a prosecuting attorney of the United States
  or of a county or judicial district of this state; or
                     (D)  the Department of Public Safety, the Texas
  Department of Insurance, the Office of Consumer Credit
  Commissioner, the Texas Department of Banking, the credit union
  department, the Department of Savings and Mortgage Lending, the
  Texas Real Estate Commission, or the Texas Appraiser Licensing and
  Certification Board.
               (2)  "Fraudulent activity" means any act that
  constitutes a violation of a penal law and is part of an attempt or
  scheme to defraud any person.
         (b)  If a person determines or reasonably suspects that
  fraudulent activity has been committed or is about to be committed,
  the person shall report the information to an authorized
  governmental agency. If a person reports the information to the
  attorney general, the attorney general shall notify each agency
  with representation on the residential mortgage fraud task force
  under Section 402.032. If a financial institution or person
  voluntarily or pursuant to this section reports fraudulent activity
  to an authorized governmental agency, the financial institution or
  person may not notify any person involved in the fraudulent
  activity that the fraudulent activity has been reported, and the
  authorized governmental agency who has any knowledge that such
  report was made shall not disclose to any person involved in the
  fraudulent activity that the fraudulent activity has been reported.
  Any financial institution or person that makes a voluntary report
  of any possible violation of law or regulation to an authorized
  governmental agency shall not be liable to any person under any law
  or regulation of the state or the United States for such report.
         (c)  This section does not eliminate or diminish any common
  law or statutory privilege or immunity.
         Sec. 402.032.  RESIDENTIAL MORTGAGE FRAUD TASK FORCE. (a)  
  In this section, "task force" means the residential mortgage fraud
  task force.
         (b)  The office of the attorney general shall establish the
  task force to form a strategic partnership between state, federal,
  and local law enforcement agencies to better enable law enforcement
  and state agencies to take a proactive stance towards tracking and
  prosecuting mortgage fraud and the perpetrators of mortgage fraud
  statewide.
         (c)  The task force consists of the following persons or
  their appointees:
               (1)  the attorney general;
               (2)  the consumer credit commissioner;
               (3)  the banking commissioner;
               (4)  the credit union commissioner;
               (5)  the commissioner of insurance;
               (6)  the savings and mortgage lending commissioner;
               (7)  the presiding officer of the Texas Real Estate
  Commission; and
               (8)  the presiding officer of the Texas Appraiser
  Licensing and Certification Board.
         (d)  The task force may request assistance from the Federal
  Bureau of Investigation, United States Secret Service, United
  States Department of Justice, United States Department of Homeland
  Security, Internal Revenue Service, and the United States Postal
  Service.
         (e)  The task force shall focus its efforts in:
               (1)  sharing information and resources; and
               (2)  successfully enforcing administrative and
  criminal actions against perpetrators of mortgage fraud.
         (f)  The agencies of the persons listed in Subsection (c) may
  share confidential information or information to which access is
  otherwise restricted by law with one or more of the other agencies
  of the persons listed in Subsection (c) for investigative purposes
  described by Subsection (b). Except as provided by this
  subsection, confidential information that is shared under this
  subsection remains confidential and legal restrictions on access to
  the information apply.
         (g)  The task force shall submit to the governor, lieutenant
  governor, and speaker of the house of representatives an annual
  report on the progress of each agency of the persons listed in
  Subsection (c) in accomplishing the purposes described by
  Subsection (b).
         (h)  The office of the attorney general shall oversee the
  administration of the task force. The attorney general shall
  provide the necessary staff and facilities to assist the task force
  in performing its duties.
         (i)  The attorney general may solicit and accept gifts,
  grants, and donations of money, services, or property on behalf of
  the state for disbursement to any state agency or local law
  enforcement agency to aid the task force in the investigation and
  prosecution of mortgage fraud in this state.
         SECTION 3.  Subchapter F, Chapter 411, Government Code, is
  amended by adding Section 411.1407 to read as follows:
         Sec. 411.1407.  ACCESS TO CRIMINAL HISTORY RECORD
  INFORMATION: CREDIT UNION DEPARTMENT. (a)  The credit union
  commissioner is entitled to obtain from the department criminal
  history record information maintained by the department that
  relates to a person who is:
               (1)  an individual who applies to incorporate a credit
  union under Subtitle D, Title 3, Finance Code;
               (2)  a board member of a credit union incorporated
  under Subtitle D, Title 3, Finance Code;
               (3)  an applicant for employment by the credit union
  department; or
               (4)  an employee of the credit union department.
         (b)  Criminal history record information obtained by the
  credit union commissioner under this section may not be released by
  any person except:
               (1)  on court order, unless the information is entered
  into evidence by the credit union department or a court at an
  administrative proceeding or a civil or criminal action under
  Subtitle D, Title 3, Finance Code; or
               (2)  with the consent of the person who is the subject
  of the criminal history record information.
         SECTION 4.  Section 555.051(a), Government Code, is amended
  to read as follows:
         (a)  This section applies only to information held by or for
  the office of the attorney general, the Texas Department of
  Insurance, the Texas State Board of Public Accountancy, the Public
  Utility Commission of Texas, [or] the State Securities Board, the
  Department of Savings and Mortgage Lending, the Texas Real Estate
  Commission, the Texas Appraiser Licensing and Certification Board,
  the Texas Department of Banking, the credit union department, or
  the Office of Consumer Credit Commissioner that relates to the
  possible commission of corporate fraud or mortgage fraud by a
