Section 8 of the Real Estate Settlement Procedures Act prohibits unearned fees and kickbacks. The Consumer Financial Protection Bureau assumed control of RESPA in July 2011. In 2013, the CFPB has become a very active but unpredictable enforcer. In recent years, nearly 35% of all reported CFPB mortgage-related enforcement actions were focused on Section 8, and the penalties imposed have reached huge totals.
The CFPB has provided minimal guidance on Section 8, and that guidance is less that enlightening. Most of the CFPB guidance has been in the form of consent decrees. CFPB consent decrees typically include significant penalties -- well past $20 million in one case. The CFPB's approach of high-dollar enforcement activities, personal liability for management, and a lack of regulatory guidance, has created an atmosphere of intimidation and fear in the industry.
Every financial institution has violations of Section 8. How serious are yours? You need to be aware of your infractions and take steps to eliminate them.
This program reviews the RESPA/Reg X rules that prohibit unearned fees and kickbacks and many of the recent consent decrees brokered by the CFPB. Participants receive a detailed manual that serves as a handbook long after the program is completed.
Upon completion of the program participants understand:
- What transactions are covered by RESPA's prohibition against unearned fees and kickbacks;
- What actions are prohibited;
- What constitutes a referral fee, or an unearned fee or kickback;
- What compensation is permissible;
- What constitutes an affiliated business arrangement and the rules that apply to such arrangements;
- How to properly handle broker arrangements;
- Recent CFPB consent decrees related to Section 8; and
- The recent PHH circuit court decision.
Who Should Attend:
The program is designed for loan officers, compliance officers, loan processors and clerks, auditors, and anyone else with responsibilities related to federally related mortgage loans.