PERSON OF THE WEEK: As the Pennsylvania Department of Banking's director of nondepository examinations, Donald DeBastiani oversees the examination of mortgage companies in the state. As the newly elected chairman of the Multi-State Mortgage Committee (MMC), DeBastiani's responsibilities include coordinating the supervision of lenders and brokers, he explains to MortgageOrb.com in this week's Person of the Week feature.
Q: Congratulations on your new role as committee chairman. What do you view as the committee's main objectives in the coming year?
Donald DeBastiani: Thank you. The MMC is still a relatively new body, created in 2008 by state regulators working with the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators. Our mission is to coordinate the exams and supervision of mortgage lenders and brokers operating in more than one state. MMC members have developed good working relationships over the past few years as we collaborated on developing the Nationwide Mortgage Licensing System (NMLS).
With MMC and NMLS, we intend to create a seamless supervisory process that leverages off existing state resources. In the coming year, I look forward to the MMC building on those relationships to increase the efficiency, timeliness and quality of our examinations.
Q: The MMC is one of the many entities investigating mortgage servicers' foreclosure and loss mitigation practices. What are your expectations for the investigation, and how do you envision the state attorneys general, state mortgage banking regulators and federal officials coordinating their efforts?
DeBastiani: The investigation is still new, and we are facing an unprecedented crisis. The state attorneys general should be applauded for stepping up to address this crisis and, through the MMC, tapping into a national pool of financial examination, and investigatory and compliance expertise. We intend to get a clear picture of what happened and how it happened, devise some solutions to prevent this crisis from recurring and develop a new collaborative framework for regulators and law enforcement to address interstate issues.
Q: More generally, what are your thoughts on the job done by federal regulators with respect to monitoring servicers?
DeBastiani: I think the servicer issue provides an opportunity for enhanced cooperation between state and federal regulators. It has become clear that state regulators have the ability to contribute to policy and implementation across state lines, because many issues tend to boil up at the state level.
Q: We're a couple years removed from the passage of the SAFE Act. What has that legislation meant to the mortgage banking community? What remains to be done in regard to the SAFE Act?
DeBastiani: I think the consensus in the regulatory and business communities is that SAFE has been a success. Implementation of the legislation has created a new, higher standard of professionalism in the mortgage banking community and enabled state regulators to crack down on unlicensed mortgage activity. The next step in the implementation of SAFE is the registration of mortgage loan originators who operate in depository institutions with NMLS. Achieving this goal will enable state and federal regulators to have a more holistic view of the entire mortgage industry.
Q: The biggest piece of banking regulation in decades was passed this year in the form of the Dodd-Frank Act. How will the act affect the agenda of the MMC?
DeBastiani: The MMC will continue to improve its ability to protect consumers in the mortgage marketplace as the Consumer Financial Protection Bureau (CFPB) begins to take on the role that Dodd-Frank intended for it. Given the recent appointments of Steve Antonakes, the Massachusetts banking commissioner, and Peggy Twohig, a Federal Trade Commission official who has worked with state regulators, to key positions within the CFPB, the MMC is optimistic about a strong oversight partnership between state and federal mortgage regulators.