Professional Documents
Culture Documents
DOJ: Buffett-Owned Mortgage Firm Guilty of Redlining in NCCo
DOJ: Buffett-Owned Mortgage Firm Guilty of Redlining in NCCo
Delaware, by and through Attorney General Kathleen Jennings, and Trident Mortgage Company
LP (“Trident”), and Fox & Roach LP (“Fox & Roach”) (collectively, Respondents), to resolve an
investigation of the business practices of Respondents relating to the provisions of the Delaware
Fair Housing Act, 6 Del. C. § 4601, et seq., the Delaware Consumer Fraud Act, 6 Del. C. § 2511,
et seq., the Equal Credit Opportunity Act, 15 U.S.C. § 1691, et seq. and Regulation B
(collectively, ECOA).
DEFINITIONS
A. All definitions contained in the Consent Order (Order) agreed upon by Trident, the
Consumer Financial Protection Bureau (CFPB), and U.S. Department of Justice, Civil
Rights Division (USDOJ), shall apply herein where relevant. The Order is attached
B. “Camden MD” means the Camden, New Jersey Metropolitan Division, as identified by
the U.S. Census Bureau, and consisting of the New Jersey counties of Camden,
C. “Conduct Provisions” refer to the forms of relief described in section I of this AVC.
D. “Current Residents” and “Current Residents of Majority-Minority Census Tracts”
Tracts in 2020 in that portion of Wilmington MD located within New Castle County,
E. “Effective Date” means the date on which the U.S. District Court for the Eastern
G. “Fox & Roach” means Fox & Roach LP, a subsidiary of HomeServices of America,
I. “Lender” means the entity Trident contracts with to administer and make loans under
the Loan Subsidy Program and carry out other Conduct Provisions as required under
the Order.
J. “Majority-Minority Census Tract” means a census tract in which more than 50% of
the residents are identified in the U.S. Census as minority (all groups other than
White non-Hispanic).
used herein, this AVC’s enforceability pertains to that portion of the Wilmington MD
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L. “States” means the Commonwealth of Pennsylvania, the State of New Jersey, and the
Attorney General, the New Jersey Office of the Attorney General, and the Delaware
Department of Justice. Use of this term herein reflects the joint negotiation of certain
terms common to the States’ AVCs; however, its use is not intended to give any State
other than the State of Delaware any right or responsibility of the State of Delaware
in this AVC, including but not limited to the right to enforce any term of this AVC in
M. “Term” shall mean the term of this AVC, which shall start on the Effective Date and
end on the latter of five (5) years or ninety (90) days after submission of a report
satisfying the State of Delaware of compliance with the requirements of this AVC.
America, Inc., as well as Trident’s successors and assigns. “Trident” does not include
the “Lender.”
identified by the U.S. Census Bureau, and consisting of New Castle County,
PARTIES
Jennings, through the Division of Fraud and Consumer Protection at the Delaware Department of
maintained a registered corporate address and principal place of business at 431 West Lancaster
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Avenue, Devon, PA 19333. Trident was licensed with the Pennsylvania Department of Banking
and Securities under National Mortgage Licensing System ID # 111942 until Trident voluntarily
Fox & Roach is a for-profit real estate services affiliate of Trident. Fox & Roach
maintains a registered corporate address and principal place of business at 431 West Lancaster
guarantor of the legal obligations herein, as the parent company of Trident and Fox & Roach.
BACKGROUND
WHEREAS, Trident has engaged in trade and commerce within Delaware by offering
and providing mortgage loans to consumers until it ended such operations in or around
December 2020.
WHEREAS, Fox & Roach has engaged in trade and commerce within Delaware by
providing real estate brokerage services to consumers and, until Trident ended its mortgage
lending operations in or around December 2020, a substantial portion of Trident’s business came
from its efforts to serve the mortgage financing needs of Fox & Roach’s customers.
WHEREAS, the Delaware Fair Housing Act makes it unlawful “for any person or other
discriminate against any person in making available such a transaction, or in the terms or
conditions of such a transaction, because of race, color, national origin, religion, creed, sex,
marital status, familial status, source of income, age, sexual orientation, gender identity or
disability.” 6 Del. C. § 4604(a). See also 6 Del. C. § 4602(24)(a)(1), defining “residential real
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financial assistance for purchasing, constructing, improving, repairing or maintaining a
dwelling…”). The Delaware Fair Housing Act also makes it unlawful to “coerce, intimidate,
threaten or interfere with any person in the exercise or enjoyment of, or on account of that person
having exercised or enjoyed, or on account of that person having aided or encouraged any other
person in the exercise or enjoyment of, any right granted or protected by Section 4604. 6 Del. C.
§ 4618.
WHEREAS, the ECOA prohibits “any creditor” from discriminating “against any
applicant, with respect to any aspect of a credit transaction—(1) on the basis of race, color,
religion, national origin . . . .” 15 U.S.C. § 1691(a)(1); 12 C.F.R. § 1002.4(a). The ECOA further
prohibits any statements, acts, or practices that would discourage, on a prohibited basis, an
applicant or prospective applicant from applying for credit. 15 U.S.C. § 1691(a); 12 C.F.R. pt.
WHEREAS, the Delaware Consumer Fraud Act makes it an unlawful practice for “The
act, use, or employment by any person of any deception, fraud, false pretense, false promise,
fact with intent that others rely upon such concealment, suppression, or omission, in connection
with the sale, lease, receipt, or advertisement of any merchandise, whether or not any person has
WHEREAS, the State of Delaware alleges that Trident engaged in redlining, meaning it
did not pursue mortgage business in Majority-Minority Census Tracts equally to the way it did
with respect to majority White census tracts, and related acts and practices.
