Source: https://www.law.cornell.edu/uscode/text/12/1735f-14
Timestamp: 2019-03-20 17:36:43
Document Index: 167802632

Matched Legal Cases: ['§ 1735', '§ 1735', 'arts 24', '§\u202f536', '§\u202f107', '§\u202f2704', '§\u202f553', '§\u202f601', '§\u202f219', '§\u202f2102', '§\u202f9', '§\u202f203', '§\u202f203', '§\u202f203', '§\u202f203', '§\u202f203', '§\u202f203', '§\u202f203', '§\u202f2704', '§\u202f601', '§\u202f601', '§\u202f553', '§\u202f553', '§\u202f553', '§\u202f553', '§\u202f553', '§\u202f553', '§\u202f553', 'arts 24', 'art 25', '§\u202f553', '§\u202f2704', '§\u202f107', '§\u202f541', 'art 10', '§\u202f541', 'ART 30']

12 U.S. Code § 1735f–14 - Civil money penalties against mortgagees, lenders, and other participants in FHA programs | U.S. Code | US Law | LII / Legal Information Institute
Section 1735f–14. Civil money penalties against mortgagees, lenders, and other participants in FHA programs
12 U.S. Code § 1735f–14 - Civil money penalties against mortgagees, lenders, and other participants in FHA programs
If a mortgagee approved under the [1] chapter, a lender holding a contract of insurance under subchapter I, or a principal, officer, or employee of such mortgagee or lender, or other person or entity participating in either an insured mortgage or subchapter I loan transaction under this chapter or providing assistance to the borrower in connection with any such loan, including sellers of the real estate involved, borrowers, closing agents, title companies, real estate agents, mortgage brokers, appraisers, loan correspondents and dealers, knowingly and materially violates any applicable provision of subsection (b), the Secretary may impose a civil money penalty on the mortgagee or lender, or such other person or entity, in accordance with this section. The penalty under this paragraph shall be in addition to any other available civil remedy or any available criminal penalty, and may be imposed whether or not the Secretary imposes other administrative sanctions. The penalty shall be in addition to any other available civil remedy or any available criminal penalty, and may be imposed whether or not the Secretary imposes other administrative sanctions.
The amount of the penalty, as determined by the Secretary, may not exceed $5,000 for each violation, except that the maximum penalty for all violations by any particular mortgagee or lender or such other person or entity during any 1-year period shall not exceed $1,000,000. Each violation of a [2] the provisions of subsection (b)(1) shall constitute a separate violation with respect to each mortgage or loan application. In the case of a continuing violation, as determined by the Secretary, each day shall constitute a separate violation.
In the case of the mortgagee’s failure to engage in loss mitigation activities, as provided in subsection (b)(1)(I), the penalty shall be in the amount of three times the amount of any insurance benefits claimed by the mortgagee with respect to any mortgage for which the mortgagee failed to engage in such loss mitigation actions.
(1) ViolationsThe Secretary may impose a civil money penalty under subsection (a) for any knowing and material violation by a mortgagee or lender or any of its owners, officers, or directors, as follows:
Failure to engage in loss mitigation actions as provided in section 1715u(a) of this title.
Violation of section 1708(d) of this title.
(2) Additional violationsThe Secretary may impose a civil money penalty under subsection (a) for any knowing and material violation by a principal, officer, or employee of a mortgagee or lender, or other participants in either an insured mortgage or subchapter I loan transaction under this chapter or provision of assistance to the borrower in connection with any such loan, including sellers of the real estate involved, borrowers, closing agents, title companies, real estate agents, mortgage brokers, appraisers, loan correspondents, and dealers for—
failure by a loan correspondent or dealer to submit to the Secretary information which is required by regulations or directives in connection with any loan that is covered by a contract of insurance under subchapter I; or
The Secretary may impose a civil money penalty, as adjusted from time to time, under subsection (a) for any use of “Federal Housing Administration”, “Department of Housing and Urban Development”, “Government National Mortgage Association”, “Ginnie Mae”, the acronyms “HUD”, “FHA”, or “GNMA”, or any official seal or logo of the Department of Housing and Urban Development, by any person, party, company, firm, partnership, or business, including sellers of real estate, closing agents, title companies, real estate agents, mortgage brokers, appraisers, loan correspondents, and dealers, except as authorized by the Secretary.
(1) EstablishmentThe Secretary shall establish standards and procedures governing the imposition of civil money penalties under subsection (a). These standards and procedures—
shall provide for the Secretary to make the determination to impose the penalty or to use an administrative entity (such as the Mortgagee Review Board, established pursuant to section 1708(c) of this title) to make the determination;
The Secretary’s determination or order imposing a penalty under subsection (a) shall not be subject to review, except as provided in subsection (d).
