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.

Foreclosure Protection is Back in the Spotlight: CFPB Proposes New Rules for Mortgage Servicers

The CFPB recently proposed additional amendments to its Mortgage Servicing Rules which, if implemented, would provide additional protections for mortgage borrowers facing default or foreclosure.  These amendments, which the CFPB announced on November 20, 2014, are the latest in a series of revisions to the Rules (which we have discussed…

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NY Department of Financial Services Issues Final Debt Collection Regulations

On December 3, New York governor Andrew Cuomo announced the final version of the state Department of Financial Services (DFS) regulations governing debt collection actions by third-party debt collectors and debt buyers.  The regulations contain a number of new requirements for third party debt collectors, including: New / Enhanced Initial…

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Ninth Circuit Ruling on Customer Agreements Affects Ability to Arbitrate TCPA and FDCPA Claims

On November 10, 2014, the Ninth Circuit reversed a district court’s order dismissing and directing to arbitration a putative nationwide class action alleging Telephone Consumer Protection Act (TCPA) violations, finding that the Customer Agreement containing the arbitration clause was unenforceable for lack of mutual assent.  Knutson v. Sirius XM Radio…

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Dodd-Frank's Deputy Enforcers - States!

No readers of this blog would disagree that the Dodd-Frank Wall Street Reform and Consumer Protection Act transformed the legal landscape for banks and consumer finance companies.  In the area of enforcement, two of the Act’s most significant changes were (1) the creation of the Consumer Financial Protection Bureau and…

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Plaintiffs Find Little Traction In Suits Against Banks Over "Payday" Loans

In recent months, a number of class actions have been filed across the country against large banks in an attempt to hold those banks accountable for debiting consumers’ deposit accounts for payments to certain companies offering short-term, small dollar loans – often called “payday loans” – online.  In all of…

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Supreme Court Will Not Review Third Circuit FDCPA Decision

The U.S. Supreme Court recently declined to review a debt collector’s appeal of the Third Circuit’s decision this summer that debtors were not required to dispute their debt under the Fair Debt Collection Practices Act (FDCPA) before filing suit.  The Third Circuit decision reversed a district court’s dismissal of a class…

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CFPB Finalizes Mortgage Rules Amendments

On October 22, the CFPB issued amendments to the Dodd-Frank Act mortgage rules that took effect in January 2014.  The amendments include: ATR/QM Cure Provision: Under the Ability-to-Repay/Qualified Mortgage Rule, a mortgage loan must meet certain requirements to be considered a “qualified mortgage”.  One such requirement is that the points and fees…

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CFPB Takes Action to Enforce New Mortgage Servicing Rules

The Consumer Financial Protection Bureau (CFPB) has entered a consent order with a mortgage bank following CFPB’s allegations that the bank violated the new mortgage servicing rules.  CFPB claimed that the bank: ​took an unreasonably long time to process borrowers’ applications for loan modifications or other foreclosure relief; failed to…

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CFPB Sues Another Company for Alleged Deceptive Student Lending Practices

On September 16, the CFPB filed suit against Corinthian Colleges, Inc. in the Northern District of Illinois for engaging in alleged predatory student lending.  This is the CFPB’s second predatory student lending suit against a for-profit college; the first being against ITT (reported by LenderLaw Watch here). The allegations and relief…

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CFPB Rule Defines "Larger Participants" In International Money Transfer Market

On September 23, the CFPB issued its final rule amending the regulation defining larger participants of certain consumer financial product and service markets specifically to add a definition for larger participants in the market for international money transfers. The rule defines such “larger participants” as those entities that have at least one million aggregate…

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Is Knowing Enough? The FTC's Concerns Regarding Mobile Banking Practices May Force You to Do ...

On September 10, 2014, the Federal Trade Commission (FTC) posted a comment in response to the Consumer Financial Protection Bureau’s (CFPB) request for information regarding the use of mobile banking services and products specifically utilized by economically vulnerable or underserved consumers.  After briefly articulating some of the benefits of mobile…

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CFPB Director Proposes to Supervise "Captive" Auto Finance Companies

On September 18, CFPB Director Richard Cordray delivered remarks at a Field Hearing about CFPB’s latest proposed rule, which would allow it to begin regulating “captive” finance companies – those entities owned by automotive manufacturers “for the primary purpose of facilitating sales for their parent companies and associated dealers.” In his…

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Interagency Guidance: Regulators Will Enforce UDAAP Laws Notwithstanding Repeal of Regulation AA

The Federal Reserve Board recently made headlines when it repealed its Regulation AA to comply with the Dodd-Frank Act, leading some to wonder how, and to what extent, regulation of financial institutions might change going forward. But the federal agencies charged with regulating banking and credit activities have made it clear that they will continue to enforce prohibitions…

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You Have No Standing to Challenge the Assignment or Transfer of Your Mortgage and Note in ...

On August 27, 2014, the California Supreme Court granted a petition for review in which the Second Appellate District of the California Court of Appeals dismissed a mortgagor’s challenge to foreclosure proceedings, ruling that she had no standing to challenge assignment of her promissory note and the deed of trust…

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CFPB Warns Credit Card Issuers Against Deceptive Marketing of Promotional APR Offers

On September 3, 2014, the CFPB issued a Bulletin warning credit card issuers about deceptive marketing of promotional annual percentage rate (APR) offers.  According to the CFPB, it has observed solicitations that offer an initial low APR for certain kinds of transactions (such as convenience checks, deferred interest rate purchases, or…

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DOJ Investigating GM Financial's Subprime Auto Loan Securities

The Department of Justice is investigating whether to bring civil claims under the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) against GM Financial Company, Inc. for its origination and securitization of subprime auto loans.  GM Financial revealed the investigation in a recent SEC 8-K filing, stating that…

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