The CFPB and the Florida Attorney General’s office were granted a $27.7 million final judgment on Friday against the Hoffman Law Group and corporate affiliates, which allegedly used deceptive marketing practices and scammed distressed homeowners into paying illegal advance fees. The lawsuit named Hoffman Law Group (formerly Residential Litigation Group), its operators, Michael Harper, Benn Willcox and attorney Marc Hoffman, and its affiliated companies, Nationwide Management Solutions, Legal Intake Solutions, File Intake Solutions, and BM Marketing Group, all based in North Palm Beach, FL. The two government agencies accused the companies of tricking consumers into paying millions of dollars in illegal upfront fees to join frivolous lawsuits that the companies falsely claimed would pressure banks to modify their loans or ...

Lenders are so amped up about the CFPB’s pending integrated disclosure rule and the host of other mortgage-related and other financial services regulations from the bureau that they can be forgiven for getting excited about the prospect of regulatory relief from sympathizers in Congress. However, the bill that made its way out of the Senate Banking, Housing and Urban Affairs Committee, the Financial Regulatory Improvement Act of 2015, introduced by Sen. Richard Shelby, R-AL, is really just the first serious episode of what will likely be a series of mini-dramas to come in the weeks and months ahead. So lenders shouldn’t get their hopes up just yet, some observers suggest. “It’s a starter,” said Bob Davis, head of mortgage markets ...

Security issuances backed by VA loans totaled $35.5 billion in the first quarter of 2015, with VA streamline refinance loans accounting for 57.7 percent, according to an Inside FHA/VA Lending analysis of Ginnie Mae data. Approximately $20.5 billion in VA interest rate reduction refinancing loans were securitized during the first three months as borrowers took advantage of lower interest rates.“For the last three to four months, rates have been bottoming out again, and if rates are lower it makes sense to refinance,” said Jon Shrum, vice president of Commerce Home Mortgage, a VA-certified lender in Huntington Beach, CA. An estimated $14.5 billion in VA purchase mortgages also were securitized during period. VA loans comprised 13.1 percent of all loans in Fannie Mae, Freddie Mac and Ginnie Mae mortgage-backed securities. California, Virginia, Texas, Florida and Washington, ... [2 charts]

Whistleblowers that bring a False Claim Act claim against an FHA lender based on previous publicly disclosed information have no standing, according to a recent federal district court ruling. Judge Jack Zouhary of the U.S. District Court for the Northern District of Ohio dismissed an FCA lawsuit against U.S. Bank because the whistleblower had neither direct nor independent knowledge of the bank’s alleged false claims – two basic requirements for standing in a whistleblower suit. The Advocates for Basic Legal Equality (ABLE), an Ohio-based legal aid group, filed an FCA lawsuit against U.S. Bank for allegedly disregarding and violating FHA regulations. The group accused the bank of filing false claims and collecting payments without evaluating loss mitigation alternatives before foreclosing on properties. According to ABLE, it had consulted with “many people,” whose mortgage loans were ...

State regulators are seeking comments regarding a number of potential changes to the Nationwide Multistate Licensing System and Registry licensing forms and the mortgage call report. Among other issues, state regulators are working to continue state adoption of the MCR as the sole activity reporting requirement for state-regulated lenders. About 14,500 companies fill out the MCR each quarter, detailing originations and other metrics. The State Regulatory Registry, which operates nationwide systems for state regulators, said compliance with the MCR remains a concern. “Compliance has steadily improved...

Mortgage industry participants are encouraged by a bipartisan bill introduced in the House last week that would provide a temporary license for loan originators transitioning from a bank to a nonbank or between states. H.R. 2121, from Rep. Steve Stivers, R-OH, would change the Secure and Fair Enforcement for Mortgage Licensing Act to allow for a temporary transitional license and give loan originators 120 days to pass testing standards for nonbank LOs when transitioning from a bank or between states. “The SAFE Act inhibits...

Exams of nonbank servicers in 2014 were “significantly extended” due to consistent delays in receiving information, according to a recent report by the Multi-State Mortgage Committee. The committee handles supervision of nonbank servicers and lenders that operate in more than one state. Some servicers were even found to have tampered with their loan collection logs prior to providing them to examiners. Many of the problems were related to growth at nonbank servicers, according to Rick St. Onge, chairman of the MMC and examination chief of the division of consumer services at Washington State’s Department of Financial Institutions. “Over the year, large bulk loan transfers took place...

In another display of multijurisdictional cooperation, the CFPB and the Maryland Attorney General last week brought an enforcement action against a Maryland-based title company and its executives, alleging they participated in a mortgage kickback scheme, trading cash and marketing services in exchange for referrals. The complaint names Genuine Title, LLC, as well as Jay Zukerberg, Brandon Glickstein, Gary Klopp, Adam Mandelberg, William Peterson, and Angela Pobletts, along with a number of limited-liability companies controlled by certain defendants. The CFPB and Maryland allege that Zukerberg and Glickstein developed and operated schemes to give loan officers marketing services and cash payments in exchange for referrals of title work. The kickback schemes violated the Real Estate Settlement Procedures Act, which prohibits giving a ...

A final rule issued this week by federal regulators setting standards for oversight of appraisal management companies goes against the concerns raised by many industry participants. The rule implements standards required by the Dodd-Frank Act, among other issues. The Consumer Mortgage Coalition, the National Association of Appraisal Management Companies and other industry participants had raised concerns about the rule proposed in April 2014. The proposal established minimum standards for AMCs – which are intermediaries between appraisers and lenders – and allowed states to establish requirements that go beyond the minimum standards. The final rule adopts...

Nonbank servicers would be subject to increased capital requirements and scrutiny under standards proposed last week by state regulators. Many parts of the proposal are similar to standards established by federal regulators, though there are some nuances for non-agency mortgages. “By relying upon existing standards and generally accepted business practices, we hope to minimize regulatory burden for small, less complex firms, while still incorporating a ...