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Recently, the CFPB released an outline of proposed measures related to the Bureau’s Dodd-Frank Section 1033 rulemaking efforts that would allow consumers the rights over their personal financial data. The outline discusses proposed regulations that would require covered data providers to make consumer financial data available directly to a consumer and to any third parties authorized by the consumer. Under these proposed regulations, consumers would be able to easily switch financial providers and transfer their account history to a new provider. In a high-level summary of the proposed regulations, the CFPB discusses the regulatory provisions it is considering proposing, including the following:
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Continue Reading CFPB Issues Proposed Rulemaking on Data Access and Portability

On October 26, the CFPB issued guidance to help banks avoid charging illegal overdraft fees on consumer deposit accounts. In its Circular 2022-06, the Bureau stated that overdraft fees assessed by financial institutions on transactions that a consumer would not reasonably anticipate likely violate the CFPA. The CFPB further highlighted two particular categories of so-called “junk fees” that likely qualify as unfair and unlawful under the CFPA (we covered the CFPB’s focus on junk fees in previous blogs here and here):
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Continue Reading CFPB Issues Latest Crack Down on Junk Fees

On October 19, in Community Financial Services Association of America, Limited v. Consumer Financial Protection Bureau, a three-judge panel in the Fifth Circuit unanimously found the CFPB’s funding structure to be unconstitutional, holding that it violates the U.S. Constitution’s Appropriations Clause. This decision followed a challenge by the CFSA to the CFPB’s “payday rule,” which prohibits lenders from withdrawing loan payments from consumer accounts after multiple failed attempts due to insufficient funds.
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Continue Reading Fifth Circuit Rules CFPB Funding Structure Unconstitutional in Next Turn of Litigation

On September 29, the CFPB released its annual report on residential mortgage lending activity and trends for 2021. Notably, the report shows a shift from refinance loans in 2020 to home purchase loans in 2021—with a greater share of home purchase loans going to Asian, Black, and Hispanic white borrowers relative to the share of home purchase loans for non-Hispanic white borrowers. Additionally, the top 25 closed-end lenders by loan volume held nearly half of the market share of residential mortgage lending; continuing a trend that has risen each year since 2018. Key findings from this year’s report includes:
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Continue Reading CFPB Annual Report: End to Mortgage Refinancing Boom, Increase in Home Purchase Loans

On October 18, 2022, the CFPB sued a software company that manages online payment platforms claiming that it utilized unlawful enrollment practices to cause unknowing consumers to automatically enroll in annual subscriptions. According to the CFPB, the software company generated over $300 million in fees from approximately three million consumers through engagement in deceptive acts and “dark pattern” techniques in violation of the CFPA and EFTA by:
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Continue Reading CFPB Sues Payment Platform as the Crack Down on Dark Patterns Continues

On September 29, the CFPB released a special edition of Supervisory Highlights on student loan servicing practices of loan servicers and schools lending to students directly. The report highlights three notable findings related to transcript-withholding practices: Federal Student Loan transfers, and Federal Student Loan payment relief and cancellation programs:
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Continue Reading CFPB Supervisory Examinations Find Violations by Student Loan Servicers and University-Owned Lenders

On September 22, the CFPB released its annual report providing an overview of the residential mortgage trends and activity in 2021 based on data collected from thousands of U.S. lending institutions under the Home Mortgage Disclosure Act (HMDA). Some of the key findings in the report include:
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Continue Reading 2021 CFPB Annual Report Shows Increase in Home Purchase Loans, Decrease in Refinancing

Recently, the CFPB released a report outlining the challenges and risks inherent in the rapid evolution of the payment ecosystem, with a particular focus on emerging uses cases involving “super apps,” buy now, pay later (BNPL), and embedded payments, as well as their implications for consumers. The report notes that these changes create more opportunities for companies to aggregate and monetize consumer financial data, and for large players to dominate consumers’ financial and commercial lives.
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Continue Reading CFPB Warns of Consumer Risk Over New Payment Products, Foreshadows Supervision of BNPLs

The FTC recently published an advance notice of proposed rulemaking to discuss harms associated with the collection, processing, and selling of personal data. The FTC is inviting public comments on whether it should implement new rules on how companies:
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Continue Reading FTC Signals Focus on Increasing Protections Around Personal Data

On August 10, the CFPB issued an interpretive rule stating that digital marketing providers that are involved in the identification or selection of prospective customers or the selection or placement of content to affect consumer engagement including purchase or adoption behavior, are subject to the CFPB’s jurisdiction. The rule ostensibly clarifies the scope of companies that are “service providers” under the CFPA to include digital marketing providers, and thereby subjecting them to the CFPB’s authority to prohibit UDAAPs.
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Continue Reading CFPB’s New Interpretive Rule Sets Sights on Digital Marketing Vendors

On August 11, the CFPB published a circular clarifying liability under consumer financial protection law for bank and nonbank financial companies that fail to safeguard consumer data. The circular describes how firms may be violating the CFPA’s prohibition on unfair acts or practices with respect to the handling of consumer data by not implementing adequate measures to protect against data security incidents. These data security incidents may lead to significant harm to a few consumers—who, for example, become victims of targeted identify theft after a breach—or may lead to harm of many consumers in the event of large scale, customer-base-wide breaches. The circular includes specific examples for reference.
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Continue Reading CFPB Circular: Safeguard Consumer Data or Face Liability