State
New Jersey, Pennsylvania
New Jersey, Pennsylvania
PHH Corporation
Enforcement, Mortgages
In 2014, the CFPB took action against PHH Corporation, a mortgage lending company, for “collecting kickbacks from mortgage insurers as part of a scheme dating back to 1995.” In June 2015, the company was ordered to pay $109 million to the CFPB.
According to the CFPB, an investigation revealed that when the company “originated mortgages, it referred consumers to mortgage insurers with which it partnered. In exchange for the referrals, the insurers purchased supposed reinsurance from PHH subsidiaries,” which PHH took “as kickbacks, in violation of Real Estate Settlements Procedures Act (RESPA).” The CFPB claimed that “consumers ended up paying more in mortgage insurance premiums” because of PHH’s scheme.
The investigation was initiated by The Office of Inspector General at the Department of Housing and Urban Development (HUD) but was transferred to the CFPB in July 2011. The CFPB sought “a civil fine, a permanent injunction to prevent future violations and restitution.” [Jeff Blumenthal, “Local mortgage lender accused of taking kickbacks”, Philadelphia Business Journal, 01/30/14]
Open