Two companies split a $600 settlement charge evenly. One did all the work; the other supplied the referral. The parties argue the split is a private commercial matter. Does that hold?
Correct Answer
A) Pay only for actual, necessary, distinct services performed
Why this is correct: The most accurate response is based on 12 CFR 1024.14(g), which permits compensation to a settlement service provider only for "services actually performed." The core requirement is that any payment must be for actual, necessary, and distinct work. A request for payment for a task not performed directly violates this rule. Why the other choices are wrong: "Use the supervisory exam response as a reason to postpone the required compliance step" is wrong because exam findings do not justify postponing compliance with clear rules. "Skip the rule because the supervisory exam response appears routine" is wrong because no rule can be skipped based on perceived routine. "Assume professional conduct is outside compliance review because no fee has been charged yet" is wrong because the request itself triggers the need for compliant handling; professional conduct is integral to compliance. Exam tip: RESPA's "services actually performed" rule is a key defense against disguised kickbacks. Always verify the service was real.
Why This Is the Correct Answer
The correct response is "Pay only for actual, necessary, distinct services performed". The ethical and legal distinction is payment for real services, not a label or customary amount.
Why the Other Options Are Wrong
Option B: Use the supervisory exam response as a reason to postpone the required compliance step.
Use the supervisory exam response as a reason to postpone the required compliance step. is not correct because it bypasses the rule supported by the explanation.
Option C: Skip the rule because the supervisory exam response appears routine.
Skip the rule because the supervisory exam response appears routine. is not correct because it bypasses the rule supported by the explanation.
Option D: Assume professional conduct is outside compliance review because no fee has been charged yet.
Assume professional conduct is outside compliance review because no fee has been charged yet. is not correct because it bypasses the rule supported by the explanation.
Memory Technique
For RESPA fee questions, ask what service was actually performed.
Exam Tip
For RESPA fee questions, ask what service was actually performed.
Common Mistakes to Avoid
- -Renaming an unearned fee does not make it earned.
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