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WHEREAS, the State of Delaware alleges that Fox & Roach and Trident shared a close
business relationship, including some co-located offices, which contributed to Fox & Roach
WHEREAS, the Respondents deny the State of Delaware’s allegations; assert that they
have treated all individuals fairly and without regard to impermissible factors such as race; and
deny that they have conducted their businesses in a manner that violates the Delaware Fair
Housing Act, Delaware Consumer Fraud Act, the ECOA, or any other law or requirement.
agency or any court as to whether Respondents conducted their businesses in a manner that
violates the Delaware Fair Housing Act, Delaware Consumer Fraud Act, the ECOA, or any other
law or requirement; nor shall Trident’s and Fox & Roach’s agreement to enter into this AVC be
WHEREAS, the State of Delaware and Respondents enter into this AVC solely for the
WHEREAS, the Respondents’ agreement to enter into this AVC shall not be considered
SETTLEMENT TERMS
NOW THEREFORE, having conducted trade and commerce within the State of
Delaware, each Respondent for itself, its officers, and employees, agrees to the following terms,
I. Conduct Provisions
1. Nondiscrimination: Trident, its officers, agents, servants, and employees, shall not
engage in any act or practice which constitutes redlining in the Philadelphia MSA in violation of
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applicable state and federal law. Fox & Roach, including its officers and employees, shall not
engage in any act or practice which constitutes redlining in the Philadelphia MSA in violation of
proactive efforts to generate interest in applying for and obtaining mortgage credit, including
home mortgage loans, home refinance loans, and home improvement loans, by Current Residents
of Majority-Minority Census Tracts within the Philadelphia MSA, consistent with sections V
through VIII of the Order. Fox & Roach shall undertake affirmative, proactive efforts to
generate interest in its real estate brokerage services by Current Residents of Majority-Minority
Census Tracts within the Philadelphia MSA, consistent with paragraph 8.a. herein.
3. Loan Subsidy Program: The States acknowledge the Order in which Trident
agrees, at section II, to fund a Loan Subsidy Program in the amount of Eighteen Million Four
Majority-Minority Census Tracts in the Philadelphia MSA. That Loan Subsidy Program
provision is hereby incorporated into this AVC. See Exhibit, section II, paragraphs 7-12. Trident
will fund the Loan Subsidy Program, oversee its implementation, and disburse loan subsidy
funds to qualified applicants. Because Trident is no longer lending, Trident will contract with a
Lender to administer and make loans pursuant to the Loan Subsidy Program. Funds shall be
distributed equitably throughout the Philadelphia MSA, consistent with the Consent Order and
4. Loan Subsidy Exhaustion: Trident shall make every good faith effort to expend
all Loan Subsidy Program funds referred to in paragraph 3 herein within five (5) years of the
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5. Customer Service for Current Resident Leads: During the Term of this AVC,
Trident shall ensure that the Lender making loans pursuant to the Loan Subsidy Program makes
Tracts in the Philadelphia MSA who express an interest in a mortgage loan product – from the
initial point of contact through the application and closing processes (as applicable) – consistent
Program: The States acknowledge and accept the Order provisions at sections III through VIII,
and incorporate them herein, with the following addition. Trident shall ensure that the training
requirements, described in the Order at section IV, are inclusive of the Delaware Fair Housing
7. Remedial Plan: The States acknowledge the Order at section IX requiring Trident
to develop and submit a comprehensive plan designed to ensure compliance with the Order and
to implement the Loan Subsidy Program (hereafter, “federal Remedial Plan”). The States
a. Trident shall convey the federal Remedial Plan to the States at the same
time that it conveys the federal Remedial Plan to the CFPB and USDOJ.
b. At the same time that Trident conveys the federal Remedial Plan, Trident
and Fox & Roach shall also convey a comprehensive compliance plan to the States designed to
ensure compliance with all of the Conduct Provisions of the States’ AVCs, including the Conduct
Provisions pertaining to Fox & Roach, to the extent not already covered in the federal Remedial
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Plan, and including specific timeframes and deadlines for implementation (herein referred to as
to the State Specific Remedial Plan or to direct Trident and/or Fox & Roach, as appropriate, to
revise it. If the States direct Trident and/or Fox & Roach to revise the State Specific Remedial
Plan, Trident and/or Fox & Roach must make the requested revisions and resubmit the State
non-objection, Trident and Fox & Roach must implement and adhere to the steps, deadlines, and
8. Fox & Roach: Notwithstanding any other provision in the Order or the States’
a. Marketing: Fox & Roach shall establish a fund in the amount of One
Hundred Fifty Thousand Dollars ($150,000) from which agents may draw, over the Term of the
States’ AVCs, solely for the purpose of conducting targeted marketing to individuals who may
be “qualified applicants” for the Loan Subsidy Program, as defined in paragraph 8 of the Order.
The fund established under this provision shall be the same fund as established under the
corresponding provisions of the other States’ AVCs and the total amount will be $150,000,
across the States. Fox & Roach shall require each broker or real estate agent seeking monies
from the fund to prepare a short proposal to be approved by the company prior to disbursement.
