The


Federal
Deposit
Insurance
Corp.
(FDIC)
this
month

announced
a
settlement
with
Arkansas-based


Bank
of
England
over
alleged
violations
of
the
Federal
Trade
Commission
Act,
the

Real
Estate
Settlement
Procedures
Act
(RESPA),
the
Fair
Credit
Reporting
Act
(FCRA)
and
the

Home
Mortgage
Disclosure
Act
(HMDA).

The
bank
has
been
issued
an
order
to
pay
a
civil
penalty
of
$1.5
million,
and
the
FDIC
has
also
issued
similar
enforcement
actions
to
nine
former
employees
of
the
bank.

“Veterans
and
their
families
who
were
deceived
into
refinancing
their
VA
loans
were
overcharged
and
did
not
receive
the
loan
products
promised,
resulting
in
significant
consumer
harm,”
Mark
Pearce,
director
of
FDIC’s
division
of
depositor
and
consumer
protection,
said
in
a
statement.
“[This]
announcement
demonstrates
FDIC’s
commitment
to
ensuring
consumers
are
treated
fairly,
and
that
those
responsible,
including
the
bank
and
individuals
employed
by
the
bank,
are
held
accountable
for
their
illegal
actions.”

Among
the
alleged
offenses,
FDIC
said
it
determined
“the
bank
brokered
certain
reverse
mortgage
loans
where
broker
fees
made
to
the
bank
constituted
things
of
value
provided
in
return
for
loan
referrals
in
violation
of
RESPA
Section
8.”

Other
alleged
violations
levied
by
the
FDIC
include
that
“the
bank,
through
one
of
its
loan
production
offices
(LPOs),
violated
[the
law]
by
misrepresenting
to
consumers
that
they
would
be
able
to
skip
multiple
loan
payments
when
refinancing
a


Department
of
Veterans
Affairs
(VA)
mortgage
loan,”
the
FDIC
said.
The
FDIC
also
determined
that
loan
officers
or
LPOs
misrepresented
their
relationships
with
the
VA
to
consumers.

FDIC
also
alleges
that
the
bank
“entered
into
certain
co-marketing
arrangements
and
marketing
service
agreements”
in
which
the
bank
and
real
estate
brokers
would
“market
their
services
together
using
online
platforms.”

“The
FDIC
determined
and
the
Bank
neither
admits
nor
denies
that
the
Bank’s
mortgage
division,
commonly
known
as
Bank
of
England
Mortgage,
engaged
in
violations
of
law
and
regulation,”
the
settlement
agreement
stated.

The
FDIC
also
levied
individual
enforcement
actions
against
nine
former
employees
of
the
bank
for
“luring
consumers
to
apply
for
mortgage
loans
with
low,
unavailable
loan
prices
that
would
not
be
honored
and
then
subsequently
increasing
the
price
before
closing
the
loan;
misrepresenting
that
consumers
could
skip
two
months
of
their
mortgage
payments;
and
misrepresenting
the
LPO’s
affiliation
with
the
VA,”
FDIC
alleged.

Two
of
the
alleged
violators
will
pay
at
least
$100,000
each
in
their
individual
cases.

RMD
attempted
to
reach
a
representative
for
the
Bank
of
England
but
did
not
receive
a
response.

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