Massachusetts Mortgage Lender Fined For Conducting Business at Unapproved Branch Location

CFPB Enforcement

On February 27, the Massachusetts Division of Banks entered into a consent order with a mortgage lender resolving allegations that it violated state and federal regulations. Under the terms of the consent order, the mortgage lender will pay a $5,000 penalty for conducting mortgage activities at an unapproved branch location. In addition to the penalty, among other requirements, the lender must (i) employ a strong focus and proactive commitment to community development activities and (ii) expand its independent audits to include compliance with state and federal laws, including regulations governing fair lending. Finally, the lender must establish, implement, and maintain policies and procedures to ensure that (i) it does not engage in residential mortgage lending in Massachusetts from unauthorized locations; (ii) it monitors the distribution of its mortgage lending in Massachusetts; (iii) mortgage loan applicants whose application are denied receive notice of their right to appeal under Massachusetts law; (iv) its license type and number are disclosed as required by Division regulation; (v) late charges listed in the Truth-in-Lending statement are not in excess of the amount permitted under Massachusetts law; (vi) it provides Servicing Disclosure Statements in accordance with the timing requirements set forth in CFPB regulations; (vii) it maintains records of transactions with mortgage brokers in compliance with Massachusetts law, and (viii) it provides all Massachusetts consumers with a privacy policy that is in compliance with CFPB regulations.