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Bank of England Hit With $1.5M Penalty for Deceptive Loan Practices

1 min read

Bank of England entered into a consent decree with the Federal Deposit Insurance Corp. and was ordered to pay a $1.5 million penalty over deceptive loan practices.

The FDIC found that the $415.7 million-asset lender violated the Federal Trade Commission Act in the sale and marketing of refinance loans backed by the Department of Veterans Affairs.

The string of violations at its former West Bloomfield, Michigan, loan production office included paying and receiving referral fees in violation of the Real Estate Settlement Procedures Act, reporting inaccurate data in violation of the Home Mortgage Disclosure Act and failing to comply with the Fair Credit Reporting Act requirements for prescreened reports.

The consent decree was entered in May but only recently became public.

Earlier this year, regulators found that nine mortgage employees at the suburban Detroit office engaged in bait-and-switch tactics and other systemic deception of customers between 2018 and 2020.

The branch manager, Zach Jabro, was ordered to pay a $110,000 civil money penalty, and the assistant branch manager, Ryan Qarana, was assessed $100,000 and banned from working in the banking industry.

Seven other BOE employees have also received sanctions ranging from additional training to $35,000. The civil penalties, which total $275,500, must not be paid by any bank.

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