Mortgagee Review Board: Administrative Actions

 
CONTENT

Federal Register, Volume 83 Issue 80 (Wednesday, April 25, 2018)

Federal Register Volume 83, Number 80 (Wednesday, April 25, 2018)

Notices

Pages 18072-18075

From the Federal Register Online via the Government Publishing Office www.gpo.gov

FR Doc No: 2018-08669

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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

Docket No. FR-6097-N-01

Mortgagee Review Board: Administrative Actions

AGENCY: Office of the Assistant Secretary for Housing--Federal Housing Commissioner, Department of Housing and Urban Development (``HUD'').

ACTION: Notice.

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SUMMARY: In compliance with Section 202(c)(5) of the National Housing Act, this notice advises of the cause and description of administrative actions taken by HUD's Mortgagee Review Board against HUD-approved mortgagees.

FOR FURTHER INFORMATION CONTACT: Nancy A. Murray, Secretary to the Mortgagee Review Board, 451 Seventh Street SW, Room B-133/3150, Washington, DC 20410-8000; telephone (202) 708-2224 (this is not a toll-free number). Persons with hearing or speech impairments may access this number through TTY by calling the toll-free Federal Information Service at (800) 877-8339.

SUPPLEMENTARY INFORMATION: Section 202(c)(5) of the National Housing Act (12 U.S.C. Sec. 1708(c)(5)) requires that HUD ``publish a description of and the cause for administrative action against a HUD-

approved mortgagee'' by HUD's Mortgagee Review Board (``Board''). In compliance with the requirements of Section 202(c)(5), this notice advises of actions that have been taken by the Board in its meetings from October 1, 2016 to September 30, 2017.

  1. Civil Money Penalties, Withdrawals of FHA Approval, Suspensions, Probations, and Reprimands

    1. Alliance Financial Resources, LLC., Phoenix, AZ Docket No. 16-1861-

      MR

      Action: On June 27, 2017, the Board voted to accept the terms of a settlement agreement with Alliance Financial Resources, LLC. (``Alliance'') that required Alliance to pay a civil money penalty in the amount of $13,000. The settlement did not constitute an admission of liability or fault.

      Cause: The Board took this action based on the following violations of HUD/FHA requirements alleged by HUD: Alliance (a) failed to timely notify HUD/FHA that Alliance entered into a Consent Order with the State of Oklahoma Department of Consumer Credit which required Alliance to pay a penalty; and (b) falsely certified on its annual certification that it had not been sanctioned by a state agency, notwithstanding the Consent Order with the Oklahoma Department of Consumer Credit.

    2. Citizens Bank, N.A., Warwick, RI Docket No. 16-1771-MR

      Action: On December 15, 2016, the Board voted to accept the terms of a settlement agreement with Citizens Bank, N.A. (``Citizens'') that required Citizens to pay a civil money penalty in the amount of $25,500. The settlement did not constitute an admission of liability or fault.

      Cause: The Board took this action based on the following violations of HUD/FHA requirements alleged by HUD: Citizens (a) failed to timely notify HUD/FHA that Citizens entered into a Consent Order with the Consumer Financial Protection Bureau which required Citizens to pay a penalty; (b) failed to timely notify HUD/FHA that Citizens had been assessed a civil money penalty by the Office of the Comptroller of Currency; and (c) failed to notify HUD/FHA that Citizens was assessed another civil money penalty by the Office of the Comptroller of Currency.

    3. CMG Mortgage, Inc., San Ramon, CA Docket No. 16-1770-MR

      Action: On December 15, 2016, the Board voted to accept a settlement agreement with CMG Mortgage, Inc. (``CMG'') that required CMG to pay a civil money penalty in the amount of $8,500. The settlement did not constitute an admission of liability or fault.

      Cause: The Board took this action based on the following violation of HUD/FHA requirements alleged by HUD: CMG failed to timely notify HUD/FHA that it entered into a Settlement Agreement with the State of New York Department of Financial Services under which it paid a fine.

    4. Financial Freedom, a Division of CIT Bank N.A., Irvine, CA Docket No.17-0036-FC

      Action: On January 9, 2017, the Board voted to accept a settlement agreement with Financial Freedom; pursuant to the settlement agreement, Financial Freedom was required to pay the United States $89,274,944 without admitting liability.

