CFPB took action against First Alliance Lending for violating “the Real Estate Settlement Procedures Act by improperly splitting revenues and fees with affiliates of a hedge fund it used to finance loans.” CFPB “levied a $83,000 civil money penalty” against the firm in February 2014.

• In February 2014, the CFPB “levied a $83,000 civil money penalty” against First Alliance Lending, a Connecticut-based “specialty firm that focuses on providing loss-mitigation financing to distressed borrowers.”

• The CFPB said that First Alliance Lending “violated the Real Estate Settlement Procedures Act by improperly splitting revenues and fees with affiliates of a hedge fund it used to finance loans.” According to CFPB Director Richard Cordray, “‘these types of illegal payments can harm consumers by driving up the costs of mortgage settlements.'”

• First Alliance self-reported the violations and cooperated with the investigation. The company called the violations “‘technical in nature.'” [Brian Collins, “CFPB Fines Lender Over Real Estate Fees,” American Banker, 02/25/14]