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…
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…
LenderLaw Watch continues its coverage of the impact COVID-19 has had and will have on various financial services sectors, this week focusing on COVID-19’s impact on credit card issuers. Although the newly enacted CARES Act (H.R. 748, 116th Cong. (2020)), signed by President Trump into law on March 27, 2020,…
As a result of COVID-19’s widespread economic disruption, the student lending industry has been impacted, from financial institutions to borrowers. In the past few weeks, the federal government has sought ways to address the student loan industry and offer protection to borrowers affected by the virus. On March 20, 2020,…
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’…
On Wednesday, March 4, 2020, the United States Department of Justice (DOJ) filed a brief with the United States Supreme Court asking the Court to decline review of a case concerning the government’s power to dismiss qui tam–or “whistleblower”–actions under the False Claims Act (FCA). The case in question is…
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…
On March 3, the Supreme Court heard argument in Seila Law LLC v. Consumer Financial Protection Bureau, a case involving two questions about the structure of the CFPB: (1) whether the provision of the Dodd-Frank Wall Street Reform and Consumer Protection Act that limits removal of the CFPB Director to…
On January 17, student loan servicer Educational Credit Management Corporation (ECMC) filed a notice of appeal in the United States District Court for the Southern District of New York, challenging the decision of Chief Bankruptcy Judge Celelia Morris, which granted summary judgment for a student loan debtor and discharged his…
The Eleventh Circuit joined the growing majority of courts in issuing an opinion that significantly narrows the scope of the Telephone Consumer Protection Act (TCPA) and delivers a blow to the plaintiffs’ bar and proponents for an expansive reading of the statue. In addressing a pair of consolidated appeals, Glasser…
On January 24, 2020, the Consumer Financial Protection Bureau (CFPB) issued a policy statement setting forth guidelines on how it intends to enforce the “abusiveness” standard under the Dodd-Frank Act. Section 103(a) of the Dodd-Frank Act authorizes the CFPB to bring enforcement actions against “covered persons” engaged in unfair, deceptive,…
At the start of the new year, both California’s Governor Newson and New York’s Governor Cuomo proposed expansions to their respective state’s regulatory oversight of consumer financial services. Of particular note, Governor Newson’s 2020-21 Budget Summary (California’s Proposal) explained that the reason behind California’s proposed regulatory expansion is the belief…
On December 10, 2019, the Federal Trade Commission (FTC) and Consumer Financial Protection Bureau (CFPB) jointly hosted a workshop on accuracy in consumer reporting. The workshop was divided into four panels and featured a variety of speakers ranging from consumer advocates to industry representatives. Each panel sought to address the…
On December 11, 2019, PayPal, Inc. (PayPal) filed suit against the Consumer Financial Protection Bureau (CFPB) in the District of Columbia, challenging the CFPB’s Prepaid Accounts Under the Electronic Fund Transfer Act (Regulation E) and the Truth in Lending Act (Regulation Z) Rule’s application to digital wallets. PayPal, Inc. v….
On December 2, 2019, the United States government submitted a brief to the Supreme Court urging it to deny review of a Ninth Circuit Court of Appeals ruling holding a provision of the Telephone Consumer Protection Act (TCPA) unconstitutional under the First Amendment. In the case in question, Gallion v….
On November 15, 2019, the Eleventh Circuit decertified a Telephone Consumer Protection Act (TCPA) class in Cordoba v. DIRECTV, LLC (No. 18-12077, 2019 WL 6044305), finding that the plaintiff could not adequately identify potential class members without resorting to individualized inquiries. The plaintiff alleged that DIRECTV failed to maintain an…
Last week, the Office of the Comptroller of the Currency (OCC) and Federal Deposit Insurance Corporation (FDIC) each issued a proposed rule designed to clarify that interest rates that are valid when a loan is made remain valid when the loan is transferred or sold. Together, the proposed rulemaking would…
On September 25, 2019, California’s Governor signed into law two bills that impact financial consumer services companies in California: California Assembly Bill 539 and California Senate Bill 187. Both laws go into effect January 1, 2020. California Assembly Bill 539 (AB 539) imposes new regulations and restrictions on loans of…
On October 23, 2019, the District of Massachusetts denied class certification in a Telephone Consumer Protection Act (TCPA) case in Sandoe v. Boston Scientific Corp. (No. 18-11826). The court held that the plaintiff could not identify class members sufficiently to satisfy the ascertainability and predominance requirements of Fed. R. Civ….
On October 4, 2019, the U.S. House of Representatives moved the Supreme Court for leave to file an amicus curiae brief in opposition to Seila Law’s petition for writ of certiorari to review the Ninth Circuit’s decision in CFPB v. Seila Law LLC, No. 7-56324 (9th Cir. 2019), which upheld the…