The CFPB has filed an amicus brief in Mohamed v. Bank of America, N.A. in which it argues that a prepaid card loaded with pandemic-related unemployment benefits is a “prepaid account” subject to Regulation E, including its error resolution requirements for investigation of consumer disputes.

Regulation E, which implements the Electronic Fund Transfer Act, defines the scope of a covered “account” to include “a prepaid account,” and specifically identifies a “government benefit account” as a category of “prepaid account.”… Continue Reading

The CFPB has issued an interpretive rule addressing the application of the Electronic Fund Transfer Act/Regulation E compulsory use prohibition to COVID-19 relief payments made by federal, state, or local government agencies.

The prohibition makes it unlawful for any person to require a consumer to establish an account for the receipt of electronic funds with a particular financial institution as a condition of employment or receipt of a government benefit.… Continue Reading

PayPal filed a lawsuit against the CFPB last week in the D.C. federal district court seeking to invalidate the Bureau’s prepaid card rule (“Rule”).  The Rule became effective on April 1 of this year.

PayPal’s primary consumer offering is a “digital wallet.”  A digital wallet is primarily used by a consumer to access his or her traditional payment devices (Funding Instruments), such as credit cards, debit cards, and checking accounts in order to allow the consumer to make electronic peer-to-peer transfers of funds or to purchase products from third-party merchants.… Continue Reading

The CFPB’s final rule on prepaid accounts, which became effective on April 1, 2019, requires issuers of prepaid accounts, with certain exceptions, to submit to the CFPB all account agreements that the issuer offers, amends, or withdraws.  The deadline for the initial submissions was May 1, 2019.  (In February 2019, the CFPB released guidance and technical specifications relating to the submission of such agreements.)… Continue Reading

The CFPB’s Spring 2017 rulemaking agenda has been published as part of the Spring 2017 Unified Agenda of Federal Regulatory and Deregulatory Actions.  The preamble indicates that the information in the agenda is current as of April 1, 2017.  Accordingly, the agenda does not reflect the issuance of the CFPB’s final arbitration rule on July 10 or other rulemaking actions taken since April 1 such as the proposed changes to the CFPB’s prepaid account rule and various recent mortgage-related developments. … Continue Reading

As it has done for other CFPB rules, the CFPB has published a small entity compliance guide for its prepaid card rule.  The final rule is generally effective on October 1, 2017.

We have blogged about Republican efforts that are underway in Congress to use the Congressional Review Act to enact a joint resolution of disapproval to nullify the prepaid card rule.… Continue Reading

The CFPB has issued its October 2016 complaint report which highlights complaints about prepaid cards and complaints from consumers in North Carolina and the Charlotte metro area.  The CFPB began taking prepaid card complaints in July 2014.

Earlier this month, the CFPB issued its long-anticipated final rule for general purpose prepaid accounts. … Continue Reading

The CFPB has released its Spring 2016 rulemaking agenda.  The agenda sets the following timetables for key rulemaking initiatives: 

Arbitration.  The Spring 2016 agenda does not reflect the CFPB’s release of its proposed arbitration rule on May 5, 2016, stating only that the CFPB “is preparing to issue a Notice of Proposed Rulemaking this spring.” … Continue Reading

The CFPB released its Fall 2015 rulemaking agenda last Friday.  The agenda sets the following timetables for key rulemaking initiatives:

Arbitration.  The Fall 2015 agenda gives a December 2015 date for further prerule activities.  We assume that date reflects the December 19 due date for the report to be issued by the CFPB’s arbitration Small Business Regulatory Enforcement Fairness Act (SBREFA) panel. … Continue Reading

Based on the CFPB’s Fall 2014 rulemaking agenda, proposed rules dealing with payday loans/deposit advance products, overdrafts, and debt collection are still months away.

The CFPB’s timetables for “prerule activities” are February 2015 for payday loans/deposit advance products, July 2015 for overdrafts, and April 2015 for debt collection.  The CFPB’s Spring 2014 agenda had given timetables for “prerule activities” of September 2014 for payday loans and deposit advance products, February 2015 for overdrafts, and December 2014 for debt collection.… Continue Reading