Ex-felon fighting denial of mortgage loan license

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The state’s authority to license mortgage loan originators is at stake in a case pending at the Indiana Court of Appeals.

The court is hearing a request by the state to reverse a Marion County Superior Court decision in December that orders the Indiana Department of Financial Institutions to issue a mortgage loan license to Michael Massey.

The department denied Massey a license on grounds of unfit character, citing his robbery of two fast-food restaurants in Vanderburgh County.

That was 38 years ago.

The department cited a number of statutes including one that justifies denial for those who committed “crimes of dishonesty.”

But attorneys for Massey, now in his early 50s, argue that federal law related to mortgage originator licensing does not regard armed robbery within the context of a crime of dishonesty. They cited the Secure and Fair Enforcement for Mortgage Licensing Act, or SAFE.

“That conviction has no … value on Massey’s credibility nor his character and fitness to receive an Indiana mortgage license,” states an argument filed in the Marion Superior case last year.

Massey passed both state and federal mortgage origination examinations. Court records state that he was employed by Ameriquest Mortgage Co. in 2003 and at one time was a mortgage loan originator for American Mortgage Funding and Stonegate Mortgage.

Marion Superior Judge Theodore Sosin ruled in favor of Massey last December.  In compliance with the court order, the department issued Massey a mortgage loan originators license, pending appeal, although he does not currently have an employer or sponsor.

In January, Attorney General Greg Zoeller asked the Court of Appeals to overturn the county court’s decision.

Zoeller argues the state indeed has broad authority in licensing, and that Indiana has elevated mortgage loan originators to the status of “licensed professionals.”

Zoeller wrote that any felony conviction is clear evidence that a person lacks the “requisite good moral character” to be licensed as an attorney in Indiana, for example. The same goes for public school teachers, insurance agents and certified public accountants, the state argues.

He also noted that as of July a process was put in place allowing those convicted of certain crimes to seek an expungement. Massey apparently has not done so.

On April 3, the Conference of State Bank Supervisors filed a brief in support of the state, saying the trial court failed to understand the federal statutes and did not take into account that Indiana has different licensing requirements.

“The precedent for Indiana and other states is a real concern,” said Mark Tarpey, deputy director of consumer credit at the Indiana Department of Financial Institutions.


  • Expungement
    Roger, the expungement statute didn't come into being until 7/2013. This case was obviously filed long before that. The AG is being dishonest in suggesting the plaintiff needs to take advantage of a procedure that was created long after the lawsuit was filed.
  • Expungement
    If you read the entire article, there is a process in place whereby this felony conviction could be expunged from his record. This would give him the ability to clean up the record from his "foolish youth". Massey has not filed the appropriate paperwork in order to do this. it seems to me that filing the paperwork would be less costly than suing the state.
  • He said what?
    Zoeller wrote that any felony conviction is clear evidence that a person lacks the “requisite good moral character”.... Are you kidding me?? Any felony conviction?? If a teenager throws a party at his or her parents house when the parents are not home and if underage drinking occurs, the teenager can get charged with a class D felony (yes...this is a class D felony). And Zoeller thinks that this means the individual lacks moral character for the rest of his or her life? How do we get rid of this dude. He is bad for Indiana!
  • KC - Get Real
    KC, nice partisan jibe. However, control by the state is affected by both republicans and democrats who continue to expand the scope and control of government. It is not partisan, both sides are guilty.
  • State Control
    This is about state control. They made a poor decision but now don't want to prevent a precedent from being set. They shouldn't have any control over licensing...it is another citizen boondoggle to generate fees and give control to the government.
  • Lack of Commons Sense
    Yes did this have to go through any courts. How can people who make mistakes when they are kids ever overcome. Again this will be another reason the rest of the country will be laughing at Indiana but mostly Zoeller.
  • How about a 2nd Chance
    A man in his early 50's committed crimes 38 years ago (assume at 16) and the State wants to continue to punish him for the rest of his life. I do not know this man's story but let's assume he has turned his life around and is trying to earn a living. Why would the State want to spend a dollar of taxpayer's money fighting this battle. I guess I understand why so many convicts return to crime when even the State won't give someone a second chance. Let's spend our money fighting the battles worth fighting.

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