[Federal Register Volume 88, Number 56 (Thursday, March 23, 2023)]
[Notices]
[Pages 17591-17597]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-05978]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. FR-6379-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.
-----------------------------------------------------------------------
SUMMARY: In compliance with the National Housing Act, this notice
advises of the cause and description of administrative actions taken by
HUD's Mortgagee Review Board against FHA-approved mortgagees in fiscal
year 2022.
FOR FURTHER INFORMATION CONTACT: Nancy A. Murray, Secretary to the
Mortgagee Review Board, 451 Seventh Street SW, Room B-133, Washington,
DC 20410-8000; telephone (202) 402-2701 (this is not a toll-free
number). HUD welcomes and is prepared to receive calls from individuals
who are deaf or hard of hearing, as well as individuals with speech or
communication disabilities. To learn more about how to make an
accessible telephone call, please visit https://www.fcc.gov/consumers/guides/telecommunications-relay-service-trs.
SUPPLEMENTARY INFORMATION: Section 202(c)(5) of the National Housing
Act (12 U.S.C. 1708(c)(5)) requires that HUD ``publish in the Federal
Register a description of and the cause for administrative action
against a[n FHA-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 the beginning of fiscal year 2022, October 1, 2021,
through September 30, 2022,
[[Page 17592]]
where settlement agreements have been reached, civil money penalties
were imposed, or FHA participation was terminated as of February 21,
2023.
I. Civil Money Penalties, Withdrawals of FHA Approval, Suspensions,
Probations, and Reprimands
1. AlaskaUSA Mortgage Company L.L.C., Anchorage, AK [Docket No. 22-
2007-MR]
Action: On February 24, 2022, the Board voted to enter into a
settlement agreement with AlaskaUSA Mortgage Company L.L.C.
(``AlaskaUSA'') that included a civil money penalty of $5,000. The
settlement did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: AlaskaUSA failed to timely notify FHA of
a state sanction in its fiscal year 2021.
2. American Lending, Inc., Costa Mesa, CA [Docket No. 21-2185-MR]
Action: On February 24, 2022, the Board voted to withdraw American
Lending, Inc. (``American Lending'') for a period of three years.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: American Lending (a) failed to timely
notify FHA of a state sanction in its fiscal year 2020; (b) submitted
to FHA a false certification concerning its fiscal year 2020; (c)
failed to maintain in its fiscal year 2020 the minimum required
adjusted net worth; (d) failed to timely notify FHA of its minimum
adjusted net worth deficiency in its fiscal year 2020; (e) failed to
maintain the minimum required liquid assets in its fiscal year 2020;
(f) failed to timely notify FHA of a required liquid assets deficiency
in its fiscal year 2020; (g) failed to maintain a warehouse line of
credit or other acceptable mortgage-funding program in its fiscal years
2020 and 2021; (h) failed to timely notify FHA of a funding program
deficiency in its fiscal year 2020; (i) failed to timely notify FHA of
a change in principal ownership in its fiscal year 2021; and (j) failed
to comply with FHA underwriting requirements concerning one FHA-insured
mortgage loan.
3. Ark-La-Tex Financial Services L.L.C. d/b/a Benchmark, L.L.C., Plano,
TX [Docket No. 21-2191-MR]
Action: On December 7, 2021, the Board voted to enter into a
settlement agreement with Ark-La-Tex Financial Services L.L.C. d/b/a
Benchmark (``Benchmark'') that included a civil money penalty of
$5,000. The settlement did not constitute an admission of liability or
fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Benchmark (a) failed to timely notify
FHA of an unresolved finding in its fiscal year 2020; and (b) failed to
timely notify FHA of a state sanction in its fiscal year 2020.
4. Aurora Financial Group, Wall Township, NJ [Docket No. 21-2235-MR]
Action: On February 24, 2022, the Board voted to enter into a
settlement agreement with Aurora Financial Group (``Aurora'') that
included a civil money penalty of $15,000. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Aurora: (a) failed to timely notify FHA
of a state sanction in its fiscal year 2020; (b) failed to timely
notify FHA of a state sanction in its fiscal year 2021; and (c) failed
to timely notify FHA of a second state sanction in its fiscal year
2021.
