Payday Lending

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In its Spring 2014 Supervisory Highlights report issued yesterday, the CFPB highlighted deficiencies and violations it found during examinations of consumer reporting agencies (CRAs), debt collectors and payday lenders.  The CFPB has authority to examine entities that qualify as “larger participants” under the final rules it adopted to supervise participants in the debt collection and consumer reporting markets and to examine payday lenders regardless of their size.… Continue Reading

Last Friday, the CFPB replied to the arguments made by three tribally-affiliated payday lenders in opposition to the CFPB’s petition in California federal court seeking to enforce the civil investigative demands (CIDs) issued by the CFPB to the lenders.  A hearing on the petition was scheduled for yesterday.   

The lenders argued that, as arms of sovereign tribes, they are not subject to the CFPB’s investigative authority. … Continue Reading

We recently reported that the CFPB has filed a petition in U.S. District Court for the Central District of California seeking to enforce the civil investigative demands (CIDs) it issued in June 2012 to three tribally-affiliated payday lenders.  A hearing on the petition has been scheduled for April 28.

In their joint memorandum of law filed in opposition to the CFPB’s petition, the lenders argue that, as arms of sovereign tribes, they are not subject to the CFPB’s investigative authority. … Continue Reading

As we previously reported, the House of Representatives Financial Services Committee held a hearing on the effects of regulatory “red tape.” In her opening statement, Meredith Fuchs, General Counsel of the Consumer Financial Protection Bureau, spoke about the goals of the CFPB in seeking input from impacted entities. Before enacting a rule, she said, the CFPB considers the costs and benefits to consumers and financial institutions, particularly the compliance burdens associated with a particular rule as compared to less burdensome alternatives.… Continue Reading

Laura Udis, the CFPB’s program manager for the payday lending industry, spoke on April 10 in Los Angeles on a panel sponsored by the American Bar Association Consumer Financial Services Committee.  CFPB staff members are generally somewhat constrained in commenting on future CFPB actions.  However, Ms. Udis advised that, in its rule-making, the CFPB may take a look at required payment plans, databases and multiple loan limits.  … Continue Reading

The CFPB recently filed a petition in U.S. District Court for the Central District of California seeking to enforce the civil investigative demands (CIDs) it issued in June 2012 to three tribally-affiliated payday lenders.  A hearing on the petition has been scheduled for April 28.

In September 2013, the CFPB issued an order denying the lenders’ petition requesting that the CFPB set aside the CIDs. … Continue Reading

At the Practicing Law Institute’s 19th Annual Consumer Financial Services Institute held on Monday in New York City, Meredith Fuchs, Associate Director & General Counsel for the CFPB delivered the opening keynote address, which touched on a number of topics regarding current areas of interest of the CFPB and provided updates on where several of such initiatives are heading.… Continue Reading

The Senate Banking Committee’s subcommittee on Financial Institutions and Consumer Protection is holding a hearing today titled: “Are Alternative Financial Products Serving Consumers?”  Observers have noted that the hearing could provide insight into the priorities of Democratic Senator Sherrod Brown who chairs the subcommittee and is expected to become chair of the full Banking Committee if Democrats maintain control of the Senate.  … Continue Reading

The CFPB has marshaled data against what it sees as a sustained use problem by payday loan borrowers and is “in the late stages” of drafting rules to limit payday loan borrowing, according to Director Cordray’s remarks prepared for today’s field hearing.

It appears that in the near future the Bureau will issue a notice of proposed rulemaking in which it concludes that repeated payday loan borrowing is “unfair” or “abusive” under the Dodd-Frank Act.… Continue Reading

Earlier this month, the CFPB issued a press release describing its second snapshot report of complaints from military consumers.  The report details complaints the CFPB has received from servicemembers, veterans, and their families and the measures it has taken in response.  Between July 2011 and January 2014, the CFPB has received approximately 14,000 complaints, handling more than 250 complaints per week in the last fiscal quarter. … Continue Reading