On November 4, 2015, the Federal Trade Commission (FTC) announced a new enforcement initiative targeting debt collection companies. The initiative, which is known as “Operation Collection Protection,” involves partnerships with state authorities to investigate debt collectors and prosecute civil and criminal enforcement actions against debt collection companies engaged in illegal…
On November 3, 2015, the Consumer Financial Protection Bureau (CFPB) released its Supervisory Highlights report detailing the Bureau’s supervision efforts for May through August of 2015. The report summarizes the violations of consumer protection laws the Bureau observed during the four-month period and identifies the areas in which the Bureau has…
On October 28, the Consumer Financial Protection Bureau (CFPB) announced that the U.S. District Court for the Northern District of Illinois entered a default judgment and order against affiliated for-profit colleges, resolving a complaint filed by the CFPB on September 16, 2014. The complaint alleged that the colleges provided “consumer financial…
On October 1, 2015, the CFPB announced an enforcement action and consent order with an indirect auto lender for illegal debt collection and other practices. It is alleged that the company’s actions violated the Fair Debt Collection Practices Act, the Truth in Lending Act, and the Dodd-Frank Act. The illegal…
On September 16, the Federal Trade Commission (FTC) announced that it had entered a stipulated order with a debt collection services provider over allegations that the debt collector violated the Federal Trade Commission Act and Fair Debt Collection Practices Act by misrepresenting to payday loan recipients that they were delinquent on their debts, collected millions…
On September 9, the Consumer Financial Protection Bureau (CFPB) announced that it entered into consent orders with two large debt purchasers for alleged violations of the Fair Debt Collection Practices Act, Consumer Financial Protection Act, and Fair Credit Reporting Act. CFPB alleged that the companies purchased debts that they knew or…
In Hart v. FCI Lender Services, Inc., the Second Circuit made it clear that servicers should pay close attention to initial communications with borrowers upon commencing loan servicing when it determined in an August 12, 2015 ruling that FCI Lender Services, Inc.’s (FCI) initial communication with a borrower was not merely…
On July 22, 2015, the Consumer Financial Protection Bureau (“CFPB”) issued a consent order against a national bank and its affiliates for its servicing practices affecting private student loan borrowers. The order asserts that the bank violated various sections of the Consumer Financial Protection Act of 2010 (“CFPA”) and the Fair…
On July 8, 2015, the Federal Trade Commission (FTC) announced that settlements were approved against companies and individuals who allegedly operated a fraudulent debt collection scheme that targeted Spanish-speaking consumers. According to the complaint, the defendants cold called Spanish-speaking consumers nationwide, and falsely held themselves out to be government officials seeking to collect a debt…
On July 8, 2015, New York Attorney General Eric T. Scheiderman announced that a court order was obtained that permanently bars a consumer debt collection agency from operating as a debt collector and further requires payment of $550,000 in consumer restitution, civil penalties, and costs. The order was signed following a…
On June 23, 2015, the Consumer Financial Protection Bureau (CFPB) released its Supervisory Highlights report detailing the Bureau’s supervision efforts for the first four months of 2015. The report summarizes the most common “illegal practices” uncovered by the Bureau and identifies the areas where the Bureau has focused on in its…
On June 18, the Consumer Financial Protection Bureau (CFPB) announced that it had entered into a consent order with a medical debt collection company over allegations that the company’s debt-collection activities violated the Fair Credit Reporting Act (“FCRA”) and the Fair Debt Collection Practices Act (“FDCPA”). The consent order alleged that the company failed…
A national bank can charge an interest rate that exceeds state law maximums, but the bank’s assignee cannot, the U.S. Court of Appeals for the Second Circuit ruled recently, in a decision that could impact the ability of debt purchasers and others to rely on an originating bank’s federal preemption. The…
The Consumer Financial Protection Bureau (“CFPB”) announced that it and the Federal Trade Commission (FTC) entered into a Proposed Consent Order with a national mortgage servicing company over allegations that its loss-mitigation activities violated the Federal Trade Commission Act (“FTCA”), the Consumer Financial Protection Act (“CFPA”), the Fair Debt Collection Practices…
On April 8, 2015, the CFPB announced that it filed a complaint against a group of individuals and companies, alleging that they engaged in a false debt collection scheme targeting consumers in Georgia and New York. After obtaining consumer information from debt brokers and other sources, the group allegedly robo-called…
On March 30, 2015, the Consumer Financial Protection Bureau (“CFPB”) announced that a California-based debt collection agency agreed to settle claims over alleged illegal and deceptive collection practices in violation of the Consumer Financial Protection Act (“CFPA”) and the Fair Debt Collection Practices Act (“FDCPA”). The CFPB alleged in its complaint…
Speculation abounds regarding what the CFPB’s expected 2015 rules regarding first party debt collectors will be. Here’s the background you need to know. On November 12, 2013, the CFPB issued an Advance Notice of Proposed Rulemaking, seeking comments to its proposal to update the Fair Debt Collection Practices Act (“FDCPA”). As…
On December 3, New York governor Andrew Cuomo announced the final version of the state Department of Financial Services (DFS) regulations governing debt collection actions by third-party debt collectors and debt buyers. The regulations contain a number of new requirements for third party debt collectors, including: New / Enhanced Initial…
On November 10, 2014, the Ninth Circuit reversed a district court’s order dismissing and directing to arbitration a putative nationwide class action alleging Telephone Consumer Protection Act (TCPA) violations, finding that the Customer Agreement containing the arbitration clause was unenforceable for lack of mutual assent. Knutson v. Sirius XM Radio…
The U.S. Supreme Court recently declined to review a debt collector’s appeal of the Third Circuit’s decision this summer that debtors were not required to dispute their debt under the Fair Debt Collection Practices Act (FDCPA) before filing suit. The Third Circuit decision reversed a district court’s dismissal of a class…