5. Bay to Bay Lending, L.L.C., Tampa, FL [Docket No. 21-2234-MR]
Action: On June 16, 2022, the Board voted to enter into a
settlement agreement with Bay to Bay Lending, L.L.C. (``Bay to Bay'')
that included a civil money penalty of $40,490. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Bay to Bay: (a) failed to timely submit
acceptable annual audited financial statements and supplemental reports
for its fiscal year 2020; (b) failed to maintain the minimum required
adjusted net worth throughout its fiscal year 2020; (c) failed to
timely notify FHA of its minimum adjusted net worth deficiency for its
fiscal year 2020; (d) failed to timely notify FHA of an operating loss
in a fiscal quarter that exceeded 20 percent of its net worth in its
fiscal year 2020; (e) failed to file the required quarterly financial
statements subsequent to an operating loss exceeding 20 percent of its
quarter-end net worth in its fiscal year 2020; and (f) failed to timely
notify FHA of a change in principal ownership in its fiscal year 2020.
6. Beeline Loans, Inc., Providence, RI [Docket No. 21-2136-MR]
Action: On December 7, 2021, the Board voted to enter into a
settlement agreement with Beeline Loans, Inc. (``Beeline'') that
included a civil money penalty of $15,000. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Beeline: (a) failed to timely notify
FHA of an operating loss in a fiscal quarter that exceeded 20 percent
of its net worth in its fiscal year 2020; (b) failed to file the
required quarterly financial statements subsequent to an operating loss
exceeding 20 percent of its quarter-end net worth in its fiscal year
2021; and (c) failed to file the required quarterly financial
statements subsequent to an operating loss exceeding 20 percent of its
quarter-end net worth in its fiscal year 2021.
7. Bellwether Enterprise Real Estate Capital, Cleveland, OH [Docket No.
21-2229-MR]
Action: On December 7, 2021, the Board voted to enter into a
settlement agreement with Bellwether Enterprise Real Estate Capital
(``Bellwether'') that included an administrative payment of $341,500.
The settlement did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA's requirements: Bellwether obtained loan fees in
excess of five percent for five loans that received reduced Mortgage
Insurance Premium (``MIP'') rates under the Affordable and Green MIP
Programs.
8. BNB Financial, Inc., Glendale, CA [Docket No. 21-2252-MR]
Action: On June 16, 2022, the Board voted to enter into a
settlement agreement with BNB Financial, Inc. (``BNB'') that included a
civil money penalty of $15,245. The settlement did not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: BNB (a) failed to timely notify FHA of
a state sanction in its fiscal year 2021; and (b) submitted to FHA a
false certification concerning its fiscal year 2021.
9. Broker Solutions, Inc., Tustin, CA
Action: On February 24, 2022, the Board voted to concur on a
settlement of a False Claims Act lawsuit initiated by a realtor against
Broker Solutions, Inc. d/b/a New American Funding (``Broker
Solutions'') and that included a payment of $702,000 to FHA. The
settlement did not constitute an admission of liability or fault.
[[Page 17593]]
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Broker Solutions (a) improperly
compensated employees performing underwriting activities on a
commission basis; (b) authorized certain managers or salespersons to
override FHA and other government underwriting requirements; (c) took
steps to improperly increase the appraised value of properties; (d)
manipulated borrower income and debt information to improperly approve
loans through TOTAL Mortgage Scorecard; and (e) withheld underwriting
deficiencies identified by quality control auditors from FHA and other
government entities.
10. Chu & Associates, Inc., d/b/a Fidelity Funding Bancorp, Pasadena,
CA [Docket No. 21-2245-MR]
Action: On December 7, 2021, the Board voted to enter into a
settlement agreement with Chu & Associates, Inc. (``Chu'') that
included a civil money penalty of $30,000. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Chu (a) failed to maintain the minimum
required adjusted net worth in its fiscal years 2020 and 2021; (b)
failed to timely notify FHA of its adjusted net worth deficiency in its
fiscal years 2020 and 2021; (c) failed to maintain the minimum required
liquid assets in its fiscal year 2020; and (d) failed to timely notify
FHA of a liquid asset deficiency in its fiscal year 2020.
11. Cliffco Inc., Uniondale, NY [Docket No. 22-2205-MR]
Action: On June 16, 2022, the Board voted to enter into a
settlement agreement with Cliffco Inc. (``Cliffco'') that included a
civil money penalty of $5,000. The settlement did not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: Cliffco failed to timely notify FHA of a
state sanction in its fiscal year 2021.
