Real estate licensees.

Existing law, the Real Estate Law, provides for the licensure and regulation of real estate brokers, real estate salespersons, and mortgage loan originators by the Department of Real Estate and makes a willful violation of that law a misdemeanor. Existing law authorizes the department to deny, suspend, or revoke a license or license endorsement on various grounds using specified procedures generally applicable to state agencies. Under existing law, a hearing to determine whether to issue a license must be initiated by filing a statement of issues. Existing law provides additional procedures with respect to certain licensing boards, including, among other things, the authority to notify an applicant that the application is denied in lieu of filing a statement of issues, as specified. This bill would require the Department of Real Estate to use those additional procedures when denying a license or a license endorsement. Existing law authorizes the Real Estate Commissioner to require any proof he or she may deem advisable concerning the honesty and truthfulness of an applicant for a real estate license or license examination, or of the officers, directors, or persons owning more than 10% of the stock of a corporate applicant, before authorizing the issuance of a real estate license. Existing law authorizes a person whose license has been revoked or suspended to petition the agency for reinstatement of the license or reduction of a penalty, as specified. This bill would authorize the commissioner to require any proof concerning the honesty and truthfulness of the officers, directors, or persons owning 10% or more of the stock of a corporate applicant. The bill would also require the commissioner to require a person submitting a petition for reinstatement of a license or reduction of a penalty to submit his or her fingerprints with the petition. Existing law authorizes the commissioner to suspend or bar a person from a position of employment, management, or control (1) where that action is in the public interest and the person has committed or caused a violation of the Real Estate Law or a rule or order adopted thereunder or (2) where the person has been convicted of a crime or held liable in a civil action where the judgment involves an offense involving dishonesty, fraud, or deceit or any other offense reasonably related to the qualifications, functions, or duties of a person engaged in the real estate business. This bill would also authorize the commissioner to bar that person from participation in examinations for licensure and would specify that a person who is suspended or barred from a position of employment, management, or control is also barred from participation in examinations for licensure. The bill would prohibit a person from cheating on, subverting, or attempting to subvert a licensing examination and would authorize the commissioner to bar a person who willfully engages in that conduct from taking a licensing examination and from holding an active real estate license for a period of up to 3 years. Because a willful violation of the prohibition on cheating or subverting a licensing examination would be a crime, the bill would impose a state-mandated local program. Existing law requires a person to obtain a real estate license endorsement from the commissioner in order to engage in the business of a mortgage loan originator, as defined. Existing law requires an applicant for that license endorsement to pass a specified written test and authorizes a person who fails the test to retake the test up to 3 consecutive times, but requires an applicant to wait at least 6 months before retesting if the applicant fails 3 consecutive retests. This bill would eliminate the 3-test limit and would require an applicant to wait at least 6 months before retesting if the applicant fails 3 consecutive tests. The bill would exempt certain military licensees from being required to renew their license endorsement until the license period that commences after they engage in business or after one year following the termination of their military service, whichever occurs first. This bill would also delete certain obsolete language and would make other related changes. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason.