The CFPB alleges PHH Corp. (PHH -2.5%) over 15 years collected up to 40% of premiums paid by consumers to mortgage insurers - "hundreds of millions in kickbacks." The company worked it, says the CFPB, by pressuring the insurers to purchase reinsurance from PHH. Those fees - rather than transferring risk - were kickbacks in exchange for the original referral, says the agency.
PHH: "We believe the CFPB's allegations grossly mischaracterize the legitimate business activities of our mortgage reinsurance subsidiary."
The case will be handled by an administrative law judge.
Last year, the CFPB reached settlements with five mortgage insurance companies totaling $15.5M over alleged kickbacks.