The CFPB ordered RMK Financial Corporation to end its illegalmortgage advertising practices and pay a civil penalty of$250,000.

The bureau claimed that the California-based mortgage lendermailed misleading print advertisements to more than 100,000consumers, which appeared to be from federal governmententities.

RMK Financial Corporation allegedly used the names and logos ofthe Department of Veterans Affairs (VA) and the Federal HousingAdministration (FHA), falsely implying they were endorsed or sentby the VA or FHA. The CFPB said the advertisements were also sentto tens of thousands of veterans and current U.S. military servicemembers.

“Deceptive advertising has no place in the mortgage marketplace,and the Consumer Bureau will continue to take action againstcompanies that mislead consumers with false claims of governmentaffiliation,” CFPB Director Richard Cordray said. “Today's actionsends a clear message that misleading consumers is illegal,unacceptable and will not be tolerated.”

The CFPB found that RMK's practices violated the Truth inLending Act as well as the bureau's Mortgage Acts and PracticesAdvertising Rule, which specifically prohibits deceptive claims inmortgage advertising.

According to the CFPB, RMK claimed its loan products were partof a “distinctive program offered by the U.S. government” andinstructed consumers to call the VA's Interest Rate ReductionDepartment at an RMK phone number. The CFPB also said some of theads included warnings that referenced U.S. Code concerning finesand imprisonment for tampering with the letter.

“RMK's ads also contained misrepresentations about the loans'interest rates and estimated monthly payments, including whetherthe interest rate was fixed or variable,” a CFPB press releasesaid. “Consumers who called the company were sometimes givenmisleading information over the phone; in some cases RMK employeestold callers or implied that RMK was endorsed by the VA orFHA.”