Section 8 of the Real Estate Settlement Procedures Act (RESPA) prohibits unearned fees and kickbacks. Over the years the Department of Housing and Urban Development (HUD) issued hundreds of enforcement actions involving Section 8.
In 2011 authority for enforcing RESPA transferred from HUD to the Consumer Financial Protection Bureau (CFPB). During CFPB’s reign the volume of Section 8 actions has dropped. While enforcement actions under the CFPB have been fewer in number, the dollar amounts have been jaw dropping. The settlements of these actions range from a few thousand dollars to many millions of dollars. Failure to comply with Section 8 can lead to jail terms, in addition to the penalties.
Compliance Resource training manuals are designed to be used when conducting in-house training, whether initial training upon implementation of the new requirement, periodic training for new team members or remedial training for longer-term team members. The RESPA Section 8 Violations training manual will help your financial institution become aware of potential violations and take steps to eliminate them.
This manual covers:
• What transactions are covered by RESPA’s prohibition against unearned fees and
• What actions are prohibited;
• What constitutes a referral fee, or an unearned fee or kickback;
• What compensation is permissible;
• What constitutes an affiliated business arrangement and the rules that apply to such
• How to properly handle broker arrangements.
A webinar recording on this topic is also available for purchase. The training manual is included with the purchase of the webinar recording. The webinar recording is available here.