On October 31, the CFPB entered into a consent order with a Florida-chartered credit union for harming consumers in connection with the botched launch of a new online banking system, in violation of the Consumer Financial Protection Act (CFPA). Continue Reading CFPB Penalizes Major Credit Union for Mishandled Online Banking Program Rollout
consumer protection
D.C. Attorney General Settles with Title Insurance Company for Alleged Kickback Scheme
On October 24, the District of Columbia Office of the Attorney General (the “DCAG”) announced that it entered into a $500,000 settlement with a title insurance company following an investigation, alleging that the company engaged in an illegal kickback scheme. Specifically, the DCAG determined that the title company offered real estate agents discounted ownership interests and profit-sharing in entities created specifically for the purpose of incentivizing those agents to make business referrals to the title company.Continue Reading D.C. Attorney General Settles with Title Insurance Company for Alleged Kickback Scheme
FTC Finalizes ‘Click to Cancel’ Rule
On October 16, the FTC announced that it has finalized its “click to cancel” rule, that will require sellers to make it much easier for consumers to cancel subscriptions. The final rule is part of the FTC’s ongoing review of its 1973 Negative Option Rule, which the agency is modernizing to combat unfair or deceptive practices related to subscriptions, memberships, and other recurring-payment programs.Continue Reading FTC Finalizes ‘Click to Cancel’ Rule
California Enacts Law Prohibiting State Banks and Credit Unions from Charging NSF Fees
On September 24, the Governor of California signed AB 2017 (the “Act”) into law. The Act prohibits state-chartered banks and credit unions from charging consumers non-sufficient fund fees (“NSF fees”) when they initiate transactions that are instantaneously declined due to insufficient funds.Continue Reading California Enacts Law Prohibiting State Banks and Credit Unions from Charging NSF Fees
DFPI Cracks Down on Illegal Student Loan Debt Relief Practices
On September 17, the California Department of Financial Protection and Innovation (DFPI) announced enforcement actions against three student loan debt relief companies. The companies were ordered to cease unlawful practices, including charging upfront fees prior to providing services. They were also required to cancel all outstanding contracts with California consumers, issue refunds, and collectively pay $260,000 in penalties.Continue Reading DFPI Cracks Down on Illegal Student Loan Debt Relief Practices
Credit Repair Company Fined $50M for Misleading Consumers
On September 30, a credit repair service provider and its owner were ordered to pay $31 million in consumer redress, and a $19 million civil money penalty, when a Massachusetts federal court granted summary judgment for the CFPB and the Massachusetts Attorney General.Continue Reading Credit Repair Company Fined $50M for Misleading Consumers
California Expands Debt Collection Protections for Small Businesses and Consumers
On September 24, California enacted a series of consumer protection laws, including three bills aimed specifically at restricting certain debt collection practices in connection with medical debt reporting, civil actions for money judgments, and commercial debt collection.Continue Reading California Expands Debt Collection Protections for Small Businesses and Consumers
The CFPB Continues to Reshape Consumer Protection in the Digital Arena
On August 28, the CFPB issued a Consumer Advisory warning that it believes video game companies are targeting children for monetary gain. With 45.7 million U.S. children engaged in video gameplay, the agency is concerned about the financial risks that games and virtual worlds pose, especially to young consumers. This Advisory highlights a growing focus on the game industry’s practices, which allegedly mimic traditional banking systems but lack corresponding consumer protections. Continue Reading The CFPB Continues to Reshape Consumer Protection in the Digital Arena
Advocacy Group Petitions CFPB to Categorize Housing Rental Leases as “Credit”
On August 12, the National Consumer Law Center (NCLC), a prominent consumer advocacy group, petitioned the CFPB to open rulemaking under the Equal Credit Opportunity Act (ECOA) to expand the definition of “credit” to include housing and apartment rental leases, and “creditors” to include landlords. While acknowledging that landlords are already banned from discriminating against prospective tenants under the federal Fair Housing Act, the petition aims to secure two additional protections. Continue Reading Advocacy Group Petitions CFPB to Categorize Housing Rental Leases as “Credit”
Allegedly Deceptive Credit Repair Scheme Settles with FTC for $12 Million
On August 5, the FTC announced a proposed settlement which included a $12 million fine in connection with a complaint it filed against operators of a credit repair operation in May of 2022. The initial complaint alleged that the company violated the Credit Repair Organizations Act, the FTC Act’s prohibition against unfair, deceptive, and abusive acts and practices, and the Telemarketing Sales Rule, by preying on consumers with low credit scores by deceptively promising credit building services they could not deliver on, and taking illegal advance fees. Continue Reading Allegedly Deceptive Credit Repair Scheme Settles with FTC for $12 Million
CFPB Settles Action against Third-Party Service Provider Supporting Credit Repair Industry
On August 8, the CFPB filed a proposed order to resolve its 2021 lawsuit (previously discussed here) against a California-based software company and its CEO for their role in helping credit repair businesses charge illegal advance fees to customers in violation of the Telemarketing Sales Rule and the Consumer Financial Protection Act.Continue Reading CFPB Settles Action against Third-Party Service Provider Supporting Credit Repair Industry