US CFPB Penalizes Republic Mortgage Insurance Over Illegal Kickbacks Practices
November 18, 2013
Insurance Business Review
Republic Mortgage Insurance Corp. (RMIC) has drawn a $100,000 fine for allegedly feeding illegal kickbacks to home lenders under an arrangement that had gone on for more than 10 years. In addition to the penalty, the mortgage insurer agreed to end the practices in question -- which entailed buying worthless captive reinsurance policies in order to turn a profit for lenders that steered referrals its way. The Consumer Financial Protection Bureau (CFPB), which filed the complaint against RMIC in U.S. District Court in Florida, has taken similar action against four other mortgage insurers this year. "Kickbacks for mortgage insurance referrals are illegal, and can drive up costs for consumers seeking to buy a home," declared CFPB director Richard Cordray.
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