On July 7, 2023, the Consumer Financial Protection Bureau (CFPB), U.S. Department of Health and Human Services (DOH), and U.S. Department of Treasury (DOT) initiated a public inquiry into certain financial products, such as medical credit cards and installment loans that the CFPB characterized as “high-cos specialty products.” The CFPB,…
In the six months since New York’s governor signed the Foreclosure Abuse Prevention Act, L. 2022, ch. 821 (eff. Dec. 30, 2022) (FAPA), a split has emerged about whether the law applies retroactively. FAPA strictly cabins the time limits for commencing mortgage foreclosures by amending five New York procedural rules…
On July 1, 2023, the New Jersey Division of Consumer Affairs, Office of Consumer Protection (Division) entered into a consent order with a national mortgage servicer. According to the Division’s press release, the company, which was formerly licensed in New Jersey before relocating to Florida, had violated the state’s consumer protection laws in…
On June 21, 2023, the Office of the Comptroller of the Currency (OCC), Treasury, Board of Governors of the Federal Reserve System (Board), Federal Deposit Insurance Corporation (FDIC), National Credit Union Administration (NCUA), Consumer Financial Protection Bureau (CFPB), and Federal Housing Finance Agency (FHFA) (collectively, the “Agencies”) published a proposed…
On June 12, 2023, an Eleventh Circuit panel issued an opinion affirming a sanctions order against the Consumer Financial Protection Bureau (CFPB) premised on the CFPB’s “derail[ment]” of multiple depositions in contravention of the district court’s instructions. See Consumer Financial Protection Bureau v. Brown, Case 21-14468 (11th Cir. June 12,…
On June 6, 2023, the Consumer Financial Protection Bureau (CFPB) issued a Spotlight on financial institutions’ growing use of “chatbots” as a means to provide cost-effective customer service. The use of chatbots in customer service has been gaining popularity among financial institutions in recent years. The ten largest commercial banks…
On May 30, 2023, the Federal Trade Commission (FTC) announced that it had finalized a consent order with one of the nation’s largest credit and debit card providers in an administrative action regarding alleged violations of the Electronic Funds Transfer Act (EFTA), as amended, 15 U.S.C. § 1693o-2, and its implementing regulation,…
On May 31, 2023, the Consumer Financial Protection Bureau (CFPB) announced that it had entered into a consent order with an Indiana-based non-bank installment lender. The consent order alleges that the lender engaged in unfair, deceptive, and abusive acts or practices concerning the “marketing, sales, and financing of optional ancillary products” that it offered. Specifically, the…
On May 31, 2023, the United States Department of Justice (DOJ), announced that it had entered into a settlement with a Philadelphia based bank and trust company over allegations that the bank had engaged in unlawful redlining in the Philadelphia metropolitan area. In the Complaint, filed contemporaneously with the consent order in U.S. District Court for the…
On January 26, 2023, the Massachusetts Division of Banks (DOB) entered into a consent order with a California-based mortgage lender. According to the DOB, the company, which was licensed as a mortgage lender in Massachusetts, had allowed a separate company to use its government issued mortgage license number, which could mislead consumers into…
On Monday May 10, 2023, the Consumer Financial Protection Bureau (CFPB or the Bureau) released a circular regarding the Bureau’s newest guidance that if a “financial institution unilaterally reopens [deposit] accounts to process debits or deposits, it can constitute an unfair practice under the [Consumer Financial Protection Act of 2012]…
On May 15, 2023, the Pennsylvania Attorney General (PA AG) announced that it reached a $11.4 million settlement with a rent-to-own lender and its affiliates. This settlement resolves a lawsuit filed by the PA AG in Pennsylvania state court in which the PA AG alleged that the lender violated state law by misrepresenting the terms of its rental-purchase agreements…
On May 4, 2023, the CFPB issued a report titled Medical Credit Cards and Financing Plans (the “Report”) that summarized the new developments in medical financing and the associated risks with these products. The Report complements the CFPB’s April 26, 2023 report that analyzed a sample of final medical collection…
On May 8, 2023 the FTC announced that it filed complaints against two loan forgiveness and debt relief companies on April 24, 2023 alleging that they falsely claimed to be affiliated with the Department of Education. The companies allegedly told students that certain fee payments would count toward repayment programs and student…
On May 5, 2023, the CFPB announced it would be sending $22.3 million in refund checks to consumers who lost money in credit card relief schemes. The CFPB sent 6,523 refund checks to damaged consumers. The relief is part of a settlement the CFPB reached with a Maryland-based debt-relief and credit-repair…
On May 1, 2023, the Consumer Financial Protection Bureau (CFPB) issued a report and a proposed rule to clarify and strengthen its regulation of so-called Property Assessed Clean Energy (PACE) financing. PACE. PACE financing is home improvement financing secured by a tax lien, rather than a mortgage. See 15 U.S.C. 1639C(b)(3)(C)(i)….
Last fall, the United States Court of Appeals for the Fifth Circuit found that the CFPB’s independent funding through the Federal Reserve was in violation of the Appropriations Clause and the underlying separation of powers principles. Community Financial Services Ass’n of America, Ltd. v. CFPB, 51 F.4th 616 (5th Circ….
On April 3, 2023, the Consumer Financial Protection Bureau (CFPB) filed a notice to appeal a district court’s decision to dismiss its complaint against Townstone Finance, Inc. (Townstone), a nonbank mortgage lender, and its owner Barry Sturner, for allegedly violating the Equal Credit Opportunity Act (ECOA). Relying on the language…
On Tuesday, April 11, 2023, a three-judge panel of the United States Court of Appeals for the Third Circuit affirmed the dismissal of a putative class action alleging that JP Morgan Chase Bank, N.A. (Chase) failed to itemize annual fees on its credit card renewal notices in violation of the…
On April 3, 2023, the Consumer Financial Protection Bureau (CFPB) issued a policy statement with guidance on what constitutes “abusive conduct” under the Consumer Financial Protection Act (CFPA). The CFPA, enacted in 2010 in response to the financial crisis, prohibits “abusive conduct” in consumer financial markets and identifies two categories…