The FTC and CFPB Announce New Rules to Tackle Junk Fees
McGuireWoods | Consumer FinSights
by Kevin Frankel, Jeffrey P. Ehrlich, Ashley B. Matthews and Kristin Lee
4M ago
On October 11, 2023, President Biden, Federal Trade Commission (FTC) Chair Lina Khan, and Consumer Financial Protection Bureau (CFPB) Director Rohit Chopra announced the latest developments in the government’s efforts to tackle junk fees. Junk fees are hidden, surprise fees imposed on customers without clear disclosure.[1] The CFPB and FTC have taken several measures to crack down on junk fees since early 2022, including: On January 26, 2022, the CFPB issued a request for information regarding fees that consumers believed to be covered by a baseline price, unexpected fees, and fees that seeme ..read more
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Real-Estate Agents Who Participate in Joint Ventures Should Be Wary of the CFPB’s Recent Policy Statement on Abusive Conduct
McGuireWoods | Consumer FinSights
by Jeffrey P. Ehrlich, Erin Ashwell, Kevin Frankel and Ashley B. Matthews
8M ago
Much has been written about the Consumer Financial Protection Bureau’s recent “Policy Statement on Abusive Acts or Practices,”[1] in which the Bureau analyzed the prohibition on abusive conduct in the Consumer Financial Protection Act of 2010 (CFPA). In response to the statement’s publication in the Federal Register, comments were submitted by banks, credit unions, debt collectors, and others.[2] But the Bureau’s policy statement should be of particular interest to another class of persons: real-estate agents who participate in joint ventures with mortgage or title companies. Mortgage and titl ..read more
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Federal Reserve Exercises Broad Disciplinary Authority to Sanction Former Bank Employees Who Committed PPP Loan Fraud
McGuireWoods | Consumer FinSights
by Jeffrey Chapman, Alexander Madrid and Staci E. Rosche
10M ago
On October 13, 2022, the Board of Governors of the Federal Reserve System (“Board”) announced multiple enforcement actions against former employees of several financial institutions because the former employees made false statements to obtain economic injury disaster loans and grants from the U.S. Small Business Administration (“SBA”) or paycheck protection loans from SBA-approved lenders.  The loans and grants were made available to small businesses who were suffering from the impact of COVID-19 and needed emergency financial assistance authorized by the Coronavirus Aid, Relief, and Econ ..read more
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CFPB Charges Schools With “Abusive” Act of Denying Academic Transcripts to Students With Debts
McGuireWoods | Consumer FinSights
by Haley Usenick, Jeffrey P. Ehrlich and Farnaz Farkish Thompson
10M ago
The Consumer Financial Protection Bureau’s recent guidance on withholding transcripts from students with debts revealed that the CFPB is using a broad definition of “private education loan” that may apply to the practices of some not-for-profit schools. Additionally, while the CFPB characterized this practice as “abusive,” its analysis suggests that these practices may also be “unfair,” meaning that the Federal Trade Commission, states, and other regulators may also have authority to address them. Read on for details about this development and important takeaways for schools with in-house lend ..read more
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Bank Regulators Remind Financial Institutions Not to Take a One-Size Fits All Approach to Assessing AML Risks from Customer Relationships
McGuireWoods | Consumer FinSights
by Jeffrey Chapman, Alexander Madrid and Melek Dunn
10M ago
The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Financial Crimes Enforcement Network, the National Credit Union Administration, and the Office of the Comptroller of the Currency (collectively the “Agencies”) issued a Joint Statement on July 6, 2022, reminding banks[1] of the “risk-based approach to assessing customer relationships and conducting customer due diligence (CDD).”  The Joint Statement reminds banks that the Agencies consider a blanket approach of assessing customer risk, based solely on the type of customer (e.g., casino, au ..read more
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FinCEN Issues Statement on BSA Due Diligence for Independent ATM Owners and Operators
McGuireWoods | Consumer FinSights
by Jeffrey Chapman, Alexander Madrid and McGuirewoods LLP
10M ago
On June 22, 2022, the Financial Crimes Enforcement Network (FinCEN) issued a Statement on Bank Secrecy Act Due Diligence for independent ATM owners and operators.  The purpose of the statement is to “provide clarity to banks on how to apply a risk-based approach to conducting customer due diligence (CDD) on independent Automated Teller Machine (ATM) owners or operators, consistent with the requirements set out in FinCEN’s 2016 CDD Rule.” Under FinCEN’s 2016 CDD Rule, banks are required to establish and maintain written policies and procedures reasonably designed to identify and verify “be ..read more
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