On March 3rd, the New York Department of Financial Services (“NYDFS”) announced a settlement with Residential Mortgage Services, Inc. (“RMS”) to resolve allegations that RMS violated the NYDFS Cybersecurity Regulation relating to a 2019 cyber breach.

In July 2020, NYDFS conducted an examination of RMS as a licensed mortgage banker. … Continue Reading

A magistrate judge has denied the CFPB’s motion for partial dismissal of the lawsuit filed in a Massachusetts federal district court challenging the creation of the CFPB’s Taskforce on Federal Consumer Financial Law.  The plaintiffs in the lawsuit are the National Association of Consumer Advocates (NACA), U.S. Public Interest Research Group (U.S.… Continue Reading

We first review recent studies finding racial disparities in connection with consumer complaints and look at the methodology used for those studies and its limitations.  We then discuss how the CFPB uses complaint data, the risks faced by companies that are the subject of complaints, and the key components of an effective complaint management system that companies should have in place.… Continue Reading

Despite expectations to the contrary, Rohit Chopra faced little in the way of hostile questioning by Republican members of the Senate Banking Committee at the hearing yesterday on his nomination by President Biden as CFPB Director.  It is possible Republican members took a less aggressive approach in questioning Mr. Chopra in order to devote more of their time to probing the views of Gary Gensler, President Biden’s nominee for SEC Chairman, whose confirmation hearing was held together with Mr.… Continue Reading

The OCC has filed a reply in support of its cross-motion for summary judgment in the lawsuit filed by state AGs to enjoin the OCC’s final rule (Rule) purporting to override the Second Circuit’s Madden decision as to national banks and federal savings associations.  The filing of the OCC’s reply concludes the briefing on the motions for summary judgment filed by the AGs and the OCC. … Continue Reading

In advance of his confirmation hearing tomorrow, the Senate Banking Committee has released the prepared statement of Rohit Chopra, President Biden’s nominee for CFPB Director. 

The brief statement highlights several areas on which Mr. Chopra is likely to focus his attention as CFPB Director.  He raises concern about the financial difficulties faced by consumers as a result of the COVID-19 pandemic, particularly in the housing market, and observes that “[e]xperts expect distress across a number of consumer credit markets, including an avalanche of loan defaults and auto repossessions.”… Continue Reading

A litigation phenomenon that has recently surged is the simultaneous filing of hundreds or even thousands of individual arbitration demands against the same company by the same law firm, requiring the company to pay the substantial up-front filing fees typically charged by arbitration administrators.  Initially used in the context of employment arbitration claims, such “mass arbitrations” are now also being pursued against consumer businesses.… Continue Reading

On March 4 and 5, 2021, the Consumer Law Review of Loyola University Chicago School of Law will hold a symposium on issues involving racial justice in consumer law.  The symposium will consist of three panel discussions, with each panel discussion followed by a Q&A session.  Chris Willis, co-chair of Ballard Spahr’s Consumer Financial Services Group, will be a member of the second panel.… Continue Reading

The CFPB recently issued a policy statement addressing the rules finalized near the end of former Director Kraninger’s tenure that amend the Regulation Z ability to repay rule/qualified mortgage (QM) requirements to replace the strict 43% debt-to-income (DTI) ratio basis for the current general QM with an annual percentage rate (APR) limit, and to create a new seasoned loan QM.… Continue Reading

Earlier this week, the CFPB announced that it has filed its first enforcement action under the leadership of Acting Director Uejio.  The lawsuit was filed in a Virginia federal district court jointly with the Attorneys General of Virginia, Massachusetts, and New York.  The complaint names as defendants Libre by Nexus, Inc.… Continue Reading