STACK: FINANCIAL PROTECTION MEASURES SIGNED INTO LAW

            HARRISBURG, June 29 – State Sen. Mike Stack today announced Gov. Ed Rendell’s signing of two financial protection measures into law.

            “These two new laws offer protection in different, but equally important ways,” said Stack, the Democratic chairman of the Senate Banking and Insurance Committee. “One measure benefits mortgage consumers, while the other protects employees in the financial sector. I’m pleased with these bills’ swift passage and I thank the governor for signing these measures into law today.”

            Senate Bill 170 protects consumers with mortgages by prohibiting their mortgage broker from being the only recipient of notices sent from the lender. It also prohibits a mortgage broker from designating who receives the notices for consumers. 

            Both bills address a fraud case in Berks County, in which mortgage broker Wesley Snyder was accepting mortgage payments from clients but never forwarded them to the companies. When the companies tried to send notices to the customers, they were sent to the broker instead because he was designated as the exclusive recipient. Snyder pleaded guilty to one count of mail fraud and is serving prison time.

            “Clearly, this broker took advantage of a loophole in the system to rip off his clients,” Stack said. “This is solid legislation that closes that loophole and prohibits brokers from withholding information about their clients’ mortgages.”

            Under House Bill 985, a financial institution is prohibited from taking action against an employee who participates in an investigation or reports illegal activity. Specifically, it provides whistleblower protections to financial services employees who report a crime or cooperate in an investigation. Previously, these whistleblowers would only get protection for reporting financial services crimes.

            “Employees who try to work on the right side of the law should not fear for their jobs,” Stack said. “No one should be punished for doing the right thing, and this legislation will prevent these employees from retribution in the workplace.”

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