12. Coastal States Mortgage, Inc., Hilton Head Island, SC [Docket No.
21-2202-MR]
Action: On December 7, 2021, the Board voted to enter into a
settlement agreement with Coastal States Mortgage, Inc. (``Coastal
States'') that included a civil money penalty of $5,000. The settlement
did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirement. Coastal States (a) failed to report an
unresolved finding in its fiscal year 2019; and (b) failed to timely
report a state sanction in its fiscal year 2019.
13. Columbus Capital Lending, L.L.C., d/b/a Zoom Loans, Miami, FL
[Docket No. 22-2006-MR]
Action: On June 16, 2022, the Board voted to enter into a
settlement agreement with Columbus Capital Lending, L.L.C. d/b/a Zoom
Loans (``Zoom Loans'') that included a civil money penalty of $15,245.
The settlement did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements. Zoom Loans (a) failed to timely notify
FHA of a state sanction in its fiscal year 2020; and (b) submitted to
FHA a false certification concerning its fiscal year 2020.
14. Contour Mortgage Corporation, Garden City, NY [Docket No. 21-2195-
MR]
Action: On December 7, 2021, the Board voted to enter into a
settlement agreement with Contour Mortgage Corporation (``Contour'')
that included a civil money penalty of $25,000. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements. Contour (a) failed to timely notify FHA
of a state sanction in its fiscal years 2018 and 2020; (b) failed to
timely notify FHA of a state sanction against its employee in its
fiscal year 2018; and (c) submitted to FHA a false certification
concerning its fiscal year 2018.
15. Credence Funding Corporation, Aberdeen, MD [Docket No. 22-2002-MR]
Action: On February 24, 2022, the Board voted to enter into a
settlement agreement with Credence Funding Corporation (``Credence'')
that included a civil money penalty of $15,245. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Credence (a) failed to timely notify
FHA of a state sanction in its fiscal year 2019; and (b) submitted to
FHA a false certification concerning its fiscal year 2019.
16. Del Sur Corporation, San Fernando, CA [Docket No. 20-2145-MR]
Action: On December 7, 2021, the Board voted to enter into a
settlement agreement with Del Sur Corporation (``Del Sur'') that
included a civil money penalty of $38,977. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Del Sur failed to maintain an escrow
account to segregate escrow commitment deposits, work completion
deposits, and all periodic payments received for loans or insured
mortgages on account of ground rents, taxes, assessments and insurance
charges or premiums in its fiscal years 2017, 2018, 2019, and 2020.
17. Dwight Capital LLC, New York, NY [Docket No. 21-2166-MR]
Action: On September 15, 2022, the Board voted to enter into a
settlement agreement with Dwight Capital LLC (``Dwight'') that included
a civil money penalty of $16,000,000, execution of 24 life-of-loan
indemnifications, and a corrective action plan. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Dwight (a) obtained loan fees in excess
of five percent for five loans that received reduced MIP rates under
FHA's Green MIP Program; (b) engaged in prohibited business practices,
(c) failed to adopt a Quality Control (``QC'') Program that fully
complied with HUD requirements; (d) failed to comply with its QC
Program, (e) engaged in business practices that do not conform to
generally accepted practices of prudent mortgagees; (f) failed to
disclose identity of interest (``IOI'') relationships; (g) failed to
properly disclose and review IOI borrowers; (h) submitted to FHA false
statements and false certifications; (i) submitted false information to
the Mortgagee Review Board; and (j) violated use and disclosure
requirements regarding brokers.
18. Evesham Mortgage L.L.C., Marlton, NJ [Docket No. 21-2246-MR]
Action: On February 24, 2022, the Board voted to enter into a
settlement agreement with Evesham Mortgage L.L.C. (``Evesham'') that
included a civil money penalty of $59,567, and execution of five life-
of loan indemnifications. The settlement did not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
[[Page 17594]]
violations of FHA requirements: Evesham (a) failed to properly verify
and document effective income on two loans; (b) failed to properly
document gift funds for nine loans; (c) failed to properly document
borrowers' funds to close for two loans; (d) failed to document that a
borrower whose underwriting approval relied on the use of retirement
account assets was both eligible to make withdrawals and did, in fact,
make the withdrawals; (e) failed to include all required documentation
in the case binders for two loans; (f) failed to timely notify FHA of a
state sanction in its fiscal year 2020; and (g) submitted to FHA a
false certification concerning its fiscal year 2020.
