On May 2, the CFPB released its Spring 2022 Supervisory Highlights. The findings of the report, which generally cover examinations completed between July and December 2021, are issued to help institutions and the general public better understand how we examine institutions for compliance with Federal consumer financial laws. Highlights include the following findings:
- Auto servicing companies were alleged to have engaged in unfair, deceptive, or abusive acts or practices like wrongful repossessions, misleading consumers about final loan payment amounts, and overcharging for add-on products.
- Consumer reporting companies were deemed to be accepting information from companies that furnish consumer data, even though there were ample signs that these furnishers were unreliable.
- Companies were found to be violating the Fair Debt Collections Practices Act and Consumer Financial Protection Act by, for example, using false or misleading representations in connection with the collection of debt.
- Financial institutions were accused of Regulation E violations, including failure to: (i) remove a duplicative hold on an account: (ii) honor a timely payment request; (iii) investigate errors; and (iv) provide notice to consumers regarding notice of revocation of provisional credit.
The report also highlighted that:
- Remittance transfer providers engaged in deceptive acts or practices by making false and misleading representations of “instant” and “30 second” transfers, even though the transfers may not be completed in 30 seconds or they may be otherwise delayed, oftentimes up to 48 hours.
- Student loan servicers misled consumers by failing to issue the incentive payments offered in advertisements of their contract and failed to issue timely refunds of payment in response to loan modifications.
Putting It Into Practice: This report confirms the CFPB’s heightened scrutiny of participants in such markets as student lending, credit reporting, money transmission, and auto lending. As the CFPB conducts future examinations, the issues identified in the latest Supervisory Highlights are likely to be a consistent theme in future CFPB enforcement actions.
