On September 14, 2020 the Consumer Financial Protection Bureau (CFPB) issued a consent order against ClearPath Lending, Inc., an Irvine, California, corporation that is licensed as a mortgage broker or lender in about 22 states. ClearPath offers and provides mortgage loans guaranteed by the U.S. Department of Veterans Affairs. The CFPB announcement said ClearPath’s principal means of advertising VA-guaranteed loans is through direct-mail advertisements sent primarily to U.S. military servicemembers and veterans.
The CFPB found that ClearPath sent consumers mailers for VA-guaranteed mortgages that contained false, misleading, and inaccurate statements or that lacked required disclosures, in violation of the Consumer Financial Protection Act’s prohibition against deceptive acts and practices, the Mortgage Acts and Practices – Advertising Rule (MAP Rule), and Regulation Z. The consent order requires ClearPath to pay a civil money penalty of $625,000 and imposes requirements to prevent future violations.
This consent order is the eighth case stemming from a CFPB sweep of investigations of multiple mortgage companies that use deceptive mailers to advertise VA-guaranteed mortgages. The CFPB commenced this sweep in response to concerns about potentially unlawful advertising in the market that the VA identified.