On November 20, the Consumer Financial Protection Bureau (CFPB) announced a settlement with a Texas-based financial services company, resolving allegations that the company violated sections 1031 and 1036 of the Consumer Financial Protection Act of 2010 (CFPA), 12 U.S.C. §§ 5531, 5536. Specifically, the CFPB alleged that the company engaged in deceptive…
On November 2, 2018, the United States Attorney for the Southern District of New York announced a settlement with a New York based credit union, resolving allegations that the credit union had illegally repossessed cars owned by servicemembers on active duty in violation of the Servicemembers Civil Relief Act, 50 U.S.C. § 3952 (“SCRA”). Under…
On July 19, 2018, the Consumer Financial Protection Bureau (CFPB) announced that it had entered into a consent order with a lender and its subsidiaries, resolving allegations that the company violated the Consumer Financial Protection Act (CFPA) and Truth in Lending Act (TILA). The lender and its subsidiaries are financial services companies…
One month after the U.S. Senate and U.S. House of Representatives voted to repeal of the Consumer Financial Protection Bureau’s (CFPB’s) indirect auto lending guidance under a Congressional Review Act challenge, President Trump signed the resolution to make the repeal official on May 21, 2018. The guidance, which Congress and the President have…
On April 17, 2018, U.S. Senate Majority Leader Mitch McConnell (R-KY) announced that the Senate would seek to repeal the Consumer Financial Protection Bureau’s (CFPB’s) indirect auto lending guidance. The Senate passed a joint resolution of disapproval under the Congressional Review Act (CRA) on the following day, thereby sending the resolution…
On April 20, 2018, the Consumer Financial Protection Bureau (CFPB) and Office of the Comptroller of the Currency (OCC) each announced settlements totaling $1 billion with a national bank resulting from a coordinated action between the two agencies. The OCC found that deficiencies in the bank’s enterprise-wide compliance risk management program…
On March 28, 2018, the Department of Justice (“DOJ”) announced it had filed a lawsuit in the Central District of California against an auto lender for allegedy repossessing the vehicles of members of the armed forces protected by the Servicemembers Civil Relief Act (“SCRA”), 50 U.S.C. § 3952. According to the complaint,…
On February 22, 2018, the Department of Justice (“DOJ”) announced that it had entered into a settlement with an auto financial services company for alleged violations of the Servicemembers Civil Relief Act (“SCRA”), 50 U.S.C. § 3955(f) relating to upfront leases. In its complaint, filed the same day in the United States District…
The Congressional Review Act (CRA) provides Congress with oversight over administrative rulemaking, providing it with a veto of sorts over rulemaking with which it disagrees. For an agency rule to become effective, the agency must submit a report to Congress describing the rule. Congress then has 60 days to issue…
The Consumer Financial Protection Bureau (CFPB) released its quarterly report on credit trends for the third quarter of 2017 last week, focusing on trends in the auto lending industry. Auto loans are a key sector in the lending market—approximately100 million auto loans are outstanding, valued at more than $1 trillion….
On September 27, the U.S. Department of Justice (“DOJ”) announced that it had entered into a $760,000 settlement with two affiliated auto finance companies stemming from allegations that the companies violated the Servicemembers Civil Relief Act (“SCRA”), 50 U.S.C. § 3901, et seq., by failing to obtain court orders prior to repossessing vehicles owned…
On September 18, 2017, the Department of Justice (“DOJ”) announced that it had entered into a $907,000 settlement with an auto loan lender and servicer (“Defendant”). In its complaint, filed the same day in the United States District Court for the Northern District of Texas, the DOJ alleged that the Defendant had…
On May 25, 2017, Massachusetts Attorney General Maura Healey (“Massachusetts AG”) announced a final judgment and permanent injunction entered in Suffolk Superior Court against an unlicensed online auto title lender, permanently banning the company from operating in Massachusetts and voiding over 200 loans made by the company to Massachusetts borrowers. The judgment also prohibits…
On May 8, 2017, the North Carolina Attorney General (“NC AG”) announced that it had obtained a final judgment against an auto title lender and two of its employees in North Carolina State Court. The NC AG alleged that the lender solicited loans online, and required consumers to secure the loans with their vehicle titles. If…
On April 26, 2017, the Consumer Finance Protection Bureau (CFPB) announced that it reached a consent order with an Ohio-based auto lender that allegedly violated a prior CFPB consent order by failing to properly return $1 million in refunds and credits to its customers. According to the CFPB, the auto lender specializes in auto loans to servicemembers. Under…
On March 29, 2017, the Massachusetts and Delaware Attorney Generals (“AGs”) announced settlements with a national bank, resolving allegations that the bank originated unfair and usurious automobile loans in violation of Massachusetts and Delaware consumer protection law. According to the AGs, the bank originated subprime loans to more than 2,000 Massachusetts and Delaware…
On March 24, 2017, the Massachusetts Commissioner of Banks (“Commissioner”) entered into a consent order with a licensed motor vehicle sales finance company, agreeing to refrain from further violations of Massachusetts state law governing the conduct of motor vehicle sales financing. The consent order came after the Commissioner examined the company and subsequently issued a…
On March 14, 2017, the Federal Trade Commission (FTC) announced that it would settle its charges against a Los Angeles-based automotive group for deceptive and unfair sales and financing practices, with the auto group agreeing to pay more than $3.6 million for return to customers. The FTC charged the auto…
On December 17, 2016, the Arkansas Attorney General’s Office (“Arkansas AG”) announced that it had filed a lawsuit against affiliated auto dealerships for violations of the Arkansas Deceptive Trade Practices Act. The Arkansas AG alleged that these auto dealerships would submit loan applications to third-party lenders, who would then deposit…
On November 30, 2016, the Colorado Attorney General’s Office announced that it had secured a judgment in Colorado state court against affiliated lenders who operated an illegal auto title loan scheme. The companies allegedly used fictitious names in extending credit services, and allegedly charged consumers usurious interest rates for personal…