Yikes, if you have not read this, I strongly recommend that you take 5 minutes to save yourself millions of dollars.
Castle & Cook Mortgage is being hit with actions regarding LO Comp. There are a couple of items I would like to point out.
1. They are cited for lack of written policy in both the company policy and employee agreement.
2. The CFPB has the legal authority to take immediate action outside of the DOJ if they choose.
3. The CFPB looks at larger and smaller lenders.
4. The penalties are remediation to the clients, civil money penalties that could be in the millions and legal/consultant bills that may rival that.
5. Times have changed folks. Looking for “ways around” regulation that puts your company in the “gray zone” you have heard me talk about, leaves the door open for this type of action. You have to ask yourself if any of your policies are worth losing your business over. While the CFPB has not shut down Castle & Cook, the question remains can they sustain the financial penalties?
6. I’ve heard from many production recruiters that they have companies recruiting against them that don’t follow the rules. They feel like they lose producers because of this. I would keep this handy to show a prospect why working for the wrong company can get them into hot water.
I think it is pretty evident that if you have not taken the time to get your company compliant…..well there is no time like the present.
Yet, I will also warn you that it is prudent to do an analysis of your previous activities as compared to when laws took affect. Catch the issue, offer consumer remediation and clean up your written policies. If you do this, it demonstrates that you are trying, versus just trying to sneak under the radar.
After reading this, I have to go take some Tums……stay tuned as more exciting adventures await us!
