New Jersey Revised Statutes § 17:12b-214 - Business Prohibited Within State, Exceptions

17:12B-214. Business prohibited within State, exceptions
214. a. Foreign associations shall not transact the business of a savings and loan association within this State, or maintain an office within this State, except as authorized pursuant to subsection b. of this section, for the purpose of transacting such business. It shall be unlawful for any person to transact business within this State on behalf of such associations; provided, however, the purchase, acquisition, holding, sale, assignment, transfer, servicing, collecting and enforcement of obligations or any interest therein secured by real estate mortgages or other instruments in the nature of a mortgage, covering real property located in this State, or the foreclosure of such instruments, or the acquisition of title to such property by foreclosure, or otherwise, as a result of default under such instruments, or the holding, protection, rental, maintenance and operation of said property so acquired, or the disposition thereof by a foreign association, or back office operations shall not be considered as transacting business within the meaning of this article.

b.A foreign association may maintain one or more service facilities in this State, provided that the foreign association performs only back office operations at the service facility and does not transact business with its customers or the public at the service facility. Prior to opening a service facility in this State, a foreign association shall register the service facility with the commissioner, which registration shall include the address of the proposed service facility and the name and address of the foreign association's agent in this State for service of process. Each service facility shall comply with the requirements and pay the fees that the commissioner establishes by regulation. Each service facility shall be subject to examination by the department to determine whether the foreign association has operated the service facility in accordance with the provisions of this subsection, the costs of which examination shall be paid by the foreign association at the department's per diem rate for examinations of depository institutions. The commissioner may, upon notice and a hearing, order a foreign association to close any service facility operated in violation of the provisions of this subsection or of any other law. An entity which is affiliated, either directly or indirectly, with a foreign association and intends to engage in back office operations in this State shall register and be regulated pursuant to this subsection as if it were a foreign association.

c.For the purposes of this section, the term "transact business" shall not include back office operations and the term "back office operations" shall include the following activities: data processing, record-keeping, accounting, check and deposit sorting and posting, computation and posting of interest, other similar clerical and statistical functions, producing and mailing correspondence or documents and such other activities as the commissioner approves.

d.For the purposes of this section, a foreign association shall not be deemed to transact business or maintain an office in this State based solely on the activities of an agent in this State.

L.1963,c.144,s.214; amended 1964, c.261; 1991, c.74, s.3; 1996, c.17, s.99.

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Last modified: October 11, 2016