CFPB, Federal Agencies, State Agencies, and Attorneys General
The CFPB has taken action against Global Tel Link Corporation (GTL) over allegations that the company took millions of dollars from a half-million accounts and blocked money transfers to consumers who are incarcerated. Those prisoners relied on those funds for food, medicine and clothing.
The CFPB is ordering GTL and its subsidiaries to stop the allegedly illegal activity, pay at least $2 million in redress to victims and pay $1 million civil monetary penalty.… Continue Reading
A panel of the Fifth Circuit Court of Appeals has set March 30, 2025 as the effective date of the CFPB’s payday lending rule.
The panel had previously set a date 286 days “from the resolution of the appeal” as the effective date, but it was not clear when that period would start.… Continue Reading
FirstCash, a national pawnshop chain, cannot use the “bona-fide error defense” in its defense of a Military Lending Act (MLA) suit filed by the CFPB against the company, a federal judge has ruled in a case of first impression.
The Act’s bona-fide error defense protects the defendants from civil liability to a person, Judge Mark Pittman of the U.S.… Continue Reading
Following lengthy litigation, the CFPB is attempting to close the books on its case against Townstone Financial alleging discriminatory lending practices and redlining African American neighborhoods in Chicago.
If the proposed order submitted by the CFPB is approved by the U.S. District Court for the Northern District of Illinois, Townstone would be prohibited from taking any actions in connection with offering or providing mortgage loans that violate the Equal Credit Opportunity Act (ECOA) and would be required to pay a $105,000 penalty to the CFPB’s victims relief fund.… Continue Reading
The CFPB recently took action against VyStar Credit Union in connection with allegations that the credit union “botched” its rollout of a new online banking system.
In May 2022, VyStar transitioned to a new online banking platform that the CFPB said was dysfunctional because it made it difficult for credit union members to perform basic banking functions for weeks, with some features unavailable for more than six months.… Continue Reading
The CFPB has filed suit against student lender Climb Credit, Inc. and its largest shareholder 1/0 (one zero), alleging that the lender induced students to take out loans by misrepresenting the quality of the training programs at their partner schools and by making false claims about the salaries and employment rates of graduates.… Continue Reading
The CFPB has banned private dispute resolution platform Ejudicate from arbitrating disputes about consumer financial products, saying that the company had misled student borrowers about the company’s neutrality and initiated sham arbitration proceedings.
The CFPB said that Ejudicate initiated those proceedings on behalf of the company Prehired—a firm which was shut down in 2023 by the CFPB and several state attorneys general, in part on the grounds that its income share agreements were illegal loans and its income share agreement program involved illegal lending practices.… Continue Reading
A federal District Judge for the Northern District of Georgia, Victoria Marie Calvert, awarded a default judgment to the CFPB against USASF, a car loan servicer of loans originated by U.S. Auto Sales Inc., a buy-here, pay-here dealership. The claim was based on alleged violations of myriad consumer protection rules.
However, Judge Calvert did not accept the estimates of damages the alleged violations caused, saying they were flawed because a CFPB data scientist used figures suggested by bureau attorneys. … Continue Reading
The CFPB earlier this month filed suit against Horizon Card Services and its CEO and sole shareholder Robert Kane for allegedly tricking subprime consumers into signing up for a high-fee credit card that only allowed them to purchase goods from the company’s overpriced online store.
The outlet that consumers were required to use had a limited selection of overpriced or off-brand goods.… Continue Reading
On August 7, 2024, the CFPB published an Issue Spotlight on the solar lending industry. In conjunction with the CFPB’s Issue Spotlight, the CFPB, U.S. Department of Treasury, and the Federal Trade Commission also issued a Consumer Advisory in connection with solar energy sales. All of this comes on the heels of states increasing scrutiny of solar sales practices.… Continue Reading
