Why does this practice not constitute payment of an illegal kickback and therefore violate RESPA?

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The Department of Housing and Urban Development (HUD), in its regulatory comments on proposed RESPA regulations in 1996, stated that it was not taking a position at that time on referral fees in affinity and relocation relationships. Ironically, the practice would violate RESPA if there was any common ownership between affiliated entities in what most of us still call “controlled business arrangements.” As we all know, there are strong political lobby interests, including NAR, on the side of limiting the reach of RESPA. In the association’s view, RESPA could easily be interpreted to prohibit the common practice of paying referral fees as part of an affinity group or due to a referral from a relocation company.

Source: TAR

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