12 U.S.C. § 1735f-14 : US Code - Section 1735F-14: Civil money penalties against mortgagees, lenders, and other participants in FHA programs

    (a) In general
      (1) Authority
        If a mortgagee approved under the (!1) chapter, a lender
      holding a contract of insurance under subchapter I of this
      chapter, or a principal, officer, or employee of such mortgagee
      or lender, or other person or entity participating in either an
      insured mortgage or subchapter I loan transaction under this
      chapter or providing assistance to the borrower in connection
      with any such loan, including sellers of the real estate
      involved, borrowers, closing agents, title companies, real estate
      agents, mortgage brokers, appraisers, loan correspondents and
      dealers, knowingly and materially violates any applicable
      provision of subsection (b) of this section, the Secretary may
      impose a civil money penalty on the mortgagee or lender, or such
      other person or entity, in accordance with this section. The
      penalty under this paragraph shall be in addition to any other
      available civil remedy or any available criminal penalty, and may
      be imposed whether or not the Secretary imposes other
      administrative sanctions. The penalty shall be in addition to any
      other available civil remedy or any available criminal penalty,
      and may be imposed whether or not the Secretary imposes other
      administrative sanctions.

      (2) Amount of penalty
        The amount of the penalty, as determined by the Secretary, may
      not exceed $5,000 for each violation, except that the maximum
      penalty for all violations by any particular mortgagee or lender
      or such other person or entity during any 1-year period shall not
      exceed $1,000,000. Each violation of a (!2) the provisions of
      subsection (b)(1) of this section shall constitute a separate
      violation with respect to each mortgage or loan application. In
      the case of a continuing violation, as determined by the
      Secretary, each day shall constitute a separate violation.

        In the case of the mortgagee's failure to engage in loss
      mitigation activities, as provided in subsection (b)(1)(I) of
      this section, the penalty shall be in the amount of three times
      the amount of any insurance benefits claimed by the mortgagee
      with respect to any mortgage for which the mortgagee failed to
      engage in such loss mitigation actions.
    (b) Violations for which a penalty may be imposed
      (1) Violations
        The Secretary may impose a civil money penalty under subsection
      (a) of this section for any knowing and material violation by a
      mortgagee or lender or any of its owners, officers, or directors,
      as follows:
          (A) Except where expressly permitted by statute, regulation,
        or contract approved by the Secretary, transfer of a mortgage
        insured under this chapter to a mortgagee not approved by the
        Secretary, or transfer of a loan to a transferee that is not
        holding a contract of insurance under subchapter I of this
        chapter.
          (B) Failure of a nonsupervised mortgagee, as defined by the
        Secretary - 
            (i) to segregate all escrow funds received from a mortgagor
          for ground rents, taxes, assessments, and insurance premiums;
          or
            (ii) to deposit these funds in a special account with a
          depository institution whose accounts are insured by the
          Federal Deposit Insurance Corporation through the Deposit
          Insurance Fund, or by the National Credit Union
          Administration.

          (C) Use of escrow funds for any purpose other than that for
        which they were received.
          (D) Submission to the Secretary of information that was
        false, in connection with any mortgage insured under this
        chapter, or any loan that is covered by a contract of insurance
        under subchapter I of this chapter.
          (E) With respect to an officer, director, principal, or
        employee - 
            (i) hiring such an individual whose duties will involve,
          directly or indirectly, programs administered by the
          Secretary, while that person was under suspension or
          withdrawal by the Secretary; or
            (ii) retaining in employment such an individual who
          continues to be involved, directly or indirectly, in programs
          administered by the Secretary, while that person was under
          suspension or withdrawal by the Secretary.

          (F) Falsely certifying to the Secretary or submitting to the
        Secretary a false certification by another person or entity.
          (G) Failure to comply with an agreement, certification, or
        condition of approval set forth on, or applicable to - 
            (i) the application of a mortgagee or lender for approval
          by the Secretary; or
            (ii) the notification by a mortgagee or lender to the
          Secretary concerning establishment of a branch office.

