Troutman Pepper Weekly Consumer Financial Services COVID-19 Newsletter -December 2021

Troutman Pepper

Like most industries today, Consumer Finance Services businesses are being significantly impacted by the novel coronavirus (COVID-19). Troutman Pepper has developed a dedicated COVID-19 Resource Center to guide clients through this unprecedented global health challenge. We regularly update this site with COVID-19 news and developments, recommendations from leading health organizations, and tools that businesses can use free of charge.

To help you keep abreast of relevant activities, below find a breakdown of some of the biggest COVID-19 driven events at the federal and state levels to impact the Consumer Finance Services industry this past week:

Federal Activities

State Activities

Privacy and Cybersecurity Activities

Federal Activities:

  • On December 3, the Consumer Financial Protection Bureau (CFPB) issued a draft of its Strategic Plan through 2026. The CFPB is seeking feedback and comments about its plan. Comments must be filed by January 3, 2022, and can be submitted via email to CFPB_Strategy@cfpb.gov. For more information, click here.
  • On December 1, the CFPB published research regarding banks and overdraft fees. It found that banks continue to rely heavily on overdraft and non-sufficient funds revenue, which reached an estimated $15.47 billion in 2019. The CFPB also found that while small institutions with overdraft programs charged lower fees on average, consumer outcomes were similar to those found at larger banks. The research notes that, despite a drop in fees collected, many of the fee practices persisted during the COVID-19 pandemic. For more information, click here.
  • On December 1, the CFPB, the Federal Reserve Board, and the Office of the Comptroller of the Currency announced that the 2022 threshold for exempting loans from special appraisal requirements for higher-priced mortgage loans will increase from $27,200 to $28,500. For more information, click here.
  • On December 1, the Federal Reserve Board and the CFPB announced the dollar thresholds that determine exemption of certain consumer credit and lease transactions in 2022, from Regulation Z (Truth in Lending) and Regulation M (Consumer Leasing). For more information, click here.
  • On November 30, Regulation F of the Fair Debt Collection Practices Act became effective. The CFPB published a guide to help consumers understand the new regulation. For more information, click here.
  • On November 29, the CFPB issued a new advisory for financial institutionsto help prevent elder financial exploitation with alerts to trust contacts. The advisory provides information about developing relevant policies and procedures; educating account holders; and training and supporting staff. For more information, click here.

State Activities:

  • On December 1, New York Attorney General Letitia James issued a consumer alert “informing New Yorkers of their rights when contacted by a debt collector,” referencing Regulation F adopted by the CFPB on November 30, and the recent New York state law called the Consumer Credit Fairness Act, which was signed into law on November 8. Attorney General James stated, “No consumer should be sued over a debt they do not legally owe or which a creditor has no right to collect, but as we recover financially from COVID-19, we are seeing more and more debt collectors come out of the woodwork with outrageous claims.” For more information, click here.
  • On November 30, Arizona Attorney General Mark Brnovich issued a press release after his office obtained ” [a] nationwide injunction to stop COVID-19 vaccine mandate for health care workers.” Per the press release, “the Western District of Louisiana granted a nationwide injunction, putting the COVID-19 vaccine mandate on hold for health care workers as a multistate lawsuit, co-led by Attorney General Brnovich,” who stated, “It’s unacceptable for the federal government to tell our medical professionals what to inject into their bodies. I will continue to push back against these unconstitutional COVID-19 vaccine mandates for all Americans.” For more information, click here.
  • On November 30, Ohio Governor Mike DeWine signed SB54 into law. Among other provisions, SB 54: (1) criminalizes the spoofing of telephone numbers; (2) requires entities that have Caller ID’s that identify them as “unknown” or “blocked” to leave voicemail messages identifying their true identity; and (3) authorizes the state attorney general to prosecute violations of the law in state and federal courts. The law becomes effective March 2, 2022. For more information, click here.
  • On November 29, the City Council for the District of Columbia held a hearing to discuss a bill that would make permanent changes to how debts are collected in the District. The bill aims to expand debt law protections to cover medical and credit card debt by prohibiting harassment including communicating with employers about a consumer’s debt and by explicitly covering the activity of third-party debt buyers. For more information, click here.
  • On November 22, New Jersey state senators Thomas Kean and Robert Singer introduced a bill titled the “Virtual Currency and Blockchain Regulation Act.” The bill aims to provide transparency, consumer protections, and a licensing structure for operators and consumers engaging in virtual currency transactions in New Jersey. For more information, click here.
  • On November 8, New York Governor Kathy Hochul signed into law the “Consumer Credit Fairness Act” (S.153). The Act contains a series of amendments to the New York Civil Practice Law and Rules that significantly impact debt collection lawsuits filed in New York state courts by creditors or debt collectors. For more information, click here.

Privacy and Cybersecurity Activities:

  • On November 29, Massachusetts Governor Charlie Baker announced that he and other state officials are considering implementing a vaccine passport requirement for residents. He stated that this passport would include a scannable QR code that would show a person’s vaccination status. For more information, click here. For those interested in learning more about the privacy implications of vaccine credentials, check out Troutman Pepper’s Law360 article by clicking here.
  • On December 1, a California federal judge tossed antitrust claims from a COVID-19 tracking service that accused Apple of unlawfully barring its software from the App Store. Developer Jeffrey D. Isaacs argued that Apple tried to keep COVID-19 trackers out of the App Store to avoid competition when it launched its own app. Judge Edward M. Chen agreed with the tech company that the developers failed to adequately explain the market or allege an antitrust injury. Specifically, Judge Chen stated the allegations of harm were particular to the plaintiff, rather than causing harm to the market. For more information, click here.
  • On November 29, an Ohio appeals court ruled that a medical billing company’s property insurance policy could cover potential damage after the company experienced loss of access during a ransomware attack. This decision differs from recent cases, which have held that tangible property damage is required. The pandemic has spawned a number of insurance related cases, centered around whether policy holders can recover for pandemic-related losses. For more information, click here.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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