MCMJIF Bylaws

Page 18 of 20

17.01 POWER TO EXAMINE: 

1. The Commissioner may, at the time of the filing of the bylaws and plan of risk management and whenever thereafter he deems it expedient, but at a minimum not less frequently than once every five years, make or cause to be made, an examination of the assets and liabilities, financial condition, method of conducting business and all other affairs of the Fund. For the purpose of the examination, the Commissioner may retain attorneys, appraisers, independent actuaries, independent certified public accountants or other professionals or specialists as examiners, or may request the Executive Committee to authorize and employ such person or persons to conduct the same or assist therein as he or she deems advisable. The reasonable expenses of the examination shall be fixed and determined by the Commissioner, and such expenses shall be paid by the Fund to the appropriate entity or person upon presentation of a detailed account. (N.J.A.C. 11:15-2.6(f)). 
2. In addition to an examination as described above, the Commissioner may conduct an examination of the Fund as he or she deems necessary, or at any time the Commissioner has reasonable cause to believe the Fund may be insolvent or in a financial condition detrimental to its members or the public. It shall be the duty of the Fund members, commissioners, executive committee and administrator to notify the Commissioner of any information indicating that the Fund may be insolvent or in a financial condition detrimental to the Fund’s members or the public. (N.J.A.C. 11:15-2.5(a)). 
3. The Fund members, commissioners or executive committee may, upon majority vote, request that the Commissioner order an examination of any Fund member which the Fund, commissioners or executive committee, in good faith believe may be in a financial condition detrimental to other members or to the public. (N.J.A.C. 11:15-2.5(b)).
4. Any examination made pursuant to N.J.S.A. 40A:10-36 and N.J.A.C. 11:15-2.25 and this article shall be conducted in accordance with the procedures set forth in N.J.A.C. 11:15-2.6(f), which are also recorded below. (N.J.A.C. 11:15-2.5(c)). 

17.02 EXAMINATION PROCEDURES: 

1. For the purposes of completing an examination of the Fund pursuant to N.J.S.A. 40A:10-47 and this article, the Commissioner may examine or investigate any person, or the business of any person, insofar as such examination or investigation is, in the sole discretion of the Commissioner, necessary or material to the examination of the Fund. (N.J.A.C. 11:15-2.6(f)1). 
2. The Fund or person from whom information is sought, including its officers, directors and agents, shall provide the Commissioner or other person appointed as examiner pursuant to this article, timely, convenient, and free access at all reasonable hours at its offices to all books, records, accounts, papers, documents and any or all computer or other recordings relating to the property, assets, business and affairs of the Fund. (N.J.A.C. 11:15-2.6(f)2). 
3. The administrator, appointed official(s), servicing organization(s), and their officers, directors, employees and agents, or other person, shall facilitate the examination and aid in the examination so far as it is in their power to do so. The Commissioner may, in accordance with the procedures set forth in N.J.A.C. 11:15-2.8 (“Revocation of approval”), suspend or terminate the authority of the Fund, if the Fund, by its administrator, appointed officials, servicing organizations, or other officers, directors, employees, or agents thereof, refuses to submit to an examination or to comply with any reasonable request of the examiners. (N.J.A.C. 11:15-2.6(f)3). 
4. The Commissioner shall give prior written notice of any proposed suspension, revocation of authority, cease and desist order, or other enforcement action to the Fund commissioners, executive committee, or member local unit as the case may be, or to any person to whom the proposed enforcement action applies specifically. Such notice shall be served personally or by certified or registered mail upon all interested parties, shall set forth the grounds for the proposed enforcement action, and shall inform the interested parties of its right to request a hearing on the proposed enforcement action. A copy of such written notice shall also be provided to the Commissioner of the Department of Community Affairs. (N.J.A.C. 11:15-2.8(a)). 
5. The interested party shall have 20 days from the mailing of the notice to request a hearing on the proposed enforcement action. Such a hearing shall be conducted in accordance with the Administrative Procedure Act, N.J.S.A. 52:14B-1 et seq, and the Uniform Administrative Procedure Rules, N.J.A.C. 1:1. Failure to mail a request for hearing within the time prescribed shall result in the suspension, revocation, monetary penalty or cease and desist order becoming effective 30 days from issuance of the original notice. In no event shall any revocation become effective prior to the date that a hearing is scheduled. (N.J.A.C. 11:15-2.8(b)).
6. After notice and opportunity for a hearing, as provided in N.J.A.C. 11:15-2.28, the Commissioner may issue an order revoking or suspending the Fund’s authority or requiring a person or the Fund to cease and desist from engaging in an act or practice found to be in violation of any provision of either N.J.S.A. 40A:10-36 et seq or N.J.A.C. 11:15-2.6 et seq. (N.J.A.C. 11:15-2.9(a)). 
7. Upon finding, after notice and opportunity for a hearing, as provided in N.J.A.C. 11:15-2.28, that the Fund has violated any cease and desist order, the Commissioner may revoke his or her approval of the Fund. (N.J.A.C. 11:15-2.9(b)). 
8. Upon finding, after notice and opportunity for a hearing, as provided in N.J.A.C. 11:15-2.28, the Commissioner may issue an order requiring the Executive Committee to dismiss an administrator, appointed official or servicing organization or terminate the contract of an administrator, appointed official or servicing organization because of any fraud, material misrepresentation, incompetence or untrustworthiness, misappropriation or conversion of monies or violation of any fiduciary responsibilities by such administrator, appointed official or servicing organization, or any of the employees, officers or directors thereof. (N.J.A.C. 11:15-2.9(c)). 
9. A copy of any notice issued pursuant to this article shall be furnished to the Commissioner of the Department of Community Affairs. (N.J.A.C. 11:15-2.9(d)).