NDBF Joins with State Securities Regulators and SEC in a $45 Million Settlement with Nexo Capital Over Interest-Bearing Accounts

February 14, 2023 (Lincoln, NE) – The Nebraska Department of Banking & Finance (NDBF) will receive a payment of $424,528.30 from Nexo Capital, Inc. (Nexo) after entering a Consent Order with Nexo. The NDBF joined other state securities regulators and the U.S. Securities Exchange Commission (SEC) in this $45 million settlement with Nexo. 

In the past year, a North American Securities Administrators Association (“NASAA”) working group of state regulators conducted a comprehensive investigation into Nexo’s alleged offer and sale of unregistered securities in the form of its Earned Interest Product (EIP).

Nexo is a Cayman Islands corporation established in 2018 that provides virtual currency-related financial services to retail and institutional borrowers in the United States, including trading, borrowing, and lending services. During the investigation, it was discovered that EIP investors could passively earn interest on digital assets by loaning those assets to Nexo. This included 346 Nebraska EIP accounts with a value of $2,480,000 as of July 31, 2022. Nexo maintained total discretion over the revenue-generating activities utilized to earn returns for investors. The company offered and promoted the EIP and other products to investors in the U.S. via its website and social media channels suggesting in some instances that investors could obtain returns as high as 36%.

Nexo is alleged to have failed to comply with state registration requirements and, as a result, investors were sold unregistered securities in violation of state law and additionally were deprived of critical information and disclosures necessary to understand the potential risks of the EIP.

“Securities laws are designed to protect investors through full and fair disclosure and the registration of securities is essential to that protection.” said NDBF Deputy Director Claire McHenry. “State securities regulators continue to lead the effort to ensure companies involved in offering digital asset investments comply with our laws and that investors are treated fairly.”

For the states participating in the settlement, Nexo will pay a fine of $424,528.30 and cease offering and selling the EIP or accepting further investments in the EIP until such activities are compliant with applicable state and federal securities laws. For any EIP accounts, savings wallets, and non-collateral wallets held by Nebraska residents after April 1, 2023, Nexo will assist customers with any withdrawals or transfers.

NDBF would like to thank its fellow NASAA member agencies, especially the multistate working group, for its coordinated efforts and the SEC for their collaboration and assistance.

NDBF encourages Nebraskans to review financial opportunities carefully and to check the registration status of the investment and the person offering it by visiting ndbf.nebraska.gov.

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Nexo Press Release 02-14-2023

NOTICE OF RULEMAKING HEARING

NEBRASKA DEPARTMENT OF BANKING AND FINANCE

Notice is hereby given that the Nebraska Department of Banking and Finance will hold a rulemaking hearing on February 9, 2023, commencing at 9:30 a.m. CST, at the First Nebraska Administrative Building, 1526 K Street, Suite 300, Lincoln, Nebraska 68508.

The purpose of the hearing is to take testimony and evidence concerning the following revisions to Title 45 of the Rules and Regulations of the Department:

1. 45 NAC 1 – Adopts guidance applicable to all Chapters in Title 45.  The rule sets forth subject matter authority of the Department of Banking and Finance and the Director’s ability to take action to protect the public interest when the Director determines it necessary; provides necessary administrative information; and establishes the methods and impact of filing documents and payment of fees.
2. 45 NAC 2 – Adopts minimum information and record requirements that banks must obtain and maintain for their entity customers.  The rule incorporates and updates the provisions of existing 45 NAC 6, “General.”  Adds identification and resolution requirements for different entity customers, including limited liability companies, and clarifies the entities covered as public or not-for-profit organizations.
3. 45 NAC 3 – Adopts minimum record keeping requirements for data centers of banks and specifies data fields for the different accounts in banks.  The rule incorporates and updates many of the provisions of existing 45 NAC 23, “Minimum Record Keeping Requirements.”  The revisions recognize that banks may retain records in electronic format, and remove an obsolete Exhibit A and an outdated Consumer Loan Reference Chart,  which is an unnecessary part of the rule.
4. 45 NAC 4 – Adopts minimum retention periods for bank records.  The rule incorporates and updates many of the provisions of existing 45 NAC 27, “Schedule for Records Retention by Banks.”  The revisions define and recognize retention of records in an electronic format; update language regarding records of property escheated to the State Treasurer; provide a standard for existing microfilmed records; and a cross-referencing clarification for banks with trust department records.
5. 45 NAC 5 – Adopts minimum retention periods for records of free-standing trust companies and trust departments of banks.  The rule incorporates and updates many of the provisions of existing 45 NAC 32, “Schedule for Retention of Records: Banks Exercising Trust Powers and Trust Companies.”  The revisions track a number of the changes proposed in 45 NAC 4, which define and recognize retention of records in an electronic format; update language regarding records of property escheated to the State Treasurer; provide standards for records of safe deposit boxes and for existing microfilmed records; and include a cross-referencing clarification for bank records that are not a part of the bank’s trust department.
6. 45 NAC 6 – Provides procedures for the filing of bank Articles of Incorporation and Bylaws.  The rule incorporates and expands the provisions of existing 45 NAC 8, “Articles of Incorporation,” by establishing procedures for banks filing Bylaws with the Department, formalizing the Department’s review and no-objection procedures of corporate documents, and by providing cross references to relevant statutes.
7. 45 NAC 7 – Amends the rule requiring banks to obtain bond riders or endorsements to cover persons and entities that perform data processing services for the bank and specifying provisions required in the rider/endorsement.  The proposed amendments expand the type of entities banks may contract with to provide these services and the list of processor-related persons who are to be deemed as bank employees for purposes of bond coverage, and update the title.
8. 45 NAC 8 – Repeal and Reissue 45 NAC 8, under the new title, "Changes In Paid-In Capital Stock."  The proposed rule incorporates and expands provisions currently contained in existing 45 NAC 12, "Paid-In Capital Stock Increase," by establishing procedures for a bank decreasing its paid-in capital stock and updating the procedures for an increase in capital stock.  The revisions set time frames for filing notices with the Department; direct when a bank may need to update its Articles of Incorporation as a result of capital stock changes; and establish agency approval and no-objection processes.
9. 45 NAC 9 – Repeal the title of 45 NAC 9, “Change in Control,” as the rule itself was repealed in 1987.  Reissue the proposed rule titled, “Active Executive Officers,” to provide practices and procedures for bank executive officer license applications, renewals, surrenders, cancellations, and revocations.  It incorporates, updates, and re-organizes many of the provisions of existing 45 NAC 28, “Rules of Practice and Procedure Applicable to Executive Officers Licenses Obtained from the Nebraska Department of Banking and Finance Pursuant to Nebraska Revised Statutes, 1943.”  The revisions address executive officers of banks which opt out of the licensing process; eliminate distinctions between Class I and Class II licenses; adopt and eliminate definitions; formalize application standards; provide for the limited transfer of a license; update license surrender and cancellation provisions; establish the evidence necessary for license suspension or suspension of executive officer authority; provide for the levy of costs in disciplinary proceedings; set post-suspension and revocation requirements; and provide for the issuance of conditional licenses.
10. 45 NAC 10 – Adopts standards under which bank directors, officers, and employees may guarantee loans at their employing bank without violating statutory limits for insider borrowing.  The proposed rule, “Insider Loan Guarantees,” incorporates, updates, and re-organizes many of the provisions of existing 45 NAC 16, “Director, Officer or Employee Borrowing;” defines terms; and corrects a statutory reference.
11. 45 NAC 11 – Repeal the title of 45 NAC 11, “Board of Directors; Residence,” as the rule itself was repealed in 1991.  Reissue the proposed rule, “Executive Officer Borrowing Reports,” to establish standards for reports that bank executive officers are required to make when they borrow from a financial institution other than their employing bank; correct a statutory reference; and incorporate current law.  The proposed rule incorporates and updates provisions currently contained in existing 45 NAC 17, “Officer Borrowing.”
12. 45 NAC 12 – Repeal and Reissue 45 NAC 12 under the new title,  “Directors' Examinations Performed by Certified Public Accountants or Public Accountants,” to provide the standards for certified public accountants and public accountants to conduct directors’ examinations of banks; update the criteria to determine auditor independence; authorize a bank’s Board of Directors to adopt specified external auditing standards and to appoint an independent person to conduct the directors’ examination; and provide that the Department may require enhanced audit procedures due to safety and soundness concerns.  The proposed rule incorporates and expands provisions currently contained in existing 45 NAC 24 of the same title.
13. 45 NAC 13 – Adopts standards governing audits and directors’ examinations of banks, including reconcilement and testing of accounts and review of capital accounts; allows for a risk-focused review of accounts; requires inquiry into other financial risk activity; removes an obsolete reference to a handbook on statistical probability; and provides an option for electronic submission of annual reports to the Department.  Revises and extends the date for submission of the audit report to 120 days after the completion of the audit, or 120 days after calendar year-end for periodic audits.  The proposed rule incorporates and updates provisions of existing 45 NAC 25 of the same title.
14. 45 NAC 14 – Adopts standards for banks to qualify for the statutory exception to the lending limit for loans secured by livestock; defines a term; removes a reference to an obsolete form; provides requirements for inspections and appraisals of livestock feeding operations, and for independence of the inspection/appraisal process from the loan production function; and removes a sample form. The rule will incorporate and update provisions of existing 45 NAC 19 of the same title.
15. 45 NAC 15 – Repeal the title of 45 NAC 15, “Executive Officer’s License,” as the rule itself was repealed in 1987.  Reissue the proposed rule, “Loans Secured by Warehouse Receipts,” to adopt standards for banks to qualify for the statutory exception to the lending limit for loans secured by warehouse receipts and define a term.  The rule will incorporate and update provisions of existing 45 NAC 20 of the same title.
16. 45 NAC 16 – Repeal and Reissue 45 NAC 16 under the new title, “Loans Secured By Deposit Accounts.”  The proposed rule sets standards for banks to qualify for the statutory exception to the lending limit for loans secured by deposit accounts; defines a term; and updates methods for calculation of the lending limit.  The rule will incorporate and update provisions of existing 45 NAC 31 of the same title.
17. 45 NAC 17 – Repeal and Reissue 45 NAC 17 under the new title, “Pool Participation Approval.”  The proposed rule sets standards for bank investments in obligations representing loans to other banks; provides an option for electronic filing of a required form with the Department; and clarifies the regulatory approval process.  The proposed rule will incorporate and update provisions of existing 45 NAC 18 of the same title.
18. 45 NAC 18 – Repeal and Reissue 45 NAC 18 under the new title, “Requirements for Purchases of Shares of Investment Companies.”  The proposed rule sets the standards for bank investments in shares of investment companies; expands the list of obligations that are eligible for investment to include Canadian government obligations and digital asset depositories; adds a definition of “unimpaired capital;” and updates methods for calculation of investment limits.  The proposed rule will incorporate and update provisions of existing 45 NAC 30 of the same title.
19. 45 NAC 19 – Repeal and Reissue 45 NAC 19 under the new title, “Leasing of Personal Property.”  The proposed rule establishes the standards for banks leasing personal property, and requires banks to comply with Title 12, Chapter 1, Part 23 of the Code of Federal Regulations, “Leasing.”  The proposed rule will incorporate and update some of the provisions of existing 45 NAC 26, “Banks: Leasing of Personal Property,” including the striking of provisions which are duplicative of federal regulations, and an addition of a statutory reference for investment limits.
20. 45 NAC 20 – Outright repeal 45 NAC 20 as an updated version will be adopted as 45 NAC 15.
21. 45 NAC 23 – Outright repeal 45 NAC 23 as an updated version will be adopted as 45 NAC 3.
22. 45 NAC 24 – Outright repeal 45 NAC 24 as an updated version will be adopted as 45 NAC 12.
23. 45 NAC 25 – Outright repeal 45 NAC 25 as an updated version will be adopted as 45 NAC 13.
24. 45 NAC 26 – Outright repeal 45 NAC 26 as an updated version will be adopted as 45 NAC 19.
25. 45 NAC 27 – Outright repeal 45 NAC 27 as an updated version will be adopted as 45 NAC 4.
26. 45 NAC 28 – Outright repeal 45 NAC 28 as an updated version will be adopted as 45 NAC 9.
27. 45 NAC 30 – Outright repeal 45 NAC 30 as an updated version will be adopted as 45 NAC 18.
28. 45 NAC 31 – Outright repeal 45 NAC 31 as an updated version will be adopted as 45 NAC 16.
29. 45 NAC 32 – Outright repeal 45 NAC 32 as an updated version will be adopted as 45 NAC 5.

The rulemaking hearing is being conducted under and by virtue of the provisions of Section 84-907, R.R.S 1943, as amended, which provides that COPIES OF THE PROPOSED RULES ARE AVAILABLE FOR PUBLIC EXAMINATION at the Office of the Department of Banking and Finance, 1526 K Street, Suite 300, Lincoln, Nebraska 68508, and at the Office of the Secretary of State, 1445 K Street, Suite 2300, Lincoln, Nebraska 68508.  In addition, the proposed rules are available on the Department of Banking and Finance’s website at https://ndbf.nebraska.gov, and the Secretary of State’s website www.sos.ne.gov.

A copy of the Fiscal Impact Statement is available at the Office of the Department of Banking and Finance and on the Department’s website.

All interested persons are invited to attend and testify at the hearing.  Interested persons may also submit written comments to the Department of Banking and Finance prior to the start of the hearing.  Such comments will be made part of the hearing record at the time of the hearing.  Written comments should be sent to the Nebraska Department of Banking and Finance, Attn: Tag Herbek, 1526 K St., Suite 300, Lincoln, NE 68508, or emailed to dob.banking@nebraska.gov.

