Undisclosed/Secret Commissions

It is common in the presence of a broker, for a commission to be paid by the lender. However, the borrower must be informed of any commission paid and the amount. Where it is not disclosed, it is possible for a claim to be bought against either party. The authority for this originates from the Hurstanger Case. The Court found the mortgage broker breached his fiduciary duty and the lender was an accessory to this breach. The claimant was awarded the commission back plus interest.