In an opinion article published by The Hill entitled “The ‘consumer’ financial bureau chooses lawyers over consumers,” Rob Nichols, President and CEO of the American Bankers Association, explains why the CFPB’s final arbitration rule gives “a regulatory windfall to trial lawyers at consumers’ expense.”  Mr. Nichols urges Congress to use the Congressional Review Act to override the rule.… Continue Reading

Eighteen states and the District of Columbia have filed suit against Secretary of Education Betsy DeVos seeking an injunction of the Department of Education’s indefinite postponement of the Obama Administration’s Borrower Defense Rule. While generally providing for loan forgiveness for borrowers deceived by postsecondary institutions, the Borrower Defense Rule also created a joint state-federal enforcement scheme by providing that any judgment obtained by a government agency against a postsecondary institution under state law would give rise to a borrower defense to loan repayment.… Continue Reading

On July 5, 2017, the U.S. District Court for the District Columbia, in the lawsuit filed in 2014 challenging “Operation Choke Point” — a federal  enforcement initiative involving various  agencies, including the Consumer Protection Branch of the Department of Justice (DOJ), the Federal Depository Insurance Corporation (FDIC), the Federal Reserve (Fed), and the Office of the Comptroller of the Currency —  denied the  agencies’ motions to dismiss and/or for summary judgment and permitted the payday lender-plaintiffs’ due process claims to proceed.… Continue Reading

The CFPB issued HMDA Loan Scenarios on July 19, 2017 to provide additional guidance to the industry on reporting transactions under the revised HMDA rule, which has a January 1, 2018 effective date for most provisions.

The guidance includes loan scenarios for a single-family mortgage loan, multifamily mortgage loan, and home equity line of credit. … Continue Reading

In a letter dated July 18, 2017 to Acting Comptroller Noreika purporting to respond to Acting Comptroller Noreika’s July 17 letter, Director Cordray continued to question how there could be “any plausible basis for [Acting Comptroller Noreika’s] claim that the arbitration rule could adversely affect the safety and soundness of the banking system.”  … Continue Reading

The letter-writing war between Director Cordray and Acting Comptroller Keith Noreika continues.  Director Cordray sent a letter dated July 18, 2017 to Acting Comptroller Noreika in which he purports to respond to Acting Comptroller Noreika’s July 17 letter to Director Cordray and continues to question how there could be “any plausible basis for [Acting Comptroller Noreika’s] claim that the arbitration rule could adversely affect the safety and soundness of the banking system.” … Continue Reading

On July 17th, the Federal Trade Commission (FTC) announced reforms to its civil investigative demand (CID) process designed to streamline information requests and improve transparency in FTC investigations.  The process reforms that will be implemented for consumer protection cases include:

  • Providing plain language descriptions of the CID process and developing business education materials to help small businesses understand how to comply;
  • Adding more detailed descriptions of the scope and purpose of investigations to give companies a better understanding of the information the agency seeks;
  • Where appropriate, limiting the relevant time periods to minimize undue burden on companies;
  • Where appropriate, significantly reducing the length and complexity of CID instructions for providing electronically stored data;
  • Where appropriate, increasing response times for CIDs (for example, often 21 days to 30 days for targets, and 14 days to 21 days for third parties) to improve the quality and timeliness of compliance by recipient; and
  • Ensuring companies are aware of the status of investigations by adhering to the current practice of communicating with investigation targets concerning the status of investigations at least every six months after they comply with the CID.
… Continue Reading

The CFPB final arbitration rule is scheduled to be published in the Federal Register tomorrow, July 19.

The rule’s effective date will be the 60th day after publication and the mandatory compliance date will be March 19, 2018.  Based on our calculation, the effective date will be Monday, September 18, 2017 (since the 60th calendar day is Sunday, September 17).… Continue Reading

State bankers associations from all 50 states and Puerto Rico have sent a letter to Senate Majority Leader Mitch McConnell and Senate Minority Leader Charles Schumer urging them to support efforts to override the CFPB’s final arbitration rule under the Congressional Review Act.

The associations state that the rule “would create a windfall for unscrupulous class-action attorneys, provide little or no relief to harmed consumers, and effectively eliminate an accessible alternative to the often-daunting judicial system.” … Continue Reading

Keith Noreika, the Acting Comptroller of the Currency, has sent a letter dated July 17 to Director Cordray asking him to delay publication of the CFPB’s final arbitration rule in the Federal Register.  The July 17 letter responds to Director Cordray’s July 12 letter to Mr. Noreika.  In his July 12 letter, Director Cordray responded to Mr.… Continue Reading