If auxiliary aids or reasonable accommodations are needed for attendance at this hearing, please call the Nebraska Department of Banking and Finance at (402) 471-2171, or, for persons with hearing impairments, please call the Nebraska Relay System at (800) 833-7352 TDD.  This contact should be made at least seven (7) days prior to the hearing.

Dated at Lincoln, Nebraska, this 23rd day of December, 2022.

Kelly Lammers, Director

Nebraska Department of Banking and Finance

 

Proposed 45 NAC 1 General Provisions for Title 45

Proposed 45 NAC 1 Redlined General Provisions for Title 45

Proposed 45 NAC 2 Record Keeping Requirements For Business Entity Customers

Proposed 45 NAC 2 Redlined Record Keeping Requirements For Business Entity Customers

Proposed 45 NAC 3 Data Center Record Keeping Standards

Proposed 45 NAC 3 Redlined Data Center Record Keeping Standards

Proposed 45 NAC 4 Schedule For Records Retention By Banks

Proposed 45 NAC 4 Redlined Schedule For Records Retention By Banks

APPENDIX 45 NAC 4

Appendix 45 NAC 4 - 12 CFR Part 344 (up to date as of 10-24-2022)

 Appendix 45 NAC 4 - 12 CFR Part 12 (up to date as of 10-24-2022)

Appendix 45 NAC 4 - 12 CFR 208.34 (up to date as of 10-24-2022)

Proposed 45 NAC 5 Schedule For Retention Of Records Banks Exercising Trust Powers And Trust Companies

Proposed 45 NAC 5 Redlined Schedule For Retention Of Records- Banks Exercising Trust Powers And Trust Companies

Proposed 45 NAC 6 Articles Of Incorporation And Bylaws

Proposed 45 NAC 6 Redlined Articles Of Incorporation And Bylaws

Proposed Amended 45 NAC 7 Electronic Data Processing Rider Or Endorsement

Proposed Amended 45 NAC 7 Redlined Electronic Data Processing Rider Or Endorsement

Proposed 45 NAC 8 Changes In Paid-In Capital Stock

Proposed 45 NAC 8 Redlined Changes In Paid-In Capital Stock

Proposed 45 NAC 9 Active Executive Officers

Proposed 45 NAC 9 Redlined Active Executive Officers

Proposed 45 NAC 10 Insider Loan Guarantees

Proposed 45 NAC 10 Redlined Insider Loan Guarantees

Proposed 45 NAC 11 Executive Officer Borrowing Reports

Proposed 45 NAC 11 Redlined Executive Officer Borrowing Reports

Proposed 45 NAC 12 Directors' Examinations Performed By Certified Public Accountants Or Public Accountants

Proposed 45 NAC 12 Redlined Directors' Examinations Performed By Certified Public Accountants Or Public Accountants

APPENDIX 45 NAC 12

Proposed 45 NAC 13 Standards For Acceptability And Scope Of Examinations For Directors' Examinations

Proposed 45 NAC 13 Redlined Standards For Acceptability And Scope Of Examinations For Directors' Examinations

Proposed 45 NAC 14 Livestock Loans

Proposed 45 NAC 14 Redlined Livestock Loans

Proposed 45 NAC 15 Loans Secured By Warehouse Receipts

Proposed 45 NAC 15 Redlined Loans Secured By Warehouse Receipts

Proposed 45 NAC 16 Loans Secured By Deposit Accounts.pdf

Proposed 45 NAC 16 Redlined Loans Secured By Deposit Accounts.pdf

Proposed 45 NAC 17 Pool Participation Approval

Proposed 45 NAC 17 Redlined Pool Participation Approval

Proposed 45 NAC 18 Requirements For Purchases Of Shares Of Investment Companies

Proposed 45 NAC 18 Redlined Requirements For Purchases Of Shares Of Investment Companies

APPENDIX 45 NAC 18

Appendix 45 NAC 18_12 CFR Part 23

Appendix 45 NAC 18_15 USC CHAPTER 41_SUBCHAPTER I_Part E_ Consumer Leasing Act

Proposed 45 NAC 19 Leasing of Personal Property

Proposed 45 NAC 19 Redlined Leasing of Personal Property

Proposed 45 NAC 20 REPEAL

Proposed 45 NAC 23 REPEAL

Proposed 45 NAC 24 REPEAL

Proposed 45 NAC 25 REPEAL

Proposed 45 NAC 26 REPEAL

Proposed 45 NAC 27 REPEAL

Proposed 45 NAC 28 REPEAL

Proposed 45 NAC 30 REPEAL

Proposed 45 NAC 31 REPEAL

Proposed 45 NAC 32 REPEAL

Fiscal Impact Statement 45 NAC

Publication Notice 45 NAC

NDBF REMINDS INVESTMENT ADVISERS, BROKER-DEALERS OF DECEMBER 31, 2022 RENEWAL DEADLINE

November 1, 2022 (LINCOLN, NEB.) — The Nebraska Department of Banking and Finance ("NDBF") reminds state-registered investment advisers, broker-dealers, and their agents and representatives that registrations in Nebraska expire on December 31, 2022. Firms will need to assemble required documentation and review filings to insure all information is accurate and up-to-date. Failure to submit supplements or provide required information by the appropriate deadline will result in the termination of the registration on January 1, 2023.

The Department will again be utilizing ShareFile for firms to submit all supplements and correspondence. The Department will send out a secure ShareFile link, unique to each firm, with the initial Notification dated November 1, 2022.  If for some reason you do not receive the notification, please email the department at DOB.SecuritiesBureau@Nebraska.gov to request a link.

FINRA Broker-Dealers and Agents please adhere FINRA’s 2023 Annual Renewal Program and Timeline.

State-registered investment adviser and investment adviser representative deadlines:

• By December 16, 2022 – Submit Nebraska specific forms and documentation to NDBF

• Before December 22, 2022 – Submit renewal payments through CRD/IARD

Non-FINRA Broker-Dealers and Agents must submit all required forms and documentation to NDBF by December 16, 2022, via ShareFile link. The Department encourages firms to remit fees electronically via ACH if possible.

NOTICE OF RULEMAKING HEARING

NEBRASKA DEPARTMENT OF BANKING AND FINANCE

Notice is hereby given that the Nebraska Department of Banking and Finance will hold a rulemaking hearing on December 7, 2022, commencing at 9:30 a.m. CST, at the First Nebraska Administrative Building, 1526 K Street, Lower Level-Development Center, Lincoln, Nebraska 68508.

The purpose of the hearing is to take testimony and evidence concerning the following adoption of Rules and Regulations of the Department:

1. 47 NAC 1 – Adopts requirements for applicants of digital asset depository charters. Upon determination an application is substantially complete, the Director shall provide notice and schedule a public hearing in accordance with the Nebraska Financial Innovation Act and Administrative Procedure Act. Requires prior approval before a digital asset depository may conduct business in foreign markets or expand activities beyond what is disclosed in initial application. Provides guidance on filing fees, computation of time, and additional review of applications.
2. 47 NAC 2 – Sets surety bond and insurance requirements of digital asset depositories in case of potential liquidation, conservatorship, or receivership and to protect applicants by ensuring sufficient coverage to protect safety and soundness of business operations against insurable risk.
3. 47 NAC 3 – Harmonizes capital requirements for digital asset depository departments and digital asset depository institutions. Identifies examples of operating expenses to meet the three-year operating expense requirements provided for in the Nebraska Financial Innovation Act.
4. 47 NAC 4 – Allows state banks to amend existing financial institution charter with application to the Department of Banking and Finance to operate a digital asset depository department. Mandates separation of operations between digital asset depository department and other bank operations. A bank’s capital structure will be evaluated using a risk-based analysis of the proposed digital asset depository department. Separation of FDIC-insured activities and non-insured digital asset activities and products to prevent customer confusion.
5. 47 NAC 5 – Provides standards and penalties for required reporting to the Department of Banking and Finance. Provides for digital signatures under Nebraska law. Defines a call report. Requires digital asset depositories to comply with federal reporting and notice requirements. Provides for computation of time to fulfill report timing requirements.
6. 47 NAC 6 – Sets requirements for digital asset depositories to have a documented system for addressing customer complaints. Provides for administrative proceedings in the case of failure to acknowledge and respond to complaints.
7. 47 NAC 7 – Provides that digital asset depositories must provide notice that digital asset products are not FDIC-insured and that it can provide notice that traditional banking products are FDIC-insured.
8. 47 NAC 8 – Establishes that digital asset depositories must have a written response program with detailed methods for handling data breaches or other cybersecurity events. Requires immediate notification to the Department of Banking and Finance of such incident at the time of awareness of occurrence and reviews of the Financial Data Protection and Consumer Notification of Data Security Breach Act of 2006 to determine further necessary notifications. Requires reporting to the Department of Banking and Finance where incident occurrence is reported federally.

The rulemaking hearing is being conducted under and by virtue of the provisions of Section 84-907, R.R.S 1943, as amended, which provides that COPIES OF THE PROPOSED RULES ARE AVAILABLE FOR PUBLIC EXAMINATION at the Office of the Department of Banking and Finance, 1526 K Street, Suite 300, Lincoln, Nebraska 68508, and at the Office of the Secretary of State, 1445 K Street, Suite 2300, Lincoln, Nebraska 68508.  In addition, the proposed rules are available on the Department of Banking and Finance’s website at https://ndbf.nebraska.gov, and the Secretary of State’s website www.sos.ne.gov.

A copy of the Fiscal Impact Statement is available at the Office of the Department of Banking and Finance and on the Department’s website.

All interested persons are invited to attend and testify at the hearing. Seating is limited. Anyone interested in viewing the hearing via a Webex online teleconference link must contact the Department at dob.digitalassets@nebraska.gov by 4:00 p.m. CST, November 30, 2022 and provide your name and email address. Teleconference seats are limited.

Interested persons may submit written comments to the Department of Banking and Finance prior to the hearing. Submitted comments will be made part of the hearing record at the time of the hearing. Comments can only be made in person at the hearing room, or through previously written testimony. Comments will not be taken through the Webex teleconference. Written testimony should be sent to the Nebraska Department of Banking and Finance, Attn: Tag Herbek, 1526 K St., Suite 300, Lincoln, NE 68508, or emailed to dob.digitalassets@nebraska.gov.

If auxiliary aids or reasonable accommodations are needed for attendance at this hearing, please call the Nebraska Department of Banking and Finance at (402) 471-2171, or, for persons with hearing impairments, please call the Nebraska Relay System at (800) 833-7352 TDD.  This contact should be made at least seven (7) days prior to the hearing.

Dated at Lincoln, Nebraska, this 28th day of October, 2022.

Kelly Lammers, Director

Nebraska Department of Banking and Finance

 

Proposed 47 NAC 1 Applications

Proposed 47 NAC 2 Surety Bonds And Pledge Of Assets; Insurance

Proposed 47 NAC 3 Capital Requirements; Paid-Up Operating Expenses

Proposed 47 NAC 4 Digital Asset Depository Department; Charter Amendment; Director; Powers And Duties

Proposed 47 NAC 5 Reports; Call Reports

Proposed 47 NAC 6 Complaints

Proposed 47 NAC 7 Notice And Statement Regarding Deposit Insurance And Risk

Proposed 47 NAC 8 Response Program For A Cybersecurity Event Or Data Breach

Fiscal Impact Statement 47 NAC

Title 47 NDBF Publication Notice

CONTACT Claire McHenry, Deputy Director – Securities Bureau 

PHONE 402-471-2171

EMAIL claire.mchenry@nebraska.gov 

 

NDBF Recognizes June 15 as World Elder Abuse Awareness Day, Urges Nebraskans to Establish a Trusted Contact

June 15, 2022 (LINCOLN, NE)— In recognition of World Elder Abuse Awareness Day (WEAAD) on June 15th, the Nebraska Department of Banking and Finance (NDBF) reminds Nebraskans and financial professionals to be on the lookout for signs of elder financial abuse. To help protect Nebraska investors, NDBF has joined the North American Securities Administrators Association (NASAA) campaign urging Nebraskans to provide their financial firms with a trusted contact.

“Investors can take steps to help safeguard their investments from potential fraud by creating an extra layer of protection with a trusted contact,” said NDBF Deputy Director Claire McHenry. “Your investment professional can help you in getting a trusted contact in place for your accounts.”

A trusted contact is an individual authorized by an investor to be contacted by their financial firm in limited circumstances. These circumstances can include concerns about activity in the investor’s account or if the firm has been unable to reach the investor after numerous attempts. A trusted contact may be a family member, attorney, accountant or another reliable third party; investors may establish more than one trusted contact and may add or change a trusted contact at any time.

Importantly, a trusted contact:

• Cannot make trades in the investor’s account.
• Cannot make decisions about the investor’s account; and
• Does not become a power of attorney, legal guardian, trustee or executor by virtue of being identified as a trusted contact.

To learn more about setting up a trusted contact, financial firms and investors are encouraged to review materials available at www.nasaa.org/trust-contact.

Before making any financial decisions, ask questions, do your homework, and visit our website at ndbf.nebraska.gov or contact NDBF at 402-471-2171 for more information.

WEAAD - Trusted Contact.pdf

 

 

FOR IMMEDIATE RELEASE

CONTACT Kelly Lammers, Director

Phone 402-471-2171

Email kelly.lammers@nebraska.gov  

Governor Ricketts Proclaims April as Financial Awareness Month, State Capitol to turn Green

March 24, 2022 (LINCOLN, NE) – Today Gov. Pete Ricketts proclaimed the month of April as Financial Awareness Month in Nebraska.  The proclamation recognizes the importance of financial awareness to Nebraskans and that Nebraska is a leader in financial innovation, financial literacy education, and consumer and vulnerable adult protection.  Additionally, the Nebraska Capitol will be lit up in green for Financial Awareness Month on April 1-3.

