1st Alliance Lending, along with its executives, John Christopher DiIorio, Kevin Robert St. Lawrence, and Socrates Aramburu, are facing a complaint from the CFPB for allegedly engaging in various unlawful mortgage-lending practices.
1st Alliance originated residential mortgages from 2004 to September 2019 and stopped operating in November 2019. DiIorio served as CEO of 1st Alliance. He managed the company along with St. Lawrence and Aramburu.
The CFPB alleges that 1st Alliance, with DiIorio’s, St. Lawrence’s, and Aramburu’s participation, knowledge, and direction, violated the Truth in Lending Act (TILA), the Fair Credit Reporting Act (FCRA), the Equal Credit Opportunity Act (ECOA), the Mortgage Acts and Practices-Advertising Rule (MAP Rule), and the Consumer Financial Protection Act of 2010 (CFPA).
The CFPB’s complaint, which was filed in the U.S. District Court for the District of Connecticut, seeks injunctions against the defendants, as well as damages, redress to consumers, disgorgement of ill-gotten gains, and the imposition of civil money penalties.
The bureau alleges that since at least 2015, in the course of its mortgage-lending business, 1st Alliance used unlicensed employees to engage in mortgage-origination activities and interactions with consumers that required them to be licensed under state law, in violation of TILA and Regulation Z, its implementing regulation.
The CFPB further alleges that 1st Alliance’s use of unqualified sales employees to deprive consumers of critical, accurate, and timely loan information was unfair.
The bureau also alleges that 1st Alliance violated Regulation Z by requiring consumers to submit documents verifying information relating to the consumer’s residential-mortgage-loan application before providing them a Loan Estimate.
The CFPB alleges that during this same period, 1st Alliance employees denied credit to consumers based on information in their consumer report or in response to their application but did not give consumers the “adverse action” notice required under FCRA and ECOA.
The bureau also alleges that 1st Alliance representatives repeatedly engaged in misleading representations, omissions, or practices toward consumers. These included misrepresentations, omissions, or practices concerning whether 1st Alliance’s employees were licensed mortgage-loan originators, whether the consumer had been preapproved or guaranteed for a particular program or term, and whether and on what terms the consumer was likely to obtain refinancing, in violation of the MAP Rule and CFPA.