Posted by AZ/Mike on 10/25/13 10:39am
Msg #489734

CFPB Attacks Kentucky Firm Over Illegal Real Estate Kickback

Sometimes it is not about how great your level of service and commitment is...

Company Funneled Kickbacks Through Network of Shell Companies

WASHINGTON, D.C. — The Consumer Financial Protection Bureau today filed a lawsuit in federal district court against a Kentucky law firm, Borders & Borders, PLC, and its principals, for illegally paying kickbacks for real estate settlement referrals through a network of shell companies.

http://www.consumerfinance.gov/newsroom/cfpb-files-suit-against-borders-borders-plc-for-paying-illegal-real-estate-kickbacks/

Reply by Christine/OK on 10/25/13 10:55am
Msg #489740

Nice post, Mike. Thank you for sharing. :D n/m

Reply by JanetK_CA on 10/25/13 2:57pm
Msg #489773

Yes!!! I love to see that kind of chicanery being exposed!

On a slightly different note, for future reference, we may want to keep the following statement in mind for other potential issues that might arise regarding competition in the marketplace:

“The CFPB will continue to pursue companies that seek to profit from convoluted arrangements that limit competition and hurt honest businesses.”

It appears that enough steps are being taken - at least on the surface (and thanks to some of our members!) - to avoid trouble with the current BGC frenzy, but who knows what we might encounter in the future.

BTW, I could be wrong, but I was under the impression that the push from lenders to implement these new BGC policies may have originated with efforts by the CFPB to enforce consumer protections. If that's the case, then I'm willing to put up with a little bit of extra expense and inconvenience (up to a point) if across the board, it accomplishes that goal. But that shouldn't be at the expense of our own security.

Thanks for posting, Mike!

Reply by Bear900/CA on 10/25/13 5:30pm
Msg #489786

JanetK: are you being told that lenders are requiring these?

"BTW, I could be wrong, but I was under the impression that the push from lenders to implement these new BGC policies may have originated with efforts by the CFPB to enforce consumer protections."

Are any others here being told by title companies or SS's that lenders are pushing this?

Sorry for skipping posts regarding these but can someone tell me in a nut what seems to be the main driver behind this new push, as spelled out by TC's or SS's, or lenders, not personal opinions?

Thanks!

Ben

Reply by JanetK_CA on 10/25/13 5:53pm
Msg #489789

Re: JanetK: are you being told that lenders are requiring these?

The letter from Fidelity includes a list "preferred" of lenders that will be requiring that any notaries hired to do their signings have a BGC, "in accordance with our service agreements executed with each of these lenders." So this requirement is now flowing downhill from lender to tc, and in some cases, to signing service.

I believe the contents of that letter has been posted here in full by someone, but I might be thinking of the release and authorization letter from Fidelity. I'm pretty sure, though, that I saw the list of lenders involved posted here a few days ago, but I can't swear to that.

Reply by Lee/AR on 10/25/13 7:14pm
Msg #489798

Ben.... the message you're looking for

with the list of Lenders is Msg #488211

Reply by Bear900/CA on 10/25/13 8:29pm
Msg #489808

Thanks Lee and Janet,

And to many others who posted, Thank you.

When these posts really got in high gear I was playing huggy-bear with the fishes. Phhht!

I found the ServiceLink form.

http://www.servicelinkfnf.com/page/aboutServiceLink/aboutServiceLink.html

And just several links for others late to the party such as myself.

Msg #489257 from Hugh
Msg #489294 from Jan/ca
Msg #488158 from Harry
Msg #484466 from Bear900 (me) in September. Partly listed below.

“Brokers and banks that are still around have run this gamut and part of their compliance is to make sure that 3rd party vendors (title, escrow and notaries) are in line with them. THIS HAS NOT STARTED. When this becomes edict and not suggestion, the bigger title companies with clout will unleash their new compliance upon their own vendors. Who dat?

They will not play footsie with independent NSA’s that don’t have the ability to develop, maintain and purchase expensive and comprehensive compliance programs. They will turn to large signing agencies that have the capital, the marketing, the pricing, the employees, the coverage, the responsibility and the compliance know-how, if they need to go outside at all.

The NSA business will change from an independent line of work to a dependent line of work to remain under the compliance requirements put upon them. The driving force behind this will be the broker and the banker who are driven by the CFPB. It is part of our business and compliance DNA and we can’t change the way it develops and goes forward.”

When I talked to our regional director of the CFPB last year he noted how unnecessary “cottage industries” are springing up to accommodate assistance for rule compliance. He was talking about the loan origination business but it’s obvious this has filtered down.

It now appears that title companies are being called to task. BGC’s are *some* banks own internal ‘best practices’ policies but not that of the lot. The fuller CFPB compliance requirement is verifying the 3rd party’s (title company’s) ‘Red Flag’ procedures, ongoing training in such, yada, yada.

Let’s hope this is where it starts and stops for NSA’s. We are by extension (sometimes directly) 3rd party vendors to the lender.

Best!

Reply by Christine/OK on 10/26/13 6:58am
Msg #489846

Here is the list of lenders FNF has stated are requiring

The BGCs and the Authorization Letter

Bank of America
BMO Harris
JP Morgan Chase
Union Bank
US Bank
Wells Fargo

Reply by Christine/OK on 10/26/13 7:00am
Msg #489847

This is the Authorization Letter directly received from FNF

VERBATIM:

"NOTICE, AUTHORIZATION AND RELEASE REGARDING EXISTING CERTIFICATES AND/OR INVESTIGATIVE CONSUMER REPORTS
________________________________________________________________________
I have provided or will provide to Fidelity National Financial, Inc. and/or its family of title companies (collectively referred to as FNF) a copy of my Background Screening Certificate from the GLBA-Compliant National Notary Association (“NNA”) or other approved vendor.

I HEREBY AUTHORIZE FNF to release, disclose and/or provide a copy of any and all certificates, forms, questionnaires, investigative reports, background checks, evaluations, analysis or any other information that I have provided or caused to be provided to FNF, or which FNF has prepared, to any customer, client, lender or other financial institution for whom FNF provides services, so as to evidence that I meet the requirements, qualifications and standards imposed by such customer, client, lender or financial institution on persons who receive or have access to consumer financial information or other confidential information.

I hereby agree and understand that this Notice, Authorization and Release will remain valid as long as I provide any services for or to FNF and throughout my affiliation with FNF. The matters and information which are covered by this Notice, Authorization and Release include, but are not limited to, information concerning my criminal history, motor vehicle history, social security number, character, or any other information requested by any customer, client, lender or other financial institution. As used herein FNF means FNF and any other division of the Fidelity National Financial, Inc. family of title insurers, including any related companies, subsidiaries and/or affiliates thereof.

I hereby release FNF, to the full extent permitted by law, from any liability or claims arising from releasing, disclosing, providing and/or reporting information concerning me to any party pursuant to this Notice, Authorization and Release.

I agree that a copy or fax of this document shall be as valid as the original."