The month-long financial awareness campaign is an initiative from the Nebraska Council of Economic Education (NCEE) and the Nebraska Department of Banking and Finance (NDBF).  Nebraska banks, credit unions, securities professionals, state agencies, consumer groups, and private sector organizations are conducting a variety of educational activities in schools, workplaces, and communities to educate Nebraskans about the importance of setting goals, making wise financial decisions, and protecting yourself and your financial future.

“Whether you are just starting out, or have been saving and investing for some time, April is a great opportunity to review your financial health and awareness.  Consider working with a bank, credit union, or registered securities professional to help protect and grow your finances,” said NDBF Director Kelly Lammers.  “There have been a number of recent financial initiatives, from the Financial Innovation Act to added consumer protections for vulnerable and senior adults.  It’s important to review the basics as well as learn about new products like cryptocurrencies and digital assets to improve your financial awareness.”

“We at NCEE primarily focus on K-12 financial education.  If we can reach kids early and install good financial habits, we have changed their financial futures.  I encourage everyone to engage with something during this April Financial Awareness Month.  Financial literacy is a life-long pursuit.  No matter what age and stage you’re at, we can always do something to better our financial position,” said NCEE president, Dr. Jennifer Davidson.

NDBF Director Lammers and Dr. Jennifer Davidson, President of NCEE, encourage all Nebraskans to take part in financial awareness efforts offered by NCEE, NDBF, and other organizations, including:

• The Nebraska Council on Economic Education is the premiere organization providing economic and financial education and resources to Nebraska. NCEE programming and resources can be found at http://nebraskacouncil.unl.edu and http://nceefinance.org.
• NDBF has information and four new My MoNEy videos on financial education topics at https://ndbf.nebraska.gov/consumers/consumer-resources.
• The Office of the Nebraska Attorney General has information on how to protect yourself from identity theft and scams at https://ProtectTheGoodLife.Nebraska.gov.
• The Nebraska State Treasurer’s Office, in partnership with NCEE, has a new a new, robust and personalized financial education learning center, Enrich. https://nast.enrich.org/landing/nast-start-nebraska
• The Nebraska Bankers Association and its 162 member banks are pleased to support Nebraska Financial Awareness Month. Nebraska banks are committed to improving financial literacy in the communities they serve. They sponsor programs and offer tools to help Nebraskans of all ages improve their financial decision-making and reach their financial goals. Individuals and families who have a solid financial education foundation are more likely to purchase a home, save for college and invest which, in turn, helps Nebraska communities thrive.  Nebraska banks are also watching out for their customers. They pushed for the passage of legislation that allows them to place a hold on a transaction if they suspect a vulnerable customer is a victim of financial exploitation.
• For the Nebraska Credit Union League, promoting financial well-being for all is a critical component in the fulfilment of the credit union mission of People Helping People. Financially healthy credit union members lead to healthy credit unions and healthy communities. Financial well-being isn’t “a thing” credit unions do. It is “the thing.”
• FPA of Nebraska is a professional organization for Certified Financial Planners™ and supports various financial literacy programs through Junior Achievement and other initiatives.
• Nebraska Independent Community Bankers encourages Nebraskans to talk about financial needs and solutions with the local Community Bank in April and thereafter whenever questions arise. AARP encourages Nebraskans to visit the AARP Fraud Watch Network at www.aarp.org/fraudwatchnetwork or call the AARP Fraud Watch Network Helpline at 1-877-908-3360 to report a scam or get help if you’ve fallen victim.
• Future Business Leaders of America (FBLA-PBL) is a national career and technical student organization for students in middle school, high school, and college who are interested in business administration, business education, management, finance, and information technology careers. Over 5800 students in more than 150 secondary schools and 13 postsecondary schools in Nebraska participate in the FBLA-PBL organization. FBLA offers over 15 competitive events in the finance career field to include financial literacy. Benefits of FBLA membership are leadership development, career preparation, community service, networking with business and community leaders, and challenging competitions.

 

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NDBF Financial Awareness Month 2022 Press Release.pdf

NDBF and the Office of the Nebraska Attorney General Partner with CFTC and 26 State Securities Regulators to Stop $68 Million Precious Metals Scheme that Targeted the Elderly

Feb. 2, 2022 (LINCOLN, NE) – The Nebraska Department of Banking and Finance (NDBF) and the Office of the Nebraska Attorney General announced today that they are participating in a consolidated enforcement action to stop a fraudulent precious metals scheme that solicited over $68 million from at least 450 investors nationwide, including $658,000 from investors in Nebraska.

NDBF and the Office of the Nebraska Attorney General have joined the Commodity Futures Trading Commission (CFTC) and 26 state securities regulators in filing a complaint in the United States District Court for the Central District of California alleging Safeguard Metals LLC and Jeffrey Santulan, a/k/a Jeffrey Hill, solicited investors nationwide by touting precious metals at grossly inflated prices that were not disclosed.

“This is one of many large-scale precious metals investment schemes we’ve endeavored to stop since the pandemic began and we are investigating numerous more precious metals investment companies on similar allegations. To prevent any further damages, investors are advised to be particularly cautious when purchasing precious metals and to check for excessive commissions, spreads or markups as high as 30 to 70 percent,” said NDBF Deputy Director Claire McHenry. “As the market continues to fluctuate, we anticipate seeing more fraudsters capitalize on investors’ uncertainty and use fear to manipulate good people out of their hard-earned money.”

The investors in this case were advised to liquidate their holdings at registered investment firms to fund investments in precious metals, bullion, and bullion coins through self-directed individual retirement accounts. Self-directed IRAs should not be confused with traditional IRAs or other retirement vehicles.

“In expectation of additional precious metals investment schemes, investors are advised to check the registration of all investment products and professionals, carefully research investments, ask tough questions about the fees, markups or spreads, risks, and potential returns,” said NDBF Deputy Director McHenry. “If the answers seem too good to be true or don’t make sense, protect your wallet by just walking away.” 

The defendants are accused of failing to disclose the markup charge for their precious metals bullion products and that investors could lose the majority of their funds once a transaction was completed. In many cases, the market value of the precious metals sold to investors was substantially lower than the value of the securities and other retirement savings investors had liquidated to fund their purchase. 

NDBF and the Office of the Nebraska Attorney General encourage investors to contact NDBF if they suspect they have been targeted by similar precious metals investment schemes. Please contact NDBF at 402-471-2171.

 

 

Safeguard Metals Consumer Advisory 2.2.2022.pdf

Safeguard Metals - CFTC Complaint.pdf

Safeguard Metals - SEC Complaint.pdf

 

NDBF REMINDS INVESTMENT ADVISERS, BROKER-DEALERS OF DECEMBER 31, 2021 RENEWAL DEADLINE

November 1, 2021 (LINCOLN, NEB.) — The Nebraska Department of Banking and Finance ("NDBF") reminds state-registered investment advisers, broker-dealers, and their agents and representatives that registrations in Nebraska expire on December 31, 2021. Firms will need to assemble required documentation and review filings to make sure information is accurate and up-to-date. Failure to submit filings or provide required information by the appropriate deadline will result in the termination of the registration on January 1, 2022.

 

State-registered investment adviser and investment adviser representative deadlines:

• By December 17, 2021 – Submit Nebraska specific forms and documentation to NDBF

• Before December 13, 2021 – Submit renewal payments through CRD/IARD

• Before December 26, 2021 – Submit required electronic form filings through CRD/IARD

 

FINRA broker-dealer and agent deadlines:

• Before December 26, 2021 – Submit renewal payments through CRD/IARD

• Before December 26, 2021 – Submit required electronic form filings through CRD/IARD

 

Non-FINRA Broker-Dealers and agents must submit all required forms and documentation to NDBF by December 17, 2021

 

2022 Annual Renewal Program Letter-1.pdf

2022 IA Renewal Notice and Checklist fillable.pdf

2022 Non FINRA Renewal Notice and Checklist fillable.pdf

Contact: Claire McHenry, Deputy Director – Securities Bureau

Phone: 402-471-2171

Email: claire.mchenry@nebraska.gov

 

NDBF NOW ACCEPTING ONLINE FILING FOR FRANCHISES, BUSINESS OPPORTUNITIES

September 20, 2021 (LINCOLN, NE) - The Nebraska Department of Banking and Finance (NDBF) announced today that NDBF has joined with the North American Securities Administrator’s Association’s (NASAA) Electronic Filing Depository (EFD) System to accommodate the electronic filing of franchises and business opportunities under Nebraska’s Seller-Assisted Marketing Plan (SAMP) Act. 

The new functionality, referred to as the “Franchise Electronic Depository (FRED),” allows franchise filers to submit electronic filings and fees to NDBF for franchise filings on the EFD System. Additionally, NDBF is expanding the “Universal Filing Type (UFT)” filing functionality to allow business opportunity filers to submit electronic filings to NDBF on the EFD System.  

Developed by NASAA, of which NDBF is a member, the EFD System was launched in 2014 and was initially used to facilitate the filing of Form D for Regulation D, Rule 506 offerings with state securities regulators and to pay related fees. The system was expanded in 2019 to accommodate Form NF-UIT notice filings for unit investment trusts (UITs) and further expanded in 2020 to allow a variety of corporation finance offerings including, among others, registrations by coordination and qualification, Regulation A (Tier 1 and Tier 2), and crowdfunding (federal and state) filings with NDBF. 

The EFD website also enables the public to search and view, free of charge, Reg. D Rule 506, Form NF-UIT, and franchise filings made through EFD. EFD is available at: https://www.efdnasaa.org.

NDBF’s expansion of online filing for franchises and business opportunities helps grow Nebraska and advances the state’s mission of creating opportunities through more effective, more efficient, and consumer-focused state government.

If you have questions about a particular offering in a franchise or business opportunity, or about EFD, contact NDBF at DOB.SecuritiesFiling@nebraska.gov or 402-471-2171.

 

####

FRED Publication Final.pdf

Governor Pete Ricketts is holding an Ag & Economic Development Summit in Kearney, Nebraska on August 3rd at 4:00 PM and August 4th at 2:30 PM. If you would like to attend, tickets will need to be purchashed. Please click the links below for more information. 

 

Facebook Link:

https://fb.me/e/6q4ONObGP

Twitter Link:

https://twitter.com/GovRicketts/status/1417604201866305537?s=20

To purchase Tickets: 

https://www.eventbrite.com/e/2021-governors-ag-economic-development-summit-registration-159180746899

 

Location of Summit:

Younes Conference Center

416 W Talmadge Rd,

Kearney, NE 68845

Contact: Christopher German, Senior Staff Attorney 

Phone: 402-471-2171 

Email: christopher.german@nebraska.gov 

Installment Sales Act and Installment Loan Act Updates

April 19, 2021 (LINCOLN, NE) - The Nebraska Department of Banking and Finance

(“NDBF”) is providing the following notice regarding consumer lenders.  Effective      

March 18, 2021, Legislative Bill 363 (2021) (“LB 363”) amended sections of the Nebraska Installment Sales Act and the Nebraska Installment Loan Act (collectively referred to as “the Acts”). 

Nebraska Installment Sales Act

Section 45-335(11) of the Nebraska Installment Sales Act was amended to define a sales finance company as “a person purchasing one or more installment contracts from one or more sellers or acquiring any rights of ownership, servicing, or other forms of participation in or otherwise engaging with a consumer on behalf of the purchaser of one or more installment sales contracts from one or more sellers.”  (emphasis added)

Additionally, Section 45-346 of the Nebraska Installment Sales Act was amended to reflect the established practice of NDBF to require an additional bond amount of $50,000 for each licensed branch location, including branches not physically located in Nebraska, of an applicant or licensee under the Nebraska Installment Sales Act. 

Nebraska Installment Loan Act

Prior to the passage of LB 363, a license was required to engage or continue in the business of making loans of money and charge, contract for, and receive the maximum for interest and other charges allowed under the Nebraska Installment Loan Act.  Now, sections 45-1004 and 45-1005 of the Nebraska Installment Loan Act have been amended to require a license for non-chartered entities holding, servicing, or otherwise participating in consumer loans made to Nebraska residents with an interest rate greater than 16% per annum, a principal balance of less than $25,000, and a duration of 145 months or less.

The Nebraska Installment Loan Act still requires lenders who are making installment loans to have a physical presence in Nebraska, but the physical presence requirement does not apply to owners, servicers, or purchasers of installment loans if they are not making such loans.

Conclusion

With the change in the Acts, consumer lenders should consult with legal counsel to determine if licensure is necessary under Nebraska law.  As stated above, LB 363 is already effective; therefore, NDBF would expect those now subject to the licensing requirements to file an application for a license on the Nationwide Mortgage Licensing System (“NMLS”) by October 1, 2021. 

A properly licensed debt collection agency is not required to be licensed under the Acts due to the changes contained in LB 363, for conducting activities that are covered by such debt collection agency licensure.  However, licensure under the Acts may be required where such an agency conducts business beyond the scope of such debt collection agency license that includes licensable business activity under the Nebraska Installment Sales Act or the Nebraska Installment Loan Act.

Failure to obtain a license as required under the Acts, may result in administrative actions being taken by NDBF, including the imposition of fines, penalties, and other forms of liability, as set forth in Sections 45-343 and 45-353 of the Nebraska Installment Sales Act and Sections 45-1015, 45-1033, and 45-1069 of the Nebraska Installment Loan Act.

