The CFPB is not going anywhere—Except Maybe the U.S. Supreme Court—Following DC Circuit en banc Decision

We've been following PHH's longstanding challenge of the CFPB's imposition of a fine against it for alleged RESPA kickback violations, through which elemental questions regarding the Bureau's constitutionality were tested. More ›

Consumer Financial Services: What to Expect in 2018

The year of 2017 was highly volatile for the consumer financial services industry and featured significant court rulings, regulatory changes, and other developments.

With a new year upon us, the Consumer Crossroads blog wanted to ask some of our Hinshaw financial services attorneys about what we might expect in 2018. Here they are, specifically prognosticating trends in FCRA litigation, reverse mortgages, student loan regulatory and litigation, CFPB developments, cryptocurrencies, TCPA litigation, lost promissory notes, federal regulatory conduct, and local government responses to the foreclosure crisis. More ›

State and Local Governments Prepare to Fill the Consumer Regulatory Enforcement Void

Last week, the Democratic Attorneys General sent a letter to President Trump expressing concern over his choice for CFPB director, Mick Mulvaney and the future of consumer protection, more generally. As was expected, the states are preparing to take on more aggressive roles in consumer protection given the significant weakening of the CFPB. "State attorneys general have express statutory authority to enforce federal consumer protection laws, as well as the consumer protection laws of our respective states," the group said in its letter. "We will continue to enforce those laws vigorously regardless of changes to CFPB’s leadership or agenda." More ›

Trouble With A Capital C: Cordray’s Move To Name His Own Successor At The CFPB

In contrast to his big wins on Jeopardy! in the 1980s, Richard Cordray lost badly in 2017 after staking so much on the Consumer Financial Protection Bureau’s (“CFPB”) Final Rule, which would have prohibited the use of class action waivers in the arbitration clauses of consumer financial contracts, such as credit card agreements and mortgages. The CFPB’s Final Rule drew sharp, valid criticism from both the U.S. Treasury Department and the Office of the Comptroller of the Currency. After the House of Representatives and the Senate acted pursuant to the Congressional Review Act to nullify the Final Rule, Mr. Cordray pleaded unsuccessfully with President Trump for a veto. It is unsurprising, really, that he decided to step down far earlier than anticipated.

Mr. Cordray’s parting-shot - his effort to name his own successor by appointing a presumably sympathetic Deputy Director - will likely miss its mark. Under the provision of Dodd-Frank that Senator Elizabeth Warren has cited in support of Mr. Cordray’s maneuver, the CFPB’s Deputy Director serves as acting Director only “in the absence or unavailability of the Director” (12 U.S.C. § 5491(b)(5)), not in the event the Director resigns. Moreover, 12 U.S.C. § 5491(b)(3) states that, “…the Director shall be appointed by the President, by and with the advice and consent of the Senate.”  Senator Warren’s November 24th “tweet,” that “if there is a [CFPB] Director vacancy, the Deputy Director becomes the Acting Director … [and] [President Trump] can’t override that[,]” simply appears to read too much into the provision of Dodd-Frank she cites. More ›

CFPB Director Richard Cordray Resigning

In news that is still breaking, the first and only Consumer Financial Protection Bureau director, Richard Cordray, has announced he will be resigning at the end of this month. He announced his departure in an email to staff that was reported out by several news agencies. His term was set to expire in July, 2018. Many predict Cordray will make a run for Ohio governor. More ›

U.S. Senate Joins The House To Eliminate The CFPB’s Final Rule Against Class Action Waivers in Arbitration Clauses; The President Is Expected To Sign

With Vice President Pence casting a dramatic tie-breaking vote just after 10 p.m. E.D.T. on October 24th, the U.S. Senate joined the U.S. House of Representatives to eliminate, based on their authority under the Congressional Review Act (CRA), the Consumer Finance Protection Bureau's (CFPB) controversial Final Rule on arbitration agreements, which was issued in July. The CFPB's Final Rule would bar providers of consumer financial products and services from including mandatory class action waivers in the arbitration clauses of their agreements with consumers. More ›

Take Note: Employers are Helping Pay Student Loans and Consumer Advocates are Watching Closely

A growing number of employers are offering student loan repayment assistance as a means of attracting and retaining talent. Industries like tech, financial services, and health services are among the early adopters, offering variations of the same general benefit:  the employer agrees to pay a certain amount—either a set figure or a percentage of salary—toward their employee’s student loan debt. Since student loan repayment benefits are relatively novel, the rules for both employers offering the benefit, and the student loan servicers administering it, are not yet explicit. More ›

In a Bind about CFPB's Arbitration Rule?

Don't be. At least Republican lawmakers are certainly not. On Tuesday, the U.S. House of Representatives voted overwhelmingly, 231-190, to eliminate the CFPB's final rule arbitration rule using a procedural mechanism called the Congressional Review Act.

The Congressional Review Act allows both houses of Congress to vote on resolutions of disapproval within 60 legislative days of a proposed rule being published in the Federal Register. Under the CRA, the resolution can be brought to the House floor without going to a committee vote, and does not need a filibuster-proof, 60 vote majority to pass in the Senate. If the President signs the resolution, the CFPB would be barred from developing a regulation that is substantially similar to the one disapproved unless Congress specifically authorizes it. More ›

CFPB Rule Bars the Use of Mandatory Arbitration Clauses to Prohibit Class Actions; Some Members of Congress Vow to Take Action to Reverse

This week, the Consumer Financial Protection Bureau (CFPB) adopted a final rule prohibiting a broad range of financial firms from using mandatory arbitration clauses to bar class action suits and received wide press coverage. The CFPB announced that this final rule would "restore the ability of groups of people to file or join group lawsuits." Some in the financial services industry potentially subject to the rule have already issued statements opposing and attacking it and asking that Congress use its statutory authority to reverse the CFPB's action. More ›

CFPB Releases State by State Report on Consumer Complaints

This week, the Consumer Financial Protection Bureau (CFPB) released its June 2017 complaint report. The format is different than usual. Normally, the report spotlights complaints from a particular industry and state. This month, the report provides a state by state overview of what consumers are complaining about across the country. You can see the top 5 industries receiving complaints by volume and quarterly percent change for each state. More ›