Yesterday, CFPB announced they ordered Mortgage Master, Inc. and Washington Federal to pay fines for violating the Home Mortgage Disclosure Act (HMDA). “HMDA” (pronounced as “hum-da”) is the section of the loan application which asks applicants to disclose their sex and race, which is reported to the government to prevent discrimination.
Inaccurate HMDA data impedes the Bureau’s efforts to detect violations of the Equal Credit Opportunity Act (ECOA) and to stop discrimination in home mortgage lending. Federal prudential regulators, enforcement agencies, community organizations, and state and local agencies also rely on accurate HMDA data to evaluate a financial institution’s compliance with ECOA and other laws, such as the Fair Housing Act and the Community Reinvestment Act. Enforcing HMDA ensures that lenders that engage in discriminatory lending or that fail to meet the credit needs of the entire community, including low- and moderate-income neighborhoods, cannot hinder regulatory efforts by collecting and submitting erroneous data.
Mortgage Master, Inc. was smacked with a civil penalty of $425,000. Mortgage Master, Inc. is NOT to be confused with Mortgage Master Service Corporation. They are two entirely different organizations. Mortgage Master, Inc. is headquartered in Massachusetts. Mortgage Master Service Corporation is based in Washington state. Again, Mortgage Master, Inc. is in no way related to Mortgage Master Service Corporation.
Washington Federal faces a civil penalty of $34,000. Washington Federal reacted stating:
“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.”
Looks like the CFPB is not affected during the government shutdown.
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