VANCOUVER, B.C.–Several credit unions and banks in British Columbia have been fined for failures in mortgage documentation.
According to the consumer watchdog group Consumer Protection BC, it found systemic failures by financial institutions that were not complying with mortgage discharge rules in the wake of a major fraud case in the province.
In response, B.C.’s consumer protection agency has levied fines against eight banks and credit unions in the province after finding they were not complying with mortgage discharge regulations aimed at preventing fraud and making transactions more seamless, according to Business in Vancouver.
For failing to discharge mortgages within 30 days of a mortgage loan being paid in full, Consumer Protection BC said it levied fines against three big banks and five other financial institutions, including a $5.3-million fine against Toronto Dominion Bank (TD), the largest, to date, according to the report.
Those Paying Fines
Also assessed fines:
- Scotiabank ($387,150)
- Bank of Montreal ($132,700)
- First National Financial GP Corporation ($29,200)
- Coast Capital Savings ($47,900)
- Vancouver City Savings Credit Union ($86,300)
- First West Credit Union ($14,000) and Prospera Credit Union ($8,800).
“Consumer Protection BC’s recent assessment of the financial sector’s compliance with provincial consumer protection laws showed that there is broad non-compliance when it comes to the requirement to provide a consumer with a discharge document within 30 days of a mortgage loan being paid in full,” Business in Vancouver quoted the agency as stating.
Law Society Raised Concerns
Consumer Protection BC said investigations were conducted after hearing concerns from the Law Society of BC, Society of Notaries Public of BC and Land Title and Survey Authority of British Columbia.
The agency told the publication it continues to investigate other institutions but did not disclose which ones.
According to Business in Vancouver, a mortgage lender is required to provide the borrower with a discharge document so the Land Title and Survey Authority of British Columbia can clear the property title. In B.C., the maximum fee a lender may charge for this document is $75, the report said.
Rules the Result of an Earlier Fraud
“In the event a homeowner sells their home with money owing on the mortgage, a lawyer or notary is typically the key to achieving a discharge as they take the money from the buyer and pay off the lender (with any leftover money going to the seller),” the report explained. “At this point, the bank is to provide the discharge document to the borrower and land title office, thus providing the seller and buyer peace of mind of a clean transaction and property title.”
The rules in B.C. were put in place as the result of a related fraud.
It’s Called Fresh for a Reason. And We Offer Home Delivery. For Free!
The biggest, best and freshest news reporting in credit unions remains free in ’23! Each morning CUToday.info delivers its daily Fresh Today news update offering the latest headlines and breaking news right to your email, with the easy-to-read headlines format allowing you to click on the stories that interest you most in order to learn more.
If you haven’t yet signed up for the new email solution on which CUToday.info has partnered with ResponseGenius, you can do so here. Signing up requires less than one minute of your time—and it’s free!
Please note that after signing up you may need to go to your Spam/Junk folder and mark the morning headlines email as safe. CUToday.info does not provide its list of readers and emails to outside parties, and we will not be contacting you to sell you an extended warranty or sending you any links so you may cash in on an inheritance you didn’t know was coming.
And did we mention it’s free?
Please note and/or make your IT department or email administrator aware the emails will be coming from the domains CUTodayinfo.com and CUTodayinfoReply.com.