On May 4, 2015, Comptroller of the Currency Thomas Curry, Federal Reserve Board (FRB) Governor Daniel Tarullo, and Federal Deposit Insurance Corporation (FDIC) Chairman Martin Gruenberg held the third in a series of outreach meetings to discuss with the public their efforts to reduce the regulatory burden on community banks…
Goodwin Procter’s Consumer Financial Services Enforcement practice today launched Consumer Finance Enforcement Watch, a first-of-its-kind tracking blog to monitor state and federal consumer finance enforcement actions. The blog provides real-time reporting of publicly available enforcement activity taken against consumer financial service companies in key areas, including: mortgage lending and servicing;…
Beginning with its next sale in June 2015, HUD will have new, stricter requirements for entities that purchase distressed loans as part of the Distressed Asset Stabilization Program (“DASP”), a development we initially covered here. Initially conceived as a way to lower losses suffered by the FHA from troubled loans,…
On April 27, 2015, The Supreme Court granted certiorari to review a 9th Circuit decision in the Spokeo, Inc. v. Robins case. In so doing, the Supreme Court will likely resolve an important question of Article III standing: whether violation of a federal statute that confers a private right of action…
Last week, the U.S. House of Representatives passed a Bill that would both more permanently install two advisory boards for the CFPB and cap the Bureau’s future funding. Principally, HR 1195 — the Bureau of Consumer Financial Protection Advisory Board Act — would force the Director to create three advisory…
On April 24, 2015, the U.S. Department of Housing and Urban Development (HUD) announced that it would reform its Distressed Asset Stabilization Program (DASP), requiring purchasers to take stronger steps to ensure that homeowners are given further options to avoid foreclosure. DASP was set up in 2010, to pool distressed…
The mortgage servicing industry remains under scrutiny, as evidenced by the recent joint enforcement action against Green Tree Servicing, LLC by the Consumer Financial Protection Bureau (CFPB) and the Federal Trade Commission (FTC). In a joint complaint filed in Minnesota, the regulators allege that Green Tree, through its collection activities…
An Illinois federal district court held on March 20, 2015 that California law protects T-Mobile from having to turn over the names and addresses of thousands of its California customers without their consent in response to a third-party subpoena in a nationwide class action. The case, Birchmeier v. Caribbean Cruise Line,…
In November 2014, we reported that class action lawsuits were being filed across the country by consumers against large banks regarding their involvement with short term loans. These actions allege that lenders were engaging in unlawful practices relating to online short-term, small dollar – or “payday” – loans, and were…
On March 26, 2015, CFPB Director Richard Cordray announced a proposed outline of changes to payday lending that would vastly alter the current rules and regulations. The new rules would address both short-term and longer-term credit products such as payday loans; deposit advance products; high-cost installment loans; certain other open-end lines…
On March 12, 2015, the Senate Intelligence Committee took an important step in advancing a comprehensive bill titled the Cybersecurity Information Sharing Act of 2015 (“CISA”) aimed at bolstering U.S. companies and the federal government’s cyber security protections. But some privacy watchdogs and other government officials are openly wondering whether…
On March 9, 2015, Consumer Financial Protection Bureau (CFPB) Director Richard Cordray held oral arguments in the first appeal of a CFPB administrative enforcement action. Both counsel for the CFPB and Respondents PHH Mortgage Corporation and Atrium Insurance Corporation appealed to Cordray from the Administrative Law Judge’s (ALJ) Recommended Decision,…
On March 10, 2015, the Consumer Financial Protection Bureau (CFPB) released its Arbitration Study, which concludes that arbitration agreements in contracts associated with consumer financial products constrain consumers’ ability to assert their rights if a dispute arises. The study, which the CFPB was directed to carry out under Section 1028(a)…
On March 3, 2015 CFPB Director Richard Cordray appeared before the House Committee on Financial Services to deliver testimony regarding the Bureau’s work. Director Cordray spent much of his semiannual address touting the Bureau’s efforts in the mortgage space. In his written statement, Director Cordray commented on the Bureau’s Qualified…
The Equal Credit Opportunity Act (ECOA) prohibits discrimination against applicants for credit—but what about guarantors who agree to be responsible for repayment? A federal regulation treats spousal guarantors as “applicants” who can sue under EOCA, but two federal appellate courts disagreed with each other about the question. The Supreme Court agreed on…
On February 24, 2015, Capital One Financial Corporation disclosed in its annual SEC 10-K filing that in early 2015 it had received subpoenas related to the bank’s subprime auto financing and securitization activities from the New Jersey office of the Department of Justice (DOJ) and the New York district attorney’s…
On February 25, the Department of Justice (DOJ) announced that it had reached a settlement with MetLife Home Loans LLC concerning its investigation into MetLife’s origination and underwriting practices of loans insured by the U.S. Department of Housing and Urban Development’s (HUD) Federal Housing Administration (FHA loans). As part of…
As the cyber security threat to the U.S. economy and national security has grown, U.S. states and businesses have taken increasing steps to prevent potential hacks from invading user privacy and U.S. intelligence activities. Most recently, New York’s attorney general, proposed new rules to help safeguard consumer privacy and provide businesses with incentives…
On April 28, 2014, the Supreme Court granted certiorari to decide whether, as held by the Eight Circuit, a borrower must file a lawsuit to exercise and preserve her TILA rescission right within three years of consummating the loan, or whether simply providing written notice of rescission is sufficient to…
State and federal regulation of payday lenders is far from a new phenomenon. Recently, litigation against entities using the “tribal lending” model, and government attempts to suppress certain online lending programs via Operation Chokepoint have put the spotlight back on industry. In past articles, we have noted that the Consumer Financial…