The Consumer Financial Protection Bureau sued mortgage originator and servicer Freedom Mortgage Corp., for allegedly submitting erroneous Home Mortgage Disclosure Act data in 2020.
According to the lawsuit, the CFPB found 51 errors in an initial review of 159 HMDA data files that the Boca Raton, Fla.-based company compiled in 2020. Freedom Mortgage eventually corrected 174,000 data entries or nearly 20 percent of the more than 700,000 mortgage loans it processed that year.
The lawsuit was filed Oct. 10 in the Southern District of Florida. Freedom Mortgage reportedly violated a 2019 consent order requiring it to improve compliance management practices. In that case, company loan officers were allegedly told to inaccurately label applicants as non-Hispanic white when no information about ethnicity or race was given.
In August, the CFPB fined the nonbank $1.75 million for paying illegal kickbacks for mortgage loan referrals. Freedom Mortgage reportedly violated the Real Estate Settlement Procedures Act by offering real estate agents and brokers cash payments. The company also allegedly paid for subscription services and catered parties with the understanding that they would refer potential homebuyers to the firm.
“The CFPB will continue to focus on ending the cycle of misconduct by repeat offenders in the financial industry,” said Director Rohit Chopra.