  person who is licensed or otherwise regulated by any of those state
  agencies. In this subsection, "corporate fraud" means a violation
  of state or federal law or rules relating to fraud committed by a
  corporation, limited liability company, or registered limited
  liability partnership or an officer, director, or partner of those
  entities while acting in a representative capacity.
         SECTION 5.  Section 32.32, Penal Code, is amended by
  amending Subsections (a) and (b) and adding Subsections (d) and (e)
  to read as follows:
         (a)  For purposes of this section, "credit" includes:
               (1)  a loan of money;
               (2)  furnishing property or service on credit;
               (3)  extending the due date of an obligation;
               (4)  comaking, endorsing, or guaranteeing a note or
  other instrument for obtaining credit;
               (5)  a line or letter of credit; [and]
               (6)  a credit card, as defined in Section 32.31 (Credit
  Card or Debit Card Abuse); and
               (7)  a mortgage loan.
         (b)  A person commits an offense if he intentionally or
  knowingly makes a materially false or misleading written statement
  to obtain property or credit, including a mortgage loan [for
  himself or another].
         (d)  The following agencies shall assist a prosecuting
  attorney of the United States or of a county or judicial district of
  this state, a county or state law enforcement agency of this state,
  or a federal law enforcement agency in the investigation of an
  offense under this section involving a mortgage loan:
               (1)  the office of the attorney general;
               (2)  the Department of Public Safety;
               (3)  the Texas Department of Insurance;
               (4)  the Office of Consumer Credit Commissioner;
               (5)  the Texas Department of Banking;
               (6)  the credit union department;
               (7)  the Department of Savings and Mortgage Lending;
               (8)  the Texas Real Estate Commission; and
               (9)  the Texas Appraiser Licensing and Certification
  Board.
         (e)  With the consent of the appropriate local county or
  district attorney, the attorney general has concurrent
  jurisdiction with that consenting local prosecutor to prosecute an
  offense under this section that involves a mortgage loan.
         SECTION 6.  Article 12.01, Code of Criminal Procedure, is
  amended to read as follows:
         Art. 12.01.  FELONIES.  Except as provided in Article 12.03,
  felony indictments may be presented within these limits, and not
  afterward:
               (1)  no limitation:
                     (A)  murder and manslaughter;
                     (B)  sexual assault, if during the investigation
  of the offense biological matter is collected and subjected to
  forensic DNA testing and the testing results show that the matter
  does not match the victim or any other person whose identity is
  readily ascertained; or
                     (C)  an offense involving leaving the scene of an
  accident under Section 550.021, Transportation Code, if the
  accident resulted in the death of a person;
               (2)  ten years from the date of the commission of the
  offense:
                     (A)  theft of any estate, real, personal or mixed,
  by an executor, administrator, guardian or trustee, with intent to
  defraud any creditor, heir, legatee, ward, distributee,
  beneficiary or settlor of a trust interested in such estate;
                     (B)  theft by a public servant of government
  property over which he exercises control in his official capacity;
                     (C)  forgery or the uttering, using or passing of
  forged instruments;
                     (D)  injury to a child, elderly individual, or
  disabled individual punishable as a felony of the first degree
  under Section 22.04, Penal Code;
                     (E)  sexual assault, except as provided by
  Subdivision (1) or (5); or
                     (F)  arson;
               (3)  seven years from the date of the commission of the
  offense:
                     (A)  misapplication of fiduciary property or
  property of a financial institution;
                     (B)  securing execution of document by deception;
  [or]
                     (C)  a violation under Sections 162.403(22)-(39),
  Tax Code;
                     (D)  false statement to obtain property or credit;
  or
                     (E)  money laundering;
               (4)  five years from the date of the commission of the
  offense:
                     (A)  theft, burglary, robbery;
                     (B)  kidnapping;
                     (C)  injury to a child, elderly individual, or
  disabled individual that is not punishable as a felony of the first
  degree under Section 22.04, Penal Code;
                     (D)  abandoning or endangering a child; or
                     (E)  insurance fraud;
               (5)  ten years from the 18th birthday of the victim of
  the offense:
                     (A)  indecency with a child under Section
  21.11(a)(1) or (2), Penal Code; or
                     (B)  except as provided by Subdivision (1), sexual
  assault under Section 22.011(a)(2), Penal Code, or aggravated
  sexual assault under Section 22.021(a)(1)(B), Penal Code; or
               (6)  three years from the date of the commission of the
  offense: all other felonies.
         SECTION 7.  The change in law made by this Act to Article
  12.01, Code of Criminal Procedure, does not apply to an offense if
  the prosecution of that offense became barred by limitation before
  the effective date of this Act. The prosecution of that offense
  remains barred as if this Act had not taken effect.
         SECTION 8.  To the extent of a conflict, this Act prevails
  over any other Act of the 80th Legislature, Regular Session, 2007,
  regardless of the relative dates of enactment.
         SECTION 9.  This Act takes effect September 1, 2007.
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
 
         I certify that H.B. No. 716 was passed by the House on April
  4, 2007, by the following vote:  Yeas 140, Nays 0, 2 present, not
  voting; and that the House concurred in Senate amendments to H.B.
  No. 716 on May 15, 2007, by the following vote:  Yeas 139, Nays 0, 2
  present, not voting.
 
  ______________________________
  Chief Clerk of the House   
 
         I certify that H.B. No. 716 was passed by the Senate, with
  amendments, on May 9, 2007, by the following vote:  Yeas 31, Nays 0.
 
  ______________________________
  Secretary of the Senate   
  APPROVED: __________________
                  Date       
   
           __________________
                Governor