Financial services companies - banks, non-bank lenders and loan servicers, auto finance companies, student loan companies, debt collectors, credit card issuers, non-traditional finance companies, and other market participants - face numerous legal challenges today, including government investigations and enforcement actions, a shifting regulatory landscape, novel civil litigation theories and other litigation risks. Especially as the Consumer Financial Protection Bureau and other regulators issue guidance and promulgate new rules and regulations impacting the consumer finance industry, it is now more critical than ever that corporate counsel stay abreast of these developments and related enforcement and litigation trends in order to manage institutional risks. Recognizing this need, Goodwin's LenderLaw Watch monitors, chronicles and analyzes news and legal issues impacting our clients and the consumer finance industry.

CFPB Issues Statement on Temporary Supervisory and Enforcement Practices for Credit Card Electronic Disclosures in Response to COVID-19

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In response to the ongoing impact the COVID-19 pandemic has had on the financial industry, on June 3, 2020, the Consumer Financial Protection Bureau (CFPB) issued a statement (CFPB Statement) announcing that it would provide temporary flexibility for credit card issuers in connection with certain written disclosure requirements. Under Regulation…

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U.S. Paycheck Protection Program Lenders: Risks of False Claims Act Enforcement Actions

Congress has recently updated the Paycheck Protection Program (PPP) to stabilize the economy in response to the troubling economic impact of the COVID-19 pandemic.  Lenders should be aware that the federal government’s efforts to provide loans to small businesses in the wake of the pandemic may also result in increased…

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Fair Lending Considerations in a COVID-19 World: Fair Servicing and Consumer Relief in the U.S.

The sudden financial impact of the COVID-19 pandemic on consumers has led to calls for loan servicers and other interested parties to provide temporary or permanent relief for borrowers who are unable to continue making loan payments.  The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), guidance in the…

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Federal Court Enjoins Enforcement of Massachusetts Attorney General’s COVID-19 Debt Collection Regulation

On May 6, 2020, the U.S. District Court for the District of Massachusetts, in ACA International v. Healey, Case No. 1:20-cv-10767-RGS, enjoined Massachusetts Attorney General Maura Healey (AG Healey) from enforcing provisions of the emergency regulation, 940 CMR 35.00, et seq. (Regulation), prohibiting debt collection calls and initiating lawsuits during…

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CFPB Holds Public Advisory Committees Meeting on Impact of COVID-19

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On May 1, 2020, the Consumer Financial Protection Bureau (Bureau or CFPB) held a joint virtual meeting of its four advisory committees:  the Consumer Advisory Board, the Community Bank Advisory Council, the Credit Union Advisory Council, and the Academic Research Council.  The meeting—the Bureau’s first public event since the onset…

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COVID-19 and State Debt Collection Restrictions: What States Are Doing to Curb Debt Collection and the Industry’s Response

A number of state officials and regulators have taken steps to decrease the economic burdens stemming from COVID-19 on consumers in their states, including by placing additional restrictions on debt collection practices.  Among the more notable of these efforts took place on March 26, 2020, when Massachusetts Attorney General (AG)…

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Trends in U.S. Paycheck Protection Program Class Actions

Early uncertainty and the initial lapse in appropriations for the U.S. CARES Act’s Paycheck Protection Program (PPP) set off a wave of litigation by disgruntled small businesses who have been unable to secure PPP loans.  PPP loans were made available through various lenders to certain COVID-19-affected businesses meeting specific maximum…

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Fair Lending Considerations in a COVID-19 World: U.S. Paycheck Protection Program Issues

The first wave of class actions relating to the COVID-19 pandemic is here, including a number of cases concerning so-called “gating” eligibility rules that are legitimately applied by many lenders to manage the flow of applications for the U.S. Small Business Administration (SBA) Paycheck Protection Program (PPP). We expect these…

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Federal Agencies Encourage Access to Small-Dollar Loans in Light of COVID-19

This week LenderLaw Watch covers developments related to small-dollar loans in response to the COVID-19 crisis. Every year the Board of Governors of the Federal Reserve System (Federal Reserve) conducts its Survey of Household Economics & Decision-making, asking households across the country questions related to financial wellbeing and security.  According…

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Court Rules Against Plaintiff Challenging Implementation of Paycheck Protection Program

Two financial institutions have now been sued in separate putative class action lawsuits concerning their implementation of the CARES Act’s Paycheck Protection Program (PPP), which is aimed at assisting small businesses keep employees on their payroll.  Plaintiffs in both lawsuits allege that the financial institutions are unlawfully restricting access to…

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COVID-19 and Consumer Financial Services: Navigating New U.S. and State Orders, Rules, Laws, Guidance, and Pleas

Over the past several weeks, the coronavirus (COVID-19) pandemic has sparked a litany of new orders, rules, laws, guidance, and plain asks from federal and state leaders, agencies, and courts. The President and federal and state leaders have all begun to focus on how COVID-19 is likely to impact Americans’…

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CFPB Publishes its Winter 2020 Supervisory Highlights

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On February 14, 2020, the Consumer Financial Protection Bureau (CFPB) released its Winter 2020 Supervisory Highlights (Report).  It summarizes the CFPB’s findings on violations in the areas of debt collection, mortgage servicing, payday lending, and student loan servicing completed between April 2019 and August 2019.  The CFPB notes that it…

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