After exhausting all administrative remedies established by the Secretary under subsection (c)(1), a mortgagee or lender or such other person or entity against whom the Secretary has imposed a civil money penalty under subsection (a) may obtain a review of the penalty and such ancillary issues (such as any administrative sanctions under 24 C.F.R. parts 24 and 25) as may be addressed in the notice of determination to impose a penalty under subsection (c)(1)(A) in the appropriate court of appeals of the United States, by filing in such court, within 20 days after the entry of such order or determination, a written petition praying that the Secretary’s determination or order be modified or be set aside in whole or in part.
If any mortgagee or lender or such other person or entity fails to comply with the Secretary’s determination or order imposing a civil money penalty under subsection (a), after the determination or order is no longer subject to review as provided by subsections (c)(1) and (d), the Secretary may request the Attorney General of the United States to bring an action in an appropriate United States district court to obtain a monetary judgment against the mortgagee or lender or such other person or entity and such other relief as may be available. The monetary judgment may, in the court’s discretion, include the attorneys fees and other expenses incurred by the United States in connection with the action. In an action under this subsection, the validity and appropriateness of the Secretary’s determination or order imposing the penalty shall not be subject to review.
(g) “Knowingly” defined
(June 27, 1934, ch. 847, title V, § 536, as added Pub. L. 101–235, title I, § 107(a), Dec. 15, 1989, 103 Stat. 2000; amended Pub. L. 104–208, div. A, title II, § 2704(d)(13)(B), Sept. 30, 1996, 110 Stat. 3009–490; Pub. L. 105–65, title V, § 553, Oct. 27, 1997, 111 Stat. 1413; Pub. L. 105–276, title VI, § 601(g), (h), Oct. 21, 1998, 112 Stat. 2674; Pub. L. 108–447, div. I, title II, § 219(a), Dec. 8, 2004, 118 Stat. 3319; Pub. L. 109–171, title II, § 2102(b), Feb. 8, 2006, 120 Stat. 9; Pub. L. 109–173, § 9(f)(2), Feb. 15, 2006, 119 Stat. 3618; Pub. L. 111–22, div. A, title II, § 203(f), May 20, 2009, 123 Stat. 1647.)
2009—Subsec. (b)(1). Pub. L. 111–22, § 203(f)(1)(A)(i), inserted “or any of its owners, officers, or directors” after “mortgagee or lender” in introductory provisions.
Subsec. (b)(1)(H). Pub. L. 111–22, § 203(f)(1)(A)(ii), substituted “subchapter I or II of this chapter, or any implementing regulation, handbook, or mortgagee letter that is issued under this chapter.” for “subchapter I, II, or IX–A (as such subchapter existed immediately before December 15, 1989) of this chapter or any implementing regulation or handbook that is issued under this chapter.”
Subsec. (b)(1)(K), (L). Pub. L. 111–22, § 203(f)(1)(A)(iii), added subpars. (K) and (L).
Subsec. (b)(2)(D). Pub. L. 111–22, § 203(f)(1)(B), added subpar. (D).
Subsec. (b)(3). Pub. L. 111–22, § 203(f)(1)(C), amended par. (3) generally. Prior to amendment, text read as follows: “Before taking action to impose a civil money penalty for a violation under paragraph (1)(D) or (F), or paragraph (2)(A), (B), or (C), the Secretary shall inform the Attorney General of the United States.”
Subsec. (g). Pub. L. 111–22, § 203(f)(2), substituted “For purposes of this section, a person acts knowingly when a person has actual knowledge of acts or should have known of the acts.” for “The term ‘knowingly’ means having actual knowledge of or acting with deliberate ignorance of or reckless disregard for the prohibitions under this section.”
2006—Subsec. (b)(1)(B)(ii). Pub. L. 109–173 substituted “Deposit Insurance Fund” for “Bank Insurance Fund for banks and through the Savings Association Insurance Fund for savings associations”.
Pub. L. 109–171 repealed Pub. L. 104–208, § 2704(d)(13)(B). See 1996 Amendment note below.
1998—Subsec. (a)(2). Pub. L. 105–276, § 601(g), inserted second paragraph.
Subsec. (b)(1)(I). Pub. L. 105–276, § 601(h), which directed the addition of subpar. (I) after subpar. “(h)”, was executed by adding subpar. (I) after subpar. (H), to reflect the probable intent of Congress.
