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Tag Archives: Enforcement Actions

FDIC Action Is a Reminder that Bank Partnerships Are Not a Panacea for Non-Banks

Posted in Enforcement Actions, UDAAP

On May 11, 2017, the FDIC announced that it had reached settlements with Bank of Lake Mills and two of its “institution-affiliated parties””—Freedom Stores, Inc. and Military Credit Services, LLC—for allegedly engaging in unfair and deceptive practices in violation of Section 5 of the FTC Act. Read our client alert.

Court Finds CFPB Case Against Payment Processor Lacking

Posted in CFPB, Enforcement Actions, UDAAP

On March 17, 2017 the United States District Court for the District of North Dakota granted the motion of Intercept Corporation and its senior executives to dismiss the complaint filed almost a year ago by the CFPB. Intercept is a payment processor that initiates ACH transactions to consumer accounts on behalf of its merchant-customers. This… Read More

Financial Services Report – Winter 2016

Posted in Arbitration, Auto Lending, CFPB, Credit Cards, Disparate Impact, Electronic Payments, Enforcement Actions, Fair Lending, Foreclosure, Military Issues, Mobile Payments, Mortgage, Payday Lending, Preemption, Privacy, Regulatory Developments, State Regulators, UDAAP

Hope you survived all of those awkward Thanksgiving holiday conversations—amazing how divided people are on whether the court got it right in the PHH case, isn’t it? So on we go into the holiday season, while visions of Dodd-Frank repeal dance in our heads. No long winter’s nap for the CFPB, not with the inauguration… Read More

CFPB and California Announce Enforcement Actions Against Online Lender

Posted in CFPB, Enforcement Actions

On Tuesday, September 27, 2016, the CFPB and the California Department of Business Oversight (“DBO”) announced separate enforcement actions against Flurish, Inc., an online lender that does business as “LendUp” in California and two dozen other states. LendUp agreed to pay, collectively, $3.43 million in restitution to consumers and $2.8 million in civil money penalties… Read More

CFPB Levies Largest Civil Money Penalty in Agency History, Alleges “Abusive” Conduct

Posted in CFPB, Credit Cards, Enforcement Actions

On September 8, 2016, the CFPB, the OCC, and the City and County of Los Angeles entered into a Consent Order with Wells Fargo, with civil money penalties totaling $185 million. The CFPB’s portion of those penalties is $100 million, which is the largest fine the Bureau has imposed since opening its doors in July… Read More

CFPB Relies on “Mystery Shoppers” in BancorpSouth Mortgage Discrimination Settlement

Posted in CFPB, Disparate Impact, Enforcement Actions, Fair Lending, Mortgage

CFPB “mystery shoppers,” along with secret recordings, were part of the CFPB’s factual allegations in a recent mortgage discrimination settlement. The DOJ and CFPB announced a settlement with BancorpSouth Bank to resolve alleged violations of the Fair Housing Act and Equal Credit Opportunity Act (ECOA). The complaint alleges that from at least 2011 to 2013,… Read More

ACH Debit Transactions – Whose Agent Are You?

Posted in CFPB, Enforcement Actions, UDAAP

Tucked away in a seeming innocuous paragraph in a complaint, the CFPB has asserted an extraordinary and potentially far-reaching expansion of its authority. On June 6, 2016, the CFPB filed an action in a U.S. district court asserting that Intercept Corporation (Intercept) (and each of its owners) engaged in unfair acts and practices in violation… Read More

CFPB Suffers First Official CID Challenge

Posted in CFPB, Enforcement Actions

On April 21, 2016, Judge Richard J. Leon of the United States District Court for the District of Columbia ruled on the first judicial challenge to the Consumer Financial Protection Bureau’s (“CFPB,” or “Bureau”) authority to issue and enforce a civil investigative demand (“CID”). The Bureau had issued to the Accrediting Council for Independent Colleges… Read More

Is the CFPB the New Cop on the Data Security Beat?

Posted in CFPB, Enforcement Actions, Privacy, UDAAP

On March 2, 2016, the Consumer Financial Protection Bureau (“CFPB”) broke new ground (at least for the CFPB) when it released a consent order against Dwolla, Inc., an online payment platform, regarding data security. While in many respects the data security “message” sent by the CFPB is not a new one (e.g., companies must live up to… Read More

CFPB Argues Statute of Limitations Not Applicable in Certain UDAAP Actions

Posted in CFPB, Enforcement Actions, Mortgage, UDAAP

On January 15, 2016, the CFPB filed a brief opposing a motion to dismiss in the Matter of Integrity Advance, LLC (“Integrity”) asserting that there is no time bar for certain CFPB actions under its UDAAP authority.  The CFPB’s argument cites its own RESPA enforcement action, which is currently on appeal, in contending that the… Read More

EVENT: ACI’s 14th National Forum on Prepaid Card Compliance

Posted in CFPB, Enforcement Actions, Events

Thursday, January 28, 2016 8:05 a.m. – 9:20 a.m. Mandarin Oriental 1330 Maryland Avenue SW Washington, D.C. 20024 Morrison & Foerster partner Obrea Poindexter is speaking on the “An In-Depth Analysis of the CFPB’s Proposed Rule for Prepaid Cards, Assessment of What the Final Rule Will Look Like, and an Analysis of Recent CFPB Enforcement… Read More

Big Data, Big Deal

Posted in Disparate Impact, Enforcement Actions, Privacy

The FTC rang in the New Year with a report, Big Data: A Tool for Inclusion or Exclusion? Understanding the Issues. The report wrestles with the implications of using big data analytics to target and make decisions about customers. Some of the FTC’s observations are common sense, but others require more careful analysis. For example,… Read More