Additional licensing information for consumer lenders is available on NDBF’s website at https://ndbf.nebraska.gov/industries/consumer-lending-licenses and on the NMLS website at https://mortgage.nationwidelicensingsystem.org/Pages/default.aspx. If you have questions, please call NDBF at 402-471-2171.

####

Industry Update - Installment Sales Act and Installment Loan Act Updates

FOR IMMEDIATE RELEASE

CONTACT Mike Cameron, Securities Bureau Counsel

Phone 402-471-2171

Email mike.cameron@nebraska.gov

 

Metals.com, Tower Equity, Chase Metals, and Barrick Capital Receivership Claim Deadline of April 30, 2021

March 15, 2021 (LINCOLN, NE) – The Nebraska Department of Banking and Finance (NDBF) and the Office of the Nebraska Attorney General, other state regulators and the Commodity Futures Trading Commission recently filed a joint civil enforcement action against Metals.com, Tower Equity, Chase Metals, Barrick Capital and other associated parties.  The complaint alleges that the defendants perpetrated a fraudulent precious metals investment scheme that involved at least 1,600 investors and more than $185 million in customer funds, including $600,000 from Nebraska investors. 

The United States District Court for the Northern District of Texas entered an injunction and a restraining order freezing the assets of the defendants.  It also appointed Kelly Crawford as Receiver – an official responsible for marshalling assets of the defendants for the benefit of investors.  

The Receiver will begin administering the claims process and returning money to investors.  As part of the process, he will be sending correspondence, instructions, and a claims form.  Investors must complete and return their claims forms to the Receiver to participate in the claims process and request a return of money.  The deadline to return the claim form is April 30, 2021. 

“NDBF and the Office of the Nebraska Attorney General continue to fight to protect senior citizens and other victims,” said NDBF Deputy Director Claire McHenry.  “We are committed to holding bad actors accountable for their actions and pursuing relief for victims of illegal scams.  We are therefore encouraging investors to promptly begin working with the Receiver to request a return of funds.” 

Investors should direct questions about the claims process to the Receiver.  They can contact the Receiver at kelly.crawford@solidcounsel.com or 214-706-4213.  The Receiver also maintains a website that provides information about the claims process, and it is accessible at https://www.metalsandbarrickcapitalreceivership.com.

NDBF can also provide additional information and explanation relating to the allegations of fraud, the lawsuit, the receivership, and the claims process. Please contact NDBF at 402-471-2171.  

###

 

3.15.21 Consumer Advisory - Metals.com Receivership Claim Deadline.pdf

FOR IMMEDIATE RELEASE 

CONTACT: Thomas Sindelar, Investigation Supervisor
PHONE: 402-471-2171
EMAIL: thomas.sindelar@nebraska.gov

Nebraska Department of Banking and Finance Orders Two Internet “Investment” Companies to Stop Soliciting Investors

Lincoln, Neb., October 20, 2020 – The Nebraska Department of Banking and Finance (“NDBF”) has issued Cease and Desist Orders (“Order”) against two entities that claimed to offer investments via the internet.

On August 17, 2020, NDBF issued an Order to Canadian FX Traders. The entity maintained the website, https://canfxtraders.com/, which has been deactivated. The Order prohibits the entity from offering or selling securities in Nebraska until the securities have been registered with NDBF. The Order also prohibits the entity from offering or selling securities in Nebraska until they are registered as broker-dealers or agents of a broker-dealer with NDBF.

Canadian FX Traders offered “binary options in cryptocurrency trades” to at least one Nebraska investor. This investor invested $1,500.00 with Canadian FX Traders. The company led the investor to believe that the trading had been successful as her purported balance had increased to $38,000.00. When she attempted to withdraw funds, she was informed that she needed to pay various additional fees before the funds could be withdrawn. She paid over $4,800.00 in additional fees in an attempt to withdraw her funds. Ultimately, the investor was unable to withdraw her funds and she lost her entire investment along with the additional fees she paid to Canadian FX Traders.

On September 2, 2020, NDBF issued an Order to Crypto-Initiation Company of Bournemouth, United Kingdom. The entity maintained the website, https://cryptoinitiation.com/, which has been deactivated. The Order prohibits the entity from offering or selling securities in Nebraska until the securities have been registered with NDBF. The Order also prohibits the entity named from offering or selling securities in Nebraska until they are registered as broker-dealers or agents of a broker-dealer with NDBF.

Crypto-Initiation Company offered “investment plans” which promised eight percent weekly returns to at least one Nebraska investor. The investor invested $50,000.00 in one of the investment plans. After investing, the investor was told that he needed to make an additional pledge in order to start receiving his payments. The investor increased his investment to $75,000.00 but never received his promised payments. The investor lost the entire investment.

A copy of the Cease and Desist Orders are available on NDBF’s website at www.ndbf.nebraska.gov.

NDBF strongly cautions investors on conducting business over the Internet with financial companies with whom they are unfamiliar. In many cases, the investor is told to wire money or send a prepaid card, often to a location outside the United States. In other cases, the investors are instructed to send bitcoin to fund their investment. Investors never receive the promised return and cannot recover their money. Furthermore, these investors may be asked to provide personal information such as social security numbers and bank account numbers to the Internet company, which makes them prime targets for identity theft.

More information about the laws governing the financial industries in Nebraska can be found on NDBF’s website. If you have questions about any investment matters, call NDBF at (402) 471-3445.

Crypto Cease and Desist Press Release

 Canadian FX Traders Cease & Desist Order

Crypto-Initiation Company Cease & Desist Order

####

CONTACT Claire McHenry, Deputy Director – Securities Bureau

PHONE 402-471-3445

EMAIL claire.mchenry@nebraska.gov

 

NDBF Alerts Nebraskans about Investments in Precious Metals and Self-Directed Individual Retirement Accounts

August 28, 2020 (LINCOLN, NEB.) – The Nebraska Department of Banking and Finance (NDBF) has recently received an increased volume of complaints related to investments in precious metals in self-directed individual retirement accounts. Precious metals such as gold and silver have been the subject of widespread advertising campaigns on television, online, and in print media. Such advertisements may emphasize the potential for large returns while downplaying any risks. Precious metal promotions may target seniors who may have concerns about protecting their long-term investments, including retirement accounts.

Companies may point to financial crisis or market volatility as evidence of greater stability and security available through precious metals as opposed to other investments.  Historically speaking, the value of gold-related investments fluctuates even more than the stock market. Gold often moves in reverse of stocks and bonds, so when stocks are down, gold seems like a very tempting investment.

Precious metals can be part of a well-diversified portfolio, but like all investment opportunities, an investment in precious metals involves risk. Individuals should not rely on claims in advertisements, word-of-mouth referrals, or “cold calling” tactics utilized by firms promoting these investments. Consumers should be particularly wary of aggressive sales tactics encouraging the liquidation of their existing portfolio in favor of investment in precious metals. NDBF strongly encourages any prospective investor to conduct thorough independent research on any opportunity prior to investing.

The Financial Industry Regulatory Authority (FINRA) issued an Investor Alert that provides tips for individuals considering an investment in precious metals:

1. Say “NO” to pushy salespeople.
2. Check out the salesperson’s background before you invest.
3. Be on high alert when you hear “low risk”.
4. Look out for leverage risk.
5. Get a full accounting of fees.

Using these strategies can help you understand the benefits and risks of a prospective investment, avoid surprise costs or fees, and protect yourselves from fraud.

Self-Directed Individual Retirement Accounts (IRAs)

Precious metals companies may also encourage individuals to open a self-directed IRA. As with other IRAs, the owner of a self-directed IRA invests funds in various assets and a custodian holds the IRA on the owner’s behalf. Yet while most IRA investments are limited to common securities like stocks or bonds, self-directed IRAs allow for investment in alternative assets. These alternative assets, including cryptocurrencies and precious metals, are riskier investments than those permitted by most IRA custodians. Self-directed IRA custodians have only limited duties to make sure that the alternative assets – and the promoter selling them – are legitimate.  Unscrupulous investment promoters may exploit self-directed IRAs because they permit investors to hold riskier assets, including those not registered as securities.

Anyone considering a self-directed IRA should obtain as much information as possible prior to investing, including:

• Duties and responsibilities of the IRA custodian.
• Fees associated with the account.
• Tax consequences of opening, investing in, or withdrawing from a self-directed IRA.
• Specific details regarding the alternative assets in which funds will be invested.

NDBF also recommends working with individuals and firms that are registered to sell securities and to verify their background and registration status.  Background information on registered individuals and firms is available through NDBF. In addition, you may obtain information regarding a broker or investment adviser through FINRA’s Broker Check database at BrokerCheck.FINRA.org or through the SEC’s Investment Adviser Public Disclosure website at AdviserInfo.SEC.gov.

More information about the laws governing the securities industry in Nebraska can be found on NDBF’s website at www.ndbf.nebraska.gov. If you have questions about any investment matter, call Nebraska Department of Banking and Finance at 402-471-3445.

Precious Metals Investor Alert 8.2020.pdf

###

May 1, 2020.  Nebraska Department of Banking and Finance Director Mark Quandahl has designated the Nebraska Bankers Insurance and Services Company (NBISCO) as the Administrator of the Single Bank Pooled Collateral program for the State of Nebraska.

Notice of Intent to Award

And

Public Comment Period

April 16, 2020

 

The Nebraska Department of Banking and Finance states its intention to designate an Administrator of the Single Bank Pooled Method (SBPM) on or about May 1, 2020.

Pursuant to:  Nebraska Department of Banking and Finance RFP 2020-001

For:     Administrator of Single Bank Pooled Method

Intended appointee:   Nebraska Bankers Insurance and Services Company (NBISCO)

Any member of the public may comment on this notice of intent to award, the contents of RFP 2020-001, the intended appointee and the proposal response of the Nebraska Bankers and Insurance and Services Company from this date until 5:00 pm (the close of business) on April 30, 2020 by emailing said comments to mark.quandahl@nebraska.gov

 

Nebraska Department of Banking and Finance

By Mark Quandahl, Director

 

Notice of Intent to Award.pdf

 

Please note the updates to the schedule for RFP 2020-001.

Activity
Date/Time

5. Oral Interviews, Presentations and/or Demonstrations
03/13/2020 through 04/03/2020

6. Post “Notification of Intent to Appoint” on internet 

04/10/2020

7.  Public Comment Period
04/13/2020 through 04/27/2020

8.  Contract Finalization period  
04/10/2020 through 04/30/2020

9.  Designation/appointment       
05/01/2020*

10.  Protest Period for non-appointed applicants 
05/04/2020 through 05/15/2020*

11.  Administrator Start Date   
07/01/2020*

* Unchanged from previous activity schedule of events

 

RFP 2020-001 Schedule Update 20200330

NDBF Urges Nebraskans to Beware of Con Artists Looking to Profit from Coronavirus Fear and Uncertainty

March 9, 2020 (LINCOLN, NEB.)  — In light of the ongoing developments related to the current coronavirus (COVID-19) situation, and its impact on financial markets, the Nebraska Department of Banking and Finance (NDBF) is urging Nebraskans to beware of con artists seeking to capitalize on fear and uncertainty.

 

“We know con artists are opportunistic and use current events to cloak their schemes with an air of immediacy and legitimacy. Never make an investment decision without understanding what you are investing in, who you are doing business with, where your money is going, how it will be used, and how you can get it back,” said NDBF Deputy Director Claire McHenry. “Always ask if the salesperson and the security are registered with their state or provincial securities regulator.”

 

Deputy Director McHenry also said investors should be on the lookout for scam artists trying to use the market downturn and the coronavirus to scare investors into so-called “safer, guaranteed investments.” “If you have concerns about your retirement accounts or investments, talk to your financial professional,” Deputy Director McHenry said. “Avoid making decisions based on panic or fear.”

 

To help investors identify common telltale signs of possible investment fraud, NDBF has provided three questions to ask before making a new investment.

 

• First, is the investment being offered with a guaranteed high return with little or no risk?

All investments carry risk that you may potentially lose some or all of your money. Anyone who says their investment offer has no risk is lying. No one can guarantee an investment return.

• Second, is there a sense of urgency or limited availability surrounding the investment?

If the offer is legitimate, it will be there later. If someone offers you a “can’t miss” investment opportunity and puts you on the spot, do not be afraid to walk away.

• Third, is the person offering the investment, and the investment itself, properly licensed or registered?

For the same reasons you would not go to an unlicensed doctor or dentist, you should avoid unregistered investment salespeople and their products.

“Make sure you have all the facts before you hand your money over to someone else to invest,” Deputy Director McHenry said. Deputy Director McHenry also encourages investors to contact NDBF with any questions about the investment professional they are working with or the product being offered.

 

More information about the laws governing the securities industry in Nebraska can be found on NDBF’s website at ndbf.nebraska.gov. If you have questions about any investment matter, call NDBF’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

 

#####

Press Release - Coronavirus March 9 2020.pdf

NDBF Closes Ericson State Bank, Ericson, Nebraska

Contacts:

Mark Quandahl, Director                                       Patricia Humlicek Herstein, General Counsel

402-417-8982                                                          402-525-8312                                                                                                

mark.quandahl@nebraska.gov                               patricia.herstein@nebraska.gov

    

Main Office:  402-471-2171                                         

 

FOR IMMEDIATE RELEASE

February 14, 2020 (Lincoln, Neb.) – The Nebraska Department of Banking and Finance (NDBF) announced that at 4:00 p.m. today it closed Ericson State Bank, Ericson, Nebraska, because it was insolvent.  NDBF had been closely monitoring the bank for some time and recently made a demand for a capital injection, which was not met.

