For Immediate Release
March 17, 2009
Contact: Kristin Crawford
717-787-4420
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Senate Passes Brubaker’s Mortgage Fraud Legislation

HARRISBURG – The Senate passed two bills today sponsored by Sen. Mike Brubaker (R-36) that will protect consumers from mortgage fraud. 

Senate Bill 170 would prohibit a mortgage broker or originator from being the exclusive recipient of communications to a consumer. The legislation would prevent brokers from withholding information about interest rates, fees or monthly payments, and it would ensure that consumers are informed of the terms of their mortgage. 

Senate Bill 171 would also help to prevent fraud by protecting mortgage company employees that report illegal activities or take part in an investigation, hearing or inquiry. The legislation would prevent an employer from taking actions such as reducing an employee’s salary or benefits, changing the terms of employment, or firing an employee.  

Brubaker introduced the bills in response to the OPFM mortgage scandal that defrauded more than $26 million from Pennsylvania homeowners. Brubaker said that hundreds of Lancaster County homeowners lost millions of dollars due to the mortgage and investment fraud scheme.   

"It is unconscionable for con artists to take advantage of homeowners through this sort of fraud, and the General Assembly must take action to prevent this from happening again," Brubaker said. "I am very pleased that my colleagues have joined me in supporting legislation to protect homeowners, and I am hopeful that the House will take prompt action to send this bill to the governor’s desk in the near future." 

Brubaker said that both bills were drafted with input from the Department of Banking to ensure they offered consumers adequate protection from fraud. 

Both bills will now be sent to the House of Representatives for consideration.