When State Regulators Come Knocking - Brokers Should Understand What To Do Before And After Enforcement Actions

Reprinted from Scotsman Guide Residential Edition and scotsmanguide.com, October 2009

The financial industry is in a state of turmoil. Daily headlines resound with the closing of more financial institutions and new bankruptcies — and questions. Amid theories of what caused this, elected officials and the public blame financial-industry professionals as a whole.

As a result, state regulators are cracking down on mortgage companies and pursuing financial institutions more aggressively than ever.

For mortgage brokers, this means a higher likelihood of regulatory examinations. Such investigations could result from the introduction of new regulations, which bring the potential for new mistakes. It is therefore critical that industry professionals ensure compliance; update procedure manuals; bolster internal audit and compliance procedures; and properly train their employees.