We have a program that pays $25 to every person who sends us a referral is this illegal? They aren’t settlement service providers though.

Yes this would be a violation of RESPA Section 8(a) because the statute states that anyone who refers settlement service business. It does not limit illegal kickbacks or referral arrangements to only settlement service providers. In fact I represented a client in a RESPA enforcement action for just this type of program.

Answered By: Marx Sterbcow