12 CFR §1024.14 — Prohibition against kickbacks and unearned fees
Regulation X §1024.14 implements RESPA section 8: prohibits referral fees, fee splitting, unearned charges; defines "thing of value" broadly; lists statutory exemptions; requires 5-year recordkeeping.
Verbatim regulatory text
Verbatim provisions from 12 CFR §1024.14 — 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 CFR §1024.14(b) — No referral fees
(b) No referral fees. No person shall give and no person shall accept any fee, kickback or other thing of value pursuant to any agreement or understanding, oral or otherwise, that business incident to or part of a settlement service involving a federally related mortgage loan shall be referred to any person . Any referral of a settlement service is not a compensable service, except as set forth in § 1024.14(g)(1) . A company may not pay any other company or the employees of any other company for the referral of settlement service business .
12 CFR §1024.14(c) — No split of charges except for actual services performed
(c) No split of charges except for actual services performed. 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 settlement service in connection with a transaction involving a federally related mortgage loan other than for services actually performed. A charge by a person for which no or nominal services are performed or for which duplicative fees are charged is an unearned fee and violates this section. The source of the payment does not determine whether or not a service is compensable. Nor may the prohibitions of this part be avoided by creating an arrangement wherein the purchaser of services splits the fee.
12 CFR §1024.14(g)(1) — Permitted payments under section 8 of RESPA
(1) Section 8 of RESPA permits:
12 CFR §1024.14(g)(3) — Multiple services must be actual, necessary, and distinct
(3) Multiple services. When a person in a position to refer settlement service business , such as an attorney, mortgage lender , real estate broker or agent, or developer or builder, receives a payment for providing additional settlement services as part of a real estate transaction, such payment must be for services that are actual, necessary and distinct from the primary services provided by such person .
12 CFR §1024.14(h) — Recordkeeping (5-year retention)
(h) Recordkeeping. Any documents provided pursuant to this section shall be retained for five (5) years from the date of execution.
12 CFR §1024.14(g)(1) — Permitted payments under section 8 of RESPA — enumerated items (chapeau recall fix)
(i) A payment to an attorney at law for services actually rendered; (ii) A payment by a title company to its duly appointed agent for services actually performed in the issuance of a policy of title insurance; (iii) A payment by a lender to its duly appointed agent or contractor for services actually performed in the origination, processing, or funding of a loan; (iv) A payment to any person of a bona fide salary or compensation or other payment for goods or facilities actually furnished or for services actually performed; (v) A payment pursuant to cooperative brokerage and referral arrangements or agreements between real estate agents and real estate brokers. (The statutory exemption restated in this paragraph refers only to fee divisions within real estate brokerage arrangements when all parties are acting in a real estate brokerage capacity, and has no applicability to any fee arrangements between real estate brokers and mortgage brokers or between mortgage brokers .); (vi) Normal promotional and educational activities that are not conditioned on the referral of business and that do not involve the defraying of expenses that otherwise would be incurred by persons in a position to refer settlement services or business incident thereto; or (vii) An employer's payment to its own employees for any referral activities.