UDAAP
The Dodd-Frank Act added provisions allowing the Consumer Financial Protection Bureau (CFPB) to restrict “abusive” acts under their UDAAP authority. This is in addition to the Unfair and Deceptive Acts or Practices (UDAP) authority that existed under the FTC Act. These provisions under the Dodd-Frank Act could have the most impact on the operations of our member banks, both with regard to possible enforcement actions and upcoming rulemaking that would interpret these provisions. Examination guidelines issued by the CFPB also address UDAAP practices.
February 5, 2020On Wednesday, February 5, the Consumer Financial Protection Bureau announced a proposed settlement with Think Finance, LLC , and six subsidiaries to resolve a CFPB lawsuit from November, 2017. The Bureau alleged that the Think Finance Entities engaged in unfair, deceptive, and abusive acts and practices in connection with the illegal collection of loans that were void in whole or in part under...
May 17, 2019On Friday, May 17, 2019, the CFPB issued a press release regarding filing a lawsuit in the federal district court in the Eastern District of New York against Forster & Garbus, LLP, a New York debt-collection law firm. The Bureau’s complaint alleges that Forster & Garbus violated the Fair Debt Collection Practices Act by representing to consumers that attorneys were meaningfully involved...May 17, 2019On Friday, May 17, 2019, the CFPB issued a press release regarding filing a lawsuit in the federal district court in the Eastern District of New York against Forster & Garbus, LLP, a New York debt-collection law firm. The Bureau’s complaint alleges that Forster & Garbus violated the Fair Debt Collection Practices Act by representing to consumers that attorneys were meaningfully involved...
March 28, 2018On Wednesday, March 28, 2018, the FDIC announced settlements with Cross River Bank , and its institution-affiliated party, Freedom Financial Asset Management, LLC for unfair and deceptive practices in violation of the FTC Act related to the marketing and origination of Consolidation Plus Loans. The FDIC also found the bank and its institution violated TILA and EFTA. The settlement will require...
October 20, 2017On Friday, October 20, 2017, the OCC issued a Bank Supervision Policies and Procedures Manual ( PPM 5000-43 ) on Impact of Evidence of Discriminatory or other Illegal Credit Practices on Community Reinvestment Act Ratings. The PPM addresses the considerations the OCC will take to address “compliance downgrades” on CRA performance evaluations in the future. The PPM sets forth two principles that...
September 6, 2017On Wednesday, September 6, 2017, the CFPB took action against Zero Parallel , LLC, an online lead aggregator,claiming the company pushed consumers towards lenders who offered illegal or unlicensed loans often void in the customer’s state. The Bureau claims Zero Parallel sold consumers’ payday and installment loan applications to lenders it knew were likely to make void loans the lenders had no...
August 23, 2017CFPB Takes Action against American Express Subsidiaries On Wednesday, August 23, 2017, the CFPB took action against two American Express banking subsidiaries for allegedly discriminating against consumers in Puerto Rico, the U.S. Virgin Islands, and other U.S. territories. The agency claims the companies provided consumers with credit and charge card terms inferior to those available in the 50...
July 31, 2017On Monday, July 31, 2017, the CFPB issued a bulletin warning companies about tricking consumers into expensive pay-by-phone fees. The Bureau expressed concerned about companies potentially misleading consumers about the purpose and amount of certain pay-by-phone fees or keeping them in the dark about much cheaper payment options. The bulletin also reviews guidelines to help consumer financial...
June 8, 2017On Thursday, June 8, 2017, the CFPB announced it had sent letters to top retail credit card companies encouraging the use of more transparent transactions. The letter addresses the agency’s concerns with retailers using deferred-interest promotions for credit cards. “With its back-end pricing, deferred interest can make the potential costs to consumers more confusing and less transparent,” said...Pages
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