offered by
Consent Order

Consent Order American Interbanc Mortgage, LLC

Date: 07/29/2015
Organization: Division of Banks
Docket Number: 2015-08
Location: Irvine, CA

Table of Contents


Suffolk, SS.

Docket No. 2015-08


In the Matter of


Irvine, California
Mortgage Lender License No. ML2043

WHEREAS, American Interbanc Mortgage, LLC, Irvine, California (American Interbanc or Company), a licensed mortgage lender under Massachusetts General Laws chapter 255E, has been advised of its right to Notice and Hearing pursuant to Massachusetts General Laws chapter 30A, section 10, and having waived those rights, entered into a STIPULATION AND CONSENT TO THE ISSUANCE OF A CONSENT ORDER (Consent Agreement) with representatives of the Division of Banks (Division) dated July 29, 2015, whereby, solely for the purpose of settling this matter, American Interbanc agrees to the issuance of this CONSENT ORDER (Consent Order) by the Commissioner of Banks (Commissioner);

 WHEREAS, on August 1, 2011 the Commissioner and American Interbanc entered into a Stipulation and Consent to the Issuance of a Consent Order, Docket No. 2011-026 (2011 Consent Order) for the purpose of settling the matters raised as a result of a 2011 Mortgage Lender Community Investment examination; 

WHEREAS, an examination of American Interbanc was conducted pursuant to General Laws chapter 255E, section 8, as of April 14, 2014 to assess: the Company’s level of compliance with applicable Massachusetts and federal statutes, rules and regulations governing the conduct of those engaged in the business of a mortgage lender in the Commonwealth; the Company’s lending performance under Mortgage Lender Community Investment standards described in the Division’s regulation 209 CMR 54.00 et seq; and the Company’s compliance with the 2011 Consent Order;

WHEREAS, the Report of Examination (the Report) issued pursuant to the Division’s 2014 examination of American Interbanc alleged non-compliance with applicable state and federal statutes, rules, and regulations governing the conduct of those engaged in the business of a mortgage lender in the Commonwealth;

WHEREAS, the Report noted that the Company was in full compliance with the 2011 Consent Order;

WHEREAS, on March 31, 2015, prior to the issuance of the Report, American Interbanc submitted a surrender/cancellation request for its Massachusetts Mortgage Lender license through the Nationwide Multi-State Licensing System & Registry (NMLS) for reasons unrelated to the examination findings;           

WHEREAS, the parties now seek to resolve by mutual agreement, the matters identified in the Report; and

WHEREAS, by mutual agreement of the Company and the Division, the 2011 Consent Order is hereby superseded and replaced by this Consent Order.


NOW COME the parties in the above-captioned matter, the Division and American Interbanc and stipulate and agree as follows:

  1. American Interbanc has  reimbursed the borrowers identified in the Report for the extra costs paid by the borrowers as a result of the Company’s failure to timely fund the loan and/or the settlement agent’s failure to timely disburse the loan funds as described in the Company's response dated June 1, 2015 (Response) to the Report.
  2. American Interbanc must conduct a review of all Massachusetts loans closed since February 19, 2012 and identify transactions where borrowers were charged per diem interest during the period between the funding date noted on the HUD-1 Settlement Statement that was signed at closing and the date the funds were disbursed to the borrowers.  American Interbanc must reimburse all identified borrowers for the difference between the extra per-diem paid to the previous lien holder and the per diem interest that would have been charged had the Company timely funded the transaction.   In addition, the Company must reimburse each such borrower for any overages paid as the result of a delay in paying off the existing loan(s). The Company will calculate the reimbursements using the formula contained in the Response.
  3. American Interbanc has reimbursed the borrowers identified in the Report for the duplicate discharge/release fees that American Interbanc or its settlement agents collected and retained. 
  4. American Interbanc must review all Massachusetts residential mortgage loan refinances closed since February 19, 2012 to identify transactions in which the borrower was charged duplicate discharge/release fees.  In those transactions where a duplicate fee was charged and no appropriate refunds were made by the Corporation’s closing attorney or settlement agent, the Corporation must reimburse the affected borrowers for the duplicate fees. 
  5. Within one hundred and twenty  (120) days of the execution of the Consent Order, American Interbanc must provide evidence to the Division that all required reimbursements described in Paragraphs 1–4 have been paid to consumers. 
  6. It is understood that, in the event that the Company fails to make the consumer reimbursements described in this Consent Order the Division is authorized to submit a claim for such reimbursements against the mortgage lender Massachusetts surety bond maintained by American Interbanc pursuant to the Division’s regulation 209 CMR 42.03(2)(a).
  7. The provisions of this Consent Order shall not limit, estop, or otherwise prevent any other state agency or department, other than the Division or the Commissioner or his designee, from taking any other action affecting American Interbanc and/or any of its officers, directors, or managers.
  8. This Consent Order shall become effective immediately upon the date of its issuance.                           
  9. The provisions of this Consent Order shall be binding upon American Interbanc and its directors, officers, managers, and their successors and assigns.
  10. The provisions of this Consent Order shall remain effective and enforceable except to the extent that, and until such time as, any provisions of this Consent Order shall have been modified, terminated, suspended, or set aside by the Commissioner or upon an order of a court of competent jurisdiction.
  11. This Consent Order and the Consent Agreement are the complete documents representing the resolution of this matter.  There are no other agreements, promises, representations, or warranties other than those set forth in this Consent Order, which replaces and supersedes any prior agreements between American Interbanc and the Commissioner.


Dated at Boston, Massachusetts, this 29th day of July, 2015

By: David J. Cotney
Commissioner of Banks
Commonwealth of Massachusetts