19. Fairway Independent Mortgage Corporation, Madison, WI [Docket No.
21-2192-MR]
Action: On February 24, 2022, the Board voted to enter into a
settlement agreement with Fairway Independent Mortgage Corporation
(``Fairway'') that included a civil money penalty of $96,960. The
settlement did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Fairway (a) failed to adopt and
implement a QC Plan in compliance with FHA requirements; and (b) failed
to comply with FHA's self-reporting requirements to ensure it reported
to FHA all fraud, misrepresentation, and other findings.
20. Finco Mortgage L.L.C., Scottsdale, AZ [Docket No. 22-2004-MR]
Action: On February 24, 2022, the Board voted to enter into a
settlement agreement with Finco Mortgage L.L.C. d/b/a Minute Mortgage
(``Minute Mortgage'') that included a civil money penalty of $10,000.
The settlement did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Minute Mortgage (a) failed to maintain
the minimum required adjusted net worth in its fiscal year 2021; and
(b) failed to timely notify FHA of its minimum adjusted net worth
deficiency in its fiscal year 2021.
21. GoodLeap, LLC, Roseville, CA [Docket No. 21-2250-MR]
Action: On September 15, 2022, the Board voted to enter into a
settlement agreement with GoodLeap, LLC (``GoodLeap'') that included a
civil money penalty of $35,245. The settlement did not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: GoodLeap (a) failed to timely notify
FHA of an operating loss in a fiscal quarter that exceeded 20 percent
of its net worth in its fiscal year 2020 and fiscal year 2021; (b)
failed to file the required quarterly financial statements subsequent
to an operating loss exceeding 20 percent of its quarter-end net worth
in its fiscal year 2020 and fiscal year 2021; (c) failed to timely
notify FHA of a state sanction in its fiscal year 2020; and (d)
submitted to FHA a false certification concerning its fiscal year 2020.
22. Grande Homes, Inc., National City, CA [Docket No. 21-2249-MR]
Action: On June 16, 2022, the Board voted to enter into a
settlement agreement with Grande Homes, Inc. (``Grande Homes'') that
included a civil money penalty of $5,000. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: Grande Homes violated FHA requirements
by failing to timely notify FHA of a change of its principal ownership
in its fiscal year 2020.
23. Greystone Funding Company L.L.C., Atlanta, GA [Docket No. 22-2019-
MR]
Action: On February 24, 2022, the Board voted to enter into a
settlement agreement with Greystone Funding Company L.L.C.
(``Greystone'') that included a civil money penalty of $4,801,340 and
required Greystone to update its training materials; improve its
underwriting processes; institute review by senior staff and, if
necessary, its legal department; instruct its team to err on the side
of disclosure; expand its IOI screening; and amend its QC plan to
clarify it reporting obligations. The settlement did not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Greystone: (a) falsely certified in
three instances in each of twenty Section 223(a)(7) refinance
applications submitted by Greystone in 2020 and 2021; (b) failed to
disclose an ongoing Department of Justice investigation into the
borrower's projects and companies; and (c) failed to disclose an IOI
with the borrower.
24. Heartland Bank and Trust Company, Bloomington, IL [Docket No. 21-
2209-MR]
Action: On December 7, 2021, the Board voted to enter into a
settlement agreement with Heartland Bank and Trust Company
(``Heartland'') that included a civil money penalty of $5,000. The
settlement did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: Heartland violated FHA requirements by
failing to timely notify FHA of change in its business structure in
fiscal year 2020.
25. Jet Direct Funding Corp. d/b/a Jet Direct Mortgage, Bay Shore, NY
[Docket No. 20-2019-MR]
Action: On May 18, 2021, the Board voted to enter into a settlement
agreement with Jet Direct Funding Corp. d/b/a Jet Direct Mortgage
(``Jet Direct'') that included a civil money penalty of $19,819. The
settlement did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Jet Direct (a) failed to timely notify
FHA of a state sanction in its fiscal year 2018; (b) failed to timely
notify FHA of a state sanction in its fiscal year 2019; and (c)
submitted to FHA a false certification concerning its fiscal year 2018.
26. JSB Mortgage Corporation, La Mirada, CA [Docket No. 20-2067-MR]
Action: On September 21, 2021, the Board voted to impose a civil
money penalty of $25,134 against JSB Mortgage Corporation (``JSB'').