      Cause: The Board took this action because Financial Freedom allegedly failed to self-curtail debenture interest on mortgage insurance claims it had submitted to HUD relating to HECM loans.

    5. Great Western Financial Services, Inc., Plano, TX Docket No. 16-

      1781-MR

      Action: On June 27, 2017, the Board voted to accept a settlement agreement with Great Western Financial Services (``Great Western'') that required Great Western to pay a civil money penalty in the amount of $52,468. The settlement did not constitute an admission of liability or fault.

      Cause: The Board took this action based on the following violations of HUD/FHA requirements alleged by HUD: Great Western (a) failed to timely notify HUD/FHA that it was assessed a fine by the State of Illinois Department of Financial and Professional Regulation Division of Banking; (b) failed to timely notify HUD/FHA that it was issued a Consent Order by the State of Oklahoma Department of Consumer Credit requiring Great Western to pay a civil money penalty; (c) failed to timely notify HUD/FHA that it was issued a Consent Order by the State of Connecticut Department of Banking requiring Great Western to pay a civil money penalty; (d) failed to timely notify HUD/FHA that it was issued a Consent Order by the State of Texas Department of Savings and Mortgage

      Page 18073

      Lending requiring Great Western to pay a civil money penalty; (e) falsely certified to HUD/FHA that it had not been sanctioned by any state agency in 2014; (f) falsely certified to HUD/FHA that it had not been sanctioned by any state agency in 2015; and (g) falsely certified to HUD/FHA that it had not been sanctioned by any state agency in 2016.

    6. James B. Nutter and Company, Kansas City, MO Docket No. 16-1773-MR

      Action: On October 20, 2016, the Board voted to accept a settlement agreement with James B. Nutter and Company (``Nutter and Company'') that required Nutter and Company to pay a civil money penalty in the amount of $3,500. The settlement did not constitute an admission of liability or fault.

      Cause: The Board took this action based on the following violation of HUD/FHA requirements alleged by HUD: Nutter and Company failed to timely notify HUD/FHA that it had entered into a settlement agreement with the State of New York Department of Financial Services under which it paid a fine.

    7. Magna Bank, Memphis, TN Docket No. 14-1712-MR

      Action: On December 15, 2016, the Board voted to accept a settlement agreement with Magna Bank that required Magna Bank (a) to pay a civil money penalty in the amount of $84,000; and (b) indemnify HUD/FHA for losses incurred in the amount of $45,499.60 on one loan. The settlement did not constitute an admission of liability or fault.

      Cause: The Board took this action based on the following violations of HUD/FHA requirements alleged by HUD: Magna Bank (a) failed to provide Servicemember Civil Relief Act notices to defaulted borrowers; (b) failed to maintain copies of inspection reports; (c) failed to offer loss mitigation in accordance with HUD requirements; (d) failed to send loss mitigation information to the mortgagor's counsel in bankruptcy cases; (e) failed to perform and/or document a pre-

      foreclosure management review; (f) improperly charged property inspection fees; (g) created a permanent loan modification with monthly payments that exceeded the trial modification amounts; (h) failed to perform property inspections after being unable to contact the borrower; (i) sent cover letters that did not meet HUD's requirements; (j) failed to provide accurate reports to HUD's Single Family Default Monitoring System (``SFDMS''); (k) failed to reconcile its portfolio with respect to SFDMS reporting; (l) failed to meet SFDMS reporting deadlines; and (m) failed to establish and implement a quality control plan with all required elements.

    8. MLD Mortgage, Inc. d/b/a The Money Store, Florham Park, NJ Docket No. 16-1660-MR

      Action: On June 27, 2017, the Board voted to accept a settlement agreement with MLD Mortgage, Inc. d/b/a The Money Store (``MLD Mortgage''); pursuant to the settlement agreement, MLD Mortgage was required to (a) pay a civil money penalty in the amount of $34,968, and (b) refrain from making any claim for insurance benefits to HUD/FHA and/or indemnify HUD/FHA for HUD's losses on three loans. The settlement did not constitute an admission of liability or fault.

      Cause: The Board took this action based on the following violations of HUD/FHA requirements alleged by HUD: MLD Mortgage (a) failed to notify HUD/FHA that it entered into a consent order with the State of Washington Department of Financial Institutions under which it paid a fine; and (b) failed to properly underwrite HUD/FHA insured loans.