 

NDBF named the Federal Deposit Insurance Corporation (FDIC) as receiver of the bank.  The FDIC has entered into a purchase and assumption agreement with Farmers and Merchants Bank, Milford, Nebraska.  The transaction includes the assumption of all customer deposits.  The sole office of Ericson State Bank, located at 427 Central Avenue, Ericson, Nebraska, will be open for business on Tuesday, February 18, 2020, under the name, Farmers and Merchants Bank.  Farmers and Merchants Bank is owned by Country Bank Shares, Inc., Milford, Nebraska.

 

“The failure of Ericson State Bank resulted primarily from large out-of-territory commercial loan losses and poor management practices which led to a deterioration of the bank’s capital.  When the capital was not replenished, the Department was left with no option but to place the insolvent institution in receivership,” said Mark Quandahl, NDBF Director.  Quandahl noted that the overwhelming majority of Nebraska banks are in a strong condition.

 

Ericson State Bank was chartered in 1959, and is a subsidiary of Wheeler County Bancshares, Inc., a one-bank holding company, located in Ericson, Nebraska, owned by Debra Poulsen and Jack Poulsen.  As of December 31, 2019, Ericson State Bank had total assets of approximately $100.9 Million and total deposits of approximately $95.2 Million. 

A copy of a 2019 NDBF regulatory action against the bank can be found at http://www.nebraska.gov/ndbf/searches/Orders/20190923_EricsonStateBank_ConsentOrder.pdf

 

The most recent closures of Nebraska state-chartered banks occurred November 4, 2011, when Mid City Bank, Inc., Omaha, Nebraska, was declared insolvent, and February 13, 2009, when NDBF closed Sherman County Bank, Loup City, Nebraska.  Mid City Bank, Inc. was purchased by Premier Bank, formerly known as Purdum State Bank, Purdum, Nebraska.  Sherman County Bank was purchased by Heritage Bank, headquartered in Wood River, Nebraska.  Prior to the Loup City closing, no state-chartered bank had been closed since 1989.

 

Customers with questions about today's transaction should call the FDIC toll-free at

1-877-367-2717.

Interested parties may also visit the FDIC website:      

https://www.fdic.gov/bank/individual/failed/banklist.html

Statistical data about the bank may be found at: https://www7.fdic.gov/idasp/confirmation_outside.asp?inCert1=18265

 

 

********************************************************************************

• Mark Quandahl and Patti Herstein will be available between 4:00 p.m. – 6:00 p.m. CST on Friday, February 14.

• Mark Quandahl will be available on Saturday, February 15, 9:00 a.m. – 4:00 p.m. CST.

• The NDBF main office will be closed for the weekend and the Presidents’ Day Holiday on Monday, February 17, and will reopen Tuesday, February 18, from 8:00 a.m. – 5:00 p.m. CST

********************************************************************************

A copy of the official release is here:

NDBF Press Release Insolvent Bank Closure 2-14-2020

December 2, 2019 (LINCOLN, NEB.)  — The Nebraska Department of Banking and Finance (NDBF) announced today that ClearSky is conducting updates to its BlueExpress filing solution.  Filers using BlueExpress to file Form NF for mutual fund filings should be aware of scheduled disruptions to electronic filings and a change required in order to continue electronic filing. 

 

Filers should expect an electronic filing outage on Thursday, January 9, 2020 in order for ClearSky to complete and verify the migration and confirm state access to the new filing database.  Filers will also need to update the BlueExpress State URL. NDBF notified electronic filers of the required update. If you did not receive the notification or otherwise need assistance, please contact NDBF at DOB.SecuritiesFiling@nebraska.gov or 402-471-3445.

 

ClearSky provided NDBF with the following schedule:

 

Date:  

January 8, 2020          Final day to use current BlueExpress State URL

January 9, 2020          Electronic filing outage for all filers

January 10, 2020        Electronic filing to resume using new BlueExpress State URL

###

Industry Advisory - BlueExpress Outage and Update.pdf

 

Department of Banking and Finance

Industry Advisory

NDBF OFFERS RESOURCES TO HELP INVESTMENT PROFESSIONALS WORK WITH CLIENTS AFFECTED BY THE OPIOID EPIDEMIC

October 28, 2019 (LINCOLN, NEB.) — The Nebraska Department of Banking and Finance (NDBF) today announced the availability of resources to raise awareness of the impact of the opioid epidemic on investment professionals and their clients, especially senior investors.

"The opioid crisis in North America is devastating families and our communities. It is also a rising contributor to elder financial abuse," said NDBF Deputy Director Claire McHenry.

The U.S. Department of Health and Human Services in 2017 declared opioid abuse a public health emergency and estimated in 2017 that 11.4 million Americans misused prescription opioids. Recent research by Virginia Tech’s Center for Gerontology and the Elder Justice Coalition identified a connection between opioid abuse and elder abuse, including financial exploitation.

Deputy Director McHenry said the agency is offering two new resources to help raise awareness of how the opioid crisis impacts investment professionals and their clients.

The first is a guide to help investment professionals understand the many ways opioid use disorder might affect their clients, how to spot signs of financial exploitation, and how to help clients affected by opioid abuse. The guide also includes a list of helpful resources. The second resource consists of conversation starters financial professionals can use to help start a dialogue with clients about the financial ramifications of opioid addiction.

"Investment adviser representatives and broker-dealer agents are well positioned to be part of the solution, but they have to be prepared to talk to clients in crisis," Deputy Director McHenry said. "The cost of opioid addiction and treatment can have major financial ramifications. Clients facing opioid addiction – either themselves or within the family – may be strapped for resources and can be vulnerable to poor financial decision-making or even fraud."

The resources are also available on the agency’s website ndbf.nebraska.gov.

More information about the laws governing the securities industry in Nebraska can be found on NDBF’s website at ndbf.nebraska.gov. If you have questions about any investment matter, call NDBF’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

###

Industry Advisory - Opioid Guide.pdf

Industry Advisory - Opioid Addiction.pdf

NDBF ISSUES ADVISORY ON OPPORTUNITY ZONE INVESTMENTS

 

August 6, 2019 (LINCOLN, NEB.)  — The Nebraska Department of Banking and Finance (NDBF) today issued an advisory to raise awareness of the risks associated with investments in opportunity zones, economically distressed communities where new investments, under certain conditions, may be eligible for preferential tax treatment as part of the 2017 Tax Cuts and Jobs Act.

 

“This program provides an opportunity to strengthen investments in low-income communities and rural areas that traditionally struggled to attract the capital necessary to spur economic growth and job creation,” Deputy Director Claire McHenry said.

 

Investors attracted to opportunity zone investments for the potential tax benefits and promise of return on investment should weigh various factors before deciding to invest. The advisory discusses how opportunity zone investments work, the risks investors should understand when considering opportunity zone investments, and steps investors can take to protect themselves.

 

The full advisory is available on the agency’s website ndbf.nebraska.gov.

 

Separately, the North American Securities Administrators Association (NASAA), of which NDBF is a member, and the U.S. Securities and Exchange Commission (SEC) recently issued a summary that explains the application of the federal and state securities laws to opportunity zone investments.

 

The summary also provides an overview of the SEC and state requirements relating to qualified opportunity funds and their securities offerings, broker-dealer registration, and considerations for advisers to a qualified opportunity fund. The summary is available on the NASAA website http://www.nasaa.org/wp-content/uploads/2019/07/Opportunity-Zones-NASAA-SEC-Staff-Statement.pdf

 

Before making any financial decisions, ask questions, do your homework and contact NDBF at (402) 471-3445 for more information.

 

More information about the laws governing the securities industry in Nebraska can be found on NDBF’s website at ndbf.nebraska.gov. If you have questions about any investment matter, call NDBF’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

Consumer Advisory - Opportunity ZOne.pdf

Informed Investor Advisory - Opportunity Zone.pdf

 

###

NDBF RECOGNIZES WORLD ELDER ABUSE AWARENESS DAY

WARNS OF DANGER SIGNS FOR SUSPECTED FINANCIAL ABUSE

June 14, 2019 (LINCOLN, NEB.)  — In recognition of World Elder Abuse Awareness Day (WEAAD) on June 15, the Nebraska Department of Banking and Finance (NDBF) reminds financial professionals and the public throughout Nebraska to be on the lookout for elder financial abuse, including potential exploitation by family members or caretakers.

“Senior financial exploitation is a growing problem. Many in our elderly population are vulnerable due to social isolation and distance from family, caregiver, and other support networks,” Deputy Director Claire McHenry said. “Taking the time to understand the warning signs and the steps that can be taken to report financial abuse are key to helping those who cannot help themselves.”

The North American Securities Administrators Association (NASAA), of which NDBF is a member, has developed resources to help call attention to the red flags of fraud and suspected guardian financial abuse. For example, the “Guarding the Guardians” publication provides examples of exploitation and information on how to report suspected abuse.

Examples of suspected guardian abuse include:

• The guardian takes money from the protected individual’s investment portfolio to buy a flashy car for personal use.

• The guardian overcharges for a caregiving service, such as billing the estate hourly for wait time to file paperwork in person when it could have been submitted online.

• The guardian does not take the protected individual to medical appointments or purchase necessary medication.

The publication as well as other resources to help seniors are available on NASAA’s Serve Our Seniors website at serveourseniors.org/about/investors/. Other senior investor protection resources are available on the NDBF’s website at ndbf.nebraska.gov.

Financial and investment professionals also are encouraged to contact the agency to request a Senior$afe presentation on how to spot and report suspected senior financial exploitation.

Deputy Director McHenry asks anyone with suspicions of possible senior financial exploitation to contact the agency at 402-471-2171.

More information about the laws governing the securities industry in Nebraska can be found on NDBF’s website at ndbf.nebraska.gov. If you have questions about any investment matter, call NDBF’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

Consumer Advisory - WEAAD.pdf

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LPL Financial to pay $499,000 to Nebraska for Securities Violations

 

April 30, 2019 (Lincoln, Nebraska) – The Nebraska Department of Banking and Finance (NDBF) announced today that LPL Financial has paid the State of Nebraska $499,000 as part of a nationwide settlement of claims that it sold unregistered securities.

 

“This settlement sends a strong message that states hold firms accountable and continue to serve a vital role in protecting investors,” Deputy Director Claire McHenry said.

The settlement stems from a multi-state investigation led by Alabama and Massachusetts.  State securities regulators concluded that LPL offered and sold unregistered, non-exempt securities and failed to reasonably supervise the flow of information to ensure full and proper compliance with state securities registration requirements.

The settlement also found that LPL violated state securities laws by failing to maintain books and records, failing to effectively supervise its agents and staff, and that it was negligent in cancelling certain third-party services critical for compliance with state securities requirements.

In total, LPL will pay $26 million in civil penalties among the states. Additionally, LPL will offer to repurchase from investors’ securities held in LPL accounts determined to have been unregistered, non-exempt equity or fixed-income securities sold since October 1, 2006, plus 3% interest.

The settlement amount includes a $60,000 fine, $80,000 in costs to the Department, and $359,000 to be paid to the Department of Banking and Finance Settlement Cash Fund.  The settlement funds will primarily be utilized to further financial literacy programs for K-12 Nebraska students.

A copy of the Consent Order is available on the Department’s website http://www.nebraska.gov/ndbf/searches/Orders/20190410_LPLFinancialLLC_ConsentOrder.pdf 

More information about the laws governing the financial industries in Nebraska can be found on the Department’s website at ndbf.nebraska.gov.  If you have questions about any investment matters, call the Department’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

Consumer Advisory - LPL Settlement.pdf

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Nebraska Energy Office 1% Energy Related Disaster loans through Nebraska Financial Institutions

The Nebraska Department of Banking and Finance and the Nebraska Energy Office (NEO) presented a webinar on April 12, 2019.   The webinar focused on the NEO Dollar and Energy Savings Loan Program 1% loans to assist those impacted by floods to repair their homes, provided the home has not been condemned. 

Please click here for a copy of the full webinar: 

NDBF & NEO 1 % Disaster Loans Webinar

Please click here for the slide deck with updated phone numbers since the call:  

Click here

 

 

April 2, 2019 (LINCOLN, NEB.) — The Nebraska Department of Banking and Finance (NDBF) today announced its support of Financial Literacy Month, a nationwide investor awareness initiative that invites people to improve their understanding of financial principles and best practices.

"Educating investors of all ages empowers them to make sound financial choices," said Deputy Director Claire McHenry.

For this year’s Financial Literacy Month campaign, NDBF is focusing on raising awareness among millennials, those born between 1981 and 1996, of the importance of investing and protecting those investments from financial predators.

"Financial literacy is important for the financial future of Nebraska. We cannot afford to let the next generation embark on these critical early investing years without the financial literacy and awareness they will need," McHenry said.

A recent survey by the North American Securities Administrators Association (NASAA), of which the NDBF is a member, found that three-quarters of millennials (76 percent) said they do not have a brokerage account to hold investments such as stock, bonds, mutual funds or retirement assets. Among those who do invest, nearly half (46 percent) said they were not concerned about their financial security in retirement.

"This shows a gap in understanding of how to build wealth for a financially secure retirement. I encourage investors, or those thinking about investing, to visit our website, which offers a variety of investor awareness and protection resources." McHenry said.

Investors also are encouraged to contact NDBF before making an investment decision to learn more about the investment product and the person offering it for sale. "One quick call is all it takes," McHenry said. "Education is an investor’s best defense against investment fraud and best tool to build a strong financial future."

