INDIANAPOLIS | Indiana Secretary of State Todd Rokita has revoked the licenses of 361 mortgage brokers who failed to comply with new consumer protection safeguards.

The brokers were given more than a year to comply with a 2007 state law requiring each firm to designate a principal manager with at least three years experience in the loan industry and have that person pass a state standards exam.

"These provisions were put in place to ensure a loan broker industry in Indiana that is competent, responsible and accountable," Rokita said Wednesday in a statement. "Any loan broker business attempting to operate in Indiana without meeting these requirements is engaging in criminal activity, and my office will work aggressively to stop them."

Scofflaws face administrative fines of up to $10,000 and could be hit with felony criminal charges resulting in six months to three years in jail, said Rokita spokesman Jim Gavin. The secretary of state's office plans to dispatch investigators from its securities division to check whether unlicensed brokerage firms still are doing business in Indiana.

Rokita mailed letters last month warning more than 500 brokers they were at risk of losing their licenses if they did not meet the new state requirements by Tuesday. Since the July 7 warning, 169 brokers have passed the state licensing exam.

About 80 of the notices came back undeliverable and another 143 brokers voluntarily surrendered their licenses, illustrating the weak housing market's impact on the brokerage business.

Brokers help match home buyers with lenders. Following Wednesday's action, there are now about 750 licensed mortgage brokers in Indiana.