On March 21, the FDICFed, and OCC jointly issued an interim final rule to extend the applicability date of certain provisions of the Community Reinvestment Act (CRA) final rule and requested comments on the extension. The CRA, was enacted to encourage banks to help meet the credit needs of low- and moderate-income communities. The new rules, adopted in October 2023, are an effort by federal regulators to increase the CRA’s scope and rigor as well as modernize it for the digital age by better accounting for banks’ internet and mobile banking services. While previous CRA exams focused on the low- and moderate-income lending that banks do around their physical branches, the new rules add the possibility of new assessments in places where banks have online customers. Continue Reading Persisting Regulatory Uncertainty: Federal Regulators Delay New Community Lending Rules

On March 29, the CFPB and the FTC jointly filed an amicus brief with the Eleventh Circuit in a matter involving a dispute under the Fair Credit Reporting Act. The case involves a consumer who filed disputes with a consumer reporting agency (CRA) after discovering multiple errors in her credit file, including incorrect personal information. However, the CRA failed to delete the disputed information, notify any furnishers of the consumer’s dispute, or provide the sources of the disputed information. The consumer sued, alleging the CRA violated the FCRA’s reinvestigation requirement by failing to reinvestigate her dispute regarding her name, address, and SSN information. The CRA claimed the text of the CRA did not require it to reinvestigate incorrect personal identifying information. At summary judgment, the district court found that while the reinvestigation requirement applied to personal identifying information, the CRA did not “willfully or negligently” violate the FCRA because its interpretation of the reinvestigation requirement was not objectively unreasonable.Continue Reading CFPB and FTC Argue Consumer Reporting Companies Have an Obligation to Correct Errors in Joint Amicus Brief

On April 2, at an event at the White House on Data Protection and National Security, CFPB Director Rohit Chopra’s articulated potential changes to the data security regulation landscape and noted that the Bureau is considering rules to amend the Fair Credit Report Acting, tightening the regulation of data brokers that trade in sensitive consumer data. His remarks follow an Executive Order signed by President Biden five weeks ago aimed at protecting American’s sensitive personal data from “countries of concern.” Continue Reading CFPB Announces Potential FCRA Expansion Targeting Brokers of Consumer Data

On April 4, the CFPB published a new Issue Spotlight, titled “Banking in Video Games and Virtual Worlds” that analyzes the increased commercial activity within online video games and virtual worlds and the apparent risks to consumers—in this case, to online gamers. In particular, this report examines how “game assets” are being used and the associated risks, including the emergence of products or services that resemble traditional consumer financial products or services. Continue Reading Report Signals CFPB Taking Aim at Video Game and Virtual Worlds Industries

On March 27, the CFPB issued Circular 2024-02, which warns that remittance providers may be liable under the CFPA for certain deceptive marketing practices related to the speed or cost of sending a remittance transfer. Under EFTA’s “Remittance Rule,” (Subpart B of Regulation E), the term “remittance transfer” includes most electronic transfers of funds sent by consumers in the United States to recipients in other countries. Alarmingly, the Bureau notes that providers may be liable irrespective of whether they are in compliance with the Remittance Rule’s disclosure requirements. The Bureau’s circular singles out the following advertising practices by remittance providers as potentially deceptive in violation of the CFPA:Continue Reading CFPB Issues Guidance on Deceptive Practices by Remittance Transfer Providers

In a significant ruling on March 19, the Third Circuit Court of Appeals held that the CFPB can proceed with its lawsuit against a group of Delaware student loan trusts rejecting their claims that they are just passive financing entities outside the reach of the Bureau’s authority. Continue Reading Third Circuit Ruling Gives CFPB Green Light to Enforce Against Student Loan Trusts

In its latest campaign against “junk fees,” the CFPB announced that it was requesting consumer feedback on fees incurred as part of the residential home loan closing process, such as title insurance, credit reporting, and origination fees, as well as appraisal costs. Continue Reading CFPB Renews Push on “Junk Fees” with Closing Costs in its Sights

On March 6, the CFPB finalized its credit card late fee rule (previously discussed here) aimed at ensuring that late fees charged on consumer credit card accounts are “reasonable and proportional.” The rule amends Regulation Z, which implements the Truth in Lending Act, in two key ways:Continue Reading The CFPB Finalizes Credit Card Late Fee Rulemaking

In the latest development to challenges to the CFPB’s 1071 rulemaking, plaintiff trade associations, including the American Bankers Association and the Texas Bankers Association, have filed a motion for summary judgment requesting the court bar enforcement of the Bureau’s Small Business Lending Rule.Continue Reading Trade Groups Continue Fight Against CFPB’s 1071 Small Business Rulemaking

On February 21, a proposed class action lawsuit was filed against an auto finance company in the U.S. District Court for the Northern District of Georgia alleging various violations of the Military Lending Act (“MLA”). The named plaintiff is a “Covered Borrower” under the MLA, which includes active-duty military servicemembers and their dependents.Continue Reading Auto Finance Company Faces Class Action Lawsuit for Targeting Military Families