Goodwin’s Consumer Finance Insights (CFI) monitors, reports, and analyzes the latest legal news, activity, and developments impacting the consumer finance industry. Consumer financial services companies—whether banks, fintechs, nonbank and alternative lenders, payment providers, or industry vendors or service providers, like digital advertisers and lead generators—face a constantly shifting and maturing regulatory and legal landscape. Growing from the Financial Crisis, today more than any time in history the consumer finance industry must confront a robust and growing body of industry legislation and regulation, all while under the microscope of sophisticated enforcers, like the Consumer Financial Protection Bureau (CFPB), Federal Trade Commission (FTC), and state regulators and attorneys general. It is critical for in-house and outside corporate counsel, compliance departments, and business executives to stay informed and aware of these developments to navigate institutional, reputational, and legal risks. Goodwin’s CFI is a singular source of the most recent industry news and latest enforcement activity for you to leverage. Here, you will find links to original enforcement documents, enforcement activity statistics, and reports, analysis, and commentary from Goodwin’s leading Consumer Financial Services Litigation and Enforcement practitioners.

CFPB Enters Consent Agreement with Student Loan Lender Concerning Sales and Billing Practices

On July 23, 2015, the Consumer Financial Protection Bureau (“CFPB”)​ filed a complaint and proposed consent order in the United States District Court for the Eastern District of California in connection with a settlement reached with a student loan lender that offered fee-based assistance to consumers filling out the federal government’s Free Application…

Read More

CFPB Issues Order and Penalties Against National Bank for Student Loan Servicing Practices

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…

Read More

Hefferon Serves As Co-Chair And Panelist At ACI's 23rd National Conference On Consumer Finance Class Actions & Litigation – July 27-28, 2015

Goodwin Procter partner and chair of the firm’s Consumer Financial Services Litigation Practice, Thomas Hefferon, will serve as the conference co-chair and speak on a panel titled “Consumer Finance Class Action Litigation and Settlement Trends and New and Emerging Procedural Considerations: Certification and Other Procedural Developments, Offers of Judgment/Full Relief,…

Read More

CFPB and OCC Issue Consent Orders Against National Bank for Credit Card Practices

​On July 21, 2015, the Consumer Financial Protection Bureau (“CFPB”) issued a consent order requiring a national bank and its subsidiaries to provide roughly $700 million in consumer relief due to the bank’s practices relating to its credit card services and add-on products.  The consent order states that a CFPB review of the bank’s practices…

Read More

Colorado AG Files Action Against Retailer Over Credit Extended to Military Servicemembers

On July 17, 2015, the Attorney General for the State of Colorado (“Colorado AG”) filed a lawsuit in Denver District Court alleging that a retailer and its related companies repeatedly violated Colorado’s consumer lending laws concerning credit extended to military servicemembers. ​ The action is the second lawsuit filed by the Colorado AG in the…

Read More

CFPB: Principles for Faster Payment Systems

On July 9, 2015, the CFPB published a set of Consumer Protection Principles it believes should guide the financial industry in the development of newer, faster methods of payment.  These Principles, though merely suggestions, may help members of the financial industry anticipate the expectations of their regulators and develop new…

Read More

Auto Finance Company Settles Action Brought by CFPB and DOJ

On July 15, the Consumer Financial Protection Bureau (“CFPB”) and the Department of Justice (“DOJ”) announced that claims concerning an indirect auto finance company’s alleged discriminatory lending practices were settled as part of a consent order requiring $24 million in restitution payments to borrowers and changes to the lender’s dealer compensation system.  The consent order alleges…

Read More

Pennsylvania Attorney General Announces Settlement with Mortgage Loan Modification Companies

On July 13, 2015, Pennsylvania Attorney General Kathleen G. Kane announced a settlement with two Philadelphia-based mortgage loan modification companies following an investigation by the states’ Bureau of Consumer Protection.  According to the Attorney General’s announcement, the Bureau initiated the investigation as a result of consumer complaints filed against the companies for,…

Read More

Florida Mortgage Company Employees Plead Guilty to FHA Mortgage Fraud

​On July 14, 2015, the U.S. Attorney for the Southern District of Florida announced​ that the owner of a Miami-area mortgage company, his business partner, and a senior mortgage underwriter each pleaded guilty to conspiracy to commit wire fraud affecting a financial institution.  As part of the owner’s plea, he will forfeit $8…

Read More

FHA Attempt To Provide New Guidance: Too Little, Too Late?

On June 18, the Federal Housing Administration provided lenders with a new Defect Taxonomy for Single Family Housing Loans, or Loan Quality Assessment Methodology.  It has been working on the new taxonomy for almost a year, and the final product is very similar to what it presented for comment in September…

Read More

Add-On Products Continue To Present Litigation Risks For Lenders

The Consumer Financial Protection Bureau’s recent action against two credit card vendors regarding credit monitoring and identity theft protection services is a reminder of the legal risks associated with certain add-on products. The July 1 settlement, in which the CFPB found that the vendors misled customers about the benefits of…

Read More

Bank Settles Debt Collection Action Brought by CFPB and Claims of 47 State Attorneys General

​On July 8, 2015, the Consumer Financial Protection Bureau (“CFPB”) announced that claims concerning a bank’s alleged debt collection practices in violation of the Consumer Financial Protection Act (“CFPA”) had been settled for over $200 million.  According to the consent order, the bank “sold to debt buyers certain accounts that were inaccurate, settled, discharged…

Read More

FTC Reaches Accord With Companies and Individuals Accused of Phony Debt Collection Scam

FTC

​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…

Read More

New York Attorney General Obtains Court Order Barring Operations of Debt Collector

​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…

Read More

Court Enters Injunctive Relief in FTC and Florida Attorney General Action Against Telemarketers Who Offered Debt Relief Services

​On July 7, the Federal Trade Commission (FTC) announced that a federal court entered a preliminary injunction​ halting an alleged nationwide debt relief telemarketing scam and freezing the defendants’ assets. The FTC claims that the defendants millions from consumers.  The complaint, brought by the FTC and Florida Attorney General, alleged that the defendants contacted consumers…

Read More

Payday Lenders Agree to Exit Consumer Lending Business in Settlement With FTC

FTC

On July 7, 2015, the FTC ​announced that it reached two stipulated settlements (available here and here) with payday lenders who allegedly deceived customers by signing them up for loans without their permission and then withdrawing “finance” charges indefinitely. The settlements stem from allegations in a complaint​ filed last year that defendants “purchase consumers’ sensitive financial information from online lead generators or data…

Read More