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Fed Takes Action against Peoples Bank
On Tuesday, November 28, 2017, the Federal Reserve (Fed) issued a consent order against Peoples Bank of Lawrence, KS, claiming the bank engaged in deceptive residential mortgage origination practices which violated the Federal Trade Commission Act (FTCA). According to the Fed, Peoples told borrowers they were paying a certain amount for discount points that would lower the borrower’s interest rates, when in fact, the rates were not reduced. The Fed required Peoples to pay $2.8 million restitution to impacted borrowers. Additionally, Peoples must refund all discount points payments that did not reduce borrowers’ rates, and avoid future FTCA violations.