On February 6, 2020, the Consumer Financial Protection Bureau published a Statement of Policy Regarding Prohibition on Abusive Acts or Practices to “convey and foster greater certainty” regarding how it will apply the “abusiveness” standard in exercising its sweeping UDAAP authority under the Dodd-Frank Act. This is a welcome move by the Bureau, which previously… Read More
On September 6, 2017, the CFPB announced that it has taken action against an online lead aggregator. The allegations revolved around the company’s selling personal information of consumers who were interested in small-dollar or installment loans to online lenders. It was alleged that the loans ultimately offered to consumers were, or were likely to be, void… Read More
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.
On April 27, 2017, the CFPB filed a complaint in a federal district court in Illinois against four online tribal-affiliated lenders alleging that the lenders violated the Truth in Lending Act, and engaged in unfair, deceptive, or abusive acts or practices. The CFPB is seeking injunctive relief and damages against the online lenders. Read our… Read More
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
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
Given the outcome of the presidential election, the focus is now on President-Elect Trump’s campaign promises to scale back the Dodd-Frank Act and pursue deregulation of financial services. As of now, little is known about specific actions the new administration will pursue after inauguration. There is, however, a template for reform, namely, the Financial Creating… Read More
On August 3, 2016, the Federal Trade Commission (FTC) released two items in connection with its series of events on the implications of FinTech for consumers. First, the FTC announced it will be hosting the next event in the FinTech Forum series on October 26, 2016. The event will address crowdfunding and peer-to-peer payments. Second,… Read More
On July 28, 2016, the CFPB issued its outline of proposals under consideration for the regulation of debt collection. This 117-page release, entitled “Small Business Review Panel for Debt Collector and Debt Buyer Rulemaking: Outline of Proposals Under Consideration and Alternatives Considered” (“Outline”), was announced in connection with the CFPB’s field hearing on debt collection… Read More
As we previously reported in our June 3, 2016 client alert, the CFPB has issued a Notice of Proposed Rulemaking for short-term loans. In this follow-up alert, we take a closer look at the Proposed Rule and its implications for consumer lending generally. Although the Proposed Rule is often characterized as a “payday loan rule,”… Read More
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
On June 2, 2016, the CFPB released its long-anticipated Notice of Proposed Rulemaking (“Proposed Rule”) on short-term lending. Although the rulemaking has been characterized as the “payday loan rule,” it is sweeping in terms of the products covered and the limitations it would impose on the short-term consumer lending industry generally. The Proposed Rule is… Read More
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
The Consumer Financial Protection Bureau’s (CFPB) exercise of its sweeping authority to prohibit unfair, deceptive, and abusive acts or practices (UDAAP) continues to command the attention of financial institutions and financial services companies regulated by the agency. As promised by CFPB Director Richard Cordray, the CFPB has defined UDAAP primarily through enforcement actions, along with… Read More
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
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
December 3, 2015 1:00 pm – 2:30 pm EST Morrison & Foerster partners Nancy Thomas and Angela Kleine will speak on the “Consumer Protection Provisions in the Dodd-Frank Act: Adjusting to the New Paradigm” Lorman webinar on December 3. Click here to register.
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
In June 2014, Morrison & Foerster published the client alert, “CFPB & DOJ Consent Orders with Former GE Capital Retail Bank: Something Old and Something New.” Summary: Yesterday, the CFPB announced a $225 million settlement of two major credit card enforcement matters with Synchrony Bank, formerly known as GE Capital Retail Bank. First, the “Add-On… Read More
The CFPB, OCC and FDIC (“the regulators”) took action on August 12, 2015 against three banks in the Citizens Bank corporate family, resulting in $11 million in required restitution and a total of $20.5 million in federal civil money penalties. The action, described in the Consent Order, is based on the unfairness and deceptiveness provisions… Read More
In July 2014, Morrison & Foerster partners Nancy Thomas and David Fioccola and associate Jessica Kaufman authored the client alert “The CFPB’s Most Recent Consent Order: Defining ‘Abusive’ Acts and Practices Through Enforcement.” To read the alert, click here.
The CFPB’s exercise of its sweeping authority to prohibit unfair, deceptive, and abusive acts or practices (UDAAP) continues to command the attention of financial institutions and financial services companies regulated by the agency. As promised by CFPB Director Richard Cordray, the CFPB has defined UDAAP primarily through enforcement actions, along with a few agency-issued supervisory… Read More
On Wednesday, July 29, 2015, the Fed is hosting a free webinar on “Common Violations and Hot Topics.” Senior staff will cover areas of common and/or substantive concern—including HMDA, ECOA (with a focus on spousal signatures), UDAAP, and the Flood Disaster Protection Act—and conduct a Q&A with participants. Registration is required.
On Wednesday, July 8, the CFPB announced its latest — and largest — settlement of claims of unfair and deceptive debt collection practices. The OCC and 47 State Attorneys General all were part of the overall settlement. The numbers are significant: $50 million in restitution and $166 million in penalties. The injunctive relief is extensive,… Read More