1997—Pub. L. 105–65, § 553(a), amended section catchline generally, substituting “mortgagees, lenders, and other participants in FHA programs” for “mortgagees and lenders”.
Subsec. (a)(1). Pub. L. 105–65, § 553(b)(1), substituted “If a mortgagee approved under the chapter, a lender holding a contract of insurance under subchapter I, or a principal, officer, or employee of such mortgagee or lender, or other person or entity participating in either an insured mortgage or subchapter I loan transaction under this chapter or providing assistance to the borrower in connection with any such loan, including sellers of the real estate involved, borrowers, closing agents, title companies, real estate agents, mortgage brokers, appraisers, loan correspondents and dealers, knowingly and materially violates any applicable provision of subsection (b), the Secretary may impose a civil money penalty on the mortgagee or lender, or such other person or entity, in accordance with this section. The penalty under this paragraph shall be in addition to any other available civil remedy or any available criminal penalty, and may be imposed whether or not the Secretary imposes other administrative sanctions.” for “Whenever a mortgagee approved under this chapter, or a lender holding a contract of insurance under subchapter I of this chapter, knowingly and materially violates any of the provisions of subsection (b), the Secretary may impose a civil money penalty on the mortgagee or lender in accordance with the provisions of this section.”
Subsec. (a)(2). Pub. L. 105–65, § 553(b)(2), inserted “or such other person or entity” after “lender” in first sentence and substituted “the provisions of subsection (b)(1)” for “provision of subsection (b)(1)” in second sentence.
Subsec. (b)(2). Pub. L. 105–65, § 553(c)(1), (2), added par. (2) and redesignated former par. (2) as (3).
Subsec. (b)(3). Pub. L. 105–65, § 553(c)(1), (3), redesignated par. (2) as (3) and substituted “or (F), or paragraph (2)(A), (B), or (C)” for “or paragraph (1)(F)”.
Subsec. (c)(1)(B). Pub. L. 105–65, § 553(d)(1), inserted “or such other person or entity” after “lender”.
Subsec. (d)(1). Pub. L. 105–65, § 553(d)(2), inserted “or such other person or entity” after “lender” and substituted “parts 24 and 25” for “part 25”.
Subsec. (e). Pub. L. 105–65, § 553(d)(3), inserted “or such other person or entity” after “lender” in two places.
1996—Subsec. (b)(1)(B)(ii). Pub. L. 104–208, § 2704(d)(13)(B), which directed the amendment of section 526(b)(1)(B)(ii) of the National Housing Act by substituting “Deposit Insurance Fund” for “Bank Insurance Fund for banks and through the Savings Association Insurance Fund for savings associations” and which substitution was probably intended by Congress to be made in subsec. (b)(1)(B)(ii) of this section, section 536 of the National Housing Act, was repealed by Pub. L. 109–171. See Effective Date of 1996 Amendment note below and 2006 Amendment note above.
Pub. L. 101–235, title I, § 107(b), Dec. 15, 1989, 103 Stat. 2003, provided that:
“The amendment made by subsection (a) [enacting this section] shall apply only with respect to—
violations referred to in the amendment that occur on or after the effective date of this section [Dec. 15, 1989]; and
Pub. L. 105–65, title V, § 541, Oct. 27, 1997, 111 Stat. 1412, provided that:
“(a)Issuance of Necessary Regulations.—
Notwithstanding section 7(o) of the Department of Housing and Urban Development Act [42 U.S.C. 3535(o)] or part 10 of title 24, Code of Federal Regulations (as in existence on the date of enactment of this Act [Oct. 27, 1997]), the Secretary shall issue such regulations as the Secretary determines to be necessary to implement this subtitle [subtitle C (§§ 541–564) of title V of Pub. L. 105–65, enacting section 1437z–1 of Title 42, The Public Health and Welfare, amending this section,sections 1708, 1715z–4a, 1715z–19, and 1735f–15 of this title, section 1516 of Title 18, Crimes and Criminal Procedure, section 6103 of Title 26, Internal Revenue Code, and sections 503 and 1437z of Title 42, and enacting provisions set out as notes under section 1735f–15 of this title and sections 503 and 1437z–1 of Title 42] and the amendments made by this subtitle in accordance with section 552 or 553 of title 5, United States Code, as determined by the Secretary.
“(b)Use of Existing Regulations.—
In implementing any provision of this subtitle, the Secretary may, in the discretion of the Secretary, provide for the use of existing regulations to the extent appropriate, without rulemaking.”
24 CFR PART 30 - CIVIL MONEY PENALTIES: CERTAIN PROHIBITED CONDUCT