AN ACT Relating to the mortgage lending fraud prosecution account;
Summary
HB2193 creates and funds a dedicated mortgage lending fraud prosecution account in the custody of the state treasurer. The bill imposes a $1 surcharge at the time a deed of trust is recorded, with the county auditor allowed to retain up to 5% of the collections for administrative costs. The remaining revenue is transmitted monthly to the state treasurer and deposited into the new account. The Department of Financial Institutions, in consultation with the attorney general and local prosecutors, is directed to develop rules governing how the money will be used to support criminal prosecution of fraudulent activities in the mortgage lending process.
The bill also specifies that the surcharge does not apply to assignments or substitutions of previously recorded deeds of trust, and it includes a sunset date, after which the surcharge and related provisions expire. Expenditures from the account are limited to criminal prosecution of mortgage lending fraud, and only the director of the Department of Financial Institutions or the director’s designee may authorize spending. The account is subject to standard allotment procedures, but no separate appropriation is required for expenditures.
Impact
HB2193 amends Washington law governing deed-of-trust recording fees and creates a new special revenue account dedicated to mortgage lending fraud enforcement. It affects county auditors, the state treasurer, the Department of Financial Institutions, the attorney general, and local prosecutors by establishing a new funding stream and administrative framework for investigating and prosecuting mortgage-related fraud. The bill does not broadly change substantive criminal law, but it changes how enforcement efforts are financed and administered.
Sentiment
Based on the bill text and the absence of recorded committee testimony or votes in the provided material, the bill appears to be framed as a targeted anti-fraud enforcement measure with a generally practical, law-enforcement-oriented purpose. The structure of the bill suggests support for strengthening prosecution resources rather than controversy over broader policy changes. No formal vote history or hearing record is provided here to indicate opposition or amendment-driven debate.
Contention
The main potential points of contention are the new $1 surcharge on deed-of-trust recordings and the creation of a dedicated account funded by that surcharge. County auditors may be concerned about administrative burden, though they are allowed to retain a small portion for collection costs. Another possible issue is the bill’s narrow use of funds, which limits spending to criminal prosecution of mortgage lending fraud and places spending authority with the Department of Financial Institutions rather than directly with prosecutors. The sunset provision may also reflect concern about making the surcharge temporary and subject to later review.