Links in “Fines, Penalties, Suits, and Settlements”
- Court Places Responsibility for Fraud Loss on Business Account Owner
Credit unions that have long complained about the high costs of fraud may see a glimmer of hope in a recent case in which an 8th Circuit Appellate Court ruled that a company that declined to participate in the security protections offered by its bank is responsible not only for its $440,000 loss for a fraudulent wire, but also for the bankâs legal fees. The ruling relied on the fact that the bank had a reasonable security program in place as well as additional security features that the company declined to adopt. The ruling applies only to business account owners. [6/19/14]
- Deceptive and Illegal Mortgage Servicing Practices Bring Down the Hammer
CFPB, DOJ, and HUD proposed a federal court order requiring SunTrust Mortgage, Inc. to provide $500 million in loss-mitigation relief to underwater borrowers. âTodayâs action will help homeowners and consumers harmed by SunTrustâs unlawful foreclosure practices," said Richard Cordray.  [6/18/14]
- Florida Bank Fined for Flood
First Southern Bank in Florida was fined for not ensuring that its borrowers with properties in flood hazard areas obtained adequate flood insurance. [6/18/14]
- Supreme Court Weighs In on NCUAâs MBS Lawsuits
The Supreme Court has instructed the 10th Circuit Court of Appeals to re-examine a ruling that allowed NCUA to sue several banks over deceptive mortgage backed securities they sold to failed corporate credit unions. Under the Court of Appeals ruling, NCUA was allowed to proceed with the suits despite the fact that the suits exceeded the 3-year statute of limitations. A more recent case involving an environmental action has cast a new light on the prior ruling for NCUA. [6/17/14]
- CFPB Hits NJ Title Company for RESPA Violations
HUD tips off the CFPB into Stonebridge Title Services of New Jersey practice of paying commissions to third parties in exchange for title business referrals. RESPA permits commissions for referrals only to employees of the company. [6/16/14]
- California Accuses Lender of Unfair, Deceptive Tactics
The state alleges that CashCall made misleading representations and omitted material information to lure consumers into taking out loans in amounts greater than they were seeking. The lender routinely charged rates of 135% or more. California is seeking to suspend CashCall's license. [6/16/14]
- BSA Bedevils Bancorp
Bancorp Bank's consent order with the FDIC calls for the Delaware bank to fix its BSA program, including appointing a qualified BSA/OFAC officer, addressing its suspicious activity monitoring, enhancing customer due diligence, completing a look-back project, establishing an independent testing program, and bolstering its training program. [6/16/14]
- Texas Case May Present SCOTUS Another Opportunity to Resolve Disparate Impact
Two prior Supreme Court of the United States cases that could have resolved the issue of disparate impact, which focuses not on discriminatory intent, but discriminatory impact, were settled before the court could rule. A new case, Inclusive Communities Project v. Texas Department of Housing, could give the court a third chance. [6/10/14]
- Mass. Sues FHFA for Blocking Foreclosure Buyback Program
Massachusetts passed a law that would prohibit creditors from blocking home sales to a non-profit that intends to resell the property back to the former homeowner. The FHFA refuses to go along. Massachusetts is suing. [6/9/14]
- $7.5M Later: A Laundry List of How Not to Collect Debt
The Federal Trade Commission hits Consumer Portfolio Services (Irvine, CA) with $5.5 million settlement for violations of the FTC Act and another $2 million in civil penalties for violations of the Fair Debt Collection Practices Act and the Fair Credit Reporting Act. Here's a laundry list of how not to collect debt. [6/4]