Cause: The Board took this action based on the following alleged
violations of FHA requirements: JSB (a) failed to timely notify FHA of
a state sanction in its fiscal year 2019; (b) submitted to FHA a false
certification concerning its fiscal year 2019; and (c) permitted its
Officer in Charge to engage in dual employment.
27. Manhattan Financial Group, Inc., Escondido, CA [Docket No. 21-2206-
MR]
Action: On February 24, 2022, the Board voted to enter into a
settlement agreement with Manhattan Financial Group, Inc. (``Manhattan
Financial'') that included a civil money penalty of $10,067. The
settlement did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: Manhattan
[[Page 17595]]
Financial failed to timely notify FHA of a state sanction in its fiscal
year 2019.
28. Mortgage Clearing Corporation, Tulsa, OK [Docket No. 21-2253-MR]
Action: On February 24, 2022, the Board voted to enter into a
settlement agreement with Mortgage Clearing Corporation (``Mortgage
Clearing'') that included a civil money penalty of $5,000. The
settlement did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: Mortgage Clearing failed to timely
notify FHA of a state sanction in its fiscal year 2021.
29. Mortgage Solutions of Colorado L.L.C., Colorado Springs, CO [Docket
No. 22-2013-MR]
Action: On June 16, 2022, the Board voted to enter into a
settlement agreement with Mortgage Solutions of Colorado L.L.C.
(``Mortgage Solutions'') that included a civil money penalty of
$15,366. The settlement did not constitute an admission of liability or
fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: Mortgage Solutions (a) failed to timely
notify FHA of a state sanction in its fiscal year 2020; and (b)
submitted to FHA a false certification concerning its fiscal year 2020.
30. New England Regional Mortgage Corporation, Salem, NH [Docket No.
22-2009-MR]
Action: On February 24, 2022, the Board voted to enter into a
settlement agreement with New England Regional Mortgage Corp (``New
England Regional'') that included a civil money penalty of $5,000. The
settlement did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: New England Regional failed to timely
notify FHA of a state sanction in its fiscal year 2021.
31. North American Financial Corporation, Henderson, NV [Docket No. 21-
2214-MR]
Action: On June 16, 2022, the Board voted to enter into a
settlement agreement with North American Financial Corporation (``North
American'') that included a civil money penalty of $25,500. The
settlement did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: North American (a) originated 33 FHA
loans between February 8, 2017 and August 27, 2018 without the
appropriate state license; and (b) failed to timely notify FHA of a
state sanction in its fiscal year 2020.
32. Pacific Horizon Bancorp, La Crescenta, CA [Docket No. 22-2018-MR]
Action: On February 24, 2022, the Board voted to enter into a
settlement agreement with Pacific Horizon Bancorp (``Pacific Horizon'')
that included a civil money penalty of $15,245. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Pacific Horizon (a) failed to timely
notify FHA of a state sanction in its fiscal year 2020; and (b)
submitted to FHA a false certification concerning its fiscal year 2020.
33. Poli Mortgage Group, Norwood, MA [Docket No. 22-2012-MR]
Action: On September 15, 2022, the Board voted to enter into a
settlement agreement with Poli Mortgage Group (``Poli'') that included
a civil money penalty of $15,245. The settlement did not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Poli (a) failed to timely notify FHA of
a state sanction in its fiscal year 2020; and (b) submitted to FHA a
false certification concerning its fiscal year 2020.
34. ReNew Lending, Inc., Reno, NV [Docket No. 21-2254-MR]
Action: On June 16, 2022, the Board voted to enter into a
settlement agreement with Renew Lending, Inc. (``ReNew'') that included
a civil money penalty of $10,000. The settlement did not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: ReNew (a) failed to maintain the
minimum required liquid assets in its fiscal year 2020; and (b) failed
to timely notify FHA of a liquid assets deficiency in its fiscal year
2020.
35. Residential Acceptance Corporation, L.L.C., Tampa, FL [Docket No.
21-2198-MR]
Action: On June 16, 2022, the Board voted to enter into a
settlement agreement with Residential Acceptance Corporation, L.L.C.
(``Residential Acceptance'') that included a civil money penalty of
$30,490 and indemnification of one loan. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Residential Acceptance (a) failed to
properly validate assets and resolve conflicting information during
underwriting; (b) failed to meet FHA requirements in documenting gift
funds; and (c) failed to timely notify FHA of two state sanctions in
its fiscal year 2021.
