CFPB Penalizes Two Institutions for HMDA Violations

14 Oct

M Report – Tory Barringer

The Consumer Financial Protection Bureau (CFPB) has ordered two mortgage lenders to pay civil penalties for violating the Home Mortgage Disclosure Act (HMDA) with allegedly inaccurate for applications from 2011. According to a release from the agency, Mortgage Master (a nonbank headquartered in Walpole, Massachusetts), and Washington Federal (a Seattle-based bank), failed HMDA reviews when it was determined “that their compliance systems were inadequate and that they had severely compromised mortgage lending data.”

The HMDA, passed in 1975, requires lenders to make loan information to the public in order to ensure there are no violations of the Equal Credit Opportunity Act (ECOA) and to stop lending discrimination. “When financial institutions report inaccurate information, it obstructs the purpose of the Home Mortgage Disclosure Act and makes it more difficult for the CFPB to discover and stop discriminatory lending,” said CFPB Director Richard Cordray. “Today we are sending a strong signal that no mortgage lending institution—whether bank or nonbank—should be able to mislead the public with erroneous data.”

CFPB’s consent order for Mortgage Master—issued alongside an order from the Commonwealth of Massachusetts Division of Banks—requires the lender to pay a penalty of $425,000 and to correct and resubmit its 2011 HMDA data. Mortgage Master is also directed to develop and implement a compliance system to prevent future violations. Washington Federal is required to pay $34,000 in addition to making the same changes to its reports and compliance system.

>> Read more: http://www.themreport.com/articles/cfpb-penalizes-two-institutions-for-hmda-violations-2013-10-11

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