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CFPB takes action against mortgage payment processor
The CFPB Tuesday announced an enforcement action against ACI – a nationwide payment processor – for improperly initiating roughly $2.3 billion in unlawful mortgage payment transactions. The bureau said the company’s data handling practices negatively impacted nearly 500,000 homeowners with mortgages serviced by Mr. Cooper (formerly known as Nationstar).
According to the bureau, Mr. Cooper was one of ACI’s largest mortgage servicing customers, servicing the mortgages of more than four million borrowers and collecting their monthly mortgage payments. Many of those borrowers chose to schedule monthly payments using ACI’s Speedpay product, which allowed the company to automatically transfer homeowners’ authorized mortgage payments from their personal bank accounts to Mr. Cooper.
In April 2021, ACI conducted tests of its electronic payments platform but used actual consumer data from Mr. Cooper’s accounts, which resulted in the unlawful initiation of $2.3 billion in mortgage payment transactions.
The enforcement action requires ACI to:
- pay a $25 million penalty to the CFPB’s victims relief fund;
- adopt and enforce reasonable information security practices;
- never process payments without obtaining proper authorization; and
- never use sensitive consumer financial information for software development or testing purposes without documenting a compelling business reason and obtaining consumer consent.