Washington State Fines West Capital Lending $75,000 for Consumer Loan Act Violations

Regulators in Washington state have levied a significant $75,000 penalty against West Capital Lending Inc. (WCL), a mortgage lender, for alleged violations of the state's Consumer Loan Act. This enforcement action, detailed in a consent order dated July 8, resolves allegations previously outlined in a September 2025 statement of charges. The violations encompass a range of serious infractions, including permitting individuals without the requisite state licenses to conduct mortgage-related activities and failing to meet critical disclosure and reporting obligations. In addition to the substantial fine, WCL is mandated to pay a $3,000 investigation fee and adhere to a "cease and desist" order, prohibiting any future violations of the Consumer Loan Act and its associated regulations.

West Capital Lending Inc., a company operating within the mortgage lending sector, did not admit to the allegations or any wrongdoing as part of the settlement agreement. By entering into this consent order, WCL waived its right to a formal hearing and any subsequent administrative or judicial review of the issues raised by the Washington State Department of Financial Institutions (DFI). The company also withdrew its appeal to the state's Office of Administrative Hearings, signaling an end to the formal dispute process.

The allegations stem from a comprehensive statewide examination of WCL's business practices, which took place over an extended period, from May 9, 2022, to March 31, 2024. During this examination, regulators identified several key compliance failures. Notably, the statement of charges indicates that at least one individual acting on behalf of WCL assisted a borrower with a residential mortgage application for a property located in Washington without possessing the required mortgage originator license in the state. This practice directly contravenes licensing requirements designed to protect consumers and ensure professional conduct within the mortgage industry.

Furthermore, regulators claimed that WCL accepted at least one mortgage application for a Washington property before it had secured its state consumer loan license. This suggests a potential disregard for the regulatory framework governing the initiation of lending activities. The examination also revealed that at least six managers who were supervising Washington-licensed mortgage loan officers were themselves not licensed by the state. This raises concerns about the oversight and compliance culture within WCL's management structure.

In addition to personnel licensing issues, the DFI asserted that WCL failed to prepare and maintain at least 34 required supervisory plans. These plans are crucial for ensuring that loan officers operate within legal and ethical boundaries. The initial penalties sought by regulators were subsequently pared back as part of the settlement negotiations. Additional allegations involved the company's surety bond coverage and regulatory reporting, with the department claiming WCL failed to maintain adequate coverage and meet its reporting obligations to the state. The Nationwide Multistate Licensing System (NMLS) is a database used by state mortgage regulators to track licensing information for individuals and companies in the mortgage industry.