Finance
Under RESPA, a 'kickback' or unearned fee arrangement where a settlement service provider pays a referral fee to someone for steering business to them is:
ALegal if disclosed to the consumer
BProhibited and can result in criminal penalties✓ Correct
CLegal for amounts under $500
DAcceptable if both parties are licensed
Explanation
RESPA Section 8 prohibits kickbacks and unearned fees in connection with federally related mortgage loans. Paying or receiving a thing of value in exchange for referrals of settlement service business is illegal and can result in civil and criminal penalties. Legitimate affiliated business arrangements with full disclosure are allowed.
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