The Consumer Financial Protection Bureau (CFPB) has sued Rocket Homes, a subsidiary of Rocket Companies, Inc., and Jason Mitchell Group Holding Partners LLC for their roles in an alleged scheme to pressure real estate brokers and agents to not share valuable information with clients and direct homebuyers to do business with Rocket Mortgage and an affiliate company.
According to the CFPB, Rocket offered incentives, such as homebuyer referrals and priority for future homebuyer referrals from the network. In exchange, the brokers and agents referred their clients to Rocket for lending and the affiliate company Amrock for settlement services, such as title, closing and escrow services. Rocket Homes also “required” that the brokers and agents receiving the referrals steer clients away from other competing lenders and prevent brokers and agents from telling clients about other products, such as down payment programs, which were not offered by Rocket.
The Mitchell Group and Jason Mitchell are being accused of participating in the kickback schemes and of encouraging its network of brokers and agents to engage in “coercive tactics” to get consumers to use Rocket Mortgage for their home loans. CFPB claims that Mitchell Group agents were trained to suggest that house settlements could fall through if homebuyers wanted to comparison shop with Rocket competitors.
An investigation by CFPB also found that The Mitchell Group referred thousands of clients to Rocket Mortgage and Amrock. Jason Mitchell offered “Dog Bone” awards of $250 gift cards to agents who made the most referrals to Rocket and Amrock.
“Rocket engaged in a kickback scheme that discouraged homebuyers from comparison shopping and getting the best deal,” said CFPB Director Rohit Chopra. “At a time when homeownership feels out of reach for so many, companies should not illegally block competition in ways that drive up the cost of housing.”
The lawsuit seeks to stop the alleged unlawful conduct, as well as seek financial redress for harmed borrowers and civil penalties.
Both Rocket Homes and The Mitchell Group deny any wrongdoing and have vowed to fight the charges in court.
