NewDay

Quick summary on NewDay

Misleading Advertising Practices: In 2015, the Consumer Financial Protection Bureau (CFPB) fined NewDay USA $2 million for deceptive advertising. The company falsely claimed endorsements from veterans’ organizations without disclosing financial relationships, misleading consumers about their affiliations.

Cheating Scandal Among Employees: The New York Department of Financial Services (NYDFS) banned NewDay USA from operating in the state and imposed a $1 million penalty due to a cheating scandal. Employees, including senior executives, were involved in dishonest practices related to mandatory continuing education courses and licensing exams.

Widespread Regulatory Violations: The Multi-State Mortgage Committee (MMC) fined NewDay USA $5.28 million for regulatory violations. Investigations revealed employees shared test questions and answers, with compliance staff completing required courses and quizzes on behalf of others, sometimes for compensation.

Involvement of Top Executives in Misconduct: CEO Robert Posner and former COO Paul Alger were directly implicated in the cheating scandal, having their continuing education requirements fulfilled by other employees multiple times, indicating a culture of misconduct at the highest levels.

Questionable Commitment to Veterans: Despite marketing itself as a lender for military families, NewDay USA’s unethical practices suggest a prioritization of profit over the welfare of veterans, raising concerns about the company’s true commitment to those it claims to serve.

Operational Bans in Key Markets: Due to regulatory violations, NewDay USA faced operational bans in significant markets, such as New York, limiting its ability to serve clients and damaging its reputation.