CFPB Accuses Rocket Homes and Jason Mitchell Group of Illegal Kickback Scheme

The Consumer Financial Protection Bureau (CFPB) is going after Rocket Homes and The Jason Mitchell Group for an alleged kickback scheme. The CFPB claims Rocket Homes offered referrals and other incentives to the group of brokerages in exchange for sending borrowers to real estate settlement services provided by a Rocket affiliate.  

Allegedly, Jason Mitchell gave small rewards, such as $250 gift cards, to agents when referrals were sent to Rocket partners like lender Rocket Mortgage and title company Amrock. Over a five-year period, the real estate broker steered thousands of clients toward Rocket-affiliated companies, according to the CFPB’s investigation.

“Rocket engaged in a kickback scheme that discouraged homebuyers from comparison shopping and getting the best deal,” said CFPB Director Rohit Chopra in a statement. “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.”

Rocket Homes Responds to CFPB Lawsuit

Rocket Homes is also accused of encouraging brokers and agents to “preserve and protect” customer relationships with Rocket Mortgage. The agents were purportedly instructed to conceal information that could dissuade a borrower from using a lender other than Rocket Mortgage. Information about programs not available through Rocket, like down-payment assistance, was purportedly withheld.

The lawsuit claims Rocket Homes even threatened and suspended real estate agents if they did not participate in the scheme. Rocket Homes allegedly demanded at least 80% of homebuyers referred to a real estate firm use Rocket Mortgage to fund the home purchase.

Rocket Homes is standing its ground against the CFPB. The company claims the exact opposite of the government’s accusations, saying it actually encourages customers to seek out information to determine the best program for their situation.

“The CFPB’s allegations are false and a distortion of reality. The accusation that homebuyers paid more when working with Rocket Homes is a lie,” the company stated, per HousingWire. “Additionally, the notion that Rocket Homes penalized real estate brokers or agents for helping clients compare rates and choose the best lender for them is also a lie.”

If the CFPB’s lawsuit is successful, Rocket and Jason Mitchell must immediately stop the kickback scheme. The companies will also pay various fines and penalties, which will go toward the CFPB’s victims relief fund.

The CFPB has been busy going after financial institutions for various violations of federal law. In addition to the case against Rocket Homes and The Jason Mitchell Group, the government watchdog filed a lawsuit against Walmart and fintech company Branch Messenger. The CFPB is accusing Walmart of opening deposit accounts for delivery drivers without consent, while Branch Messenger charged the drivers excessive “junk fees” to use the accounts.