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Category Archives: CFPB Enforcement

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Tribally-affiliated lenders file opposition to CFPB’s petition to enforce CIDs

Posted in CFPB Enforcement, Payday Lending

We recently reported that the CFPB has filed a petition in U.S. District Court for the Central District of California seeking to enforce the civil investigative demands (CIDs) it issued in June 2012 to three tribally-affiliated payday lenders.  A hearing on the petition has been scheduled for April 28. In their joint memorandum of law… More >

Guilty pleas entered in CFPB’s first criminal referral

Posted in CFPB Enforcement

The CFPB’s first publicly announced criminal referral has resulted in the entry of guilty pleas by a debt settlement company and its principal, according to a Reuters report.  The referral, which was made to the U.S. Attorney for the Southern District of New York, arose out of the CFPB’s investigation of two debt-relief service providers… More >

CFPB General Counsel Meredith Fuchs in the “Disparate Impact” Hot Seat

Posted in Auto Finance, CFPB Enforcement, Vehicle Loans

As we previously reported, the House Financial Services Committee has been interested in the specific methodology and metrics used by the CFPB in its disparate impact analysis under the Equal Credit Opportunity Act and Regulation B. On March 7, Chairman Hensarling sent a letter to Director Cordray seeking a response to the Committee’s questions, and… More >

Did the CFPB Run a Stop Sign?

Posted in CFPB Enforcement, Fair Lending, Vehicle Loans

As we previously reported, last Friday House Financial Services Committee Chairman Jeb Hensarling (R-TX) sent a letter to CFPB Director Richard Cordray asking for a response by March 13 to specific questions about the methodology and analyses employed by the CFPB in determining whether dealer finance charge participations violate the Equal Credit Opportunity Act and… More >

House Financial Services Committee Chairman to CFPB on Indirect Auto Investigations: Slow Down. Pull Over. And Show Us Some ID.

Posted in CFPB Enforcement, Fair Lending, Vehicle Loans

Since last March, when the CFPB issued Bulletin No. 2013-02, its highly controversial release warning banks and finance companies that purchase motor vehicle installment sales contracts that, under existing law, any dealer finance charge participation may violate the Equal Credit Opportunity Act and Regulation B, numerous members of Congress have been unsuccessful in seeking clear… More >

Director Cordray highlights CFPB collaboration with state AGs

Posted in CFPB Enforcement

The CFPB’s collaboration with state attorneys general was the focus of Director Cordray’s remarks today to the National Association of Attorneys General.  Director Cordray discussed the role of such collaboration in various CFPB enforcement actions, including its actions against Payday Loan Debt Solutions and CashCall.  He also commented that in addition to cases that have… More >

CFPB settles self-reported RESPA violations

Posted in CFPB Enforcement, Mortgages

The CFPB announced today that it has issued a Consent Order under which a Connecticut mortgage lender that self-reported potential RESPA Section 8 violations agreed to pay an $83,000 civil money penalty for such violations.  According to the CFPB’s press release, in addition to reporting its own potential violations, the lender provided information “related to the… More >

Trade group criticizes CFPB reliance on enforcement and informal guidance

Posted in CFPB Enforcement, Credit Cards, Fair Lending

The U.S. Chamber of Commerce’s Center for Capital Markets Competitiveness has sent a detailed letter to Director Cordray in which it criticizes the CFPB’s approach of “regulation by enforcement settlement combined with issuance of brief guidance statements” in lieu of engaging in rulemaking or otherwise soliciting public input.  In the letter, the Chamber expresses its strong… More >

CFPB supervisory report highlights exam report changes, non-public supervisory actions and mortgage servicing deficiencies

Posted in CFPB Enforcement, CFPB Exams, Mortgages

Last month, the CFPB began using new templates for its examination reports and supervisory letters (collectively, “reports’).  The template changes were announced in the CFPB’s Winter 2013 Supervisory Report, which highlights supervision work completed between July and October 2013.  CFPB examiners (who numbered approximately 320 as of January 2, 2014) began using the new templates for… More >

CFPB denies payday lender’s petition to modify or set aside CID

Posted in CFPB Enforcement, Payday Lending

The CFPB has issued an order denying the petition filed by CheckSmart Financial Company in September 2013 to modify or set aside a civil investigative demand (CID) it received from the CFPB.  As we previously reported, the petition stated that the CID was issued in connection with a nonpublic investigation launched by the CFPB “to… More >

CFPB settles RESPA referral fee charges against mortgage lender based on rent payments

Posted in CFPB Enforcement, Mortgages

The CFPB has announced that it has issued a Consent Order to settle charges that a mortgage lender and its principal violated RESPA Section 8 by paying illegal kickbacks to a bank in exchange for mortgage loan referrals.  According to the Consent Order, the lender had entered into an agreement with a bank in which the… More >

CFPB sends enforcement action “early warning” to for-profit postsecondary education provider

Posted in CFPB Enforcement, Student Loans

In a Form 8-K filed with the SEC on December 27, 2013, ITT Educational Services, Inc. disclosed that it has received a CFPB “early warning” letter stating that the CFPB’s Enforcement Office is considering recommending that the CFPB take legal action against ITT.  Such letters, which are sent pursuant to the CFPB’s discretionary Notice and… More >

