The Federal Deposit Insurance Corporation (FDIC) have settled a case against Seattle-based HomeStreet Bank, with the bank paying a $1.35m fine without acknowledging any wrongdoing.
The FDIC had alleged that the bank had violated the Real Estate Settlement Procedures Act (RESPA). The regulation prohibits giving or accepting a thing of value for the referral of settlement service involving a federally related mortgage loan.
The FDIC accused HomeStreet Bank of failing to comply with the law after the firm’s Home Loan Center-based mortgage banking business line, entered into certain co-marketing arrangements in which the bank and real estate brokers agreed to market their services together using online platforms.
Moreover, the regulator said HomeStreet Bank also broke the law by renting space in the offices of real estate brokers and home builders, which the FDIC said resulted in the payment of fees by the bank to real estate brokers and home builders for their referrals of mortgage loan business, in violation of RESPA. HomeStreet Bank has terminated all of the co-marketing and desk rental agreements.
HomeStreet Bank has paid the fine without admitting or denying the accusations.
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