The Consumer Financial Protection Bureau has fined Mortgage Master and Washington Federal for filing inaccurate Home Mortgage Disclosure Act reports.
“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.”
The CFPB fined Walpole, Mass.-based Mortgage Master $425,000 after its examiners discovered significant data errors in its 2011 HMDA report. The errors involved 21,000 loan applications processed in 2011. The Massachusetts Division of Banks also reviewed Mortgage Master’s HMDA reporting and found significant errors.
Mortgage Master president Paul Anastos noted that the CFPB and state examiners were in his shop for over a year. “Their finding was related to administrative errors in our reporting system, and the audit confirmed that no borrowers were harmed in any way, nor did any borrowers need to be refunded. We agreed to settle this matter with the CFPB and the state of Massachusetts,” Anastos said.
Under the settlement, Mortgage Master agreed to pay the civil penalty, resubmit a corrected 2011 HMDA report and implement a more effective
The CFPB’s examiners discovered significant errors in nearly 5,790 loan applications Washington Federal processed in 2011. The Seattle bank agreed to pay a $34,000 civil penalty and take corrective actions.
But the bank’s executives are not pleased with the way the CFPB has publicized the enforcement action.
"We agreed to a consent order because we did not believe that the technical issues involved or the small penalty justified litigation. We are, however, disappointed with the harshness of the language in the CFPB’s press release, which in our view is not consistent with prior discussions, including their repeated statements to us that the order is the equivalent of a traffic ticket.’ For the record, the consent order relates to very technical interpretations of application data, such as date of application, on a sample of files reviewed during an examination occurring over a year ago. While we differ with their conclusions, we also realize that the CFPB has the final say and we will strive to meet their expectations in future examinations,” according to a statement issued by Washington Federal.
