Do Regulators Now Have Their Eye on the Mortgage Lending Industry?

The Consumer Financial Protection Bureau (CFPB) is making its presence known to mortgage providers that don’t comply with industry and federal government rules.

The CFPB is tasked with supervising banks, credit unions, and other financial companies to enforce federal consumer financial laws and protect people from unexplained or undisclosed fees, and the costs and risks of borrowing money. CFPB’s official mission is to ‘make markets for consumer financial products and services work for Americans, whether they’re applying for a mortgage, choosing among credit cards, or using any number of other consumer financial products.’

Most recently, the CFPB fined mortgage lender Amerisave  for allegations of deceptive advertising. While Amerisave and its owner didn’t admit or deny CFPB’s allegations, the company agreed to refund $14.8 million to consumers, and pay a fine of $4.5 million.

It’s clear that the three-year-old regulator will be aggressive in its methods to end alleged mortgage market exploitations.

Next steps for your business

Under the CFPB’s watch, what are your compliance and risk mitigation obligations if you’re a mortgage lender, or provide other consumer financial products?

If you use website advertising, social media, and other methods of digital communications to seek out customers, there are compliance and regulatory issues to address right now.

First and foremost, the CFPB says “a supervised entity must develop and maintain a sound compliance management system that is integrated into the overall framework for product design, delivery, and administration.”

So along with the development of compliance policies, training, and enforcement that are suited to your business and industry— monitoring of your company website, online advertisements, social media interactions, and other forms of digital communication with potential customers is critical.

Using technology tools to monitor customer communications

Archiving solutions can help a great deal, enabling you to search, review and produce records of your company’s digital messages, advertisements and interactions with customers, right when you need them.
When you supervise and archive digital records, including keeping a complete record of all actions taken against non-compliant messages, you’ll also be better prepared to respond to an e-discovery, legal or regulatory event.

While you work hard to meet the needs of your customers, keep an eye over all of the communications that represent your company and its brand! The CFPB surely will.