Approval by the company shall ensure that the proposal meets the goals of the fund and that the
marketing method(s) proposed comply with applicable law. The States expect, but this AVC
does not require, that Fox & Roach will administer and limit draws from the fund so that
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qualifying marketing is conducted in the following proportions within the Philadelphia MSA
during the Term of the States’ AVCs: Pennsylvania – Five County Region (70%); New Jersey –
Camden MD (24%); Delaware – that portion of the Wilmington MD located within New Castle
County, Delaware (6%). Fox & Roach agrees that these proportions are shared goals and that if
a State raises a bona fide concern that expenditure of the funds has been significantly
imbalanced, it will meet and confer in good faith with the States; and
b. Training: Fox & Roach shall require each current Fox & Roach
executive, manager, and sales associate in the Philadelphia MSA, within six (6) months of the
Effective Date of the States’ AVCs, and for all new executives, managers, and sales associates in
the Philadelphia MSA, within six (6) months of their start date, to take the online At Home With
Diversity® (AHWD) course and obtain certification by the National Association of Realtors
regarding the same. Failure of Fox & Roach’s sales associates to take the training shall not, by
itself, be deemed a violation of this AVC. In addition, the training requirement for current sales
associates applies only to those who represented a consumer in five (5) or more transactions in
the past twelve (12) months, and for future sales associates only to those who represented a
consumer in five (5) or more transactions in the twelve (12) months prior to becoming affiliated
c. Within seven (7) days of the Effective Date, Fox & Roach shall designate
at least one direct telephone number and e-mail, physical, and postal addresses as points of
contact that the States may use to communicate with Fox & Roach.
Compliance Monitoring: The States acknowledge the Order provisions pertaining to distribution
and acknowledgement (Order section XIV), reporting (Order section XIII), recordkeeping (Order
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section XV), compliance monitoring (Order section XVII), and administration (Order section
XVIII). The States incorporate such provisions herein, with the following additions:
a. Trident shall deliver a summary or a copy of the States’ AVCs at the same
time and to each individual to whom a copy of the Order is delivered pursuant to the Order at
paragraphs 51-52. Within thirty (30) days of the Effective Date, Fox & Roach shall deliver to
each Fox & Roach (i) executive; (ii) manager; and (iii) individual holding a broker license in the
Philadelphia MSA, a summary or a copy of the States’ AVCs. Any summary of the States’
AVCs delivered by Trident or Fox & Roach pursuant to this subparagraph shall include
instructions on how to obtain electronic copies of each State’s AVC and any summary shall be
submitted to the States for non-objection within twenty (20) days of the Effective Date.
Order at paragraph 49 (hereafter “federal Compliance Reports”), to the States at the same time
that it conveys the federal Compliance Reports to the CFPB and USDOJ. At the same time that
Trident conveys the federal Compliance Reports, Trident and Fox & Roach shall also convey to
the States an accurate written compliance progress report, sworn to under penalty of perjury,
describing in detail and to the extent not already covered in the federal Compliance Reports: (i)
the manner and form in which Trident and Fox & Roach have complied with each of the
Conduct Provisions of the States’ AVCs and (ii) the manner and form in which Trident and Fox
& Roach have complied with the State Specific Remedial Plan (hereafter the “State Specific
Compliance Reports”).
c. If the State Specific Compliance Reports cause the States concern or raise
questions for the States about Trident’s or Fox & Roach’s compliance or good faith, the States
collectively and individually shall have the right to meet and confer with either or both Trident
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and Fox & Roach within thirty (30) days of collectively or individually delivering such concerns
d. Trident shall also convey to the States at the same time that it conveys to
the CFPB and USDOJ: the Credit Needs Assessment (Order paragraph 14); qualifications of the
completed, and any proposed changes to the third-party trainer or the training curriculum (Order
final judgment, order, or settlement in a Related Consumer Action (Order paragraph 45);
notification of any development that may affect compliance obligations arising under the Order
(Order paragraphs 46 and 48); points of contact (Order paragraph 47.a.); acknowledgment of
receipt of the Order (Order at paragraph 50); signed and dated acknowledgments (Order
paragraph 53); list of individuals (Order paragraph 54); and any additional compliance reports
e. Trident shall make available to any of the States upon request the
f. The States shall have a consultative role with the CFPB and USDOJ as to
all matters covered by the Order, and the determinations of the CFPB and USDOJ control with
respect to such provisions of the Order. Each State shall have enforcement authority in their
respective jurisdictions with respect to matters covered solely by the States’ AVCs.
this AVC, to the extent not covered in the Consent Order, will be in effect until the latter of five
(5) years or ninety (90) days after the submission of a report satisfying the State of Delaware of
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II. Monetary Provisions
10. Costs: In consideration of this AVC, the State of Delaware has agreed to waive
seeking recovery of its costs incurred in conducting its investigation and negotiations leading to
this AVC.
11. Civil Penalty: Delaware acknowledges the civil money penalty to be paid to the
CFPB pursuant to the Order at paragraph 38. In light of that provision of the Order, and in
consideration of this AVC, the State of Delaware has agreed to waive the assessment of any civil
penalty.
12. The Parties agree that the state and federal courts of the State of Delaware shall
have jurisdiction over the subject matter of this AVC and over Respondents for purpose of
13. Any time limits for performance may be extended by mutual written agreement of
the Parties. Other modifications may be made only upon approval of the Court, by motion by
any Party. If there are changes in material factual circumstances, the Parties will work
14. The Parties agree that litigation is not reasonably foreseeable as of the Effective
Date of the States’ AVCs. If any party implemented a litigation hold to preserve information,
the party is no longer required to maintain it, but the parties acknowledge that they may need to
institute a future litigation hold if a dispute arises regarding the interpretation of or compliance
with the terms of this AVC. Nothing in this Paragraph relieves either party of any other
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15. In the event that any dispute arises regarding the interpretation of or compliance
with the terms of this AVC, the Parties will endeavor in good faith to resolve any such dispute
between themselves before bringing it to a state or federal court in the State of Delaware for
resolution. The State of Delaware agrees that if it reasonably believes that Respondents have
materially violated any provision of this AVC, it will provide Respondents written notice thereof
and give Respondents forty-five (45) days to resolve the alleged violation before presenting the
matter to a court.