          (H) Violation of any provisions of subchapter I or II of this
        chapter, or any implementing regulation, handbook, or mortgagee
        letter that is issued under this chapter.
          (I) Failure to engage in loss mitigation actions as provided
        in section 1715u(a) of this title.
          (J) Failure to perform a required physical inspection of the
        mortgaged property.
          (K) Violation of section 1708(d) of this title.
          (L) Use of "Federal Housing Administration", "Department of
        Housing and Urban Development", "Government National Mortgage
        Association", "Ginnie Mae", the acronyms "HUD", "FHA", or
        "GNMA", or any official seal or logo of the Department of
        Housing and Urban Development, except as authorized by the
        Secretary.
      (2) Additional violations
        The Secretary may impose a civil money penalty under subsection
      (a) of this section for any knowing and material violation by a
      principal, officer, or employee of a mortgagee or lender, or
      other participants in either an insured mortgage or subchapter I
      loan transaction under this chapter or provision of assistance to
      the borrower in connection with any such loan, including sellers
      of the real estate involved, borrowers, closing agents, title
      companies, real estate agents, mortgage brokers, appraisers, loan
      correspondents, and dealers for - 
          (A) submission to the Secretary of information that was
        false, in connection with any mortgage insured under this
        chapter, or any loan that is covered by a contract of insurance
        under subchapter I of this chapter;
          (B) falsely certifying to the Secretary or submitting to the
        Secretary a false certification by another person or entity;
          (C) failure by a loan correspondent or dealer to submit to
        the Secretary information which is required by regulations or
        directives in connection with any loan that is covered by a
        contract of insurance under subchapter I of this chapter; or
          (D) causing or participating in any of the violations set
        forth in paragraph (1) of this subsection.
      (3) Prohibition against misleading use of Federal entity
        designation
        The Secretary may impose a civil money penalty, as adjusted
      from time to time, under subsection (a) for any use of "Federal
      Housing Administration", "Department of Housing and Urban
      Development", "Government National Mortgage Association", "Ginnie
      Mae", the acronyms "HUD", "FHA", or "GNMA", or any official seal
      or logo of the Department of Housing and Urban Development, by
      any person, party, company, firm, partnership, or business,
      including sellers of real estate, closing agents, title
      companies, real estate agents, mortgage brokers, appraisers, loan
      correspondents, and dealers, except as authorized by the
      Secretary.
    (c) Agency procedures
      (1) Establishment
        The Secretary shall establish standards and procedures
      governing the imposition of civil money penalties under
      subsection (a) of this section. These standards and procedures - 
          (A) shall provide for the Secretary to make the determination
        to impose the penalty or to use an administrative entity (such
        as the Mortgagee Review Board, established pursuant to section
        1708(c) of this title) to make the determination;
          (B) shall provide for the imposition of a penalty only after
        the mortgagee or lender or such other person or entity has been
        given an opportunity for a hearing on the record; and
          (C) may provide for review by the Secretary of any
        determination or order, or interlocutory ruling, arising from a
        hearing.
      (2) Final orders
        If no hearing is requested within 15 days of receipt of the
      notice of opportunity for hearing, the imposition of the penalty
      shall constitute a final and unappealable determination. If the
      Secretary reviews the determination or order, the Secretary may
      affirm, modify, or reverse that determination or order. If the
      Secretary does not review the determination or order within 90
      days of the issuance of the determination or order, the
      determination or order shall be final.
      (3) Factors in determining amount of penalty
        In determining the amount of a penalty under subsection (a) of
      this section, consideration shall be given to such factors as the
      gravity of the offense, any history of prior offenses (including
      those before December 15, 1989), ability to pay the penalty,
      injury to the public, benefits received, deterrence of future
      violations, and such other factors as the Secretary may determine
      in regulations to be appropriate.
      (4) Reviewability of imposition of penalty
        The Secretary's determination or order imposing a penalty under
      subsection (a) of this section shall not be subject to review,
      except as provided in subsection (d) of this section.
    (d) Judicial review of agency determination
      (1) In general
        After exhausting all administrative remedies established by the
      Secretary under subsection (c)(1) of this section, a mortgagee or
      lender or such other person or entity against whom the Secretary
      has imposed a civil money penalty under subsection (a) of this
      section may obtain a review of the penalty and such ancillary
      issues (such as any administrative sanctions under 24 C.F.R.
      parts 24 and 25) as may be addressed in the notice of
      determination to impose a penalty under subsection (c)(1)(A) of
      this section in the appropriate court of appeals of the United
      States, by filing in such court, within 20 days after the entry
      of such order or determination, a written petition praying that
      the Secretary's determination or order be modified or be set
      aside in whole or in part.
      (2) Objections not raised in hearing
        The court shall not consider any objection that was not raised
      in the hearing conducted pursuant to subsection (c)(1) of this
      section unless a demonstration is made of extraordinary
      circumstances causing the failure to raise the objection. If any
      party demonstrates to the satisfaction of the court that
      additional evidence not presented at the hearing is material and
      that there were reasonable grounds for the failure to present
      such evidence at the hearing, the court shall remand the matter
      to the Secretary for consideration of the additional evidence.
      (3) Scope of review
        The decisions, findings, and determinations of the Secretary
      shall be reviewed pursuant to section 706 of title 5.
      (4) Order to pay penalty
        Notwithstanding any other provision of law, in any such review,
      the court shall have the power to order payment of the penalty
      imposed by the Secretary.
    (e) Action to collect penalty
      If any mortgagee or lender or such other person or entity fails
    to comply with the Secretary's determination or order imposing a
    civil money penalty under subsection (a) of this section, after the
    determination or order is no longer subject to review as provided
    by subsections (c)(1) and (d) of this section, the Secretary may
    request the Attorney General of the United States to bring an
    action in an appropriate United States district court to obtain a
    monetary judgment against the mortgagee or lender or such other
    person or entity and such other relief as may be available. The
    monetary judgment may, in the court's discretion, include the
    attorneys fees and other expenses incurred by the United States in
    connection with the action. In an action under this subsection, the
    validity and appropriateness of the Secretary's determination or
    order imposing the penalty shall not be subject to review.
    (f) Settlement by Secretary
      The Secretary may compromise, modify, or remit any civil money
    penalty which may be, or has been, imposed under this section.
    (g) "Knowingly" defined
      For purposes of this section, a person acts knowingly when a
    person has actual knowledge of acts or should have known of the
    acts.
    (h) Regulations
      The Secretary shall issue such regulations as the Secretary deems
    appropriate to implement this section.
    (i) Deposit of penalties in insurance funds
      Notwithstanding any other provision of law, all civil money
    penalties collected under this section shall be deposited in the
    appropriate insurance fund or funds established under this chapter,
    as determined by the Secretary.