To help prevent another financial crisis from crippling the U.S. economy, the Federal Reserve and other regulators have stepped up the campaign against wayward mortgage brokers.

As part of the new rules, brokers who work for agency-regulated institutions must register with the Nationwide Mortgage Licensing System and Registry. They are also required to have their fingerprints scanned before they can conduct business in the future. The new regulation will be implemented on October 1, while the registry is expected to accept registrations by January 28, 2011.

The new regulation was announced after the Feds, the Comptroller of the Currency, the Federal Deposit Insurance Corp., the Office of the Thrift Supervision, the Farm Credit Administration, and the National Credit Union Administration finalized rules under the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (SAFE Act) this week.

Meanwhile, Americana Mortgage Group president Bob Moulton praised changes in financial rules, saying that they “cleaned up” the mortgage industry. However, he warned that the strict financial regulatory reform has reduced credit availability for mortgage lending.

Reports said thousands of mortgage brokers, who came under intense scrutiny in the aftermath of the burst of the housing bubble, have agreed to undergo mandatory education and credit checks since the SAFE Act was implemented two years ago. Many of them have also taken state and federal testing just to retain the right to handle mortgage originations.

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