    9. NFM, Inc., Linthicum, MD Docket No. 16-1683-MRT

      Action: On June 27, 2017, the Board voted to accept a settlement agreement with NFM, Inc. (``NFM''); pursuant to the settlement agreement, NFM paid a civil money penalty in the amount of $6,000. The settlement did not constitute an admission of liability or fault.

      Cause: The Board took this action based on the following violation of HUD/FHA requirements alleged by HUD: NFM failed to timely notify HUD/FHA that NFM entered into a settlement agreement with the State of New York Department of Financial Services under which it paid a fine.

    10. OceanFirst Bank, Toms River, NJ Docket No. 16-1756-MR

      Action: On June 27, 2017, the Board voted to accept a settlement agreement with OceanFirst Bank (``OceanFirst'') that required OceanFirst to pay a civil money penalty in the amount of $4,500. The settlement did not constitute an admission of liability or fault.

      Cause: The Board took this action based on the following violation of HUD/FHA requirements alleged by HUD: OceanFirst failed to notify HUD/FHA that OceanFirst had merged with another entity.

    11. PHH Home Loans, LLC., Mount Laurel, NJ Docket No. 16-1865-MR

      Action: On June 27, 2017, the Board voted to release PHH Home Loans, LLC. (``PHH'') from any civil money penalties or administrative actions as part of a settlement between PHH and the United States that required PHH to pay the United States $65,000,000.

      Cause: The Board took this action based on PHH's alleged failure to properly originate, underwrite, and conduct quality control reviews for HUD/FHA insured loans in violation of HUD/FHA requirements.

    12. Polonia Bank, Huntingdon Valley, PA Docket No. 16-1622-MR

      Action: On December 15, 2016, the Board voted to accept a settlement agreement with Polonia Bank (``Polonia'') that required Polonia to (a) pay a civil money penalty in the amount of $346,000; and (b) indemnify HUD/FHA for HUD's losses on thirty-one loans. The settlement did not constitute an admission of liability or fault.

      Cause: The Board took this action based on the following violations of HUD/FHA requirements alleged by HUD: Polonia (a) failed to properly process and document closeouts for three 203(k) mortgages; (b) failed to ensure that it properly calculated the maximum mortgage amount on one loan; (c) failed to adequately document the stability of borrowers' income on five loans; (d) failed to properly document compliance with Federal debt requirements on one loan; (e) failed to adequately verify or document borrowers' earnest money deposit, source of funds to close, or the source of funds to pay consumer debt on thirteen loans; (f) failed to ensure the integrity of AUS data by using a credit report older than 120 days; (g) failed to timely notify HUD/FHA that it entered into a formal written agreement with the Comptroller of Currency; (h) failed to properly document the source and adequacy of funds used for down payments and for closing costs on sixteen loans; (i) falsely certified to HUD/FHA that it had not been the subject of unresolved findings by any state agency in 2014; and (j) failed to timely submit acceptable audited financial statements for fiscal year 2015.

    13. Prudential Huntoon Paige Associates, LTD. Dallas, TX Docket No. 16-1665-MR

      Action: On October 20, 2016, the Board voted to accept a settlement agreement with Prudential Huntoon Paige Associates, LLC. (``Prudential'') that required Prudential to make a

      Page 18074

      payment in the amount of $4,000,000. The settlement did not constitute an admission of liability or fault.

      Cause: The Board took this action based on Prudential's alleged failure to properly process and underwrite four multi-family HUD/FHA insured projects in violation of HUD/FHA requirements.

    14. Reverse Mortgage Solutions, Inc., Houston, TX Docket No. 16-1685-

      MRT

      Action: On June 27, 2017, the Board voted to accept a settlement agreement with Reverse Mortgage Solutions, Inc. (``Reverse Mortgage'') that required Reverse Mortgage to pay a civil money penalty in the amount of $4,500. The settlement did not constitute an admission of liability or fault.

      Cause: The Board took this action based on the following violation of HUD/FHA requirements alleged by HUD: Reverse Mortgage failed to timely notify HUD/FHA that Reverse Mortgage entered into a settlement agreement with the State of New York Department of Financial Services under which it paid a fine.

