12 U.S.C. §2607 — Prohibition against kickbacks and unearned fees

respa-12usc-2607

12 U.S.C. §2607 (RESPA Section 8) prohibits referral kickbacks and fee-splitting for unearned services, conditions affiliated business arrangements on disclosure and choice, and imposes criminal, treble- damages, and injunctive remedies.

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source:
  type: regulation
  id: respa-12usc-2607
  authority: 12 U.S.C. §2607 — Prohibition against kickbacks and unearned fees
  description: |
    12 U.S.C. §2607 (RESPA Section 8) prohibits referral kickbacks and
    fee-splitting for unearned services, conditions affiliated business
    arrangements on disclosure and choice, and imposes criminal, treble-
    damages, and injunctive remedies.
obligations:
  - id: respa-12usc-2607-a-no-referral-kickbacks
    canonical_id: respa-12usc-2607-a-no-referral-kickbacks
    section: 12 U.S.C. §2607(a) — Prohibition on referral kickbacks
    description: |
      No person shall give and no person shall accept any fee, kickback, or
      thing of value pursuant to any agreement or understanding, oral or
      otherwise, that business incident to or a part of a real estate
      settlement service involving a federally related mortgage loan shall
      be referred to any person. [LENDER] may not give or accept any
      referral kickback for settlement-service business — regardless of
      whether the kickback is documented in writing.
    type: dont
    audit_question: Can [LENDER] evidence that no fee, kickback, or thing of value was given or accepted, in connection with any settlement-service referral on a federally related mortgage loan, pursuant to any agreement or understanding (oral or written) — including in marketing services agreements, lead-buying arrangements, desk rentals, and gift/entertainment programs?
    program_review: Do the P&Ps facilitate anti-kickback controls so that no fee, kickback, or thing of value is given or accepted, pursuant to any agreement or understanding (oral or written), for referring settlement-service business on a federally related mortgage loan — covering marketing-services agreements, lead-buying arrangements, desk rentals, and gift/entertainment programs?
    file_review: Review settlement-service-provider relationships, MSAs, lead-buying, desk rentals, and gift/entertainment records; the compliance person judges whether any arrangement amounts to a thing-of-value-for-referral.
    judgment: true
    feeds: []
    workflow_phase: origination
    owner_role: compliance_officer
    secondary_owner_role: default_servicing_analyst
    cadence: continuous
    consequence: 'Criminal: fine up to $10,000 and/or imprisonment up to one year under §2607(d)(1). Civil: joint-and-several treble damages equal to 3× the settlement-service charge under §2607(d)(2). Injunctive: action by Bureau, Secretary, or state AG/insurance commissioner under §2607(d)(4).'
    tags:
      - round-b
      - regulator-direct
      - respa
      - anti-kickback
      - section-8
      - promoted
    primary_source:
      tier: 1
      authority: 12 U.S.C. §2607(a)
      source_class: respa-statute
      source_url: https://www.law.cornell.edu/uscode/text/12/2607
      snapshot_id: 14d95a2c6c276bfa
      fetched_at: '2026-05-22T18:52:55Z'
      content_hash: sha256:af95f9e16296c8a8c24776cc3ecd0b49ae086b29879862880d27b50dc4bd6808
      paragraph_quote: No person shall give and no person shall accept any fee, kickback, or thing of value pursuant to any agreement or understanding, oral or otherwise, that business incident to or a part of a real estate settlement service involving a federally related mortgage loan shall be referred to any person.
      drafter_attestation: |
        Copied verbatim from snapshot 14d95a2c6c276bfa (content.txt) at
        2026-05-22T19:50Z. Substring is the §2607(a) anti-kickback
        sentence in its entirety.
    promoted_at: '2026-05-22T19:17:23+00:00'
    promoted_from: respa-12usc-2607-roundb-v1.yaml
  - id: respa-12usc-2607-b-no-fee-splitting-without-services
    canonical_id: respa-12usc-2607-b-no-fee-splitting-without-services
    section: 12 U.S.C. §2607(b) — Prohibition on splitting charges for unearned services
    description: |
      No person shall give and no person shall accept any portion, split,
      or percentage of any charge made or received for the rendering of a
      real estate settlement service in connection with a transaction
      involving a federally related mortgage loan other than for services
      actually performed. [LENDER] may not split settlement-service fees
      with another party except as compensation for actual services
      rendered.
    type: dont
    audit_question: For every settlement-service fee [LENDER] gives or accepts a portion of, can [LENDER] evidence the corresponding actual services performed and the bona-fide-and-reasonable basis for the split?
    program_review: Do the P&Ps ensure that no portion, split, or percentage of any settlement-service charge on a federally related mortgage loan is given or accepted other than for services actually performed?
    file_review: Review fee-split arrangements; the compliance person judges whether the corresponding actual services were performed and the split is bona fide and reasonable for them.
    judgment: true
    feeds: []
    workflow_phase: origination
    owner_role: compliance_officer
    secondary_owner_role: default_servicing_analyst
    cadence: continuous
    consequence: Criminal under §2607(d)(1) (fine up to $10,000 and/or imprisonment up to one year); treble damages under §2607(d)(2).
    tags:
      - round-b
      - regulator-direct
      - respa
      - anti-kickback
      - fee-splitting
      - promoted
    primary_source:
      tier: 1
      authority: 12 U.S.C. §2607(b)
      source_class: respa-statute
      source_url: https://www.law.cornell.edu/uscode/text/12/2607
      snapshot_id: 14d95a2c6c276bfa
      fetched_at: '2026-05-22T18:52:55Z'
      content_hash: sha256:af95f9e16296c8a8c24776cc3ecd0b49ae086b29879862880d27b50dc4bd6808
      paragraph_quote: No person shall give and no person shall accept any portion, split, or percentage of any charge made or received for the rendering of a real estate settlement service in connection with a transaction involving a federally related mortgage loan other than for services actually performed.
      drafter_attestation: |
        Copied verbatim from snapshot 14d95a2c6c276bfa (content.txt) at
        2026-05-22T19:50Z. Substring is the §2607(b) fee-splitting
        sentence in its entirety.
    promoted_at: '2026-05-22T19:17:23+00:00'
    promoted_from: respa-12usc-2607-roundb-v1.yaml
  - id: respa-12usc-2607-c4-afba-disclosure-required
    canonical_id: respa-12usc-2607-c4-afba-disclosure-required
