Consumer Lenders

News & Analysis as of

Record penalty against payday lender

As previously reported, on 26 August 2014, the Federal Court determined that The Cash Store Pty Ltd (in liquidation), a payday lender, and Assistive Finance Australia Pty Ltd, a loan funder, committed seven separate breaches...more

The Equal Credit Opportunity Act: Overview of Damages for Violations

As previously discussed on this blog, the Equal Credit Opportunity Act (the “ECOA”) prohibits creditors from discriminating against credit applicants based on race, religion, sex, national origin, marital status, and age...more

Trade groups urge CFPB to respond to AFSA vehicle sales finance study

Five prominent industry trade groups sent a letter to the CFPB yesterday seeking “to engage the CFPB in a constructive dialogue” on the study of indirect auto financing commissioned by the American Financial Services...more

CFPB takes action on misleading advertisements

Late last week, on February 12, the CFPB announced actions against three mortgage companies for alleged violations of Regulation N, the Mortgage Acts and Practices Advertising Rule. Among other restrictions, Regulation N bars...more

Payday Lender Agrees to Refund $8 Million in Settlement with Pennsylvania AG

On February 11, the Pennsylvania AG announced a settlement with a national payday lender that will pay $8 million in restitution to consumers who were allegedly provided illegal payday loans. According to the state AG, the...more

Regulators Release Guidance on Private Student Loans With Graduated Repayment Terms at Origination

On January 29, the federal financial regulatory agencies, in partnership with the State Liaison Committee of the Federal Financial Institutions Examination Council, issued guidance for financial institutions on private...more

A New Balancing Act: The DOJ Provides New Direction Regarding the SCRA's Interest Rate Benefit

When Congress reenacted the Servicemembers’ Civil Relief Act (“SCRA”) in 2003, Congress designed the SCRA to balance the interests of active duty servicemembers and their creditors, as it had done under the SCRA’s predecessor...more

Guidance on Private Student Loans With Graduated Repayment Terms Released

On January 29, federal financial regulatory agencies in partnership with the State Liaison Committee (SLC) of the Federal Financial Institutions Examination Council, issued guidance for financial institutions on private...more

Appellate Court Notes

SC19216 - Sikorsky Financial Credit Union, Inc. v. Butts - Finally some clarity in rules pertaining to the award of post-judgment interest. Here the (consumer) loan agreement provided that interest would accrue at 9%...more

FTC Settles With Payday Lenders for $21M Plus $285M in Waived Charges

Why it matters - Continuing the regulatory crackdown on payday lenders, the Federal Trade Commission (FTC) reached a proposed settlement with two lenders – AMG Services, Inc. and MNE Services, Inc. – for a $21 million...more

Update on state AGs/regulator lawsuits using Dodd-Frank authority

Below is an update on the lawsuits we have been following that state attorneys general and a state regulator have brought using their Dodd-Frank enforcement authority. Under Dodd-Frank Section 1042, a state AG or regulator is...more

Marriage Equality and The Equal Credit Opportunity Act

On January 1, 2015, United States District Judge Hinkle issued an Order ruling that all Florida counties are to start issuing marriage licenses to same-sex couples as of January 6, 2015. The implications of this ruling are...more

The CFPB 2015 Forecast: Continued Cloudiness, Thunderstorms Likely

This will be a busy year at the Consumer Financial Protection Bureau (CFPB), and that certainly means it will be a busy year for financial institutions as well. In addition to exercising its supervisory and enforcement...more

Deference in Decline: ECOA’s Regulation B and Agency Discretion Might Not Be Broad Enough to Include Spousal Guarantors

For more than 40 years, the Equal Credit Opportunity Act (‘‘ECOA’’) has prohibited lenders from discriminating against applicants for credit on various prohibited bases, including marital status. The policy reasons for such...more

The Business Records Exception As It Applies to Prior Loan Servicer Records - January 2015 Fourth District Court Ruling Provides...

Last week, in Bank of New York v. Andrew Calloway, the Fourth District Court of Appeals provided some long-awaited clarity to the business records exception as it relates to a prior loan servicer's records under Florida law....more

CFPB Proposes Regulating Nonbank Auto Finance Companies

On September 16, the Consumer Financial Protection Bureau (CFPB) issued and requested comment on a proposed rule that would, for the first time, subject nonbank auto finance companies to federal regulation and oversight. The...more

Fighting Back Against CFPB Demands

An increasing number of banks, mortgage lenders, auto finance companies and other financial services industry participants are dealing with inquiries, investigations and actual or threatened legal claims from the Consumer...more

CFPB Supports DoD’s Proposal to Expand Scope of Military Lending Act

On December 29, the CFPB released a report highlighting its concern that loopholes in the Military Lending Act (MLA) have allowed companies to offer costly credit products to military personnel and their families. The report...more

SEC Inspection Staff Uncovers A Possible Fraud

The SEC claims that an individual that controlled several entities including an investment fund created phony consumer loans to funnel investor cash to his faltering financial operations rather than investing the money in...more

UDAAP Council Weekly UDAAP Standards Report - 1/07/2015

Every week, courts around the United States issue decisions addressing aspects of civil UDAAP claims. In an effort to illuminate the UDAAP standards, below is a sampling of some of this week’s UDAAP decisions on the meaning...more

CFPB Weighs in on Department of Defense Military Lending Act Proposed Rule

On December 29, 2014, the Consumer Financial Protection Bureau (CFPB) released a report, entitled “The Extension of High-Cost Credit to Servicemembers and Their Families” (“Report”). According to the CFPB, the Report provides...more

Waiting for the CFPB’s arbitration study

“Waiting for the CFPB’s arbitration study” isn’t the title of a new play but it does describe the study’s status as we enter the final hours of 2014. Since the CFPB sent letters to payday lenders in August 2014...more

Petitioner Opposes NY Regulator’s Motion To Dismiss Lawsuit Seeking Access to Database of Alleged Illegal Payday Lenders

The consumer financial services attorney (the petitioner) who sued the New York State Department of Financial Services (DFS) and its superintendent, Benjamin Lawsky, to obtain access to DFS’s database of alleged illegal...more

Retail Vehicle Installment Sale Contracts Now Regulated under PA Consumer Credit Code’s Motor Vehicle Sales Finance Provisions

In September 2014, dealers received a letter from the Department of Banking (“Banking”) regarding the repeal and replacement of the Motor Vehicle Sales Finance Act (“MVSFA”) with the Motor Vehicle Sales Finance provisions...more

Bank of Russia Has for the First Time Published Marginal Values of Full Cost of Payday Loans

On November 14, 2014, the Bank of Russia has for the first time published information on the weighted average of full cost of consumer loans calculated for the period from September 1 to September 30, 2014 and the marginal...more

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