Higher One, Inc. Enforcement Actions Remind Nonbank Service Providers of Their Legal Obligations When Partnering With Banks

Posted in CFPB, Enforcement Actions, UDAAP

On December 23, 2015, the Federal Reserve Board (“Federal Reserve”) and the Federal Deposit Insurance Corp. (“FDIC” and, collectively with the Federal Reserve, the “Agencies”) announced settlements with Higher One, Inc. (“Higher One”) for alleged violations of the prohibition against deceptive acts and practices under Section 5 of the Federal Trade Commission Act. In conjunction… Read More

CFPB Takes Action Against Lead Aggregators

Posted in CFPB, Enforcement Actions

On December 17, 2015, the Consumer Financial Protection Bureau (“CFPB”) announced that it has taken action against lead aggregators that resold sensitive personal information to lenders and debt collectors. In a complaint against T3Leads and a consent order against a sole proprietorship (“Lead Publisher”), the CFPB alleged that the lead aggregators exposed millions of consumers… Read More

#ThrowbackThursday: CFPB as HUD: Another Section 8 Consent Order Displays CFPB’s RESPA Approach

Posted in CFPB, Enforcement Actions, Mortgage

In October 2014, Morrison & Foerster published the client alert “CFPB as HUD: Another Section 8 Consent Order Displays CFPB’s RESPA Approach.” Summary: In a recent RESPA enforcement action, the CFPB  negotiated a consent order with Lighthouse Title, Inc. (“Lighthouse”) for alleged violations of RESPA’s prohibition against kickbacks. RESPA Section 8(a) and its implementing regulation,… Read More

CFPB’s Message to Employment Background Screening Providers: A Rose by Any Other Middle Name is Probably the Wrong Person

Posted in CFPB, Enforcement Actions

On October 29, the CFPB took action against two of the country’s largest employment background screening report providers for violations of the FCRA. This is one of the CFPB’s most significant FCRA actions to date, following a relatively small number of FCRA consent orders by the CFPB over the past few years. The providers are… Read More

#ThrowbackThursday: FTC Comments on the CFPB’s Foray into Mobile Financial Services, Emphasizing Its Extensive Consumer Protection Efforts in the Space, Including Enforcement Actions

Posted in CFPB, Enforcement Actions, Mobile Payments

In September 2014, Morrison & Foerster published the client alert “FTC Comments on the CFPB’s Foray into Mobile Financial Services, Emphasizing Its Extensive Consumer Protection Efforts in the Space, Including Enforcement Actions.” Summary: Earlier this month, the Bureau of Consumer Protection of the FTC submitted comments to the CFPB in response to the CFPB’s June… Read More

#ThrowbackThursday: How to Be a Good Corporate Citizen CFPB Style

Posted in CFPB, Enforcement Actions

In July 2013, Morrison & Foerster published the client alert “How to Be a Good Corporate Citizen CFPB Style.” Summary: On June 25, 2013, CFPB issued Bulletin 2013-06 identifying “responsible business conduct” that may impact the exercise of its “enforcement discretion.” The Bulletin specifies the following four broad categories of conduct that the CFPB “may… Read More

EVENT: Financial Services Regulatory and Enforcement Current Issues

Posted in Enforcement Actions, Events, Regulatory Developments

Friday, November 6, 2015 08:00 AM-02:15 PM Eastern Speakers: Oliver Ireland, Jay Baris, Obrea Poindexter, Anna Pinedo, Remmelt Reigersman, Sean Ruff, James Schwartz and Julian Hammar Join us for our half-day briefing on emerging issues. 8:15 a.m. – Living with the Volcker Rule; 9:00 a.m. – Liquid alternative investments: what to expect from the SEC;… Read More

CFPB Orders Auto Financer to Pay $48.3M for Misleading Borrowers

Posted in CFPB, Enforcement Actions, Indirect Auto Lending, UDAAP

On September 30, 2015, the CFPB ordered an indirect auto lending company and its auto lending subsidiary to pay $48.3 million in fines for alleged FDCPA, TILA, and UDAAP violations. The CFPB alleges that the companies manipulated borrowers by using phony caller ID information and lying about imminent repossession or criminal charges in order to… Read More

#ThrowbackThursday: The CFPB Targets Mortgage Reinsurance Yet Again

Posted in CFPB, Enforcement Actions, Mortgage

In February 2014, Morrison & Foerster published the client alert “The CFPB Targets Mortgage Reinsurance Yet Again.” Summary: The Consumer Financial Protection Bureau filed an administrative enforcement action against PHH Corporation, alleging a nearly 15-year “mortgage insurance kickback scheme” by its mortgage origination and reinsurance subsidiaries involving “hundreds of millions of dollars” in allegedly improper… Read More

One-Two Punch: CFPB Indirect Auto and Add-On Product Orders

Posted in Auto Lending, CFPB, Credit Cards, Enforcement Actions

The CFPB announced two new enforcement action settlements on September 28: one for alleged discriminatory auto loan pricing and the other for alleged deceptive credit card add-on product marketing practices. Indirect Auto Settlement: The joint CFPB and DOJ auto-lending enforcement action continues the Bureau’s campaign to regulate auto dealer markups via lender enforcement actions. In… Read More

CFPB Brings Long-Anticipated First Redlining Enforcement Action – New Approach to Redlining Analysis Is Put into Action

Posted in CFPB, Enforcement Actions, Fair Lending, Mortgage

On September 24, 2015, the CFPB and DOJ announced a joint action against Hudson City Savings Bank for allegedly discriminatory redlining practices from 2009 through 2013 in certain neighborhoods in New York, New Jersey, Connecticut, and Pennsylvania in violation of the Equal Credit Opportunity Act and the Fair Housing Act. Over the past few months,… Read More