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Lending

Regulatory burden: CFPB settles RESPA enforcement based on HUD statute, brought to light by the FDIC

May 22, 2013

This headline is correct.

At least I think it is.

Recently HousingWire reported that the Consumer Financial Protection Bureau forced a Texas homebuilder, Paul Taylor, to give up $118,194.20.

Taylor received the money for mortgage origination referrals and will now deposit those funds into the Treasury.

The settlement resolves violations of the Real Estate Settlement Procedures Act, which prohibits giving and receiving kickbacks for services involving federally related mortgages.

Thankfully, law firm Ballard Spahr's immensely useful CFPB monitor straightens out how it went down.

Basically, the CFPB settles RESPA enforcement based on HUD statute, brought to light by the Federal Deposit Insurance Corp. 

The regulatory rabbit hole goes even deeper.

"We find it interesting that, in seeking disgorgement, the CFPB appears to have relied on the remedies available under Dodd-Frank Section 1055 rather than RESPA," writes Richard Andreano Jr.

"Given that the facts alleged by the CFPB indicated a clear RESPA violation, we find it interesting that the CFPB did not impose any penalty in addition to ordering disgorgement," Andreano continued.

HousingWire remains vigilant in its coverage of regulatory developments, even as they seem to get more and more confusing.

 

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