On July 25, 2022, the FDIC issued Financial Institution Letter (FIL)-34-2022 announcing updates to Chapters 1 and 4 of its Formal and Informal Enforcement Actions Manual (Manual). The Manual includes updates to the minimum standards for the FDIC’s termination of cease-and-desist and consent orders. The updates do not change any rights or obligations of the parties to an enforcement action.… Continue Reading

On July 28, the U.S. House Committee on Financial Services passed H.R. 4277, the Overdraft Protection Act.  Introduced by Congresswoman Carolyn B. Maloney (D-NY), the bill would prohibit financial institutions from engaging in unfair or deceptive acts or practices in connection with overdraft coverage.

Specifically, the bill would require financial institutions that offer overdraft coverage for accounts to disclose: (i) the specific amount of overdraft coverage fees; (ii) that the consumer’s transaction may be declined if there are insufficient funds in the account; and (iii) that the consumer will not be charged a fee if the transaction is declined. … Continue Reading

The CFPB announced last week that it has entered into a settlement with Hyundai Capital America (Hyundai) to resolve alleged violations of the Fair Credit Reporting Act and Regulation V arising from Hyundai’s reporting of information on vehicle retail installment contracts and leases to consumer reporting agencies (CRAs) from 2016 to 2020. … Continue Reading

Last week, the CFPB published additional frequently asked questions on Regulation F, its debt collection rule.   The new FAQs address third-party communications, electronic communications, and unusual or inconvenient time and place provisions.

Prohibitions on Third-Party Communications.  The FAQs address the following questions:

  • What is the Debt Collection Rule’s general prohibition on third-party communications?
… Continue Reading

On July 18, the Federal Housing Finance Agency (“FHFA”) announced the launch of a new Office of Financial Technology with the goal of advancing effective risk management as it evaluates fintech developments in the housing finance space.  The FHFA also issued a request for information (“RFI”) seeking public input on how to facilitate responsible innovation, identify barriers or challenges to implementing fintech into housing finance, support equity for homeowners and renters, and increase efficiency and effectiveness in the compliance and regulatory processes. … Continue Reading

On July 20, 2022, the Connecticut Department of Banking (the “Department”) issued a Consumer and Industry Advisory on Money Transmission (the “Advisory”).  The Department believes the Advisory was necessary for two reasons.  First, the Department notes the “significant disruption to traditional money transmission systems” caused by the “increased use of technology to enable immediate payment mechanisms” and “the explosion of virtual currency.” … Continue Reading

On July 20, 2022, the Federal Trade Commission (“FTC”) and 18 state attorneys general led by New York Attorney General Letitia James announced that they have entered into a settlement with Harris Originals of NY, Inc. and related entities (collectively, “Harris Jewelry”), a national jewelry retailer that markets and sells military-themed gifts, to resolve their lawsuit which alleged that Harris Jewelry had engaged in unlawful sales and credit practices targeting servicemembers. … Continue Reading

Director Chopra gave interviews this week to several news reporting outlets including American Banker, Law 360, Politico, and Bloomberg.  Below are some of highlights of the interviews as reported by those outlets, several of which also provided interview transcripts.  We also share our reactions to Director Chopra’s comments.

CFPB priorities and status of rulemaking activity.… Continue Reading

In a recent consent order with a national bank, the CFPB found that the bank committed UDAAP violations in its process for handling garnishment orders and by including certain waiver language in its deposit account agreements.  We discuss the specific aspects of the bank’s process that the CFPB found to be improper and what banks should consider when reviewing their own garnishment procedures in light of the consent order. … Continue Reading

The Consumer Financial Protection Bureau (CFPB) is “encouraging” student loan servicers to identify their military borrowers in order to conduct proactive outreach encouraging them to consolidate their loans and submit applications for forgiveness under the Public Service Loan Forgiveness Program (PSLF). 

Servicemembers (and any other eligible public service applicants) must apply for PSLF by October 31, 2022 to be considered for relief under a limited waiver that temporarily relaxes program rules allowing more borrowers to qualify. … Continue Reading