CFPB orders Alabama firm to pay $500K
May 29, 2014 – CFPB on Wednesday said it has taken enforcement action and assessed a $500,000 civil money penalty against a real estate firm in Alabama for inadequate disclosures to consumers on their options in choosing service providers while buying a home.
RealtySouth is the largest real estate firm in Alabama. The agency says it violated the Real Estate Settlement and Practices Act, which prevents firms from getting kickbacks from referring consumers to certain real estate settlement services: RealtySouth’s purchase contracts explicitly directed consumers to its affiliate, TitleSouth, for title and closing services.
“Disclosures give consumers the power to make informed financial decisions, and buying a house is among the biggest financial decisions most people ever make,” CFPB Director Richard Cordray said. “The Consumer Bureau will continue to take action against companies that attempt to modify disclosures and keep consumers in the dark.”
The agency was alerted to the firm’s disclosure form practice by the Department of Housing and Urban Development.