The Department had a process for setting fees that was based on its budgetary needs. The Department also complied with requirements for the calculation of
licensing and regulatory fees for the mortgage industry and the thrift industry, respectively, in fiscal years 2015 and 2016. In addition, the Department
followed a process guided by factors in the Texas Finance Code for imposing penalties on mortgage companies, mortgage bankers, mortgage loan servicers, and
residential mortgage loan originators when they did not comply with requirements.
However, the Department did not have a schedule of penalties to help ensure transparency and to aid in imposing consistent penalty amounts. The Department’s support
for the enforcement actions tested did not always include an explanation regarding how the Department determined the amount of the penalty recommended in its investigative
report or the amount of the penalty it actually imposed. The Department also did not always document its reasons for issuing a formal advisory letter instead of a formal enforcement order.
Additionally, the Department did not have current, written policies and procedures to document its processes for budgeting, fee-setting, and imposing penalties.
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