16. Delaware hereby waives any right of the Attorney General to reopen the subject
matters under these laws closed by this AVC for further proceedings against Respondents in the
public interest, and releases and discharges Respondents from any and all potential liability for
its potential claims under these laws arising out of the allegations herein, including any
Philadelphia MSA; provided, however, that the foregoing waiver shall not be construed to
diminish or waive the right of the State of Delaware or the Attorney General to enforce the terms
of this AVC in the event of any breach of this AVC by Respondents, or to investigate or
commence an enforcement action concerning any violations of law that occur following the
Effective Date.
17. Larry Flick V, as Chief Executive Officer of Trident, hereby states that he is
18. Larry Flick V, as Chief Executive Officer of Fox & Roach, hereby states that he is
authorized to enter into and execute this AVC on behalf of Fox & Roach.
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20. Respondents, and HomeServices of America, are and have been represented by
legal counsel and have been advised by legal counsel of the meaning and effect of this AVC.
21. Respondents further agree to execute and deliver all authorizations, documents
and instruments which are necessary to carry out the terms and conditions of this AVC, whether
required prior to, contemporaneous with or subsequent to the Effective Date, as defined herein.
22. For any provisions herein that require Respondents to seek approval from
Delaware, Respondents shall seek such approval by writing to Christian Douglas Wright
23. Respondents agree by the signing of this AVC that Respondents shall abide by
24. This AVC may be executed in any number of counterparts and by different
signatories on separate counterparts, each of which shall constitute an original counterpart hereof
and all of which together shall constitute one and the same document. One or more counterparts
of this AVC may be delivered by facsimile or electronic transmission with the intent that it or
25. This AVC sets forth all of the promises, covenants, agreements, conditions and
understandings between the Parties, and it supersedes all prior and contemporaneous agreements,
arrangements, or understandings, oral or written, between the Parties relating to the subject
matter of this AVC that are not fully expressed herein, incorporated by reference, or attached
hereto. Each party specifically warrants that this AVC is executed without reliance upon any
statement or representation by any other party hereto, except as expressly stated herein,
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incorporated by reference, or attached hereto. Any amendments to this AVC must be approved
26. If any clause, provision or section of this AVC shall, for any reason, be held
illegal, invalid or unenforceable, such illegality, invalidity, or unenforceability shall not affect
any other clause, provision or section of this AVC and this AVC shall be construed and enforced
as if such illegal, invalid or unenforceable clause, section or other provision had not been
contained herein.
27. Neither the State of Delaware, Respondents, nor HomeServices of America, shall
be considered the drafter of this AVC or any of its provisions for the purpose of any statute, case
law, or rule of interpretation or construction that would or might cause any provision to be
WHEREFORE, intending to be legally bound, the signatories have hereto set their
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Date: July 26, 2022 For the State of Delaware:
By: ________________________________
Christian Douglas Wright
Director of Impact Litigation
Delaware Department of Justice
820 N. French Street
Wilmington, DE 19801
(302) 683-8899
[email protected]
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7/26/2022
EXHIBIT:
CONSENT ORDER
FILED IN THE
UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
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UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
INTRODUCTION
Plaintiffs, the Consumer Financial Protection Bureau (Bureau) and the United States of
America (United States), commenced this civil action to obtain injunctive and monetary relief
and civil penalties from Trident Mortgage Company LP (Trident). The Complaint alleges
violations of the Fair Housing Act (FHA), 42 U.S.C. §§ 3601-3619, the Equal Credit
Opportunity Act (ECOA), 15 U.S.C. §§ 1691-1691f, and the Consumer Financial Protection Act
The Bureau, the United States, and Trident (together, “the Parties”) agree to entry of this
Consent Order (Order), without adjudication of any issue of fact or law, to settle and resolve all
1. This Court has jurisdiction over the parties and the subject-matter of this action.
2. Trident neither admits nor denies the allegations in the Complaint, except as
specified in this Order. For purposes of this Order, Trident admits the facts necessary to establish
the Court’s jurisdiction over Trident and the subject matter jurisdiction related to the Lawsuit
Subject Matter.
3. Trident waives all rights to seek judicial review or otherwise challenge or contest
the validity of this Order and any claim it may have under the Equal Access to Justice Act, 28
U.S.C. § 2412, concerning the prosecution of this action to the date of this Order. Each Party
agrees to bear its own costs and expenses, including, without limitation, attorneys’ fees.
DEFINITIONS
b. “Effective Date” means the date on which the Court enters this Order.
d. “Lawsuit Subject Matter” means allegations that Trident violated the FHA,
ECOA, and/or the CFPA in connection with Trident’s mortgage lending in the
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Minority Neighborhoods in its residential mortgage lending.
e. “Lender” is the entity Trident contracts with to administer and make loans
under the Loan Subsidy Fund and carry out other Conduct Provisions as
required under this Order. Trident will not serve as the Lender under this
Order.
means a census tract in which more than 50% of the residents are identified in
the U.S. Census as in a group other than white Non-Hispanic, including Black,
assigns.
