On June 4, the Consumer Financial Protection Bureau (CFPB) announced that Director Richard Cordray issued a decision in the the first appeal of a CFPB administrative enforcement action. The appeal hearing was previously covered by Consumer Finance Enforcement Watch. The Director’s decision upheld in part and reversed in part an Administrative Law Judge’s (ALJ) November 2014 Recommended Decision, which held that a mortgage lender violated the Real Estate Settlement Procedures Act (RESPA) by accepting kickbacks (in the form of reinsurance premiums) for loans closing on or after July 21, 2008. The Director’s decision was more expansive and found instead that the lender violated RESPA when it accepted a kickback payment on or after July 21, 2008. The Director’s final order requires the lender to disgorge the reinsurance premiums that it recieved during that time period, totaling $109 million. The order also precludes the lender from referring any customer to a provider of real estate settlement service who has agreed to make any payment to the lender that is triggered by the referral
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