“Secret and unlawful payments keep consumers in the dark and put honest businesses at a disadvantage, and the Consumer Bureau will continue to take action against them,” said Consumer Financial Protection Bureau (the Bureau) director Richard Cordray.

On April 29, 2015, the Bureau and the Consumer Protection Division, Maryland Attorney General (CPD), filed a complaint in federal court against Genuine Title, LLC, former executives, loan officers, and affiliated companies. The complaint contained the following causes of action:

  1. Violations of the Real Estate Settlement Procedures Act (RESPA) by giving and receiving fees, kickbacks, or things of value pursuant to an agreement, or understanding, in connection with real estate settlement services involving federally related mortgage loans.
  2. Violations of the Consumer Financial Protection Act (CFPA) by violating RESPA and knowingly or recklessly providing substantial assistance to other defendants who were violators of the CFPA; and
  3. Violations of the Consumer Protection Act (CPA) by constituting unfair or deceptive trade practices that are prohibited under the CPA.

The Bureau and the CPD allege that Genuine Title, a defunct title company that went out of business in 2014 after nine years of offering real estate settlement services, developed and operated unlawful schemes to provide kickbacks that incentivized loan officers to encourage consumers to close their federally related mortgage loans with Genuine Title.

Furthermore, the plaintiffs allege that Genuine Title took part in a marketing services scheme by providing marketing services to loan officers. In exchange, the loan officers would refer settlement service business for federally related mortgages to Genuine Title by recommending Genuine Title to borrowers.

In addition, the plaintiffs allege that a pay-to-play scheme was developed by Genuine Title. From 2009-2013, through this pay-to-play scheme, Genuine Title paid loan officers for referrals of settlement service business for federally related mortgages. This scheme allowed Genuine Title to give cash to the loan officers; it was intended to increase the amount of business generated by the participating loan officers and increase Genuine Title’s profits.

Click here for more on the sanctions each individual defendant will be subject to if the court enters the consent orders.

Click here to view the complaint.