CONDUCT PROVISIONS
Nondiscrimination Injunction
6. Trident, its officers, agents, servants, and employees, are permanently restrained
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from engaging in any act or practice that constitutes redlining in violation of the Fair Housing
Act, 42 U.S.C. §§ 3601-3619, the Equal Credit Opportunity Act, 15 U.S.C. § 1691-1691f or
Regulation B, 12 C.F.R. part 1002. Nothing else in this Order will be read as an exception to this
Paragraph.
II
7. Within 10 days of the Effective Date, Trident must reserve or deposit into a
segregated deposit account Eighteen Million Four Hundred Thousand dollars ($18,400,000) for
the purpose of funding a Loan Subsidy Program to increase the credit extended in Majority-
violation of the FHA and ECOA (Loan Subsidy Program). The investment under the Loan
Subsidy Program will consist only of the cost of providing the subsidies to consumers described
in Paragraph 9 and not the cost of implementing the Loan Subsidy Program.
a. Trident has ceased accepting new inquiries or loan applications for mortgage
loans. Accordingly, Trident will comply with the requirement to make loans
and make loans under the Loan Subsidy Program. Within 14 days of the
Effective Date, Trident will identify the Lender, subject to the non-objection
of Plaintiffs. Within 30 days of the Effective Date, Trident will enter into a
contract between the Lender and Trident (the Lender Contract), which will be
subject to the non-objection of Plaintiffs. The Lender Contract will require the
Lender to comply with the provisions of this Order including the Remedial
Plan required under Section IX and must require it to work cooperatively with
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Trident and the Plaintiffs in the conduct of such activities. The Lender must be
Census Tracts in the Philadelphia MSA, and Trident must include a copy of
loans on a more affordable basis than otherwise available from the Lender.
Loans originated under this program must not exceed the conforming loan
8. The Lender will subsidize home mortgage loans made to “qualified applicants”
with funds from the Loan Subsidy Fund. A “qualified applicant” is any applicant who (i) applies
for a mortgage for a residential property located in a Majority-Minority Census Tract in the
Philadelphia MSA that will serve as the applicant’s primary residence, or (ii) is qualified to
participate in a Special Purpose Credit Program consistent with the goals of this Section and
subject to the non-objection of the Plaintiffs. A qualified applicant must in all cases be qualified
for a residential mortgage loan under the underwriting standards of the Lender.
9. Loan subsidies under the Loan Subsidy Program must be provided throughout the
term of the Order, so long as funds remain in the Loan Subsidy Fund, through any of the
an interest rate below the otherwise prevailing market interest rate offered by
the Lender;
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c. closing cost assistance in the form of a direct grant;
mortgage insurance; or
10. The Lender will retain the discretion to offer more than one, or all, of the forms of
subject to regulatory requirements. The Lender must exercise this discretion in a manner that is
consistent with originating loans to qualified applicants with due reliance upon applicable
underwriting guidelines, and will have discretion to provide the loan subsidy among its loan
products. The combined forms of subsidies set forth in Paragraph 9 cannot exceed Ten Thousand
dollars ($10,000) per qualified applicant unless Trident receives non-objection from Plaintiffs to
11. No provision of this Order, including the Loan Subsidy Program, requires the
Lender to make a loan to a person who is not qualified for the loan based upon lawful,
nondiscriminatory terms; however, the Lender may choose to apply more flexible underwriting
standards in connection with the Loan Subsidy Program. The underwriting standards applied to
12. Though the Lender has obligations under the Lender Contract and this Order,
Trident is responsible for ensuring that the requirements of this Order, including each of the
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III
13. Within 45 days of the Effective Date, Trident must secure and retain one or more
the Philadelphia MSA. If the Plaintiffs object to one or more CNA Consultants Trident selects,
Trident must identify new CNA Consultants to the Plaintiffs within 45 days. This credit needs
b. an evaluation (to include market research and interviews) of the credit needs
including, but not limited to, the need for and feasibility of alternative
Minority Neighborhoods;
e. a review of the availability and feasibility of relevant federal, state, and local
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them would assist in achieving the remedial goals of this Order;
g. recommendations that address how each requirement of the Order as set forth
in Paragraphs 7-12 and 15-31 should be carried out to best achieve the
14. Within 90 days of being retained, the CNA Consultant must prepare a written
report detailing the findings of the review (CNA Report) and provide the CNA Report to the
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Training
15. Trident will ensure that all Covered Staff and Officials receive bi-annual training.
The training will include topics on implicit racial bias, conduct that could constitute redlining,
and how to detect, prevent, and remedy redlining, as well as training on Trident’s and the
Lender’s obligations under ECOA, Regulation B, the FHA, and this Order. Trident will
implement a system for each person referenced in this Paragraph to acknowledge that they
completed the fair lending training. All training attendees will be required to demonstrate
proficiency. Trident will bear all costs associated with the trainings. The training will be
conducted by an independent, qualified third-party trainer selected by Trident and subject to non-
16. Within 60 days of the Effective Date, Trident will submit the qualifications of the
third-party trainer described in Paragraph 15 to the Plaintiffs for non-objection. Within 45 days
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of receiving non-objections from the Plaintiffs regarding the independent, qualified third-party
trainer, Trident will submit the proposed training curriculum to the Plaintiffs for non-objection.
