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Category Archives: Payday Lending

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CFPB shows its hand on payday (and title and longer-term high-rate) lending

Posted in Deposit Advance Loans, Payday Lending, Vehicle Loans

The CFPB has moved a step closer to issuing payday loan rules by releasing a press release, factsheet and outline of the proposals it is considering in preparation for convening a small business review panel required by the Small Business Regulatory Enforcement Fairness Act and Dodd-Frank.  The CFPB’s proposals are sweeping in terms of the… More >

Another payday loan study finds affordability and rollover limits do not benefit borrowers

Posted in Payday Lending

We recently wrote about three studies that cast serious doubt on the benefit to payday loan borrowers of an ability-to-repay requirement, a payment-to-income (PTI) ratio ceiling, and rollover limits, three potential payday loan restrictions thought to be under consideration by the CFPB. The findings of these studies find support in another study released this week… More >

CFPB to hold March 26 payday lending field hearing

Posted in Payday Lending

The CFPB has announced that it will hold a field hearing on payday lending on March 26, 2015 in Richmond, Virginia.  Like other CFPB field hearings, the event will feature remarks from Director Richard Cordray, as well as testimony from consumer groups, industry representatives, and members of the public. At his appearance last week before… More >

Director Cordray appears before House Financial Services

Posted in CFPB Rulemaking, Hot Issues, Overdrafts, Payday Lending, Prepaid Cards, Richard Cordray, TILA / RESPA

On Tuesday, March 3, CFPB Director Richard Cordray appeared before the House Financial Services Committee to answer questions regarding the Bureau’s Semi-Annual Report to Congress and the President, which it published on December 4 of last year.  As we anticipated shortly before Director Cordray’s testimony, the report merely provided a backdrop for the hearing, which,… More >

Liberal and minority caucuses press Director Cordray for payday loan limits

Posted in Payday Lending

The leaders of four liberal and minority Congressional caucuses have written to Director Cordray to urge the CFPB to adopt “strong protections” for payday loans.  The letter was signed by the co-chairs of the Congressional Progressive Caucus and the chairs of the Congressional Hispanic Caucus, Congressional Black Caucus, and Congressional Asian Pacific American Caucus. The… More >

Another study raises questions about possible CFPB payday loan limits

Posted in Payday Lending

We recently wrote about two studies, one by Professor Ronald Mann and the other by Professor Jennifer Lewis Priestley, that cast serious doubt on the benefit to payday loan borrowers of an ability-to-repay requirement and limits on rollovers for payday loans, two elements that the CFPB is expected to include in its payday loan proposal. Another recent… More >

Payday loan rulemaking prediction: CFPB will issue proposal this summer

Posted in Payday Lending

Isaac Boltansky of Compass Point has issued an estimated timeline for the CFPB’s payday loan rulemaking that includes a July 2015 expected date for the CFPB’s release of a proposed rule. Mr. Boltansky estimates that the CFPB will  initiate a small business panel pursuant to the Small Business Regulatory Enforcement Fairness Act (SBREFA) this month, conclude… More >

Studies question value of expected CFPB payday loan limits

Posted in Payday Lending

The CFPB’s payday loan rulemaking was the subject of a NY Times article this past Sunday which has received considerable attention. According to the article, the CFPB will “soon release” its proposal which is expected to include an ability-to-repay requirement and limits on rollovers. Two recent studies cast serious doubt on the rationale typically offered… More >

NY Regulator and House Republicans weigh in on CFPB payday loan rulemaking

Posted in Payday Lending

Not surprisingly, letters sent to the CFPB this week by New York Financial Services Superintendent Benjamin Lawsky and by 12 House Republicans urge the CFPB to take very different approaches as it considers payday and short-term loan rulemaking. In their letter, the House Republicans set forth the following five principles which they believe the CFPB should… More >

Defense Department proposes expansion of Military Lending Act regulations

Posted in Military Issues, Payday Lending

As anticipated, the Department of Defense’s proposed regulations to implement provisions of the Military Loan Act added by the 2013 Defense Authorization Bill would significantly expand MLA coverage.  The proposed revisions would limit interest charged to servicemembers and their dependents on all payday loans, vehicle title loans, refund anticipation loans, deposit advance loans, installment loans,… More >

CFPB and FTC file lawsuits against online payday lenders

Posted in CFPB Enforcement, Payday Lending

Earlier this month, the CFPB and FTC filed lawsuits against different groups of interrelated companies and their individual principals for engaging in allegedly unlawful online payday lending schemes. The CFPB’s lawsuit, which the CFPB made public yesterday, was filed under seal on September 8, 2014 in a Missouri federal court contemporaneously with an ex parte… More >

FDIC withdraws list of “risky” businesses alleged to be targeted in “Operation Choke Point”