More information about the laws governing the securities industry in Nebraska can be found on NDBF’s website at ndbf.nebraska.gov. If you have questions about any investment matter, call NDBF’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

Consumer Advisory - Financial Literacy Month.pdf

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Legislative Bills 258  & 259 with Effective date March 8, 2019 and LB 355 has  Various Operational Dates.

For more information about the Legislative Bills please Click the below pdf links for the respective bills.

Legislative Bill 258 - Effective March 8, 2019

Legislative Bill 259 - Effective March 8, 2019

Legislative Bill 355 - Various Operational Dates

 

 

 

 

February 25, 2019 (LINCOLN, NEB.) —The Nebraska Department of Banking and Finance (NDBF) is participating in America Saves Week and Military Saves Week, February 25-March 2, to help raise awareness among investors, especially those entering the workforce or those early in their careers, of the importance of safeguarding their financial futures.

"Building a safe and secure financial future it is critical for all generations and we must ensure this important message is making its way to Millennials," said Deputy Director Claire McHenry.

The nation’s 75 million Millennials, those born between 1981 and 1996, have surpassed Baby Boomers as the largest demographic in the United States. With nearly a quarter of the entire U.S. population, Millennials also make up nearly two-fifths of all working age Americans – those saving and investing to build retirement nest eggs.

"Millennials either are just coming of age or are starting to get serious about building wealth for their financial futures. At the same time, many are straddled with student loan debt, are ill-equipped with the financial literacy tools necessary to build their future and may become susceptible to go-to promise of con artists: high returns for low risk," Deputy Director McHenry said.

To help promote investor awareness and protection, the NDBF is providing three quick tips.

1. Watch for the Red Flags of Fraud. "If it sounds too good to be true, it usually is," Deputy Director McHenry said.

2. Understand Who You Are Doing Business With. "Many of us spend more time reading restaurant’s reviews than researching the background of our stockbroker or investment adviser," she said.

3. Know where to turn for help. "Your state securities regulator is just a click or call away," Deputy Director McHenry said.

NDBF can provide detailed information about an investment product, broker or adviser. This information is free and easy to obtain. For more information, please contact NDBF at (402) 471-3445 or online at www.ndbf.nebraska.gov.

NDBF is a proud partner in America Saves Week and Military Saves Week, national public awareness campaigns led by the Consumer Federation of America to motivate people to save for their financial future. To learn more, visit www.americasaves.org.

More information about the laws governing the securities industry in Nebraska can be found on NDBF’s website at www.ndbf.nebraska.gov. If you have questions about any investment matter, call NDBF’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

Consumer Advisory - Military Saves Week.pdf

Informed Investor Advisory Military Saves.pdf

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Dec. 3, 2018 (LINCOLN, NEB.) — The Nebraska Department of Banking and Finance (“NDBF”) released today the results of its 2018 Cybersecurity Survey of Nebraska-Registered Investment Advisers. The report details results of a voluntary survey issued to all Nebraska advisers used to assess cybersecurity practices and risk management.  The 2018 survey is follow up to the 2016 Cybersecurity Survey to determine whether Nebraska advisers had improved their cybersecurity practices. 

“The Department wishes to thank all of the Nebraska advisers that participated in the survey,” Deputy Director Claire McHenry said.

In general, NDBF found that Nebraska advisers were taking steps to address cybersecurity threats, but that firms also could improve their practices.  The survey focused on several cybersecurity issues, including devices, Wi-Fi access, passwords and encryption, and anti-virus/anti-malware protections.  The report also identifies best practices and resources to assist firms to address cybersecurity issues. 

“Cybersecurity remains a key priority for the Department,” said Deputy Director McHenry.  “It is essential that investment advisers address cybersecurity threats to protect their clients and their firms, regardless of the size of the firm.”

2018 Cybersecurity Survey Report.pdf

 

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NEBRASKA MONEY TRANSMITTER LICENSEES

IMPORTANT NOTICE REGARDING CALL REPORTS

The Nebraska Department of Banking and Finance ("NDBF"), by Order of the Director effective November 9, 2018, has adopted "mandatory" Money Services Businesses ("MSB") Call Reports under the Nationwide Multistate Licensing System ("NMLS"). A copy of the Order is attached to this Notice.

Such reporting will commence with the Q4 2018 reporting period, and the initial report is due 45 days after such fourth quarter end (February 14, 2019). Previously, filing MSB Call Reports electronically through NMLS was optional in Nebraska. A "Location" report, which will be available on the NDBF website, will continue to be required to be submitted directly to the NDBF at renewal. A request for an exemption from mandatory reporting through the NMLS may be submitted to the Director.

MSB Call Reports were developed with the goal of enhancing and standardizing the information available to state regulators concerning the activities of MSB licensees, including money transmitters. Electronic submission of MSB Call Reports through the NMLS enables licensees to efficiently, effectively, and securely comply with the reporting requirements of multiple states. Licensees will be able to submit quarterly and annual information directly in NMLS. Twenty-four state agencies currently have adopted mandatory NMLS MSB Call Reports in NMLS. Training and additional materials are available in the NMLS Resource Center

Questions regarding this Notice or the attached Order should be directed to NDBF at dob.consumerfinance@nebraska.gov@nebraska.gov>

Mandatory Money Transmitter Call Reports Order

NDBF ISSUES ADVISORY ON MARIJUANA-RELATED INVESTMENTS

October 22, 2018 (LINCOLN, NEB.) — The Nebraska Department of Banking and Finance (NDBF) is cautioning investors about schemes and risks associated with marijuana-related investments.

Investments in marijuana business ventures are becoming more prevalent and are receiving increased media coverage. Fraudsters may attempt to use this attention to convince investors to hand over money for risky or outright fraudulent marijuana ventures.

 

The advisory provides information about common marijuana-related investment schemes and the unique risks associated with marijuana-related investments, including reverse merger and pump-and-dump schemes, and jurisdictional legality.

 

The full advisory is available on the agency’s website here.

 

More information about the laws governing the securities industry in Nebraska can be found on NDBF’s website at www.ndbf.nebraska.gov. If you have questions about any investment matter, call NDBF’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

Consumer Advisory - Marijuana.pdf

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PROTECT YOURSELF FROM INVESTMENT FRAUD

Sept. 11, 2018 (LINCOLN, NEB.) — If you are looking at an investment opportunity, the Nebraska Department of Banking and Finance (NDBF) urges you consider this first: Americans lose billions of dollars to fraud each year. A little extra effort can help you protect your money. While the details of investment scams constantly change, common warning signs, or red flags, are often present. Watch out for:

• Guaranteed high returns – a guarantee is only as good as the person offering it, and their credit rating.
• Low risk and high returns – if it is a high return investment, you are putting your money at risk.
• Offshore investment opportunities – if you send your money offshore, you lose the protection offered by state securities laws.
• Tax loopholes – you will still have to pay taxes, even after you lose your money.

 

 If you are offered an investment opportunity, consider these questions:

 

• Are you dealing with a licensed financial adviser or broker? Anyone selling securities or offering investment must be registered with NDBF or operating under an exemption. Call NDBF or go to brokercheck.finra.org to check their registration and background.

• Do you understand how the investment works? Scam artists rely on your lack of knowledge to make money. Seek independent advice and verify what you have been told. Get terms of the deal in writing and keep copies.

• Have you had enough time to make a decision? Take your time. Do not give in to high-pressure sales tactics.

• Do you understand how the salesperson makes money? Ask questions about what commissions the sales person will receive and whether they have any of their own money invested in the venture.

   

If you have answered no to any of these questions, investigate further.

 

More information about the laws governing the securities industry in Nebraska can be found on NDBF’s website at ndbf.nebraska.gov. If you have questions about any investment matter, call NDBF’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

Consumer Advisory - Protect yourself from investment fraud.pdf

 

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NEBRASKA DEPARTMENT OF BANKING AND FINANCE

Notice is hereby given that the Nebraska Department of Banking and Finance will hold a rulemaking hearing on July 25, 2018, commencing at 9:30 a.m., at the offices of the Department of Banking and Finance, 1526 K Street, Suite 300, Lincoln, Nebraska 68508.

The purpose of the hearing is to take testimony and evidence concerning the following changes to the Rules and Regulations of the Department:

1) The proposed repeal of Title 45, Chapters 1-5, 10, 13-14, 22, and 29.

2) The proposed repeal of Title 46, Chapters 1-6, 9 and 12.

3) The proposed repeal of Title 47, Chapters 1-11.

4) The proposed revisions to Title 48, Chapters 6, 13, 16, 38, and 39.

5) The proposed repeal of Title 48, Chapter 35.

45 NAC—Banking Rules: Chapters 1-5, 10, 13-14, 22, and 29, are proposed for repeal as such rules are obsolete.

46 NAC—Industrial, Savings & Loan, Credit Union Rules: Chapters 1-6, 9, and 12 are proposed for repeal as such rules are obsolete.

47 NAC—Electronic Transmission Terminal Rules: Chapters 1-11 are proposed for repeal as such rules are obsolete.

48 NAC—Securities Rules: The following amendments are proposed for Title 48:

48 NAC 6—Agents of Broker-Dealers: The purpose of the proposed revision of 48 NAC 6 is to update provisions governing broker-dealer agents. The proposal adjusts examination requirements for agents to correspond to new examination requirements established by the Financial Industry Regulatory Authority.

48 NAC 13—Information Requirements for the Section 8-1110(5) Exchange Exemption: The purpose of the proposed revision of 48 NAC 13 is to eliminate an obsolete notice filing requirement and to designate approved exchanges for the exchange exemption.

48 NAC 16—Information Requirements for the Section 8-1111(15) Agricultural Cooperative Exemption: The purpose of the proposed revision of 48 NAC 16 is to clarify that the filing requirements apply to all cooperatives and limited cooperative associations.

48 NAC 35—Repealed. This chapter is proposed for a complete repeal as such rule is obsolete.

48 NAC 38—Information Requirements for the Section 8-1111(23) Notice: The purpose of the proposed revision of 48 NAC 38 is to increase the amount that can be raised from $250,000 to $750,000, and to authorize issuers to rely upon the federal "Intrastate Offering Exemption", 17 CFR 230.147A.

48 NAC 39—Conditions and Information Requirements for the Section 8-1111(24) Crowdfunding Exemption: The purpose of the proposed revision of 48 NAC 39 is to eliminate certain restrictions on advertising. Issuers will be allowed to advertise across state lines as long as the advertising states that the offering is limited to Nebraska residents.

The rulemaking hearing is being conducted under and by virtue of the provisions of Section 84-907, R.R.S 1943, as amended, which provides that COPIES OF THE PROPOSED RULES ARE AVAILABLE FOR PUBLIC EXAMINATION at the Office of the Department of Banking and Finance, 1526 K Street, Suite 300, Lincoln, Nebraska 68508, and at the Office of the Secretary of State, 1201 N Street, Suite 120, Lincoln, Nebraska 68508. In addition, the proposed rules are available on the Department of Banking and Finance’s website at https://ndbf.nebraska.gov, and the Secretary of State’s website www.sos.ne.gov.

A copy of the Fiscal Impact Statement is available at the Office of the Department of Banking and Finance and on the Department’s website.

All interested persons are invited to attend and testify at the hearing. Interested persons may also submit written comments to the Department of Banking and Finance prior to the hearing, which comments will be made part of the hearing record at the time of the hearing.

If auxiliary aids or reasonable accommodations are needed for attendance at this hearing, please call the Nebraska Department of Banking and Finance at (402) 471-2171, or, for persons with hearing impairments, please call the Nebraska Relay System, (800) 833-7352 TDD. This contact should be made at least seven (7) days prior to the hearing.

Dated at Lincoln, Nebraska, this 19th day of June, 2018.

Mark Quandahl, Director

Nebraska Department of Banking and Finance

 

The drafts can also be found HERE(https://ndbf.nebraska.gov/about/legal/ndbf-2018-rules-updates-hearing-20180725) on the Department's Website.

NDBF WARNS ABOUT FAKE FINANCIAL REGULATOR

JUNE 8, 2018 (LINCOLN, NEB.) - The Nebraska Department of Banking and Finance is warning Nebraska residents about an entity claiming to be a financial regulator.  The Federal Securities Trading Regulatory Board (“FSTRB”), with a website at www.fstrb.org claims to be operating from 201 North 8^th Street, Unit 210, Lincoln, Nebraska.  According to its website, the FSTRB is responsible to “oversee, administer, and enforce the federal securities laws related to Corporate Mergers & Acquisitions.”  The FSTRB also claims to license entities and individuals engaged in the financial industry, including broker-dealers, investment advisers, “deposit taking” institutions, and money transmitters.

 

The Department was contacted by a resident of Finland who reported that a group of investors were attempting to purchase the stock of a company located in Pennsylvania.  During the transaction, the FSTRB became involved in the facilitation of the sale of the stock.  As instructed by a FSTRB employee, the investors wired money to an account in the Philippines. 

 

The Department has confirmed that there is no entity calling itself the FSTRB located at the address listed on its website.  Furthermore, the FSTRB is not a legitimate financial regulator.  It appears that this entity and website were created to give credibility to securities transactions and to induce investors to wire funds to “purchase” the securities. 

 

On June 8, 2018, the Department issued a Cease and Desist Order against FSTRB ordering it to cease acting as a broker-dealer and to cease making false and misleading representations to investors, including representing that they are a regulatory agency. 

