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CFPB: RESPA Compliance and Marketing Services Agreements (MSAs)
Home/Legal Corner/CFPB: RESPA Compliance and Marketing Services Agreements (MSAs)
CFPB: RESPA Compliance and Marketing Services Agreements (MSAs)
The CFPB, in 2015, issued a 5-page manual outlining the regulations for how Marketing Service Agreements (MSAs) would be enforced.
MSAs can be legal IF done correctly. Most aren’t.
Multiple headlines indicate the CFPB and FDIC are out to nail RESPA violators. (See the bottom of this post).
After Director Richard Cordray stepped down, the CFPB was a paper tiger (2018 and 2021). But during his tenure (2015-2017), one blockbuster prosecution in California put RESPA violators on notice in 2017.
California Gets into the Act
.What About Individual Violators
“They can’t collect legal taxes from illegal money.”
Al Capone – On appeal while at Alcatraz
Here’s what violators can expect:
Most violators write off kickbacks (ine #8“ of ”Schedule C) as advertising.
After all, what self-respecting violator would pay a hefty referral fee AND pay additional taxes (state, federal, and social security) on the gross income from that referral? Only shortsighted violators.
When one violator gets audited – the paper trail of THEIR tax return(s) – If there is a fraud that may reveal other co-conspirators.
Since the IRS has no statute of limitations (for fraud), the IRS can go back to when the violator was a “paper boy/girl”.
If fraud is found, then those results are routinely forwarded to the violator’s state tax authorities for collection. The Calif. State Franchise Tax Board has 20 years to examine all returns.”
Most of the $80 billion in the 2022 budget were already “hard” budgeted, and the clawback in the Debt Ceiling negotiation was only 21 billion dollars.
Where from Here?
The CFPB was a paper tiger – now, not so much! The former director Cordray was a political appointee and “in over his head” for starting up a new, vast agency (within the Treasury Dept).
Enforcement of RESPA is a High Profile “Reformer” and Public Issue
Currently, the Director of the CFPB is Rohit Chopra , and is a member of Wash. DC. establishment. He appears to seek a higher office (i.e., Secretary of the Treasury? Or the Chairperson of the Federal Reserve?
The CFPB is looking for scalps –
and these headlines are proof of it.
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he interim ordinance, which lasts until Aug. 1, was designed as a stop
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