TILA

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On February 27, 2023, the Consumer Financial Protection Bureau (CFPB) entered into a consent order against RMK Financial Corporation d/b/a Majestic Home Loan (RMK), a California-based mortgage lender, based on allegations that it falsely implied government endorsement of its home loans in its marketing. The consent order, which addressed numerous alleged statutory and regulatory violations and a failure to comply with an earlier consent order, prohibits RMK from engaging in any mortgage lending activities (or from receiving remuneration from mortgage lending) going forward, effectively shutting it down.… Continue Reading

In a notice of “Intent to Make Preemption Determination under the Truth in Lending Act (Regulation Z),” the CFPB announced that it is seeking comments on its preliminary determinations that the Truth in Lending Act (TILA) does not preempt certain provisions of the New York Commercial Finance Disclosure Law (CFDL) or the commercial financing laws of California, Utah, and Virginia. … Continue Reading

In Integrity Advance LLC v. Consumer Financial Protection Bureau, a panel of the U.S. Court of Appeals for the Tenth Circuit affirmed a CFPB Order requiring Integrity, a lender making short-term loans, and its CEO, James Carnes, to pay $38.4 million in legal and equitable restitution and imposing civil penalties against Integrity ($7.5 million) and Carnes ($5 million), for alleged violations of the Consumer Financial Protection Act, the Truth in Lending Act, and the Electronic Fund Transfer Act. … Continue Reading

The Federal Trade Commission provided its annual report to the Consumer Financial Protection Bureau on its enforcement and related activities in 2021 regarding the Truth in Lending Act (TILA), Consumer Leasing Act (CLA), and Electronic Fund Transfer Act (EFTA) (collectively, the “Financial Acts”).

Under Dodd-Frank, the FTC retained its authority to enforce these regulations with respect to entities subject to its jurisdiction. … Continue Reading

A divided panel of the U.S. Court of Appeals for the Eleventh Circuit in Daniels v. Select Portfolio Servicing, Inc. held last week that monthly mortgage statements required under the Truth in Lending Act and Regulation Z can constitute communications in connection with the collection of a debt under the Fair Debt Collection Practices Act (FDCPA) and the Florida Consumer Collection Practices Act (FCCPA). … Continue Reading

(Ballard Spahr will hold a webinar on 9/21 at 3pm ET, “The Path Forward for Income Share Agreements.” Register online here.) 

The CFPB issued a consent order against an income share agreement (ISA) provider, Better Future Forward (BFF), in which it concluded that BFF’s ISAs are extensions of credit under the Consumer Financial Protection Act and Truth in Lending Act and are “private education loans” under TILA. … Continue Reading

In filings submitted last week, the Consumer Financial Protection Bureau (the Bureau) both opposed and moved for summary judgment in PayPal, Inc. v. Consumer Financial Protection Bureau, asking the court to put an end to PayPal, Inc.’s lawsuit challenging the prepaid card rule (Rule), which took effect last year. The Rule set out certain fee disclosure requirements, credit-linking restrictions, and other consumer protections for “prepaid accounts.”… Continue Reading

The U.S. Court of Appeals for the Ninth Circuit recently ruled in Gilliam v. Levine that a loan made to an individual trustee to finance repairs on residential property owned by the trust was a “consumer credit transaction” for purposes of the Truth in Lending Act, the Real Estate Settlement Procedures Act, and California’s Rosenthal Act.… Continue Reading

The CFPB has issued its annual report on TILA, EFTA, and the CARD Act which covers activity in 2016 and 2017.  The report provides brief summaries of the 2016 and 2017 enforcement actions brought by the CFPB and other federal agencies with relevant enforcement authority and provides data on reimbursements required as a result of enforcement actions brought during these periods.… Continue Reading

The Department of Education has announced the new federal student loan interest rates for 2019-2020.  For the first time in three years, interest rates on federal student loans will decrease.  Rates for Direct Subsidized and Unsubsidized Loans (for undergraduate students) will fall to 4.53 percent, down from 5.05 percent for the 2018-2019 academic year.  … Continue Reading