 

To help investors determine if they are dealing with a bogus regulator, the North American Securities Administrators Association, an organization consisting of state and provincial securities regulators, including the Department, identified the following warning signs:

1. You cannot find references to them on any other regulatory websites. If you cannot find information about the “regulator” on the site of the International Organization of Securities Commissions, www.iosco.org, they probably are not a legitimate regulator.

2. They endorse or approve any investment opportunity, stock, or company. Legitimate regulators are not in the business of promoting any deal, only enforcing securities laws and ensuring fair dealing.

3. They say that paying a fee to “release restricted shares” is anything other than an attempt to steal your savings. This is a common ploy, and a recent twist on age-old advance fee schemes.

4. Little or no information about the “regulator” appears in Internet search engines. Any legitimate regulator should generate hundreds of entries in any Internet search engine.

5. If you talk to other regulators, and they say they have “never heard of them,” you are most likely dealing with a fake regulator.

 

The Department strongly cautions consumers on conducting business over the Internet with financial companies with whom they are unfamiliar.  In many cases, the customer is told to wire money or send a money order, often to a location outside the United States. Consumers never receive the promised services and cannot recover their money.  Furthermore, these consumers may be asked to provide personal information such as social security numbers and bank account numbers to the Internet company, which makes them prime targets for identity theft. 

Individuals who conducted business with the FSTRB are asked to contact the Department.

A copy of the Cease and Desist Order is also available on the Department’s website at www.ndbf.nebraska.gov. 

More information about the laws governing the financial industries in Nebraska can be found on the Department’s website.  If you have questions about any investment matters, call the Department’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

FSTRB Cease and Desist Press Release

FSTRB Cease and Desist Order

NDBF ISSUES ADVISORY ON FINANCIAL UNICORNS

April 24, 2018 (LINCOLN, NEB.) — The Nebraska Department of Banking and Finance (NDBF) is cautioning investors about pre-IPO investments in large privately held companies with supposed valuations of more than $1 billion, commonly referred to as "unicorns." Investing in unicorns is speculative and generally unavailable to retail investors.

 

NDBF is sharing an Informed Investor Advisory about financial unicorns. The advisory provides information and resources to help investors better understand "unicorn" companies. The advisory discusses the risks of investing in pre-IPO companies, including fraud, as well as disclosure, liquidity and valuation considerations.

 

The full advisory is available on the agency’s website here.

 

More information about the laws governing the securities industry in Nebraska can be found on NDBF’s website at www.ndbf.nebraska.gov. If you have questions about any investment matter, call NDBF’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

Consumer Advisory - Unicorns

Informed Investor Advisory - Unicorns

Conversation Starters For Military Families

 

MARCH 1, 2018 (LINCOLN, NEB.) — This week is Military Saves Week, which encourages members of the military and their families to save money and build wealth.  The Nebraska Department of Banking and Finance (“NDBF”) proudly supports our service members and understands that they have unique challenges.

Military life changes quickly with deployments, relocations, promotions or changes in dependents. NDBF is issuing conversation starters to help military families prepare themselves to make safe and wise financial decisions. 

Budgeting

• How much income goes toward fixed expenses (e.g. rent, insurance) versus flexible expenses (e.g. entertainment and investments)?
• Have you created a financial plan to show where your money goes?
• Have you taken advantage of military resources to help develop personal finance skills?
• Are your family members aware of all financial accounts, bill deadlines, investments, etc. in case of deployment or an emergency?

Saving

• What are your short and long-term financial goals (e.g. buy a home, start a family)?
• Do you have an emergency fund for unexpected financial hardships?
• How could you spend less and save more?
• Are you aware of the special savings accounts and financial programs available to military personnel on deployment?

Investing

• What are the risks and benefits of investing compared to saving?
• What investments are appropriate now (e.g. securities, real estate, education)?
• How do you balance immediate financial needs with long-term financial goals?
• Do you understand basic investing strategies (e.g. diversification and dollar cost averaging)?
• Who can help you make informed financial or investment decisions?
• Are you taking advantage of all government-offered investment and retirement plans?

Scams and Frauds

• How do you identify and report suspected fraud?
• Where can you verify the background of financial professionals or firms?
• How can you effectively monitor your investments?
• How can you stay aware of current investment scams and fraud?

Additional information about Military Saves Week and a list of resources and events is available at www.militarysaves.org. 

 

More information about the laws governing the securities industry in Nebraska can be found on NDBF’s website at www.ndbf.nebraska.gov. If you have questions about any investment matter, call NDBF’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

Consumer Advisory - Military Families Conversation Starters

NDBF IDENTIFIES COMPLIANCE, CYBERSECURITY RESOURCES FOR INVESTMENT ADVISERS

DECEMBER 19, 2017 (LINCOLN, NEB.) — The Nebraska Department of Banking and Finance (“NDBF”) draws attention to resources for its state-registered investment advisers available from the North American Securities Administrators Association (“NASAA”), of which it is a member.  At its annual conference in September, NASAA released two reports important to state-registered investment advisers.

The 2017 NASAA Investment Adviser Coordinated Examination Report provides information about more than 1,200 coordinated examinations of state-registered investment advisers by 37 state securities regulators, including NDBF.  The report identified the top three findings as books and records, registration, and contracts. In particular, examiners found problems with client suitability information, inconsistencies between Parts 1 and 2 of Form ADV, and problems with the fee description in the contract. These findings are consistent with Nebraska’s examination findings. 

The exam report identifies 10 best practices to assist investment advisers in developing compliance policies and procedures, including maintaining all required records, maintaining up-to-date suitability information, and reviewing the Form ADV annually.  NDBF reminds investment advisers that under new rules, NDBF is requiring all investment advisers to adopt and implement written policies and procedures reasonably designed to prevent violations of the Securities Act of Nebraska on or before June 5, 2018. 

During the coordinated examinations, state securities examiners also found nearly 700 deficiencies involving cybersecurity.  Cybersecurity is a key priority for NDBF and NASAA.  In February 2016, NDBF surveyed its state-registered investment advisers about their cybersecurity practices.  The survey found that all firms used passwords on computers used for advisory business and most had created some policies and procedures about cybersecurity. The survey also found that investment advisers could improve cybersecurity readiness by using stronger passwords, maintaining up-to-date anti-virus/anti-malware software and operating systems, and encrypting sensitive client data, particularly on mobile devices.  NDBF will conduct a similar survey in February 2018 to gather updated information and identify trends in cybersecurity practices in Nebraska.

NASAA also released a cybersecurity checklist to help state-registered investment advisers gauge their cybersecurity preparedness; identify, protect, and detect vulnerabilities; and respond and recover from cyber events.  Cybersecurity is a growing challenge, even for smaller firms, and NDBF encourages investment advisers to review the checklist and prepare for possible cybersecurity events.  

 

Resources for State Investment Advisors

On November 13, 2017, the Federal Trade Commission issued a notice to consumers who lost money using Western Union services that they may be eligible for a refund.

If you lost money to scammers who had you pay using Western Union between January 1, 2004 and January 19, 2017, you can now ask for your money back.   

To learn more, follow this link to the Federal Trade Commission.

Nebraska Department of Banking and Finance entered into a Consent Order with Ocwen Loan Servicing, LLC and Ocwen Mortgage Servicing, Inc.

On November 3, 2017, the Nebraska Department of Banking and Finance entered into a Consent Order with Ocwen Loan Servicing, LLC and Ocwen Mortgage Servicing, Inc. The Consent Order resolves the Department’s April 20, 2017, Cease and Desist Order against the Ocwen entities and provides several protections for Nebraska mortgage consumers.

Under the Consent Order the Ocwen entities will not acquire new residential mortgage servicing rights until April 30, 2018, and will transition all loans to a new servicing system. The Ocwen entities will also engage an independent third-party auditor to test approximately 9,000 loan files for compliance with state and federal escrow laws at an estimated cost to the Ocwen entities of at least $4.4 million.

The Nebraska Department of Banking and Finance will receive regular reports on Nebraska mortgage loans and will interact with the Ocwen entities, on behalf of consumers, through an enhanced consumer complaints processing procedure. The Department will also receive regular reports on the Ocwen entities’ financial condition for three years and will get direct notification if certain liabilities are incurred by the Ocwen entities.

For media inquiries contact Mark Quandahl, Director, or Patricia Herstein, NDBF General Counsel. Consumers can contact NDBF Department Legal Counsel for information regarding the Ocwen entities, or in the event they experience problems with payments or other account issues.

Ocwen - Consent Order, Exhibit A and Exhibit B
Ocwen - Loan Servicing Cease and Desist 4 20 2017 seal

NDBF ISSUES BINARY OPTIONS ADVISORY

SEPTEMBER 15, 2017 (LINCOLN, NEB.) — A binary option is a type of all-or-nothing investment contract, similar to placing a bet. Like the flip of a coin, there are only two possible outcomes: heads you win or tails you lose. When an investor purchases a binary option contract, the investor predicts the value of an underlying asset (currency, stock, etc.) at a predetermined time or date in the future – similar to placing a bet. If the investor correctly predicts the asset price at the end of the contract, which can be just a matter of minutes, the investor receives the payout agreed upon in the contract. If the investor is incorrect, there is no payout and the investor loses the amount invested in the binary option.

The Nebraska Department of Banking and Finance (“NDBF”) is cautioning investors about schemes related to binary options amid the proliferation of online binary option platforms and a growing number of related investor complaints. The advisory provides information and resources to help investors better understand binary options, their risks and where to turn for help.

The advisory also discusses common investor complaints and offers common tactics and warning signs of schemes related to binary options, including: unsolicited investment offers; high-pressure sales tactics; personal information requests; and a lack of information about the offering firm or its management.

The full advisory is available on the agency’s website at www.ndbf.nebraska.gov/about/news-publications.

Before making any financial decisions, ask questions, do your homework and contact NDBF’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

CONTACT: Claire McHenry, Deputy Director – Securities Bureau
PHONE: (402) 471-2171
EMAIL: claire.mchenry@nebraska.gov

Consumer Alert Binary Options

NDBF Cautions Investors to Watch for Scams in Wake of Hurricane Harvey

AUGUST 31, 2017 (Lincoln, Neb.)  —  In the wake of widespread damage caused by Hurricane Harvey in Texas and Louisiana, the Nebraska Department of Banking and Finance (“NDBF”) is cautioning investors to watch out for opportunistic investment scams.

“As we are seeing in Texas and Louisiana, natural disasters bring out the best in people, with neighbors helping neighbors. Unfortunately, we know from experience that disasters also can bring out the worst in people, particularly those seeking to profit from the misfortune of others,” NDBF Deputy Director Claire McHenry said. “Unsolicited investment offers seeking to capitalize on the aftermath of Hurricane Harvey should be approached with extreme caution.”

McHenry urged investors to watch for red flags of hurricane-related scams, including unsolicited email, social media messages, crowdfunding pitches or telephone calls promoting investment pools or bonds to help storm victims, water-removal or purification technologies, electricity-generating devices and distressed real estate remediation programs.

Scam artists also may linger to prey on storm victims who anticipate receiving large lump-sum insurance settlements. “The potential for fraud remains even after the skies have cleared. Be wary of any promoter promising quick and high returns on your investments,” McHenry warned.

NDBF also cautioned about fraudulent charitable solicitations that prey on the goodness of people seeking to help those in need. “The best advice is to do your research. Give to those charitable organizations that are registered properly with state authorities. As with any charitable contribution, those who want to contribute to relief efforts should send contributions to only those charities with an established track record of making sure the donations get to the victims,” McHenry said.

 

NDBF offered three tips to help investors avoid disaster-related scams:

• Delete unsolicited emails or social media messages and hang up on aggressive cold callers promoting hurricane-related investments, especially those from small companies touting unproven or new technologies or products.
• Use common sense. Claims of guaranteed returns or low/no investment risk are classic red flags. Every investment involves some degree of risk.
• Do your homework. Contact NDBF to check that both the seller and investment are licensed and registered. If not, they may be operating illegally.

More information about the laws governing the securities industry in Nebraska can be found on NDBF’s website at www.ndbf.nebraska.gov. If you have questions about any investment matters, call NDBF’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

CONTACT: Claire McHenry, Deputy Director – Securities Bureau
PHONE: (402) 471-2171
EMAIL: claire.mchenry@nebraska.gov

Hurricane Harvey Consumer Alert

NDBF to Hold August 17^th Investment Adviser Compliance Seminar

The Nebraska Department of Banking and Finance (“NDBF”) recently announced comprehensive amendments to its Rules under the Securities Act of Nebraska, contained in Title 48 of the Nebraska Administrative Code, became effective on June 5, 2017.  The amendments reflect NDBF’s goal of reducing regulatory complexity and promoting uniformity while protecting investors and promoting capital formation in Nebraska.

The NDBF Bureau of Securities will host a compliance seminar on August 17, 2017 at 2:00 pm CDT to assist investment advisers and their compliance personnel in understanding and complying with these new requirements.  Speakers will include NDBF Director Mark Quandahl, Deputy Director – Securities Bureau Claire McHenry, and Securities Bureau Counsel Mike Cameron. 

People may attend in person or electronically via webinar.  Space is limited.  Register by August 11, 2017 to reserve your seat.

Where:            Training Room – Basement Level
                        1526 K Street
                        Lincoln, NE 68508

When:             August 17, 2017
                        2:00 pm – 3:30 pm

Registration:  Click here to email the NDBF Securities Bureau.  Include in the email your name, firm, and whether you will attend in person or via webinar. Webinar participants will be emailed instructions on joining the webinar.