Within 30 days of receiving non-objections from the Plaintiffs regarding the proposed training
curriculum, Trident will commence delivery of the training described in this Section with
training to conclude within 90 days of receiving non-objections. Trident will provide a report
that includes these acknowledgements to the Plaintiffs 45 days after it has completed the
training. Any proposed changes to the third-party trainer or the training curriculum are subject to
17. Within 10 days of the Effective Date, Trident must reserve or deposit into a
segregated deposit account Eight Hundred Seventy-Five Thousand dollars ($875,000) to be spent
18. The Lender Contract will require the Lender to undertake such advertising and
outreach efforts, and will require the Lender’s name to appear in advertising materials and
outreach programs. The advertising and outreach campaign will be informed by the findings and
recommendations of the credit needs assessment required in Paragraphs 13-14, will advertise the
Lender’s residential loan products, including products for which the Loan Subsidy Program will
be applied, and will seek to generate applications from qualified applicants for mortgage loans
details regarding the distribution channels to be used for advertising and outreach will be set
19. The Lender Contract will require the Lender to include on all of its print
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advertising and promotional materials referencing residential mortgage loans an equal housing
opportunity logo, slogan, or statement. All radio or television advertisements will include an
audible statement that the Lender is an “Equal Opportunity Lender” or “Equal Housing Lender.”
20. In addition to the targeted advertising efforts described in Paragraphs 17-20, the
Lender Contract will require the Lender to conduct quarterly outreach programs in the
Philadelphia MSA for real estate professionals and entities engaged in residential real estate-
the products and services that the Lender offers, including the Loan Subsidy Program in this
Order, and to otherwise develop business relationships with them. These programs will be
VI
21. Within 10 days of the Effective Date, Trident must reserve or deposit into a
segregated deposit account Three Hundred Seventy-Five Thousand dollars ($375,000) for the
Census Tracts in the Philadelphia MSA that will help identify and support qualified loan
applicants and will consider the results of the credit needs assessment required in Paragraphs 13-
14 in so doing.
22. The Remedial Plan described in Paragraph 32 must specify that Trident will
sponsor at least eight financial education events per year offered by community and
governmental organizations engaged in fair lending work, or through the Lender’s financial
education programs. Salaries or other compensation for participating personnel of Trident or any
10
of its affiliates, including HSOA or the Lender, will not count towards the amount spent on these
programs. The financial education events may be conducted as in-person events offered at a
23. These events will cover consumer finance and related matters to help identify
24. These financial education events will be marketed toward residents of Majority-
VII
agency, the Lender Contract will require the Lender to maintain and/or open licensed branch
locations so that at least 4 such offices are located within Majority-Minority Neighborhoods in
the Philadelphia MSA within 18 months of the Effective Date. The Lender Contract will also
require that a minimum of 4 such those offices remain in operation during the term of this Order.
These offices will be in visible and accessible locations in the Majority-Minority Neighborhoods
26. All lending offices that the Lender operates within Majority-Minority
Neighborhoods in the Philadelphia MSA will provide services generally commensurate with
those services previously offered at Trident’s full-service offices, as well as any additional
products or services the Lender may choose to offer as a result of the credit needs assessment.
27. Nothing in this Order precludes the Lender from opening or acquiring additional
11
28. The Lender Contract will require the Lender to employ a full-time Manager of
Community Lending. For the duration of this Order, Trident and the Manager of Community
within the Philadelphia MSA consistent with the action steps contained in the Remedial Plan;
coordinate the community lending initiatives and outreach programs required under this Order;
serve as a resource to the Lender’s staff to encourage and develop more lending within Majority-
Minority Neighborhoods within the Philadelphia MSA; promote financial education and
counseling within the Philadelphia MSA; and build relationships with community groups within
29. The Lender Contract will require that, within 180 days of the Effective Date, not
less than 4 mortgage loan officers total are assigned to solicit applications primarily from
Majority-Minority Neighborhoods within the Philadelphia MSA. The Lender Contract will
require that such loan officers are assigned to cover all Majority-Minority Census Tracts within
the Philadelphia MSA, and that these loan officers have the opportunity to earn similar
compensation to other loan officers for the work that they will perform in the Majority-Minority
Neighborhoods. These mortgage loan officers shall not be precluded from also originating loans
VIII
30. Within 10 days of the Effective Date, Trident must reserve or deposit into a
segregated deposit account Seven Hundred Fifty Thousand dollars ($750,000) to be spent on the
partnerships described in this Paragraph. The Lender Contract will require the Lender to partner
12
(1) home repair or other grants designed to assist homeowners who experience financial distress
Philadelphia MSA. The Lender will develop such partnerships in a manner consistent with
achieving the remedial goals of this Order; specifically, the Lender will form partnerships with
Neighborhoods in the Philadelphia MSA; marketing its residential loan products in Majority-
Majority-Minority Neighborhoods in the Philadelphia MSA; and assisting with the revitalization
MSA.
31. During the life of the Loan Subsidy Program, the Lender will annually evaluate its
partnership(s), to identify any required changes to the program to better meet the residential
IX
Remedial Plan
32. Within 180 days of the Effective Date, Trident must develop and submit to the
Plaintiffs a comprehensive compliance plan designed to ensure compliance with this Order and
a. include detailed steps for addressing each action required by this Order;
13
c. propose in writing how best to achieve the goals of the Order in light of the
CNA Report;
Neighborhoods;
state, or local governmental programs that may assist in serving the affected
areas; the basis for the selection of the proposed partner(s); and a detailed
description of how the partnership(s) will be implemented over the term of the
Order;
j. include the signatures of the Lender and any other entities responsible for
33. Plaintiffs will have the discretion to make a determination of non-objection to the
Remedial Plan or to direct Trident to revise it. If the Plaintiffs direct Trident to revise the
Remedial Plan, the Compliance Committee must make the requested revisions and resubmit the
14
34. After receiving notification that the Plaintiffs have made a determination of non-
objection to the Remedial Plan, Trident must implement and adhere to the steps,
recommendations, deadlines, and timeframes that will be specified in the Remedial Plan.
