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CFPB keeps heat on payday lending

Posted in Payday Lending

The CFPB wants the public to read the transcript of the field hearing on payday lending it held in Birmingham, Alabama on January 19 and give the CFPB feedback on the issues raised at the hearing. Some of those issues are included in the notice published by the CFPB in the Federal Register which sets an April 23 deadline for receiving comments. While the CFPB’s approach strikes us as odd, it reinforces what we already knew and have written about in a post, which is that the CFPB has the payday lending industry in its crosshairs.

Earlier this year, as we reported in a post, the CFPB issued examination guidelines. As we also reported in this post, the CFPB has started to examine payday lenders. We understand that the CFPB is very focused on ensuring that the lender has written policies and procedures describing how the lender is complying with Federal consumer financial services statutes including the new proscription in Dodd-Frank against engaging in unfair, deceptive and abusive acts or practices. Our firm has been working with payday lenders to develop such policies and procedures and to examine the lender’s compliance with such laws in advance of CFPB exams.