The guidance that the Consumer Financial Protection Bureau issued recently on marketing services agreements is fuzzy, at best. Because the bureau has “grave concerns” about MSAs, and are watching lenders’ compliance closely, the strategy should be undertaken with only the most rigorous planning, documentation and oversight. While mortgage industry experts were hoping for definitive answers on when and how MSAs are executed legally, the bureau’s direction simply reinforces — though strongly — the agency’s subjective assessment of these arrangements. Since decisions about MSA compliance will largely be decided on a case-by-case basis, lenders cannot expect that one case of wrongdoing will necessarily look like the next.
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Ari Karen is an experienced litigator and speaker who has focused his practice in representing financial institutions in both government investigations and litigation before state and federal trial and appellate courts nationwide. Mr. Karen’s practice is diverse, representing clients on matters concerning banking regulations, Dodd Frank financial reform laws, contractual disputes, employment and labor statutes, wage-hour class actions, employment discrimination and fair lending matters, whistleblower complaints and non-competition claims, among others.
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