36. Residential Mortgage Funding Inc., Orange, CA [Docket No. 22-2003-
MR]
Action: On February 24, 2022, the Board voted to enter into a
settlement agreement with Residential Mortgage Funding, Inc.
(``Residential Mortgage'') that included a civil money penalty of
$15,245. The settlement did not constitute an admission of liability or
fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Residential Mortgage (a) failed to
timely notify FHA of a state sanction in its fiscal year 2020; and (b)
submitted to FHA a false certification concerning its fiscal year 2020.
37. Ruoff Mortgage Company Inc., Fort Wayne, IN [Docket No. 21-2183-MR]
Action: On December 7, 2021, the Board voted to enter into a
settlement agreement with Ruoff Mortgage Company Inc. (``Ruoff'') that
included a civil money penalty of $5,000. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: Ruoff failed to timely notify FHA of a
state sanction in its fiscal year 2020.
38. Rushmore Loan Management Services, L.L.C., Dallas, TX [Docket No.
22-2010-MR]
Action: On June 16, 2022, the Board voted to enter into a
settlement agreement with Rushmore Loan Management Services
(``Rushmore'') that included a civil money penalty of $5,000. The
settlement did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: Rushmore failed to timely notify FHA of
a state sanction in its fiscal year 2020.
[[Page 17596]]
39. Sente Mortgage Inc., Austin, TX [Docket No. 22-2022-MR]
Action: On June 16, 2022, the Board voted to enter into a
settlement agreement with Sente Mortgage, Inc. (``Sente'') that
included a civil money penalty of $15,366. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: Sente (a) failed to timely notify FHA in
its fiscal year 2021 of a state sanction; and (b) submitted to FHA a
false certification concerning its fiscal year 2021.
40. ServiceMac L.L.C., Fort Mill, SC [Docket No. 21-2203-MR]
Action: On December 7, 2021, the Board voted to enter into a
settlement agreement with ServiceMac, L.L.C. (``ServiceMac'') that
included a civil money penalty of $20,000. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: ServiceMac (a) failed on four occasions
to timely notify FHA of an operating loss in a fiscal quarter that
exceeded 20 percent of its net worth in its fiscal year 2019; and (b)
failed to file the required quarterly financial statements subsequent
to an operating loss exceeding 20 percent of its quarter-end net worth
in its fiscal year.
41. SouthPoint Financial Services, Inc., Alpharetta, GA [Docket No. 22-
2021-MR]
Action: On June 16, 2022, the Board voted to enter into a
settlement agreement with SouthPoint Financial Services, Inc.
(``SouthPoint'') that included a civil money penalty of $10,067 and
execution of one 5-year indemnification agreement. The settlement did
not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: Southpoint failed to adequately document
the transfer of gift funds for an FHA insured loan.
42. Statewide Funding Inc., Ontario, CA [Docket No. 21-2215-MR]
Action: On September 15, 2022, the Board voted to enter into a
settlement agreement with Statewide Funding, Inc. (``Statewide'') that
included a civil money penalty of $25,366 and Statewide's submission of
quarterly financial statements to FHA for one year. The settlement did
not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: Statewide (a) failed to maintain in its
fiscal years 2019, 2020, and 2021 the minimum required adjusted net
worth; and (b) failed to timely notify FHA of its adjusted net worth
deficiency in its fiscal year 2020.
43. Sunmark Credit Union, Latham, NY [Docket No.21-2200-MR]
Action: On December 7, 2021, the Board voted to enter into a
settlement agreement with Sunmark Credit Union (``Sunmark'') that
included a civil money penalty of $10,000. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: Sunmark failed to timely notify FHA of
two changes in its business structure (in, respectively, December 2018
and May 2019) involving Sunmark and two non-FHA approved credit unions.
44. Sutherland Mortgage Services Inc., Sugar Land, TX [Docket No. 21-
2247-MR]
Action: On June 16, 2022, the Board voted to enter into a
settlement agreement with Sutherland Mortgage Services Inc.
(``Sutherland'') that included a civil money penalty of $10,000. The
settlement did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: Sutherland (a) failed to maintain the
minimum required adjusted net worth for its fiscal year 2020; and (b)
failed to timely notify FHA of an adjusted net worth deficiency in its
fiscal year 2020.