OIG issues report criticizing CFPB’s practice of bringing enforcement attorneys to exams

Posted in CFPB Enforcement, CFPB Exams

Effective this past November 1, the CFPB ended its controversial practice of having enforcement attorneys regularly participate in examinations of supervised entities.  Since first learning of the CFPB’s practice, we had expressed our deep concern about the practice’s inhibiting effect on free and open communications between the CFPB and supervised entities and urged the CFPB… More >

CFPB bootstraps purported state law violations into attack on online payday lending companies

Posted in CFPB Enforcement, Payday Lending

The CFPB has broken new ground in an attack in Massachusetts federal court against CashCall, several related companies and their principal.  The companies funded, purchased, serviced and collected online payday loans made by a tribally-affiliated lender the CFPB did not sue.  The defendants were charged with engaging in unfair, deceptive and abusive acts and practices… More >

Payday lender files petition to modify or set aside CID

Posted in CFPB Enforcement, Payday Lending

The CFPB recently posted to its website a petition filed by CheckSmart Financial Company to modify or set aside a civil investigative demand it received from the Bureau. According to the petition, the CID was issued in connection with a nonpublic investigation launched by the CFPB “to determine whether payday lenders, check cashers, their affiliates,… More >

CFPB settles lawsuit challenging loan officer bonuses

Posted in CFPB Enforcement, Mortgages

For mortgage industry members wondering how serious the CFPB will be when enforcing the Regulation Z loan originator compensation rule (“LO Compensation Rule”) we now have an answer— $13 million dollars serious.   As we reported previously, in July 2013, the CFPB filed suit in the U.S. District Court for the District of Utah against Castle… More >

CFPB plans to continue targeting of individuals in enforcement actions

Posted in CFPB Enforcement

In a speech last week to the Reuters Washington Summit, Director Cordray is reported to have indicated that the CFPB is committed to pursuing individuals, and not just companies, when exercising its enforcement authority.  Mr. Cordray reportedly said that “[c]ompanies run through individuals, and individuals need to know that they’re at risk when they do bad… More >

CFPB files RESPA suit for alleged kickbacks to affiliated businesses

Posted in CFPB Enforcement, Mortgages

Last week, the CFPB announced that it had filed a lawsuit against a Kentucky law firm and its principals, alleging that the defendants violated Section 8 of the Real Estate Settlement Procedures Act (RESPA) by creating a network of Affiliated Business Arrangements (ABAs) to pay illegal kickbacks for mortgage settlement referrals. The complaint was filed… More >

CFPB ramps up enforcement of HMDA

Posted in CFPB Enforcement, CFPB General, Fair Lending

The CFPB announced on October 9, 2013 that they entered into consent orders with two financial institutions that allegedly misreported HMDA data.  The CFPB also issued Bulletin 2013-11, which provides guidance on compliance with HMDA, when the CFPB will pursue HMDA enforcement actions, and resubmission of HMDA data. According to the consent orders and the… More >

CFPB will stop bringing enforcement attorneys to exams

Posted in CFPB Enforcement, CFPB Exams

Politico has reported that, effective November 1, the CFPB will end its practice of having enforcement attorneys regularly participate in examinations of supervised entities. According to the report, Director Cordray announced the change on a conference call with CFPB examiners. The report indicated that a CFPB spokeswoman attributed the change to an internal review that… More >

CFPB brings enforcement action against debt settlement payment processor

Posted in CFPB Enforcement, Payday Lending

In the latest chapter of its “comprehensive effort to prevent consumer harm in the debt-settlement industry,” the CFPB has announced the settlement of an enforcement action brought against “a leading debt-settlement payment processor” and its CEO and owner.  In its complaint, the CFPB alleged that the defendants had violated the Telemarketing Sales Rule by assisting and… More >

CFPB denies petition by tribal payday lenders to set aside CIDs

Posted in CFPB Enforcement, Payday Lending

On September 26, the CFPB issued a 10-page order denying a petition filed jointly by three tribal payday lenders that asked the CFPB to set aside the civil investigative demands (CIDs) the lenders received from the CFPB.  The order describes the lenders as “limited liability companies organized and chartered under the laws of federally recognized… More >

CFPB issues interim final rule on temporary C&Ds

Posted in CFPB Enforcement, CFPB General, CFPB Rulemaking

The CFPB has issued an interim final rule with a request for public comment on its new rules of practice for the issuance of temporary cease-and-desist orders (“Temporary C&Ds”). The Bureau is authorized to issue Temporary C&Ds under Section 1053(c) of the Dodd-Frank legislation. That provision, similar in many respects to the comparable provision in… More >

Director Cordray gives wide-ranging testimony to House Financial Services Committee

Posted in Arbitration, CFPB Enforcement, CFPB General, CFPB Rulemaking, Credit Reports

Although the House Financial Service Committee’s hearing last Thursday was entitled “The Semi-Annual Report of the Consumer Financial Protection Bureau,” the contents of the report received little mention from committee members.  Instead, committee members questioned Director Cordray, the sole hearing witness, on a wide range of topics.  Highlights include the following: The CFPB’s data collection… More >