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In March 2021, Illinois Governor Pritzker signed into law SB 1792, which contains the Predatory Loan Prevention Act (the “Act”).  The new law became effective immediately upon signing notwithstanding the authority it gives the Illinois Department  of Financial and Professional Regulation (“IDFPR”) to adopt rules “consistent with [the] Act.”

The Act extends the 36% “all-in” Military Annual Percentage Rate (MAPR) finance charge cap of the federal Military Lending Act (MLA) to “any person or entity that offers or makes a loan to a consumer in Illinois” unless made by a statutorily exempt entity.  … Continue Reading

The U.S. Court of Appeals for the Second Circuit has ruled that a debt collector did not violate the Fair Debt Collection Practices Act by sending the plaintiff a settlement offer that did not disclose that his balance could increase due to interest and fees. 

In Cortez v. Forster & Garbus, LLP, the debt collector sent a collection notice to the plaintiff offering various options for settling his account for less than the full balance owed if he made the payments indicated by the dates specified in the notice.… Continue Reading

The U.S. Court of Appeals for the Second Circuit has ruled that the lawsuit filed by the New York Department of Financial Services (DFS) seeking to block the OCC’s issuance of special purpose national bank (SPNB) charters to non-depository fintech companies should be dismissed for lack of Article III standing.  In December 2017, the DFS’s first lawsuit challenging the OCC’s issuance of SPNB charters was also dismissed for lack of Article III jurisdiction.… Continue Reading

American Banker has reported that Manny Alvarez, Commissioner of  the California Department of Financial Protection and Innovation, will be leaving the agency on June 18, 2021. 

According to the report, Governor Newsom is expected to name Chief Deputy Commissioner Chris Shultz, who is currently second in command at the DFPI, Acting Commissioner.… Continue Reading

According to an American Banker report, two senior CFPB officials, Bryan Schneider and Peggy Twohig, will be leaving the Bureau in the coming weeks.

Mr. Schneider has been serving as Associate Director of Supervision, Enforcement and Fair Lending.  He was named to the position by former Director Kraninger.

Ms. Twohig has been serving as Assistant Director of Supervision Policy and Strategy. … Continue Reading

The CFPB announced last week that it has entered into a proposed settlement with Driver Loan, LLC (“Driver Loan”) and its Chief Executive Officer to settle the November 2020 lawsuit it filed against Driver Loan and its CEO alleging the defendants engaged in deceptive acts and practices in violation of the Dodd-Frank Act’s UDAAP prohibition in connection with taking deposits from and making loans to consumers.… Continue Reading

The Ninth Circuit has granted Seila Law’s motion for a stay of the mandate pending its filing of a petition for a writ of certiorari in the U.S. Supreme Court.

After the Supreme Court ruled that the CFPB’s structure was unconstitutional and remanded the case for further consideration, a unanimous Ninth Circuit panel ruled that the civil investigative demand (CID) issued to Seila Law was validly ratified by former Director Kraninger and affirmed the district court’s decision granting the CFPB’s petition to enforce the CID.… Continue Reading

On behalf of our client RevSpring, Inc., Ballard Spahr has filed an amicus brief in support of the petition for rehearing en banc filed in the Eleventh Circuit by the defendant in Hunstein v. Preferred Collection and Management Services.  In that case, a unanimous Eleventh Circuit panel reversed the lower court’s dismissal of the plaintiff’s FDCPA claim, instead ruling that the plaintiff stated a claim by alleging that a debt collector’s transmittal of the plaintiff’s personal information to the vendor it used to generate and send collection letters “constituted a communication ‘in connection with the collection of any debt’ within the meaning of [FDCPA Section 1692c(b)].” … Continue Reading

Last month, in a very troubling decision of first impression, a unanimous panel of the U.S. Court of Appeals for the Eleventh Circuit reversed the lower court’s dismissal of the plaintiff’s FDCPA claim, instead ruling that the plaintiff stated a claim where the plaintiff alleged that a debt collector’s transmittal of the plaintiff’s personal information to the vendor it used to generate and send collection letters “constituted a communication ‘in connection with the collection of any debt’ within the meaning of [FDCPA Section 1692c(b)].” … Continue Reading

In a recent blog post, the FTC explained the role of closing letters issued by the staff of its Bureau of Consumer Protection.

The FTC indicates that it views the closing letters as a supplement to its enforcement activity.  It states that the letters inform a company or individual that the FTC is closing its investigation into their conduct.  … Continue Reading