    15. RMK Financial Corporation, Ontario, CA Docket No. 16-1866-MR

      Action: On June 27, 2017, the Board voted to accept a settlement agreement with RMK Financial Corporation (``RMK'') that required RMK to pay a civil money penalty in the amount of $26,968. The settlement did not constitute an admission of liability or fault.

      Cause: The Board took this action based on the following violations of HUD/FHA requirements alleged by HUD: RMK (a) failed to timely notify HUD/FHA that RMK was issued a consent order by the Consumer Financial Protection Bureau under which it paid a civil money penalty; (b) failed to timely notify HUD/FHA that RMK entered into settlement agreement with the State of Ohio Department of Commerce Division of Financial Institutions under which it paid a fine; (c) falsely certified that RMK had not been sanctioned by any federal or state agency in 2015; and (d) failed to timely notify HUD/FHA that RMK was issued a consent order by the State of Kentucky Department of Financial Institutions under which it paid a civil money penalty.

    16. Seckel Capital, LLC., Newtown, PA Docket No. 17-1857-MR

      Action: On June 27, 2017, the Board voted to immediately suspend Seckel Capital, LLC.

      Cause: The Board took this action based on the following violations of HUD/FHA requirements alleged by HUD: Seckel Capital, LLC submitted fraudulent financial statements for fiscal year 2012 through fiscal year 2015 and falsely certified for fiscal year 2012 through fiscal year 2015 that it was in compliance with HUD requirements.

    17. SiWell, Inc., Lubbock, TX Docket No. 16-1658-MR

      Action: On June 27, 2017, the Board voted to accept a settlement agreement with SiWell, Inc. that required SiWell, Inc. pay a civil money penalty in the amount of $193,025. The settlement did not constitute an admission of liability or fault.

      Cause: The Board took this action based on the following violations of HUD/FHA requirements alleged by HUD: SiWell, Inc. (a) failed to timely remit periodic Monthly Mortgage Insurance Premiums to HUD/FHA for 732 loans; and (b) failed to timely remit Upfront Mortgage Insurance Premiums on fifteen loans.

    18. Stearns Lending, LLC., Santa Ana, CA Docket No. 16-1687-MRT

      Action: On October 20, 2016, the Board voted to accept a settlement agreement with Stearns Lending, LLC. (``Stearns'') that required Stearns pay a civil money penalty in the amount of $4,500. The settlement did not constitute an admission of liability or fault.

      Cause: The Board took this action based on the following violation of HUD/FHA requirements alleged by HUD: Stearns failed to timely notify HUD/FHA that Stearns entered into a settlement agreement with the State of Arizona Department of Financial Institutions under which it paid a civil money penalty.

    19. SunTrust Mortgage, Inc., Richmond, VA Docket No. 16-1688-MRT

      Action: On December 15, 2016, the Board voted to accept a settlement agreement with SunTrust Mortgage, Inc. (``SunTrust'') that required SunTrust pay a civil money penalty in the amount of $8,500. The settlement did not constitute an admission of liability or fault.

      Cause: The Board took this action based on the following violation of HUD/FHA requirements alleged by HUD: SunTrust failed to timely notify HUD/FHA that it entered into a settlement agreement with the State of New York Department of Financial Services under which it paid a fine.

    20. United Shore Financial Services, LLC., Troy, MI Docket No. 17-

      0009-FC

      Action: On December 21, 2016, the Board voted to release United Shore Financial Services, LLC. (``United Shore'') from any civil money penalties or administrative actions as part of a settlement between United Shore and the United States that required United Shore to pay the United States $48,000,000 plus interest.

      Cause: The Board took this action based on United Shore's alleged failure to properly originate, underwrite, and conduct quality control reviews for HUD/FHA insured loans in violation of HUD/FHA requirements.

  2. Lenders That Failed To Timely Meet Requirements for Annual Recertification of HUD/FHA Approval but Came Into Compliance

    Action: The Board entered into settlement agreements with the lenders listed below, which required the lender to pay a civil money penalty without admitting fault or liability.

    Cause: The Board took this action based upon allegations that the lenders listed below failed to comply with HUD's annual recertification requirements in a timely manner.

