On October 28, 2024, the Ninth Circuit struck a mass arbitration agreement as unconscionable and unenforceable under California law in Heckman v. Live Nation Ent., Inc., No. 23-55770. The three-judge panel affirmed the district court’s decision holding that the arbitration agreement’s delegation clause was unconscionable under California law. The panel…
On October 31, 2024, the CFPB announced that it had entered into a consent order with a credit union, resolving allegations that the union had ineffectively rolled out a new online banking platform that left consumers without adequate access to basic banking functions, and thereby inflicted financial harm. In May 2022, the credit union attempted to launch…
On October 23, 2024, the CFPB announced that it had entered into separate consent orders with a large tech company and a bank over a joint credit card venture. The CFPB alleges that the credit card, which combined the tech company’s software with the credit-backing of the bank, was launched prematurely, which…
On October 21, 2024, Minnesota Attorney General Keith Ellison announced that his office reached a settlement with two debt settlement companies to resolve allegations that the companies misrepresented their services and collected fees in exchange for promises of settling consumers’ debts before actually performing the promised services, in violation of state law Minn. Stat. §…
On October 21, 2024, Connecticut Attorney General William Tong announced a settlement with a banking fraud prevention company (the Company), resolving allegations related to a data breach that impacted the personal information of a Connecticut Bank’s customers. The Company uses behavioral analytics and machine learning to help prevent banking fraud for its…
On October 15, 2024 the CFPB and DOJ announced they had jointly filed a complaint and consent order against a mortgage company over allegations of racial discrimination in Birmingham, Alabama. The joint complaint alleged that the company engaged in unlawful discrimination by “redlining majority-Black and high-Black areas in Birmingham” and engaging in acts that would discourage applicants…
In September 2024, the CFPB announced the launch of a public comment process for the first application for open banking standard setter recognition, marking an important step towards establishing rules for open banking in the US. This development comes in the wake of the CFPB’s June 2024 announcement identifying five…
On October 7, 2024, alongside its Fall 2024 Supervisory Highlights, the CFPB summarized its other recent supervision activity related to illegal practices undertaken by auto lenders and auto loan servicers. Add-On Products: The CFPB examiners flagged several alleged issues in how add-on products were treated by auto-lenders. First, the CFPB found…
In recent discussions surrounding banking practices, the issue of overdraft fees, particularly for ATM and one-time debit card transactions, has gained significant attention. On September 17, 2024, the Consumer Financial Protection Bureau (Bureau) issued Consumer Financial Protection Circular 2024-05 asserting that “[a] bank or credit union can be in violation…
On September 13, 2024, the United States District Court for the Southern District of Texas granted in part and denied in part the defendants’ motion to dismiss in CFPB v. Colony Ridge, Case No. 4:23-cv-04729. The Court held that the Consumer Financial Protection Bureau (CFPB) and the U.S. Department of…
On September 12, 2024, New York’s highest court dismissed an appeal challenging the constitutionality of the retroactive application of the Foreclosure Abuse Prevention Act (“FAPA”), a law that amended certain New York rules to strictly cabin the time limits for commencing mortgage foreclosures. The Court of Appeals, on its own motion,…
On September 18, 2024, the U.S. Attorney’s Office for the District of New Jersey, the U.S. Department of Housing and Urban Development (HUD) and the U.S. Department of Justice (DOJ) announced it had entered into a consent order and a conciliation agreement with a New Jersey-based bank resolving allegations that the Bank had engaged in a pattern…
On September 17, 2024, the California Department of Financial Protection and Innovation (DFPI) announced it had taken enforcement action against three companies issuing two desist and refrain orders and one consent order against the businesses for allegedly charging unlawful fees for student loan debt relief services, in violation of the California Consumer Financial Protection Law…
On September 13, 2024. the CFPB brought suit in the Western District of Pennsylvania against the nonbank offeror of a consumer credit card and its CEO alleging that the terms of the company’s credit card violated the Consumer Financial Protection Act, the Truth In Lending Act, and Regulation Z. According to the…
On September 12, 2024, the CFPB announced that it entered into a stipulated proposed order with a large student loan servicer resolving allegations that the servicer forced borrowers into costly repayment options. Under the proposed order, the servicer would cease its servicing federal direct loans. In a January 2017 complaint, the CFPB accused the…
On September 11, the CFPB announced that it had entered into a consent order with a national bank resolving allegations that the bank reported inaccurate information to consumer reporting companies. The bank agreed to pay nearly $28 million to resolve these allegations. The CFPB alleged the bank violated the Fair Credit Reporting Act (FCRA) and the Consumer…
On September 11, 2024 the CFPB announced that it had entered into a consent order and stipulation with a national bank, resolving allegations that the bank repeatedly furnished inaccurate credit information, and that the bank knew of the inaccuracies for a year or more before correcting them in violation of the Fair Credit Reporting Act (FCRA),…
On August 7, 2024, the Consumer Financial Protection Bureau (CFPB) issued a report spotlighting four marketing and financing practices relating to solar financing that it claims pose significant consumer risks (the Report). The CFPB noted that solar-powered electricity is a growing industry—suggesting that these risks may become an enforcement priority. …
On August 29, 2024, the CFPB announced that it had entered into a stipulation and consent order with a Florida-based mortgage lender, resolving allegations that the mortgage provider had misrepresented the payment terms of cash-out mortgage refinance loans it offered to servicemembers and veterans. In its consent order, the CFPB alleged that the mortgage lender committed deceptive acts or…
On August 14, 2024, the Federal Trade Commission (FTC) announced a final rule banning fake reviews and testimonials. The rule follows a notice and comment process that began in November 2022, and covers a wide range of consumer reviews and testimonials including “consumer ratings regardless of whether they include any…