    section: 12 U.S.C. §2607(c)(4) — Affiliated business arrangement disclosure and conditions
    description: |
      Affiliated business arrangements (AfBAs) are excluded from §2607(a)/(b)
      only if (A) disclosure is made of the existence of the arrangement to
      the person being referred (timing rules under §2607(c)(4)(A)(i)-(iii)
      apply by referral channel), together with a written estimate of the
      charge or range of charges generally made; (B) the person is not
      required to use any particular settlement-services provider; and (C)
      the only thing of value received from the arrangement (other than
      permitted payments) is a return on ownership interest or franchise
      relationship. [LENDER] AfBAs must satisfy all three conditions to
      avoid §2607 liability.
    type: do
    audit_question: For every affiliated business arrangement [LENDER] uses to refer borrowers to a settlement-service provider, can [LENDER] evidence (i) the §2607(c)(4)(A) disclosure with written estimate of charges, delivered per the timing rules; (ii) absence of any requirement that the borrower use a particular provider; and (iii) that the only value received is a return on ownership/franchise (apart from permitted payments)?
    program_review: 'Does the overall program account for the AfBA exemption conditions — so each affiliated-business referral satisfies all three: (A) the §2607(c)(4)(A) disclosure of the arrangement with a written estimate of the charge/range, delivered per the channel timing rules; (B) no requirement that the borrower use a particular provider; and (C) the only value received (apart from permitted payments) is a return on ownership interest or franchise relationship?'
    file_review: Spot-check AfBA-referral files; confirm the disclosure-with-estimate, the absence of any required-provider mandate, and that received value is limited to an ownership/franchise return.
    judgment: false
    feeds: []
    workflow_phase: origination
    owner_role: compliance_officer
    secondary_owner_role: default_servicing_analyst
    cadence: per-affiliated-business-referral
    consequence: Loss of §2607(c)(4) safe harbor; §2607(d) criminal, treble-damages, and injunctive exposure for the underlying §2607(a)/(b) violation. §2607(d)(3) bona-fide-error defense available only with reasonably adapted procedures.
    tags:
      - round-b
      - regulator-direct
      - respa
      - anti-kickback
      - afba
      - disclosure
      - promoted
    primary_source:
      tier: 1
      authority: 12 U.S.C. §2607(c)(4)
      source_class: respa-statute
      source_url: https://www.law.cornell.edu/uscode/text/12/2607
      snapshot_id: 14d95a2c6c276bfa
      fetched_at: '2026-05-22T18:52:55Z'
      content_hash: sha256:af95f9e16296c8a8c24776cc3ecd0b49ae086b29879862880d27b50dc4bd6808
      paragraph_quote: affiliated business arrangements so long as (A) a disclosure is made of the existence of such an arrangement to the person being referred and, in connection with such referral, such person is provided a written estimate of the charge or range of charges generally made by the provider to which the person is referred
      drafter_attestation: |
        Copied verbatim from snapshot 14d95a2c6c276bfa (content.txt) at
        2026-05-22T19:50Z. Substring is the §2607(c)(4) AfBA conditions
        opening; the (A)(i)-(iii) timing rules and (B)/(C) conditions are
        paraphrased in description.
    promoted_at: '2026-05-22T19:17:23+00:00'
    promoted_from: respa-12usc-2607-roundb-v1.yaml
  - id: respa-12usc-2607-d2-treble-damages-liability
    canonical_id: respa-12usc-2607-d2-treble-damages-liability
    section: 12 U.S.C. §2607(d)(2) — Treble-damages joint-and-several liability
    description: |
      Any person or persons who violate §2607's prohibitions or limitations
      shall be jointly and severally liable to the person or persons
      charged for the settlement service involved in the violation in an
      amount equal to three times the amount of any charge paid for such
      settlement service. For [LENDER], the §2607(d)(2) liability is
      severe — three times the charge is recoverable in a private action by
      the borrower (in addition to the §2607(d)(1) criminal penalties and
      §2607(d)(4) injunctive remedies).
    type: dont
    audit_question: Are [LENDER]'s anti-kickback controls (settlement-service-provider relationships review, AfBA disclosure governance, marketing-services-agreement review, gift/entertainment thresholds, lead-buying compliance) designed to prevent §2607(d)(2) treble-damages exposure?
    program_review: Do the P&Ps design the anti-kickback control set (settlement-service-provider relationship review, AfBA disclosure governance, MSA review, gift/entertainment thresholds, lead-buying compliance) to prevent §2607(d)(2) treble-damages exposure (three times the charge, jointly and severally, in a private action)?
    file_review: Review the anti-kickback control set; the compliance person judges whether the controls are adequate to prevent the §2607 violations that drive treble-damages exposure.
    judgment: true
    feeds: []
    workflow_phase: origination
    owner_role: compliance_officer
    secondary_owner_role: default_servicing_analyst
    cadence: continuous
    consequence: Joint-and-several treble-damages private action under §2607(d)(2); criminal liability under §2607(d)(1); injunctive action under §2607(d)(4); attorneys' fees under §2607(d)(5).
    tags:
      - round-b
      - regulator-direct
      - respa
      - anti-kickback
      - damages
      - promoted
    primary_source:
      tier: 1
      authority: 12 U.S.C. §2607(d)(2)
      source_class: respa-statute
      source_url: https://www.law.cornell.edu/uscode/text/12/2607
      snapshot_id: 14d95a2c6c276bfa
      fetched_at: '2026-05-22T18:52:55Z'
      content_hash: sha256:af95f9e16296c8a8c24776cc3ecd0b49ae086b29879862880d27b50dc4bd6808
      paragraph_quote: Any person or persons who violate the prohibitions or limitations of this section shall be jointly and severally liable to the person or persons charged for the settlement service involved in the violation in an amount equal to three times the amount of any charge paid for such settlement service.
      drafter_attestation: |
        Copied verbatim from snapshot 14d95a2c6c276bfa (content.txt) at
        2026-05-22T19:50Z. Substring is the §2607(d)(2) treble-damages
        sentence in its entirety.
    promoted_at: '2026-05-22T19:17:23+00:00'
    promoted_from: respa-12usc-2607-roundb-v1.yaml
_promotion_history:
  - promoted_at: '2026-05-22T19:17:23+00:00'
    candidate_path: obligations\_remediation\_round_b_drafts\respa-12usc-2607-roundb-v1.yaml
    candidates_promoted: 4
    candidates_skipped_existing: 0