 

 NDBF Investment Adviser Compliance Seminar

NDBF Recognizes World Elder Abuse Awareness Day

Encourages Financial Firms to Watch for Signs of Elder Financial Fraud and Exploitation

June 15, 2017 (LINCOLN, NEB.) – In recognition of World Elder Abuse Day on June 15, 2017, the Nebraska Department of Banking and Finance (NDBF) reminds financial professionals of the importance of safeguarding Nebraska’s senior population by keeping a watchful eye for signs of elder financial exploitation and promptly reporting possible abuse to appropriate authorities.

Elder financial abuse is on the rise due to the amount of wealth seniors have accumulated throughout their careers and the increasing number of retirees throughout North America.

"Seniors are often targeted for financial fraud and exploitation because they may be isolated from family, caregivers, and other support networks. In other instances, it could be family or caregivers who are taking advantage of the vulnerable adult who feels he/she cannot say anything due to fear of retribution. That's why it is important to know the red flags that could signal an elder's savings may be in danger, " NDBF Director Mark Quandahl said.

Director Quandahl highlighted three warning signs of possible elder financial fraud or exploitation to watch for:

• Has the elder moved away from existing relationships and toward new associations with other "friends" or strangers who show excessive interest in his or her finances or accounts, refuse to allow the elder to speak or are reluctant to leave the senior's side during conversations?
• Does the elder show an unusual degree of fear, anxiety, submissiveness or deference toward the person accompanying him or her?
• Does the elder display unexplained or unusual excitement over an investment opportunity, financial windfall or prize check?

"Financial services professionals are uniquely positioned to serve as a front line of defense to spot potential elder financial fraud and exploitation and alert authorities," Director Quandahl said.

Financial professionals who suspect elder financial fraud or exploitation are encouraged to contact NDBF through the department's website at www.ndbf.nebraska.gov, or by calling the NDBF Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state. People who have reason to believe a vulnerable adult has been abused, neglected or exploited may contact the Nebraska Department of Health & Human Services, Adult Protect Services 24-hour hotline toll free at (800) 652-1999 or lo.cal law enforcement.

NDBF has teamed with the North American Securities Administrators Association, of which it is a member, to provide free training to help financial services employees learn how to identify and report suspected cases of senior financial exploitation. To learn more about the Senior$afe training program, or to request a training session for your firm, contact the Department.

 

World Elder Abuse Awareness Day

 

Nebraska Man Convicted of Securities Fraud

May 22, 2017 (Lincoln, Neb.) – Scott Robert Prill (“Prill”), formerly of Kearney and Holdrege Nebraska, has been convicted of securities fraud in three Nebraska counties. Prill sold unregistered promissory note securities to Nebraska residents to fund a cattle business. Prill also fraudulently failed to provide material information to the investors in his offer and sale of securities to them. Prill was sentenced to five years of probation in Douglas County, five years of probation in Phelps County, and six years of probation in Buffalo County. In addition, Prill was sentenced to 180 days in jail in Buffalo County. Prill was also ordered to pay restitution totaling $128,000.

Scott Robert Prill Consumer Alert May 2017

Cease and Desist Order Issued to Mortgage Servicers

The Nebraska Department of Banking and Finance has issued a Cease and Desist Order to Ocwen Financial Corporation through its Nebraska licensed subsidiaries, Ocwen Loan Servicing, LLC and Ocwen Mortgage Servicing, Inc.  The Order prohibits the companies from the acquisition of mortgage servicing rights and the origination of mortgage loans until they are able to prove they can appropriately manage their consumer mortgage escrow accounts.

 

NDBF Press Release – Ocwen Financial Corp. 4-20-2017

Ocwen Financial Corp. Cease and Desist Order

Consumer Fact Sheet

Omaha Company Ordered to Stop Soliciting Investors

The Nebraska Department of Banking and Finance (“Department”) issued a Cease and Desist Order against an Omaha-based company, Parker Grant BMC, Inc., its President Daniel M. Porter (“Porter”), and its affiliates, control persons, officers, directors, agents, and employees. The Order prohibits the entity and individuals named from offering or selling securities in Nebraska until they are registered as broker-dealers or agents of a broker-dealer with the Department.

Parker Grant BMC Consumer Alert
Parker Grant BMC C&D

Federal Regulatory Alert - Unauthorized Banking Entity: The Office of the Comptroller of the Currency is warning business owners and consumers of an entity calling itself Banc of Omaha. Business owners and consumers (who may not be business owners) are receiving letters by fax and mail stating that their company has been approved for up to $250,000 in working capital and to respond by a deadline because of limited funds.

Full OCC Press Release

Effective August 1, 2016, the Department revised the form, “Notices of Switch Operation,” to provide for the annual notice of operation filing. The annual notice is due on or before September 1, 2016.

Click here for the “Switches” page.

The Nebraska Department of Banking and Finance (“NDBF”) issued an Emergency Order against Jerome P. Bonnett, Jr., a/k/a Joe Bonnett and two of his companies, Bonnett Financial Services, Inc., and BWM Advisors, LLC, Omaha, Nebraska, on May 18, 2016. The Order revoked Bonnett’s registration as an investment adviser representative and suspended the registration of BWM Advisors, LLC, for multiple violations of the Securities Act of Nebraska (“Act”).

In addition, the Nebraska Attorney General’s office, on behalf of NDBF, filed a civil action on May 18, 2016, in Douglas County District Court against Bonnett and his companies alleging violations of the Act and misappropriation of client funds. The lawsuit seeks injunctive relief, freezing of assets, and the appointment of a receiver. On May 20, 2016, the Douglas County District Court granted a Temporary Restraining Order and Asset Freeze against Jerome P. Bonnett, Jr. and the companies named above.

The hearing on the State’s request for a receiver was held June 6, 2016, before Douglas County District Judge Duane Dougherty. Judge Dougherty entered an Order appointing Thomas D. Stalnaker, 1111 N. 102nd Court, Suite 330, Omaha, Nebraska, 68114, as receiver for Bonnett Financial Services, Inc., BWM Advisors, LLC, Omaha, Nebraska, and the Estate of Jerome P. Bonnett, Jr.

NDBF has sent a letter and survey to all known clients of Jerome P. Bonnett, Jr. and the named companies. Responses will be used to assist the receiver. Persons who have not yet returned the surveys are asked to do so promptly. Clients who did not receive the letter are asked to contact NDBF at 402.471.2171.

More information will be posted as it becomes available.

Read the Emergency Order
Read the Court Complaint
Read the Court Order
Read the Order Setting Hearing
Read the Order Appointing Receiver

NEBRASKA DEPARTMENT OF BANKING AND FINANCE WARNS CONSUMERS TO BEWARE OF SCAM INVOLVING OLD AND NON-EXISTING DEBTS

The Nebraska Department of Banking and Finance is warning residents to beware of a currently popular debt collection scam in which individuals call people to demand payment of an old “payday loan” and then threaten them with possible arrest or court action if they do not immediately send payment.

Full Press Release

The Nebraska Department of Banking and Finance Securities Bureau is conducting a series of seminars for “Switch” Investment Advisers as a result of the Dodd-Frank legislation. The seminars will provide Switch IA’s with information on relevant Nebraska law as well as a general overview of the Nebraska registration and examination processes. The seminars also present an excellent opportunity to meet and ask questions of Bureau staff. The seminars are free of charge.

December 1, 2011

IA “Switch” Workshop
Presented by the Nebraska Department of Banking and Finance Bureau of Securities
1:00 p.m. to 2:30 p.m. Omaha State Office Building | Room 233J | 1313 Farnam Street | Omaha, NE

December 8, 2011

IA “Switch” Workshop
Presented by the Nebraska Department of Banking and Finance Bureau of Securities
1:00 p.m. to 2:30 p.m.
Nebraska Department of Banking and Finance
Commerce Court Building | Suite 400 | 1230 O Street | Lincoln, NE
For more information about the workshops: (402) 471-3445
Click here to visit the IA Switch Resource Center

Lincoln, Neb., November 4 – The Nebraska Department of Banking and Finance (NDBF) announced that at 6:00 p.m. today it closed Mid City Bank, Inc., Omaha, Nebraska. The bank’s four branch offices, also located in Omaha, Nebraska, were simultaneously closed. The NDBF had been closely monitoring the bank for some time and recently made a demand for a capital injection, which was not met. The Department named the Federal Deposit Insurance Corporation (FDIC) as receiver of the bank. The FDIC has entered into a purchase and assumption agreement with Purdum State Bank, Purdum, Nebraska, which will change its name to “Premier Bank.” The transaction includes the assumption of all customer deposits. All offices of the bank will be open for business on Saturday, November 5, under the new name, Premier Bank. Premier Bank is owned by the Greg Stine family.

Full Press Release

The Nationwide Mortgage Licensing System (NMLS) is now accepting registration of mortgage loan originators (MLO) who are employees of depository institutions and certain subsidiaries. Following expiration of the 180-day initial registration period on July 29, 2011, any employee of an agency-regulated institution who is subject to the registration requirements will be prohibited from originating residential mortgage loans without first meeting these requirements.

Please refer to the NMLS Resource Center for information
http://mortgage.nationwidelicensingsystem.org/Pages/Default.aspx. The resource center contains information about the registry, including the rules and upcoming training sessions, and provides contact information for the federal agencies concerning the SAFE Act requirements.

The Nebraska Department of Banking and Finance is issuing a warning to Nebraska residents considering investing in oil, gas, or alternative energy programs. According to Jack Herstein, Assistant Director for the Department’s Bureau of Securities, con artists frequently rely on today’s headlines in pitching their investment schemes. With recent headlines focusing on prices at the gas pump, Herstein warned Nebraska residents to be alert to investments in traditional and alternative energy projects. Such investments are highly risky and not appropriate for smaller investors.

Full Press Release

The Nebraska Department of Banking and Finance has issued a Cease and Desist Order against Complete Development International, Inc., 16009 Oak Plaza, Omaha, NE (“Complete Development”), its president, William “Bill” Tate, and its affiliates, officers, directors, agents and employees. The Order prohibits the entities and individuals named from offering or selling securities to Nebraska investors.

Full Press Release

Read Statement

The Nebraska Department of Banking and Finance is pleased to announce the successful implementation of mortgage loan originator licensing requirements as required by the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (the “SAFE Act”) and by legislation enacted in 2009 and 2010 which made significant amendments to the Nebraska Residential Mortgage Licensing Act to bring Nebraska in compliance with the SAFE Act.

Full Press Release

The Nationwide Mortgage Licensing System & Registry (NMLS)—a mortgage licensing system operated by state financial regulators, including Nebraska—provides “NMLS Consumer Access”. NMLS Consumer Access is a fully searchable website that allows the public to view information concerning state-licensed mortgage companies, branch offices, and individuals currently licensed through NMLS.

Read Press Release
NMLS Consumer Access

The Nebraska Department of Banking and Finance is warning of an Internet finance company calling itself Hamilton Lending Group, which lists its address as 1248 “O” Street, Lincoln, Neb. The Department has verified that the company does not have an office at the address listed.

Read more information

The NDBF is issuing a warning of a scam targeting consumers who need to borrow money. A company calling itself Hillsboro Financial Group, which lists its address as 4060 Vinton Street, Suite 4, Omaha, NE, offers personal loans to consumers and requires up-front fees for “lender’s insurance” in advance of funding a loan. The Department has verified that the company does not have an office at the Omaha address listed.

Read More

The Nebraska Department of Banking and Finance is issuing a warning of two scams targeting consumers who use Internet-based companies to borrow money. Companies calling themselves Bennett Financial Group and Westmont Financial Group, which list their respective addresses as 10665 Bedford Street and 8401 West Dodge Road, both in Omaha, NE, offer personal loans to consumer and require up-front “collateral payments” in advance of funding a loan. The Department has verified that the companies do not have offices at the addresses listed.

Read News Release

The Nebraska Department of Banking and Finance is working with AARP in a new initiative designed to give individuals an opportunity to fight back by reporting questionable investment practices in their communities to the state securities regulator for investigation.

Read News Release

The Conference of State Bank Supervisors(CSBS) announced that the Nebraska Department of Banking and Finance has received its fourth certificate of accreditation from CSBS, certifying that the department maintains the highest standards and practices in state banking supervision. The CSBS Accreditation Program identifies banking departments that serve the citizens of their state by operating a capable and professional regulatory program.

Read News Release

Recent complaints to the Nebraska Department of Banking and Finance against Internet-based lending companies have prompted the Department to issue a warning to consumers about Internet lending scams. The Department is receiving a growing number of complaints on Internet-based cash advance companies, known as delayed deposit services in Nebraska and elsewhere as payday lenders, and Internet-based consumer loan companies.

Read News Release

NDBF today announced that starting on January 2, 2008, the Department will join several states across the country in participating in the Nationwide Mortgage Licensing System (NMLS) developed by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators. The goal of the NMLS is to streamline and improve the licensing of mortgage lenders, brokers and servicers that hold licenses in multiple states.

View the news release

The Nebraska Department of Banking and Finance (NDBF) has issued an Order to Cease and Desist against SFS, Inc., doing business as One Click Cash, located at 52946 Highway 12, Suite 3, Niobrara, Nebraska, from operating as an Internet delayed deposit services business. According to Department records, One Click Cash does not have a license to operate a delayed deposit services business in the state. Delayed deposit services businesses are commonly referred to payday lenders.

View news release

Nebraska Department of Banking and Finance Director John Munn today issued this consumer alert urging homeowners with adjustable rate mortgages especially those with nontraditional mortgages to plan now for any scheduled recasts or resets of interest rates in the year ahead. Non traditional mortgage loans and many subprime loans frequently feature a recast (or reset) with a significant payment increase.

View the press release