Posted in Payday Lending

In an unexpected move earlier this week, the FDIC issued a Financial Institution Letter announcing that it was withdrawing the list of “risky” merchant categories that was included in prior guidance on account relationships with third-party payment processors.  Among the listed categories were payday loans and money transfer networks. At the House Financial Services Committee… More >

Federal district court grants CFPB petition to enforce CIDs issued to tribal lenders

Posted in CFPB Enforcement, Payday Lending

A California federal court recently issued an order granting the CFPB’s petition to enforce its civil investigative demands (CIDs) issued to three tribally-affiliated payday lenders.  However, the court also granted the lenders’ request for a stay pending their appeal to the Ninth Circuit.  Although the CFPB did not oppose the stay, the court nevertheless found… More >

House to hold hearings on “Operation Choke Point”

Posted in Payday Lending

Two House committees have scheduled hearings this week on “Operation Choke Point,” the coordinated federal multiagency enforcement initiative targeting banks serving online payday lenders and other companies that have raised regulatory concerns.  Tomorrow, July 15, the House Financial Services Committee will hold a hearing entitled “The Department of Justice’s ‘Operation Choke Point.’”  The witnesses scheduled… More >

CFPB obtains $10 million of relief for payday lender’s collection calls

Posted in CFPB Enforcement, Payday Lending

Yesterday, the CFPB and ACE Cash Express issued press releases announcing that ACE has entered into a consent order with the CFPB. The consent order addresses ACE’s collection practices and requires ACE to pay $5 million in restitution and another $5 million in civil monetary penalties. In its consent order, the CFPB criticized ACE for:… More >

CFPB to issue whitepaper on methodology for identifying auto finance discrimination and consider use of advisory opinions

Posted in Auto Finance, Military Issues, Mortgages, Payday Lending

While Director Cordray’s appearance at the House Financial Services Committee’s hearing on the CFPB’s fifth Semi-Annual Report yesterday was accompanied by the usual dose of political theater, his testimony did yield the following items of noteworthy information:  The CFPB will be issuing a white paper later this summer regarding use of the proxy methodology for… More >

CFPB confirms plans for auto finance larger participant rule in rulemaking agenda

Posted in Auto Finance, CFPB Rulemaking, Debt Collection, Deposit Advance Loans, Payday Lending, Prepaid Cards

In the latest semi-annual update of its rulemaking agenda, the CFPB officially confirmed that it plans to propose a rule to define “larger participants of a market for auto lending.”  The official confirmation follows statements made by Steven Antonakes at a Consumer Bankers Association meeting in April 2014 that the CFPB’s next larger participant rule… More >

CFPB highlights unlawful practices by consumer reporting agencies, debt collectors and payday lenders

Posted in CFPB Exams, Credit Reports, Debt Collection, Fair Lending, Payday Lending

In its Spring 2014 Supervisory Highlights report issued yesterday, the CFPB highlighted deficiencies and violations it found during examinations of consumer reporting agencies (CRAs), debt collectors and payday lenders.  The CFPB has authority to examine entities that qualify as “larger participants” under the final rules it adopted to supervise participants in the debt collection and… More >

CFPB replies to tribally-affiliated lenders’ opposition to CIDs

Posted in CFPB Enforcement, Payday Lending

Last Friday, the CFPB replied to the arguments made by three tribally-affiliated payday lenders in opposition to the CFPB’s petition in California federal court seeking to enforce the civil investigative demands (CIDs) issued by the CFPB to the lenders.  A hearing on the petition was scheduled for yesterday.    The lenders argued that, as arms of… More >

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 >

House Committee on Financial Services Concerned with Decreased Consumer Choice

Posted in CFPB General, CFPB People, Payday Lending

As we previously reported, the House of Representatives Financial Services Committee held a hearing on the effects of regulatory “red tape.” In her opening statement, Meredith Fuchs, General Counsel of the Consumer Financial Protection Bureau, spoke about the goals of the CFPB in seeking input from impacted entities. Before enacting a rule, she said, the… More >

Hints of future payday rule-making

Posted in Payday Lending

Laura Udis, the CFPB’s program manager for the payday lending industry, spoke on April 10 in Los Angeles on a panel sponsored by the American Bar Association Consumer Financial Services Committee.  CFPB staff members are generally somewhat constrained in commenting on future CFPB actions.  However, Ms. Udis advised that, in its rule-making, the CFPB may… More >

CFPB amends CashCall complaint

Posted in Payday Lending

The CFPB has filed an amended complaint in its lawsuit against CashCall and several related companies that funded, purchased, serviced and collected online payday loans to identify additional states in which the loans defendants sought to collect were purportedly void in whole or in part as a matter of state law.  The loans in question… More >