    1. Aberdeen Federal Credit Union, Aberdeen, SD ($4,500) Docket No. 16-

      1757-MRT

    2. Academy Mortgage Corporation, Draper, UT ($3,500) Docket No. 16-

      1768-MRT

    3. All in One Mortgage Lenders, Miami, FL ($8,500) Docket No. 16-1809-

      MRT

    4. Austin Bank of Chicago dba ABC Bank, Chicago, IL ($4,500) Docket No. 16-1712-MRT

    5. Bank 7, Nichols Hills, OK ($4,500) Docket No. 16-1785-MRT

    6. Bridgewater Savings Bank, Bridgewater, MA ($4,500) Docket No. 17-

      1836-MRT

    7. Celtic Bank, Salt Lake City, UT ($4,500) Docket No. 16-1711-MRT

    8. CFBank, Fairlawn, OH ($8,500) Docket No. 16-1780-MRT

    9. Champion Bank, Parker, CO ($9,468) Docket No. 17-1865-MRT

    10. City of Oakland, Oakland, CA ($8,500) Docket No. 17-1724-MRT

    11. Clark County Credit Union, Las Vegas, NV ($4,500) Docket No. 17-

      1853-MRT

    12. CoastHills Credit Union, Lompoc, CA ($4,500) Docket No. 16-1696-

      MRT

    13. Commerce State Bank, West Bend, WI ($4,500) Docket No. 16-1713-

      MRT

    14. Cooperativa de Ahorro Y Credit de Aguas, Aguas Buenas, PR ($4,500) Docket No. 16-1717-MRT

    15. Coral Mortgage Bankers Corp., Hackensack, NJ ($8,500) Docket No. 16-1723-MRT

    16. Craft3, Ilwaco, WA ($4,500) Docket No. 16-1691-MRT

      Page 18075

    17. Diversified Members Credit Union, Detroit, MI ($4,500) Docket No. 17-1895-MRT

    18. Eagle Bank and Trust Company, Hillsboro, MO ($4,500) Docket No. 16-1791-MRT

    19. Eagle Mortgage & Funding, Inc., Memphis, TN ($8,500) Docket No. 16-1790-MRT

    20. East West Bank. Pasadena, CA ($4,500) Docket No. 16-1746-MRT

    21. Fidelity Direct Mortgage, LLC., Gaithersburg, MD ($4,500) Docket No. 17-1725-MRT

    22. First National Bank of Granbury, Granbury, TX ($4,500) Docket No. 17-1871-MRT

    23. First National Bank of Pasco, Dade City, FL ($4,500) Docket No. 17-1881-MRT

    24. First State Bank, Barboursville, WV ($4,500) Docket No.16-1833-

      MRT

    25. Fulton Savings Bank, Fulton, NY ($4,500) Docket No. 16-1735-MRT

    26. Gladewater National Bank, Gladewater, TX ($4,500) Docket No. 16-

      1789-MRT

    27. Great Western Financial Services, Plano, TX ($4,500) Docket No.16-

      1781-MRT

    28. Herring Bank, Amarillo, TX ($4,500) Docket No 17-1876-MRT

    29. Home Bank and Trust, Wichita, KS ($4,500) Docket No. 17-1885-MRT

    30. Hometown Bank of the Hudson Valley, Walden, NY ($4,500) Docket No. 78716

    31. Idaho First Bank, Boise, ID ($4,500) Docket No. 16-1792-MRT

    32. Industrial Bank N.A., Washington, DC ($4,500) Docket No. 16-1784-

      MRT

    33. Intercap Lending Inc., Albuquerque, NM ($4,500) Docket No. 16-

      1749-MRT

    34. Ixonia Bank, Ixonia, WI ($4,500) Docket No. 16-1806-MRT

    35. Krkabob, Inc., d/b/a Argus Lending, Pleasant Hill, CA ($4,500) Docket No. 16-1728-MRT

    36. Landings Credit Union, Tempe, AZ ($4,500) Docket No. 17-1841-MRT

    37. Mazuma Credit Union, Overland Park, KS ($4,500) Docket No. 16-

      1801-MRT

    38. New Windsor State Bank, New Windsor, MD ($4,500) Docket No. 16-

      1800-MRT

    39. One Bank and Trust, N.A., Little Rock, AR ($4,500) Docket No. 16-

      1793-MRT

    40. Premier Members Credit Union, Boulder, CO ($8,500) Docket No. 17-

      1731-MRT

