The CFPB is focused on legal activity as well as credit card servicing enforcement and fees guidance.
05/24/2023 3:15 P.M.
2 minute read
Consumer Financial Protection Bureau Director Rohit Chopra is expected to testify on the bureau’s semiannual report to Congress in the coming weeks. ACA International will provide updates on the director’s testimony, in the meantime, here are a few of the bureau’s actions you should know about this week.
CFPB in the Courts
Earlier this month, the CFPB filed a brief (PDF) in Community Financial Services Association of America Ltd. v. CFPB arguing against a 5th Circuit Court of Appeals’ decision that the bureau’s funding structure is unconstitutional.
A decision is not expected in the case until next year, with the Supreme Court slated to consider it in its term that begins in October 2023.
Meanwhile, the CFPB has filed a request with the U.S. Court of Appeals for the 9th Circuit to deny a stay of the appeal in a case related to allegations that CashCall Inc. engaged in deceptive loan practices outside of state usury and licensing laws, according to an update from ACA member company Barron & Newburger P.C.
CashCall Inc. is seeking to delay the start of the briefing in the appeal until the Supreme Court has issued a decision in the funding structure case.
Read the CFPB’s opposition brief here (PDF).
Settlement on Disputed Credit Card Transactions
The CFPB announced it has “reached a settlement to resolve allegations that Citizens Bank violated consumer financial protection laws and rules that protect individuals when they dispute credit card transactions,” according to a news release.
The bank reportedly “failed to properly manage and respond to customers’ credit card disputes and fraud claims.”
Citizens Bank would be required to pay a $9 million civil money penalty if the settlement is entered by the court.
Read the CFPB’s news release here.
Guidance on Bank Fees and Deposit Accounts
The latest circular from the CFPB provides an overview for regulators of banks’ actions on consumer accounts that can constitute an unfair act or practice under the Consumer Financial Protection Act.
Based on consumer complaint data, the CFPB says it has observed “that even after a consumer completes all the required steps to close an account, their bank has ‘reopened’ the closed account and assessed overdraft and nonsufficient funds fees,” according to a news release.
Read more on the guidance from ACA’s coverage here.
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