Proposed Castle & Cook Settlement on Alleged Loan Originator Compensation Violations
By: Kristie D. Kully
The Consumer Financial Protection Bureau has proposed a settlement with Castle & Cook Mortgage and two of its officers. The CFPB brought an action against Castle & Cook and those officers, alleging that they violated the prohibition against loan-term based compensation under the Dodd-Frank Act and its regulations. On November 7, 2013, the parties to the action proposed a settlement to the federal court in Utah for the payment by the company and the officers of over $9 million for redress to affected consumers, plus a $4 million civil money penalty. The company and officers would also be permanently enjoined from paying compensation to a loan originator in violation of the applicable regulations, and would have to retain evidence of their compliance. According to the proposed settlement, although it would resolve the issue with the CFPB, consumers’ rights to seek redress on their own behalf against the company and/or the officers would not be limited. Read More