373Solicitor to have fidelity cover for regulated mortgages

373 Solicitor to have fidelity cover for regulated mortgages (1) If a solicitor, in the solicitor’s capacity as solicitor for a lender or contributor, negotiates the making of or acts in relation to a regulated mortgage, the solicitor must ensure that an approved policy of fidelity insurance is in force in relation to the solicitor for the purpose of compensating people who suffer financial loss because of any dishonest failure to pay money payable under the mortgage. (2) A policy of fidelity insurance is an approved policy of fidelity insurance if: (a) the insurer and the terms of the policy have been approved for this division by the Attorney-General by written order given to the law society council; and (b) any conditions imposed by the order are complied with. (3) A solicitor commits an offence if— (a) the solicitor, in the solicitor’s capacity as solicitor for a lender or contributor, negotiates the making of or acts in relation to a regulated mortgage; and (b) an approved policy of fidelity insurance is not in force in relation to the solicitor in accordance with this section. Maximum penalty: 20 penalty units. (4) A contravention of subsection (3) can be professional misconduct. (5) This section does not apply in relation to a regulated mortgage that forms part of a managed investment scheme operated by a responsible