35. The Compliance Committee must review all submissions (including plans,
reports, programs, policies, and procedures) required by this Order prior to submission to the
Plaintiffs.
36. Although this Order requires Trident to submit certain documents for review or
non-objection by Plaintiffs, Trident is responsible for its own proper and sound management, and
for ensuring that it complies with this Order and the laws that the Plaintiffs enforce, including
37. In each instance that this Order requires the Compliance Committee to ensure
adherence to, or perform certain obligations of Trident, the Compliance Committee must:
a. authorize whatever actions are necessary for Trident to fully comply with the
Order;
c. require timely and appropriate corrective action to remedy any material non-
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MONETARY PROVISIONS
XI
38. Under Section 1055(c) of the CFPA, 12 U.S.C. § 5565(c), by reason of the
violations of law alleged in the Complaint, and taking into account the factors in 12 U.S.C.
§ 5565(c)(3), Trident must pay a civil money penalty of Four Million dollars ($4,000,000) to the
Bureau.
39. Within 10 days of the Effective Date, Trident must pay the civil money penalty by
wire transfer to the Bureau or to the Bureau’s agent in compliance with the Bureau’s wiring
instructions.
40. The civil money penalty paid under this Order will be deposited in the Civil
Penalty Fund of the Bureau as required by Section 1017(d) of the CFPA, 12 U.S.C. § 5497(d).
41. Trident must treat the civil money penalty paid under this Order as a penalty paid
to the government for all purposes. Regardless of how the Bureau ultimately uses those funds,
a. claim, assert, or apply for a tax deduction, tax credit, or any other tax benefit
any source, including but not limited to payment made under any insurance
policy, with regard to any civil money penalty paid under this Order.
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XII
42. In the event of any default on Trident’s obligations to make payment under this
Order, interest, computed under 28 U.S.C. § 1961, as amended, will accrue on any outstanding
amounts not paid from the date of default to the date of payment, and will immediately become
43. Trident relinquishes all dominion, control, and title to the funds paid under this
Order to the fullest extent permitted by law and no part of the funds may be returned to Trident.
44. Under 31 U.S.C. § 7701, Trident, unless it already has done so, must furnish to
the Plaintiffs its taxpayer-identification number, which may be used for purposes of collecting
45. Within 30 days of the entry of a final judgment, order, or settlement in a Related
Consumer Action, Trident must notify the Plaintiffs of the final judgment, order, or settlement in
writing. That notification must indicate the amount of redress, if any, that Trident paid or is
required to pay to consumers and describe the consumers or classes of consumers to whom that
redress has been or will be paid. To preserve the deterrent effect of the civil money penalty in
any Related Consumer Action, Trident may not argue that Trident is entitled to, nor may Trident
benefit by, any offset or reduction of any monetary remedies imposed in the Related Consumer
Action because of the civil money penalty paid in this action or because of any payment that the
Bureau makes from the Civil Penalty Fund. If the court in any Related Consumer Action offsets
or otherwise reduces the amount of compensatory monetary remedies imposed against Trident
based on the civil money penalty paid in this action or based on any payment that the Bureau
17
makes from the Civil Penalty Fund, Trident must, within 30 days after entry of a final order
granting such offset or reduction, notify the Bureau and pay the amount of the offset or reduction
to the U.S. Treasury. Such a payment will not be considered an additional civil money penalty
and will not change the amount of the civil money penalty imposed in this action.
XIII
Reporting Requirements
46. Trident must notify Plaintiffs of any development that may affect compliance
obligations arising under this Order, including but not limited to, a dissolution, assignment, sale,
merger, or other action that would result in the emergence of a successor company; the creation
or dissolution of a subsidiary, parent, or affiliate that engages in any acts or practices subject to
this Order; the filing of any bankruptcy or insolvency proceeding by or against Trident; or a
change in Trident’s name or address. Trident must provide this notice at least 30 days before the
development or as soon as practicable after the learning about the development, whichever is
sooner.
a. designate at least one direct telephone number and email, physical, and postal
addresses as points of contact that the Plaintiffs may use to communicate with
Trident;
b. identify all businesses for which Trident is the majority owner, or that Trident
c. describe the activities of each such business, including the products and
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services offered, and the means of advertising, marketing, and sales.