    41. Prime Source Mortgage, Inc., Murrieta, CA ($4,500) Docket No. 16-

      1858-MRT

    42. Private Bank of Buckhead, Atlanta, GA ($4,500) Docket No. 16-1740-

      MRT

    43. Republic Mortgage Commercial, Salt Lake City, UT ($4,500) Docket No. 16-1754-MRT

    44. Signal Financial Federal Credit Union, Kensington, MD ($4,500) Docket No. 16-1748-MRT

    45. Sindeo, Inc., San Francisco, CA ($8,500) Docket No. 16-1695-MRT

    46. SN Servicing Corporation, Baton Rouge, LA ($4,500) Docket No. 16-

      1803-MRT

    47. Somerville National Bank, Somerville, OH ($4,500) Docket No. 16-

      1776-MRT

    48. TRM, LLC., San Juan, PR ($8,500) Docket No. 16-1743-MRT

    49. U.S. Bank Trust National Association, New York, NY ($4,500) Docket No. 16-1761-MRT

    50. United Heritage Credit Union, Austin, TX ($4,500) Docket No. 16-

      1725-MRT

    51. Wendover Financial Service Corporation, Greensboro, NC ($8,500) Docket No. 16-1731-MRT

    52. Wolverine Bank, FSB, Midland, MI ($4,500) Docket No. 16-1752-MRT

  3. Lenders That Failed To Meet Requirements for Annual Recertification of HUD/FHA Approval

    Action: The Board voted to withdraw the FHA approval of each of the lenders listed below for a period of one (1) year.

    Cause: The Board took this action based upon allegations that the lenders listed below were not in compliance with HUD's annual recertification requirements.

    1. AAA Concordia Mortgage Corp., San Juan, PR Docket No.18-1839-MRT

    2. Banco Popular North America, New York, NY Docket No. 18-1840-MRT

    3. Bristol County Savings Bank, Taunton, MA Docket No. 16-1874-MRT

    4. Canon National Bank of Canon City, Canon City, CO Docket No. 18-

      1841-MRT

    5. Citywide Bank, Denver, CO Docket No. 16-1741-MRT

    6. Community 1st Federal Credit Union, Miles City, MT Docket No. 16-

      1760-MRT

    7. Cooperativa De Ahorro Y Credito Hermanos, Hato Rey, PR Docket No. 17-1722-MRT

    8. Covenant Bank, Clarksdale, MS Docket No. 16-1797-MRT

    9. Eastland Financial Corp, Irvine, CA Docket No. 18-1842-MRT

    10. Ecom Mortgage Inc., Covina, CA Docket No. 18-1843-MRT

    11. First Community Bank, Austin, TX Docket No. 18-1844-MRT

    12. First National Bank, Massillon, OH Docket No. 18-1845-MRT

    13. Hendricks County Bank and Trust Company, Brownsburg, IN Docket No. 16-1715-MRT

    14. Kentucky Federal Savings & Loan Association, Covington, KY Docket No. 16-1707-MRT

    15. Michigan Community Credit Union, Jackson, MI Docket No. 18-1846-

      MRT

    16. Municipal Housing Authority, Yonkers, NY Docket No. 17-1732-MRT

    17. Oak Mortgage Group Inc., Dallas, TX Docket No. 18-1847-MRT

    18. Oneida Savings Bank, Oneida, NY Docket No. 16-1804-MRT

    19. Proficio Mortgage Ventures, LLC., Henderson, NV Docket No. 16-

      1794-MRT

    20. Royal Bank of Missouri, St. Louis, MO Docket No.18-1805-MRT

    21. Southeast Funding Alliance, Orlando, FL Docket No. 15-1934-MRT

    22. Vanguard Funding, LLC., Garden City, NY Docket No. 18-1848-MRT

    23. Vision Bank, N.A., Ada, OK Docket No. 16-1750-MRT

      Dated: April 10, 2018.

      Dana T. Wade,

      General Deputy Assistant Secretary for Housing/FHA Commissioner, Chairman, Mortgagee Review Board.

      FR Doc. 2018-08669 Filed 4-24-18; 8:45 am

      BILLING CODE 4210-67-P