On June 7, 2017, the Consumer Financial Protection Bureau (CFPB) announced that it entered into a consent order with a Chicago-based mortgage servicing company, settling allegations that it failed to provide borrowers with the foreclosure protections required by law. According to the CFPB, the mortgage servicer violated federal consumer protection laws in its…
On May 25, 2017, Kentucky Attorney General Andy Beshear (“Kentucky AG”) announced steps it is taking to provide guidance to Kentucky homeowners whose banks use online mortgage recording databases instead of traditional public land records to track land ownership. The Kentucky AG has provided county clerks with information to post in…
On May 16, 2017, the U.S. Department of Justice (“DOJ”) announced that it had reached a settlement with a company engaged in reverse mortgage servicing, in connection with the company’s participation in the Department of Housing and Urban Development’s (“HUD”) Home Equity Conversion Mortgage (“HECM”) program, which offers senior citizens reverse mortgages insured by the Federal Housing Administration…
On April 26, 2017, the CFPB issued a press release and its latest Supervisory Highlights, which spotlight the CFPB’s recent enforcement efforts in the areas of mortgage loan origination, mortgage loan servicing, and student loan servicing. The Supervisory Highlights reflect what the CFPB sees as common problems in each area,…
On April 13, 2017, the Consumer Financial Protection Bureau (CFPB) issued proposed amendments to clarify certain requirements of the Home Mortgage Disclosure Act (HMDA). HMDA requires that financial institutions collect and report certain information regarding their mortgage lending activities. The information that financial institutions are required to collect and report includes…
On April 12, 2017, the Massachusetts Attorney General’s Office (AG) announced that it had reached a settlement with a mortgage broker, its employee, and an insurance agent, resolving allegations that they had preyed on elderly consumers by causing them to take out reverse mortgages on their homes. The AG alleged that the broker and agent induced elderly…
On April 10, 2017, the California Department of Business Oversight (DBO) announced that it had entered into a consent order with a Michigan-based residential mortgage lender and servicer over allegations that the firm was overcharging consumers for interest on a number of loans. The DBO brought an enforcement action against the…
The five-year anniversary of some of the major financial regulations passed by the Consumer Financial Protection Bureau (CFPB) is coming up in January 2018, meaning that they will soon undergo a review to check on their effectiveness. The Dodd-Frank Act requires the CFPB to review its rules five years after their effective date to…
On March 15, 2017, the Consumer Financial Protection Bureau (CFPB) entered into a consent order with national nonbank mortgage lender that requires the lender to pay a $1.75 million civil monetary penalty to resolve alleged violations of the Home Mortgage Disclosure Act (HMDA). The CFPB alleged that the mortgage lender violated HMDA, 12 U.S.C. § 2803,…
On March 7, 2017, the United States Attorney’s Office for the Eastern District of New York announced the sentencing of an individual defendant to 15 years in prison and $2.5 million in forfeiture in connection with a loan modification scheme. The defendant may also be subject to additional restitution under the…
On February 17, 2017, the California Department of Business Oversight (California DBO) announced that it had entered in to a $225 million consent order with a national mortgage servicer following an investigation by a third-party auditor into loans serviced by the company in California between January 1, 2012 and June 30, 2015. The servicer had agreed to the audit…
On February 7, the U.S. Attorney for the Eastern District of New York, the Office of the Inspector General for the Department of Housing and Urban Development (HUD), and the Inspector General for the Federal Deposit Insurance Corporation announced a settlement agreement and consent order with a residential mortgage lender and…
A recent decision by the Ninth Circuit has created a circuit split regarding the interpretation of the Fair Debt Collection Practices Act (FDCPA). In Vien-Phung Ho v. ReconTrust Co. et al., case no. 10-56884, the court held that the trustee of a California deed of trust is not a “debt collector” under the…
On January 23, the Consumer Financial Protection Bureau (CFPB) announced that it entered into a consent order with a mortgage servicer, resolving alleged violations of the Real Estate Settlement Procedures Act (RESPA), the Fair Credit Reporting Act (FCRA), and the Consumer Financial Protection Act’s (CFPA) prohibition on deceptive acts or practices….
On January 23, the Consumer Financial Protection Bureau (CFPB) announced that it entered into a consent order with a mortgage servicer, resolving allegations that the servicer violated the Real Estate Settlement Procedures Act (RESPA) and the Consumer Financial Protection Act (CFPA). The CFPB alleged that, during 2014, the servicer informed borrowers seeking loss mitigation…
On January 18, 2017, the U.S. Attorney’s Office for the Southern District of New York (USAO) filed a lawsuit against a national bank, alleging that the bank had engaged in a years-long practice of racial discrimination in providing mortgage services. The parties reportedly have agreed to terms of a settlement to resolve the action. The…
On January 13, 2017, the Department of Justice (“DOJ”) announced that it had filed a lawsuit against a Minnesota bank, stemming from allegations that the bank engaged in illegal “redlining” of minority neighborhoods in the Minneapolis-St. Paul metropolitan area. The DOJ alleged in its complaint that the bank violated the Fair…
On December 28, the U.S. Department of Justice (DOJ) announced a $48 million settlement with a national mortgage lender, resolving allegations that the lender violated the False Claims Act by underwriting and endorsing Federal Housing Administration (FHA)-insured loans that failed to comply with FHA underwriting guidelines. The settlement was the result of an…
On December 28, the U.S. Department of Justice (DOJ) announced that it filed a complaint against, and entered a consent order with, two Ohio-based banks, resolving allegations that the banks had violated the Fair Housing Act and Equal Credit Opportunity Act by engaging in discriminatory lending. The DOJ alleged that, from at…
On December 7, 2016, the Consumer Financial Protection Bureau (CFPB) announced that it had entered into consent orders with three different reverse mortgage companies concerning alleged violations of the Consumer Financial Protection Act (CFPA) and Regulation N’s prohibitions on making material misrepresentations as to any “mortgage credit product.” The first consent order…