48. Trident must report any change in the information required to be submitted under
Paragraph 46 at least 30 days before the change or as soon as practicable after learning about the
49. Within 120 days of receiving notice of non-objection to the Remedial Plan, and
then every year after receiving notice of non-objection to the Remedial Plan, Trident must
submit to the Bureau and the United States an accurate written compliance progress report sworn
to under penalty of perjury (Compliance Report) that has been approved by the Compliance
a. lists each applicable Paragraph and subparagraph of the Order and describes
in detail the manner and form in which Trident has complied with each such
b. describes in detail the manner and form in which Trident has complied with
XIV
50. Within 7 days of the Effective Date, Trident must submit to the Plaintiffs an
51. Within 30 days of the Effective Date, Trident must deliver a copy of this Order to
52. Trident must deliver a copy of this Order to any business entity resulting from any
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change in structure referred to in Section XIII including to the Lender, any future Compliance
Committee members and executive officers, as well as to any managers, employees, or other
agents who will have responsibilities related to the subject matter of the Order, including all
53. Trident must secure a signed and dated statement acknowledging receipt of a copy
of this Order, ensuring that any electronic signatures comply with the requirements of the E-Sign
Act, 15 U.S.C. §§ 7001-7006, within 30 days of delivery, from all persons receiving a copy of
54. Within 90 days of the Effective Date, Trident must provide the Plaintiffs with a
list of all persons and their titles to whom this Order was delivered through that date under
Paragraphs 51 and 52 and a copy of all signed and dated statements acknowledging receipt of
XV
Recordkeeping
55. Trident must create, for at least 2 years after full compliance with this Order as
a. all documents and records necessary to demonstrate full compliance with each
Identifier, type of loan, loan purpose, the property address of the collateral,
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56. Trident must retain these documents for at least 2 years after full compliance of
this Order as described in Section XVIII below and make them available to Plaintiffs upon
Plaintiffs’ request.
57. Trident must maintain, for at least 2 years after full compliance with this Order as
b. for each individual borrower who received a loan under the Loan Subsidy
description of the loan received including describing the loan terms and the
subsidies provided under the Loan Subsidy Program, and the date on which
d. records showing, for each Covered Staff and Official providing services
related to the Loan Subsidy Program, that person’s: name; telephone number;
email, physical, and postal address; job title or position; dates of service; and,
e. records showing, for each service provider providing material services related
21
contact, and that person’s telephone number; email, physical, and postal
address; job title or position; dates of service; and, if applicable, the reason for
termination.
Trident must make these materials available to Plaintiffs upon the Plaintiffs’ request.
XVI
Notices
58. Unless otherwise directed by the Bureau, all material required by this Order will
be sent to the Bureau with the subject line, “CFPB and United States of America v. Trident
Mortgage Company LP, Case No. [Docket #],” by overnight delivery service or first-class mail
and
Regional Director
Northeast Region
Consumer Financial Protection Bureau
140 E. 45th Street
4th Floor
New York, NY 10017
59. All material required by this Order will be sent to the United States by email to
the Department of Justice attorney(s) assigned to this matter, and by commercial overnight
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XVII
Compliance Monitoring
60. Within 30 days of receipt of a written request from Plaintiffs, Trident must submit
additional compliance reports or other requested information, which must be sworn under
61. Trident must permit Plaintiffs’ representatives to interview any employee or other
person affiliated with Trident who has agreed to such an interview regarding: (a) the Lawsuit
Subject Matter; or (b) compliance with this Order. The person interviewed may have counsel
present.
62. Nothing in this Order will limit the Plaintiffs’ lawful use of compulsory process,
XVIII
Administration
63. Trident’s obligations under Section I of this Order will remain in effect
permanently. Unless a different duration is specified above, the other requirements of this Order
this Order; or
64. Should Trident seek to transfer or assign all or part of the operations that are
subject to this Order, Trident must, as a condition of the transfer or assignment, obtain the
23
written agreement of the transferee or assignee to comply with all applicable provisions of this
Order.
65. Should HSOA or the Lender seek to transfer or assign all or part of the operations
that are subject to this Order, HSOA or the Lender, as applicable, must, as a condition of the
transfer or assignment, obtain the written agreement of the transferee or assignee to comply with
66. By its signature HSOA fully and unconditionally guarantees the performance of
Trident’s obligations under this Order, including, but not limited to all monetary obligations and
matters relating to compliance with or enforcement of this Order, and will perform those
obligations if Trident fails to satisfy them. HSOA submits to the jurisdiction of this Court for any
matters relating to compliance with or enforcement of this Order. Trident and HSOA agree that
the Bureau and the United States reserve the right to amend the Complaint to add HSOA as a
required party under Rule 19 of the Federal Rules of Civil Procedure; provided that, before filing
any motion under Rule 19, Plaintiffs must first notify Trident and HSOA and attempt to discuss
the substance of the contemplated motion and any potential resolution. Trident and HSOA do not
waive the right to present to the Court evidence related to whether Trident has satisfied its
67. Any time limits for performance may be extended by mutual written agreement of
the parties. Other modifications may be made only upon approval of the Court, by motion of any
party.
68. The parties agree that litigation is not reasonably foreseeable. If any party
implemented a litigation hold to preserve information, the party is no longer required to maintain
it. Nothing in this Paragraph relieves either party of any other obligations imposed by the Order.
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69. The Plaintiffs release and discharge Defendants from any and all potential
liability for claims arising out of the Lawsuit Subject Matter before the Effective Date. This
release does not preclude or affect any right of the Plaintiffs to determine and ensure compliance
with the Order, or to seek penalties for any violations of the Order.
XIX
Retention of Jurisdiction
IT IS FURTHER ORDERED that the Court will retain jurisdiction of this matter for the
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The undersigned hereby apply for and consent to the entry of this Consent Order:
ERIC HALPERIN
Enforcement Director
DEBORAH MORRIS
Deputy Enforcement Director
26
FOR THE UNITED STATES:
27
FOR TRIDENT MORTGAGE COMPANY LP:
KARI K. HALL
Partner
Paul Hastings LLP
2050 M Street NW
Washington, DC 20036
Telephone: (202) 551-1782
[email protected]
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FOR HOMESERVICES OF AMERICA, INC.:
KARI K. HALL
Partner
Paul Hastings LLP
2050 M Street NW
Washington, DC 20036
Telephone: (202) 551-1782
[email protected]
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