We reported last week about the novel lawsuit brought by the New York Department of Financial Services (“DFS”) against a large subprime auto finance company and its president and CEO. The DFS relied on Section 1042 of Dodd-Frank in initiating a complaint in federal district court alleging that the defendants engaged in unfair, deceptive and abusive acts or practices and seeking greater injunctive and equitable relief and civil money penalties than would have been available under New York law.
This morning, Joy Feigenbaum, the DFS Superintendent of Banking, spoke about the lawsuit in Chicago at PLI’s 19th Annual Consumer Financial Services Institute (which I co-chair). She indicated that the hearing on the DFS’s motion for a preliminary injunction has been postponed until May 12. She also indicated that while the DFS has been communicating with the CFPB about the lawsuit (which the DFS was required to do under Section 1042 of Dodd-Frank), she does not expect the CFPB to intervene in the case.
Tom James from the Illinois Attorney General’s office spoke on the same panel about the earlier lawsuit brought by the Illinois Attorney General, which also relied upon Section 1042 of Dodd-Frank. Mr. James indicated that part of the logic behind relying upon Section 1042 is the fact that it enables the Attorney General to obtain relief for non-Illinois residents.