May 2022

On May 19, 2022, the Associate Director of the Enforcement and Compliance Division of the Financial Crimes Enforcement Network (“FinCEN”), Alessio Evangelista, spoke at the Chainalysis Links Conference in New York City on the topic of “The Intersection of Cryptocurrencies and National Security.”  Associate Director Evangelista stressed “responsible innovation” by the cryptocurrency industry, in order to protect consumers and national security interests, as well as to combat cybercrime and other illicit financial activity. … Continue Reading

Under Director Chopra’s leadership, the CFPB has regularly been sounding alarms about the potential for discrimination arising from the use of so-called “black box” credit models that use algorithms or other artificial intelligence (AI) tools.  Today, in the second of its recently-launched Consumer Financial Protection Circulars, the CFPB addresses ECOA adverse action notice requirements in connection with credit decisions based on algorithms.… Continue Reading

AG Weiser discusses the areas of consumer financial services that are a current focus of his office’s efforts.  After discussing the role of the newly-created Office of Financial Empowerment in addressing the needs of unbanked consumers, AG Weiser discusses his office’s activities concerning deceptive fees (including the types of fees of primary concern and the requirements of Colorado’s new automatic renewal law), robocalls, and student loans.  … Continue Reading

The CFPB has sent letters to the chief executive officers of six major credit card issuers regarding their companies’ payment furnishing practices.

In the letters, the CFPB cites a 2020 report in which it provided data showing a decline in the share of credit card tradelines containing actual payment data since 2012. … Continue Reading

In an announcement to its subscribers sent electronically on May 23, 2022, the California Department of Financial Protection and Innovation (“DFPI”) notified applicants – and prospective applicants – for a license under California’s Debt Collection Licensing Act (the “Act”) that changes mandated by the Federal Bureau of Investigation (“FBI’) to state agency protocols for requesting federal background checks have caused “unforeseen” and unavoidable processing delays.… Continue Reading

The CFPB announced earlier this week that as part of a new approach to innovation in consumer finance, it is replacing its Office of Innovation and Operation Catalyst with a new office, the Office of Competition and Innovation, and eliminating its No Action Letter (NAL) and Compliance Assistance Sandbox (CAS) programs. … Continue Reading

On May 20, Oklahoma Governor Kevin Stitt signed into law House Bill No. 3168 which imposes new limits on the use of automated dialing systems.  The new law, titled the “Telephone Solicitation Act of 2022” (Act), takes effect on November 1, 2022.

The Act prohibits the use of an “automated system” to make a “commercial telephonic sales call” without the “prior express written consent” of the “called party.” … Continue Reading

The U.S. Supreme Court today held that waiver of the right to arbitrate does not require a showing that the other party was prejudiced.  The unanimous opinion by Justice Kagan in Morgan v. Sundance reversed the Eighth Circuit, which had held that a party waives the right to arbitrate if it knew of the right, acted inconsistently with that right and prejudiced the other party by its inconsistent actions. … Continue Reading

The CFPB has issued a new interpretive rule regarding the authority of state attorneys general and state regulators (State Officials) to enforce the Consumer Financial Protection Act (CFPA). 

CFPA Section 1042(a) (12 U.S.C. Section 5552) authorizes “the attorney general (or the equivalent thereof) of any State” to bring “a civil action…to enforce the provisions of [the CFPA] or regulations issued under [the CFPA] and to secure remedies under provisions of [the CFPA] or remedies otherwise provided under other law.” … Continue Reading

Recently, Professor Jeff Sovern and I exchanged views on whether the CFPB could (or should) add arbitration rulemaking to its regulatory agenda.  Professor Sovern has now suggested that the CFPB’s 2015 Study of consumer arbitration would support a new regulation.  It would not.

The CFPB’s earlier final arbitration rule was overridden by the Congress under the Congressional Review Act (CRA). … Continue Reading