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CFPB Takes Action Against Franklin Loan Corporation for Steering Consumers into Costlier Mortgages
WASHINGTON, D.C. — Today, the Consumer Financial Protection Bureau (CFPB) ordered a California mortgage lender, Franklin Loan Corporation, to pay $730,000 for giving its employees illegal bonuses for steering consumers into loans with higher interest rates. The Bureau has asked a federal district court to approve a consent order requiring the company to end its illegal compensation system and refund the consumers it harmed.
| Institution | Regulator(s) | Violation | Penalty | Period covered | HMDA/fair-lending data field involved |
|---|---|---|---|---|---|
| Franklin Loan Corporation | Consumer Financial Protection Bureau (CFPB) | Paid loan officers bonuses tied to the interest rates of loans they closed, violating the Federal Reserve Board's Loan Originator Compensation Rule | $730,000 in redress to affected consumers (no civil penalty sought, based on Franklin's financial condition and the Bureau's desire to maximize relief to consumers) | June 2011 to October 2013 | Loan officer compensation / steering (interest rate-based bonuses) |
CFPB and DOJ Take Action Against National City Bank for Discriminatory Mortgage Pricing
WASHINGTON, D.C. — Today, the Consumer Financial Protection Bureau (CFPB) and the Department of Justice (DOJ) filed a joint complaint against National City Bank for charging higher prices on mortgage loans to African-American and Hispanic borrowers than similarly creditworthy white borrowers between the years 2002 and 2008. The agencies also filed a proposed order to settle the complaint that requires National City Bank, through its successor PNC Bank, to pay $35 million in restitution to harmed African-American and Hispanic borrowers.
| Institution | Regulator(s) | Violation | Penalty | Period covered | HMDA/fair-lending data field involved |
|---|---|---|---|---|---|
| National City Bank | CFPB and DOJ | Charging higher mortgage prices to African-American and Hispanic borrowers than similarly creditworthy white borrowers, in violation of the ECOA (and, per DOJ, the Fair Housing Act) | $35 million to a settlement fund for restitution to harmed African-American and Hispanic borrowers | 2002–2008 | Discretionary pricing and compensation policies (loan officer/broker discretion over rates and fees) |
Justice Department and Consumer Financial Protection Bureau Reach $98 Million Settlement to Resolve Allegations of Auto Lending Discrimination by Ally
Settlement Is Department's Third Largest Fair Lending Agreement Ever and Largest Ever Auto Lending Agreement The Department of Justice and the Consumer Financial Protection Bureau (CFPB) today announced the federal government's largest auto loan discrimination settlement in history to resolve allegations that Detroit-based Ally Financial Inc. and Ally Bank have engaged in an ongoing nationwide pattern or practice of discrimination against African-American, Hispanic and Asian/Pacific Islander borrowers in their auto lending since April 1, 2011. The agreement is the first joint fair lending enforcement action by the department and CFPB. With this agreement, eight of the top 10 largest fair lending settlements in the department's history have been under Attorney General Eric…
Justice Department Reaches Settlement with Fort Davis State Bank to Resolve Allegations of Lending Discrimination
The Justice Department announced today that Fort Davis State Bank, based in Fort Davis, Texas, will implement uniform pricing policies, conduct employee training and pay $159,000 as part of a settlement to resolve allegations that it engaged in a pattern or practice of discrimination on the basis of national origin. Facts from the Justice Department's settlement with Fort Davis State Bank, as cited in this article. InstitutionRegulator(s)ViolationPenaltyPeriod coveredHMDA/fair-lending data field involved Fort Davis State BankJustice Department (Civil Rights Division); referred by the FDICEqual Credit Opportunity Act (ECOA) — pattern or practice of pricing discrimination on the basis of national origin, charging higher prices for unsecured consumer loans to Hispanic…
Special Report: Geocoding - Achieving the Highest Accuracy
Although geocoding is only one part of the examination accuracy testing, it is substantially different from the other submittable data that is tested. The geocode is probably the most important data element because of its demographic impact. There is no such thing as 100% accuracy for geocodes on a complete LAR due to the complexities and subtleties of the subject, but there is at least one proven solution that can achieve greater than 98% accuracy. This document contains statistical and anecdotal evidence describing how to achieve the highest precision level possible to help avoid a time-consuming resubmission process or a costly penalty. See the geocoding engine behind these accuracy figures. If you want to check a hard-to-place address yourself before it becomes a resubmission problem,…
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