We have an affiliate that is an insurance agency. Although customers are given the choice to bring their own insurance policy, if they don't, we forceplace it with our affiliate. Even though we are not actually referring the customer, I am unsure if we should give the customer the Affiliated Business Arrangement Disclosure. My CO thinks that we don't have to, since there is no referral, but I have read a lot of conflicting articles on the matter. What is your opinion?
The president of our bank owns more than 1% of a local abstracting company, the only one in the county. The bank does not refer any business to the abstracting company, but by default, customers have to use them. Does the bank have to disclose this as an affiliated business arrangement? Would it make a difference if there were two abstracting companies available?
We have established a mortgage company subsidiary of the bank. Is there any legal way around the prohibition of paying tellers for referrals of bank customers to the mortgage company? Does a referral, either verbal or using a referral form, require an immediate affiliated business arrangement disclosure?