Elanor A. Mulhern

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A judge in the U.S. District Court for the Central District of California recently ordered the defendants in CashCall, Inc. (which included CashCall Inc.’s CEO Paul Reddman) to pay $134 million in restitution and $33 million in civil penalties.  The decision comes after the Ninth Circuit affirmed the district court’s 2016 award of summary judgment to the CFPB, finding the defendants had violated the CFPA. … Continue Reading

In conjunction with efforts to forgive federal student debt for certain borrowers, President Biden’s Justice Department recently announced new guidance for its attorneys to use when deciding whether to recommend that a bankruptcy judge discharge an individual’s federal student loans. 

The guidance seeks to streamline the process of discharging federal student debt which, unlike other consumer debt, is not automatically discharged through bankruptcy. … Continue Reading

Last week, the CFPB filed a lawsuit against ACTIVE Network LLC (“Active”), an online event registration company, in a Texas federal district court alleging that the company is deceiving customers into joining its fee-based membership club, “Active Advantage.”  Event organizers seeking to host community activities such as youth camps and charity race events contract with Active to provide online registration and payment processing services. … Continue Reading

In a blog post that appeared last week, the CFPB reported on research into various factors considered significant in explaining current credit card interest rates.  The CFPB reported that over 175 million Americans have at least one credit card, half of which carry a balance that continues to accrue increasingly high interest rates. … Continue Reading

Proponents of the Payday Loan Interest Rate Cap ballot initiative in Michigan met the June 1, 2022 deadline to appear on the November 2022 ballot in the state.  If not picked up by the state legislature this summer, the proposal would ask voters to approve a state statute capping payday loan interest rates, that can currently reach over 370% APR, at no more than 36% APR.… Continue Reading

A federal district court judge in the Southern District of New York ruled late last week that three credit unions had successfully established a likelihood of success on their claims that the retroactive application of New York’s recently-passed rate reduction law constitutes a regulatory taking in violation of the U.S. Constitution and preliminarily enjoined state sheriffs’ offices from enforcing the law.… Continue Reading

Three credit unions have filed a federal class action lawsuit in the Southern District of New York seeking to halt the enforcement or implementation of New York’s recently passed S.B. 5724A which would retroactively and prospectively lower the statutory annual interest rate on  consumer debt judgments from 9% to 2%.  The credit unions allege that the change in rates – set to take effect April 30, 2022 – violates the United States Constitution’s due process and property protections and should be struck down in its entirety.… Continue Reading

The CFPB has filed a lawsuit against Oakland, CA-based online lender LendUpLoans alleging that LendUp is in violation of a 2016 Consent Order that required the lender to pay over $3.5 million in consumer redress as well as civil penalties and to cease  misleading consumers with alleged false claims about the cost of loans and the benefits of repeat borrowing.… Continue Reading

Recently, the CFPB and New York Attorney General filed a Complaint against Douglas MacKinnon and members of his immediate family to unwind the allegedly fraudulent conveyance of MacKinnon’s $1.6 million home made shortly after he learned his business practices were the subject of CFPB and NYAG investigations.

This Complaint follows a 2019 consent decree, in which MacKinnon was one of three defendants who had entered a stipulated final judgment with the CFPB and NYAG. … Continue Reading

Among the suite of consumer protection bills signed into law last month by California Governor Gavin Newsom is AB 2524. The bill, as enacted, is a less-expansive version of an assembly bill that would have created an entirely new and broad system of regulation over debt settlement companies through amendments to the Check Sellers, Bill Payers and Proraters Law.… Continue Reading