Based on the market and the “New CFPB” Compliance Needs to Reinvent Itself.
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Compliance Matters, Real Estate News
Compliance Needs to Reinvent Itself
admin - Tuesday March 6, 2018
Every Processor and Underwriter just got very nervous that is employed right now…….
NEWSFLASH: There are more entities that regulate the mortgage banking industry than the CFPB. Take HUD and the FTC as examples, and there are many more at the federal level. You really should get off the kick that all we have to worry about is the CFPB. In addition, if you are a nonbank mortgage lender, and many of us are, then take the number of states you are licensed in and multiply that to get the minimum number of entities who regulate you at that level. A number of the state banking regulators have stated that they are going to increase their level of supervision to protect the consumers that the CFPB is no longer going to protect. Then add in State Attorneys General and the list simply keeps growing. While it is great that the CFPB has relaxed things a lot, this may be a temporary situation until after the 2020 elections are over and just think what will happen if a Democratic President is elected and the Democrats have the majority in both houses and the industry has to come face-to-face with Elizabeth Warren. Things that you may have thought were okay simply because no one was enforcing them, may become your worst nightmare and did anyone say “False Claims Act” cases? Personally I am concerned that some of the things we are doing now because of a relaxed CFPB will come back to haunt us later.
Finally, I will acknowledge that there are Compliance Officers who say “no” to everything as it is always the safe thing to do. But, there are many more like me who have been around for a long time who realize that you have to be able to do business and part of that means managing and taking some risk, even sometimes more than you may be comfortable with. Where that risk line is at is sometimes very tricky, and we don’t always get it right even though we try, The last thing we want is our company in the headlines and having to pay millions of dollars for something that could have easily been avoided. Reputations are very important.