Verbatim regulatory text (4)

Verbatim provisions from 12 U.S.C. §2607 — Prohibition against kickbacks and unearned fees — each quote is a verified substring of the regulator-published source snapshot, not retyped. Quoted for reference; this is not legal advice. The operational layer (P&P updates, prompts) lives in the regulation update kits.

12 U.S.C. §2607(a) — Prohibition on referral kickbacks

No person shall give and no person shall accept any fee, kickback, or thing of value pursuant to any agreement or understanding, oral or otherwise, that business incident to or a part of a real estate settlement service involving a federally related mortgage loan shall be referred to any person.

Source: 12 U.S.C. §2607(a) · source URL · snapshot 14d95a2c6c276bfa

12 U.S.C. §2607(b) — Prohibition on splitting charges for unearned services

No person shall give and no person shall accept any portion, split, or percentage of any charge made or received for the rendering of a real estate settlement service in connection with a transaction involving a federally related mortgage loan other than for services actually performed.

Source: 12 U.S.C. §2607(b) · source URL · snapshot 14d95a2c6c276bfa

12 U.S.C. §2607(c)(4) — Affiliated business arrangement disclosure and conditions

affiliated business arrangements so long as (A) a disclosure is made of the existence of such an arrangement to the person being referred and, in connection with such referral, such person is provided a written estimate of the charge or range of charges generally made by the provider to which the person is referred

Source: 12 U.S.C. §2607(c)(4) · source URL · snapshot 14d95a2c6c276bfa

12 U.S.C. §2607(d)(2) — Treble-damages joint-and-several liability

Any person or persons who violate the prohibitions or limitations of this section shall be jointly and severally liable to the person or persons charged for the settlement service involved in the violation in an amount equal to three times the amount of any charge paid for such settlement service.

Source: 12 U.S.C. §2607(d)(2) · source URL · snapshot 14d95a2c6c276bfa