On May 15, the Federal Trade Commission (FTC) announced that a settlement was reached against “a company that deceptively advertised its add-on biweekly auto payment plan” for allegedly violating the FTC Act, 15 U.S.C. Section 45, et seq. The Complaint alleged that the payment liaison company deceptively pitched consumers a…
On May 13, New York Attorney General Eric T. Schneiderman annouced that the AG obtained default judgment against Brooklyn and Florida Law Firms and the firms’ principal attorney for participating in a fraudulent mortgage rescue scheme. The AG’s petition alleged that, directly and through their third-party marketers, the firms collected…
On May 12, the Board of Governors of the Federal Reserve System announced the execution of a settlement in an enforcement action against a state member bank concerning alleged violation of Section 102(f) of the National Flood Insurance Act (NFIA). The settlment noted that where a pattern of practice of…
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;…
For the first quarter of 2015, Consumer Finance Enforcement Watch tracked 46 instances of enforcement activity taken against a consumer finance service provider. Not surprisingly, the year started off slow with only 9 enforcement actions taken in January, likely due to agencies wrapping-up actions before year-end 2014. The 46 actions ranged…
On May 12, the Consumer Financial Protection Bureau (“CFPB”) announced that it is seeking to settle claims against two cellular providers who have agreed to return $120 million in funds to wireless customers. The Bureau filed proposed orders in the United States District Courts for the District of New Jersey…
On May 11, the Consumer Financial Protection Bureau (“CFPB”) announced that it filed suit in the United States District Court for the Northern District of California against the provider of a mortgage payment liaison service for allegedly misleading customers about costs associated with its bi-weekly mortgage payment program and misrepresenting…
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 May 8, 2015, the Colorado Attorney General announced that it filed suit against a Colorado corporation for violations of Colorado lending and consumer protection laws. The company allegedly sought members of the military and their families as customers. The company would then sell goods on credit, offer consumer loans, and then collect…
On May 7, 2015, the Department of Justice (DOJ) announced a settlement with a regional bank over allegations of discriminatory lending. In a Complaint filed in federal court, the Department of Justice alleged that the bank engaged in a “pattern or practice” of charging Hispanic or African American borrowers higher…
The Consumer Financial Protection Bureau (CFPB) settled claims with three defendants after the CFPB claimed the corporations were targeting homeowners who were struggling to make mortgage payments. The parties stipulated to final judgments for the individual defendants that were filed with the Court. The CFPB also filed a motion for default judgment as…
On May 4, 2015, Illinois Attorney General Lisa Madigan announced five lawsuits filed on behalf of the State against student loan debt settlement services companies based in Texas, California, Florida, Georgia, and Illinois. The complaints allege that the companies violated Illinois’ consumer protection laws by charging hundreds to thousands of…
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 30, 2015, the FTC announced that a Federal Court entered a preliminary injunction against a regional mortgage relief company over claims the company falsely represented to consumers that they could obtain mortgage modifications. The company allegedly represented that it was associated with various federally-approved mortgage relief programs, and…
On April 29, 2015, the Consumer Financial Protection Bureau and the Maryland Attorney General announced the filing of a complaint and proposed consent order against a regional title insurance company, its principals, and certain loan officers. The title company allegedly provided payments to loan officers in exchange for referrals for…
On April 28, 2015, the Consumer Financial Protection Bureau announced a consent decree with a national bank regarding improper overdraft fees in violation of Regulation E, the implementing regulation of the Electronic Fund Transfer Act (“EFTA”). When a consumer does not have sufficient funds to cover a purchase or withdrawal,…
On April 27, 2015, the Colorado Attorney General announced that it released restitution payments to over 20,000 homeowners in connection with a settlement reached with a foreclosure law firm. On July 14 2014, the Colorado Attorney General filed a complaint against the law firm, alleging that the law firm charged inflated…
On April 2, 2015, a regional bank reached an agreement in principle to settle allegations brought by the U.S. Department of Justice (DOJ) and U.S. Department of Housing and Urban Development (HUD) relating to its former subsidiary’s issuance of mortgage loans insured by the Federal Housing Administration (FHA). The DOJ…
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…
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…