The CFPB has issued a request for information about business models that collect and sell consumer data, such as data brokers, data aggregators, and platforms. The RFI is intended to provide the CFPB with insight into the full scope of the data broker industry about which, according to the CFPB, “there is still relatively limited public understanding of their operations and other impacts.” … Continue Reading
CFPB issues bulletin on handling of discharged student loans by servicers
The CFPB has issued a new bulletin (2023-01) titled “Unfair Billing and Collection Practices After Bankruptcy Discharges of Certain Student Loan Debts.” The bulletin warns servicers that they risk engaging in a UDAAP violation by resuming collection of student loans that were discharged through the regular course of a borrower’s bankruptcy.… Continue Reading
CFPB consent order shuts down mortgage lender focused on servicemembers
By Brian Turetsky on
On February 27, 2023, the Consumer Financial Protection Bureau (CFPB) entered into a consent order against RMK Financial Corporation d/b/a Majestic Home Loan (RMK), a California-based mortgage lender, based on allegations that it falsely implied government endorsement of its home loans in its marketing. The consent order, which addressed numerous alleged statutory and regulatory violations and a failure to comply with an earlier consent order, prohibits RMK from engaging in any mortgage lending activities (or from receiving remuneration from mortgage lending) going forward, effectively shutting it down.… Continue Reading
SCOTUS extends briefing schedule in case challenging constitutionality of CFPB’s funding
By Michael Gordon & Alan S. Kaplinsky on
Posted in CFPB, Litigation and Court Decisions
Having granted the certiorari petition filed by the CFPB seeking review of the Fifth Circuit panel decision in Community Financial Services Association of America Ltd. v. CFPB, the U.S. Supreme Court has granted the parties’ joint request to extend the time to file the briefs on the merits. The Fifth Circuit panel held the CFPB’s funding mechanism violates the Appropriations Clause of the U.S.… Continue Reading
CFPB and DOJ file statement of interest in lawsuit alleging lender violated ECOA and FHA by denying loan based on appraisal alleged to be discriminatory
The Consumer Financial Protection Bureau (CFPB) and the Department of Justice (DOJ) have filed a Statement of Interest regarding the application of the Fair Housing Act (FHA) and the Equal Credit Opportunity Act (ECOA) to a lender that allegedly denied a loan to the plaintiffs based on a home appraisal alleged to be discriminatory.… Continue Reading
GAO issues report on fintech products; recommends CFPB clarify when earned wage access products are “credit” under Truth in Lending Act
The Government Accountability Office (GAO) has issued a new report entitled “Financial Technology: Products Have Benefits and Risks to Underserved Consumers, and Regulatory Clarity Is Needed.”
The report focuses on the following four types of fintech products:
- Digital deposit accounts offered by fintech companies through partnerships with banks or credit unions.
SEC asks SCOTUS to review Fifth Circuit decision with implications for CFPB’s use of administrative law judges
By Michael Gordon & Alan S. Kaplinsky on
Posted in CFPB, Regulatory and Enforcement
The Securities and Exchange Commission (SEC) has filed a petition for certiorari with the U.S. Supreme Court seeking review of the Fifth Circuit’s decision in Jarkesy v. Securities and Exchange Commission, a case with significant implications for the use of administrative law judges (ALJs) by federal agencies, including the CFPB. … Continue Reading
CFPB announces Memorandum of Understanding with NLRB for sharing information to further joint efforts to protect workers
By Alan S. Kaplinsky on
Posted in CFPB, Regulatory and Enforcement
The CFPB announced earlier this week that it has entered into a Memorandum of Understanding (MOU) with the National Labor Relations Board (NLRB) that is intended to “help to identify and end financial practices that harm workers and to enhance the enforcement of federal consumer financial protection and labor laws and regulations.” … Continue Reading
This week’s podcast episode: A close look at the Consumer Financial Protection Bureau’s credit card late fees proposal, with special guest Todd J. Zywicki, Professor of Law, George Mason University Antonin Scalia Law School
By Barbara S. Mishkin on
The CFPB has issued a proposal that would make significant changes to the current rules for credit card late fees, including substantially reducing the safe harbor late fee amounts that card issuers can charge and eliminating annual inflation adjustments. After reviewing the legislative and regulatory history of the current rules, we look at the CFPB’s flawed rationale for reducing the safe harbor to a flat $8 for all late payments, identify the serious flaws in its economic analysis of the likely effects of the reduction, and discuss how the proposal relates to the Biden Administration’s junk fees initiative. … Continue Reading
Republican House members send letter to Director Chopra raising concerns about CFPB credit card late fees proposal
By John L. Culhane, Jr. & Michael Gordon on
Posted in CFPB, Regulatory and Enforcement
A group of 17 Republican members of the House Financial Services Committee have sent a letter to CFPB Director Chopra regarding the CFPB’s credit card late fees proposal.
The concerns raised by the lawmakers in the letter include the following:
- Commenting on the CFPB’s failure in 2022 to adjust the Regulation Z late fee safe harbor amounts for inflation, the lawmakers note that the CFPB “has yet to explain or justify why there was not an increase in the most recent annual adjustment announcement –a striking lack of transparency and accountability, and especially so in an era of outsized inflation.”