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

On October 11, California’s Office of Administrative Law (“OAL”) approved the Department of Financial Protection and Innovation’s (“DFPI’s”) registration rulemaking for providers of the following products:

  • Income-Based Advances (more commonly known as earned wage access (“EWA”) products);
  • Private Postsecondary Education Financing (including income share agreements (“ISAs”);
  • Debt Settlement Services; and
  • Student Debt Relief Services.
… Continue Reading

Our podcast listeners are very familiar with federal fair lending and anti-discrimination laws that apply in the consumer lending area: the Equal Credit Opportunity Act (ECOA) and Fair Housing Act (FHA). Those statutes prohibit discriminating against certain protected classes of consumer credit applicants. For example, the ECOA makes it unlawful for any creditor to discriminate against any applicant, with respect to any aspect of a credit transaction, on the basis of race, color, religion, national origin, sex, marital status, or age (provided the applicant has the capacity to contract); the applicant’s use of a public assistance program to receive all or part of their income; or the applicant’s previous good-faith exercise of any right under the Consumer Credit Protection Act.… Continue Reading

We previously wrote about a California federal district court decision in Heckman v. Live Nation Entertainment that denied Ticketmaster’s motion to compel arbitration of Sherman Act antitrust claims based in large part on the bellwether procedures for mass arbitration claims set forth in the company’s arbitration clause.  That decision has now been affirmed by the Ninth Circuit Court of Appeals.… Continue Reading

The FCC set April 11, 2025 as the effective date for new rules designed to make it easier for consumers to revoke consent for calls and texts subject to the Telephone Consumer Protection Act and requiring callers honor these requests in a timely manner.

The new rules, adopted in February, require that callers honor do-not-call and consent revocation requests within a reasonable time, not to exceed 10 business days from receipt.… Continue Reading

On October 16, 2024, the Bank Policy Institute and the Clearing House Association filed a motion to intervene in Corner Post, Inc. v Board of Governors of the Federal Reserve System. On July 1, 2024, the Supreme Court sided with Corner Post in holding that a Section 702 claim under the Administrative Procedure Act (APA) to challenge a final agency action first accrues when the plaintiff is injured by final agency action and has the right to assert it in court.… Continue Reading

The FDIC is providing financial institutions with additional time to comply with parts of the new FDIC signage and advertising rule by extending the compliance date from January 1, 2025 to May 1, 2025.

The extension only applies to provisions of the final rule governing the use of the official FDIC signs and advertising statements – Part 328, subpart A. … Continue Reading

Alleging that the CFPB rushed to promulgate its interpretive rule, and exceeded its authority in doing so, the Financial Technology Association has filed suit against the bureau in the U.S. District Court for the District of Columbia, contending that the rule falls short on several counts.

Among other things, in the suit, the FTA contends that federal law, the Administrative Procedure Act, required the CFPB to treat the rule as a legislative rule, and, therefore, to go through the notice and comment process in issuing the rule.… Continue Reading

As we have previously reported, there are several CFPB enforcement lawsuits pending in which the defendants have filed motions to dismiss based in whole or in part on the argument that subsequent to September 2022, all funding received by the CFPB from the Federal Reserve Board has been unlawfully received. That is a result of the fact that the Federal Reserve System began then to incur substantial losses after September 2022 which continue to this day with no profits being foreseen in the near future.… Continue Reading