Title agents and attorneys are expected to adhere to the highest ethical standards, especially given Dodd Frank’s ban on unfair, deceptive or abusive acts or practices (UDAAP), which gave the CFPB broad authority to root out questionable activities. This makes it critical to understand what constitutes ethical or unethical conduct while still remaining compliant with federal law.
Luckily, October Research, LLC’s National Settlement Services Summit (NS3) has you covered.
The three-day conference will be featuring a discussion on “Ethics: UDAAP, Reverse Vendor Oversight and Legal Malpractice” June 8 in Charlotte, led by Charles Cain, executive vice president of agency at WFG National Title Insurance Co., and Marx Sterbcow, managing attorney at Sterbcow Law Group LLC.
Phillip Schulman, partner at Mayer Brown LLP, will offer a high-level overview of the legal landscape surrounding marketing service agreements (MSAs) and RESPA Section 8, while Mitchel Kider, managing member of Weiner Brodsky Kider PC, will be reviewing current legal developments surrounding AfBAs, MSAs and RESPA Section 8 compliance.
At the “Ethics: UDAAP, Reverse Vendor Oversight and Legal Malpractice” session, attendees can learn what exactly UDAAP requires of as well as how it could make vendor liability and oversight a two-way street by challenging the bounds of legal malpractice and requiring title agents and notaries to be on the lookout for client compliance issues.
In particular, attendees should pay special attention to changes in reverse vender management oversight, Sterbcow says.
“This is something that is new. No one realizes it’s new because they think that vendor management is coming from the top down. But the bureau now expects it to go from the bottom up. The general sense is that the lender is responsible for the title agent and the lawyer, but if the title agent or lawyer knows that the lender is participating in something illegal, then reverse vendor management oversight means that the attorney is now responsible for reporting bad acts by their clients,” Sterbcow explained.
He went on to point out that CFPB enforcement in this area already is beginning to take place, citing the recent enforcement action against the co-founders of T3Leads.
“The CFPB alleged that Dmitry Fomichev and Davit Gasparyan (also known as David Gasparyan) co-founded and operated T3Leads, a lead aggregator that bought and sold payday and installment loan applications without properly vetting buyers and sellers,” the enforcement action stated (emphasis added).
“That’s reverse vendor management oversight,” Sterbcow said.
Sterbcow and Cain will share real-world examples, and attendees will walk away with actionable tips for remaining UDAAP compliant in an increasingly active enforcement environment. Sterbcow says that the two also will discuss examples of potential ethical issues regarding RESPA, as well.
“Let’s say an attorney is violating RESPA,” Sterbcow said by means of example. “Does the law firm now have an obligation to report that to the bureau or notify their client of any issues, and how do they stop this practice without violating attorney-client privilege?”
The session will take place from 10:10-11:10 a.m. on Wednesday, June 8. To get more information on the 2015 National Settlement Services Summit in Charlotte, N.C., June 6-8, including the agenda and a list of speakers, click here. You can register for NS3 online or click here to get information on how to register via mail, fax or phone.