To keep you informed of recent activities, below are several of the most significant federal and state events that have influenced the Consumer Financial Services industry over the past week:

Federal Activities

State Activities

Federal Activities

• On March 1, as part of National Consumer Protection Week (NPCW), the Federal Trade Commission (FTC) and its partners, including consumer organizations, national advocacy organizations, and other federal, state, and local government agencies participated in several virtual and in-person events on issues such as avoiding scams, protecting people against identity theft, and reporting fraud for people in all communities. For information, click here.
• On February 29, the Consumer Financial Protection Bureau (CFPB) issued a circular to law enforcement agencies and regulators explaining how companies operating comparison-shopping tools can break the law when they steer consumers to certain products or lenders because of kickbacks. Consumers use comparison-shopping tools to evaluate the costs, features, and terms of many financial products, including credit cards, loans, and bank accounts. The circular explains how these practices may violate federal law and highlights examples of illegal arrangements. For information, click here.
• On February 29, the Federal Serve Board, Federal Deposit Insurance Corporation (FDIC), and the OCC announced that they will host the 2024 National Interagency Community Reinvestment Conference in Portland, OR, March 4 to 7. The 2024 program will focus on the agencies’ new CRA rule, and will include regulator-led sessions on the rule as well as panels on community development policy and activities. There will be pre-conference tours of local community development organizations and projects. For information, click here.
• On February 28, the FTC announced that it is launching a claims process for small businesses harmed by payment processing company First American Payment Systems’ undisclosed early termination fees. The agency is mailing notices to 1,137 businesses who were customers of First American between June 2017 and April 2020, and later cancelled their services. Businesses who paid an early termination fee are eligible to request a payment. The deadline to file a claim is May 28. For information, click here.
• On February 28, President Biden issued an Executive Order to protect Americans’ sensitive personal data from exploitation by countries of concern. The Executive Order authorizes the attorney general (AG) to prevent the large-scale transfer of Americans’ personal data to countries of concern and provides safeguards around other activities that can give those countries access to Americans’ sensitive data. For information, click here. That same day, CFPB Director Rohit Chopra issued a statement in response to the Executive Order. For more information, click here.

State Activities:

• On February 28, New York AG Letitia James (D) announced that her office secured more than $650,000 from a debt collection law firm and its subsidiary for filing allegedly frivolous lawsuits and “harming … New Yorkers.” An investigation by the Office of the AG (OAG) found that the debt collection law firm and its subsidiary often sued tenants on behalf of landlords in New York City Civil Court on issues that were already resolved in Housing Court. The OAG also found that the debt collection law firm illegally continued to pursue consumers for debts that were already paid or partially paid, and sometimes garnished wages for judgments that were completed. As a result of a settlement with OAG, the debt collection law firm is required to pay $595,600 in restitution to more than 4,000 affected New Yorkers, $60,000 in penalties, and stop its frivolous and predatory behavior. For more information, click here.
• On February 28, the New York Department of Financial Services (NYDFS) announced that Gemini Trust Company, LLC has committed to return at least $1.1 billion to Gemini Earn Program (Earn) customers through the Genesis Global Capital, LLC (GCG) bankruptcy proceeding. Additionally, Gemini has pledged to contribute $40 million to the GCG bankruptcy proceedings for the benefit of Earn customers. Gemini will also pay a $37 million fine to the NYDFS for alleged failures that the NYDFS claimed threatened the safety and soundness of the company. For information, click here.
• On February 26, California AG Rob Bonta, along with the FTC and a bipartisan coalition of states, filed a lawsuit challenging the merger of two national supermarket chains. According to the lawsuit, the merger would violate the federal Clayton Act, which prohibits the acquisition of assets where the effect of such acquisition may substantially lessen competition or create a monopoly. For more information, click here.
• On February 26, District of Columbia Mayor Muriel Bowser signed B25-0663. This legislation addresses conflicts between the “Protecting Consumers from Unjust Debt Collection Practices Amendment Act of 2021” and existing regulations for public utilities in D.C.’s Municipal Regulations. Areas the legislation covers include:
  • In-Person Contact for Debt Collection: The 2021 Act prohibits debt collectors from visiting consumers’ homes to collect debts, but D.C. regulations require utilities to make reasonable efforts to contact customers before service disconnection, which can include in-person notification. Utilities should continue making these efforts, including in-person visits if necessary, when other contact methods fail;
  • Posting Disconnection Notices: The Act restricts sharing debt-related information with third parties, but utilities are required to post disconnection notices that might disclose the customer’s debt situation. Businesses should continue posting these notices as required by the D.C. regulations;
  • Written Payment Agreements: The Act requires debt collectors to provide written copies of payment agreements within seven days, while D.C. regulations allow utilities 10 business days. Utilities should comply with the shorter seven-day timeframe for providing these agreements; and
  • Awareness of Temporary Legislation: The resolution mentions that identical emergency legislation was enacted temporarily in 2023 but expired in early 2024. A new round of emergency legislation is necessary until permanent measures are enacted. Businesses should stay informed about these temporary changes and adjust their practices accordingly.
    
    In D.C., noncriminal temporary amendment acts must go through a 30-day congressional review before they can be enacted. For more information, click here.
• On February 22, Pennsylvania AG Michelle Henry announced a settlement with a Colorado-based lead generator, resolving claims that the company sold Pennsylvanians’ contact information to telemarketers. Consumers, who believed they were registering for free samples or payment for completing online surveys, provided their information to the company. The company’s promotional offers allegedly failed, however, to include clear disclosures advising consumers that their information could be sold to telemarketers. The settlement permanently enjoins the company from selling or sharing consumer data, unless the data was acquired in accordance with the Federal Telemarketing Sales Rule. Additionally, the company is required to pay $25,000 to the AG’s office, which will be used for public protection and educational purposes. For more information, click here.