45. United Security Financial Corp., Murray, UT [Docket No. 21-2207-MR]
Action: On December 7, 2021, the Board voted to enter into a
settlement agreement with United Security Financial Corp. (``United
Security'') that included a civil money penalty of $5,000. The
settlement did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: United Security failed to timely notify
FHA of a state sanction in its fiscal year 2020.
46. US Direct Lender, La Canada Flintridge, CA [Docket No. 21-2143-MR]
Action: On June 16, 2022, the Board voted to enter into a
settlement agreement with US Direct Lender (``US Direct'') that
included a civil money penalty of $25,490. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of FHA requirements: US Direct (a) falsely certified in its
application for FHA approval that it had not been subject to any
regulatory actions; (b) failed to timely notify FHA of a state sanction
in its fiscal year 2020; and (c) submitted to FHA a false certification
concerning its fiscal year 2020.
47. Watermark Capital, Inc., Irvine, CA [Docket No. 22-2034-MR]
Action: On September 15, 2022, the Board voted to enter into a
settlement agreement with Watermark Capital, Inc. (``Watermark'') that
included a civil money penalty of $5,000. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: Watermark failed to timely notify FHA of
a state sanction in its fiscal year 2021.
48. Western Ohio Mortgage Corporation, Sidney, OH [Docket No. 21-2248-
MR]
Action: On February 24, 2022, the Board voted to enter into a
settlement agreement with Western Ohio Mortgage Corporation (``Western
Ohio'') that included a civil money penalty of $15,245. The settlement
did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: Western Ohio (a) failed to timely notify
FHA of a state sanction in its fiscal year 2020; and (b) submitted to
FHA a false certification concerning its fiscal year 2020.
49. Wyndham Capital Mortgage, Inc., Charlotte, NC [Docket No. 21-2204-
MR]
Action: On December 7, 2021, the Board voted to enter into a
settlement agreement with Wyndham Capital Mortgage, Inc. (``Wyndham'')
that included a civil money penalty of $5,000. The settlement did not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of FHA requirements: Wyndham failed to timely notify FHA of a
state sanction in its fiscal year 2020.
[[Page 17597]]
II. Lenders That Failed To Timely Meet Requirements for Annual
Recertification of FHA Approval but Came Into Compliance.
Action: The Board entered into settlement agreements with the
following lenders, which required the lender to pay a civil money
penalty without admitting fault or liability.
Cause: The Board took these actions based upon allegations that the
listed lenders failed to comply with FHA's annual recertification
requirements in a timely manner.
The following lenders paid civil money penalties of $10,366:
1. Home Financing Center, Inc., Coral Gables, FL [Docket No. 22-2057-
MRT]
2. Magnolia Bank, Magnolia, KY [Docket No. 22-2032-MRT]
3. Obsidian Financial Services, Inc., Melbourne, FL [Docket No. 22-
2043-MRT]
4. Republic First Bank d/b/a Republic Bank, Philadelphia, PA [Docket
No. 22-2063-MRT]
The following lender paid civil money penalties of $10,245:
Industrial Bank NA, Washington, DC [Docket No. 21-2230-MRT]
The following lenders paid civil money penalties of $5,000.
1. A Plus Mortgage Services Inc., Muskego, WI [Docket No. 22-2044-MRT]
2. Accunet Mortgage L.L.C., Waukesha, WI [Docket No. 22-2046-MRT]
3. Advantis Credit Union, Milwaukie, OR [Docket No. 22-2031-MRT]
4. Augusta Financial Inc., Santa Clarita, CA [Docket No. 22-2053-MRT]
5. Bank, Wapello, IA [Docket No. 22-2033-MRT]
6. GenHome Mortgage Corporation f/k/a Beckam Funding Corp., Irvine, CA
[Docket No. 21-2237-MRT]
7. Devon Bank, Chicago, Il [Docket No. 22-2016-MRT]
8. First Service Credit Union, Houston, TX [Docket No. 22-2030-MRT]
9. Forbright Bank, Chevy Chase, MD [Docket No. 22-2039-MRT]
10. Statebridge Company, L.L.C., Greenwood Village, CO [Docket No. 22-
2050-MRT]
11. Verve, a Credit Union, Oshkosh, WI [Docket No. 22-2042-MRT]
Julia R. Gordon,
Assistant Secretary for Housing--Federal Housing Administration,
Mortgagee Review Board, Chairperson.
[FR Doc. 2023-05978 Filed 3-22-23; 8:45 am]
BILLING CODE 4210-67-P