CFPB Issues New Rule on Use of Artificial Intelligence Models in Mortgage Lending
Goodwin | Consumer Finance Insights (CFI)
by Collin Grier
1d ago
On June 24, 2024, the Consumer Financial Protection Bureau (CFPB) announced that it had approved a new rule about the use of algorithms and artificial intelligence (AI) for home appraisals and valuations. The new rule was promulgated by the CFPB, the Federal Reserve, the Federal Deposit Insurance Corporation, the National Credit Union Administration, the Office of the Comptroller of the Currency, and the Federal Housing Finance Agency, pursuant to Dodd-Frank’s direction that the CFPB and other financial supervisory agencies create regulations to implement quality control standards for “automat ..read more
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SCOTUS Ruling Makes Federal Agency Rules Susceptible to Previously Untimely Challenges
Goodwin | Consumer Finance Insights (CFI)
by Christian Fletcher
4d ago
At the close of an extended term, on July 1, 2024, the U.S. Supreme Court expanded the time period for bringing a facial challenge to a federal agency rule.  Before the decision in Corner Post, Inc. v. Board of Governors of the Federal Reserve System, the law in at least six appellate circuits, including the D.C. and Federal Circuits, was that a claim under the Administrative Procedure Act (APA) “first accrues” when the agency issues the challenged rule.  No. 22-1008, 603 U.S. ___ (2024).  Under Corner Post, however, accrual does not occur until the claimant is injured by the ru ..read more
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CFPB Proposes Rule to Ban Medical Debt from Credit Reports
Goodwin | Consumer Finance Insights (CFI)
by Allison Funk
1w ago
Earlier this month, the Consumer Financial Protection Bureau (CFPB) issued a proposed rule to amend Regulation V, which implements the Fair Credit Reporting Act (FCRA), as to medical information and debt.   This proposed rule follows Director Chopra’s remarks in March 2022, concerning a report on medical billing and collection practices authored by the CFPB.  The report suggested that roughly 43 million people had medical bills on their credit report with the total outstanding amount around $88 billion.   In those same remarks, Director Chopra noted that he was concern ..read more
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CFPB Enters into Consent Orders with Reverse Mortgage Servicers for $16.5 Million
Goodwin | Consumer Finance Insights (CFI)
by Julia Stamper
1w ago
On June 18, 2024, the Consumer Financial Protection Bureau (CFPB or Bureau) announced that it has entered into consent orders with two companies totaling $16.5 million in civil penalties and consumer redress​, resolving allegations that those companies failed to properly service reverse mortgages. The CFPB alleged both companies violated the Consumer Financial Protection Act (CFPA) and the Real Estate Settlement Procedures Act (RESPA) by failing to respond to consumer requests for information.  Specifically, the CFPB alleged that “the companies systematically failed to ..read more
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CFPB Settles with Nonbank Mortgage Originator for $4 Million
Goodwin | Consumer Finance Insights (CFI)
by Julia Stamper
3w ago
On June 18, 2024, the Consumer Financial Protection Bureau (CFPB) announced that it has filed a proposed order that would require a Florida-based nonbank mortgage loan originator to pay a $3.95 million penalty for allegedly submitting incorrect loan data to federal regulators.   In an October 2023 complaint, the CFPB accused the mortgage originator of submitting incorrect mortgage data in violation of the Home Mortgage Disclosure Act (HMDA).  According to the complaint, the 2020 mortgage data contained multiple errors that were caused by “widespread systemic ..read more
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Increased Industry Attention on RESPA Section 8: Escue v. United Wholesale Mortgage, LLC
Goodwin | Consumer Finance Insights (CFI)
by Varun Bhatnagar
1M ago
On April 2, 2024, a putative class action was brought against United Wholesale Mortgage (UWM) alleging, among other claims, violations of Section 8(a) of the Real Estate Settlement Procedures Act (RESPA).  The lawsuit contains potential wide-ranging industry implications as UWM is the largest wholesale mortgage lender in the United States. Unlike conventional mortgage providers that analyze the borrower’s creditworthiness and then provide the mortgage, wholesale mortgage lenders, such as UWM, receive mortgage applications from third-party mortgage brokers who handle the client intake proc ..read more
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CFPB Files Suit Against Student Loan Servicer
Goodwin | Consumer Finance Insights (CFI)
by Jordan Wenik
1M ago
On May 31, 2024, the CFPB announced that it had filed suit against a Pennsylvania-based student loan servicer for engaging in allegedly unfair, deceptive and abusive acts or practices in violation of the CFPA, 12 U.S.C. §§ 5531, 5536(a)(1)(B), and for failing to establish reasonable credit reporting procedures in violation of Regulation V, 12 C.F.R. §§ 1022.40-43, and the CFPA, 12 U.S.C. § 5536(a)(1)(A). ​According to the CFPB’s complaint filed in the Middle District of Pennsylvania, the company allegedly improperly collected or attempted to collect on private stu ..read more
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Massachusetts Attorney General Settles Claims Against California-Based Financing Company for $625,000
Goodwin | Consumer Finance Insights (CFI)
by Julia Stamper
1M ago
​On May 22, 2024,​ the Massachusetts Attorney General (MA AG) announced it entered into an Assurance of Discontinuance (AOD) with a California-based financing company resolving allegations of violations of the Massachusetts Consumer Protection Act.​ The MA AG alleged that the company engaged in a “rent-a-bank” scheme, whereby the company partnered with an out-of-state bank in an attempt to circumvent Massachusetts’s maximum interest rates of 20%. Although the out-of-state bank retained title of these loans, the MA AG alleged the company is actually the ..read more
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Supreme Court Upholds CFPB’s Funding Structure
Goodwin | Consumer Finance Insights (CFI)
by Richard Sillett
1M ago
On May 16, 2024, the U.S. Supreme Court issued a significant opinion in Consumer Financial Protection Bureau v. Community Financial Services Association of America, Ltd., upholding the funding structure of the Consumer Financial Protection Bureau (CFPB).  601 U.S. 416.  In a previous post, we reported that on October 3, 2023, the Supreme Court heard oral arguments in this matter on the issue of whether the CFPB’s funding mechanism violates the Appropriations Clause of the U.S. Constitution (U.S. Const. art I § 9, cl. 7).  In a 7-2 decision, the Supreme Court held that the statu ..read more
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CFPB Enters Consent Order Over Student Loan Debt Relief Services
Goodwin | Consumer Finance Insights (CFI)
by Julia Stamper
1M ago
On May 20, 2024, the Consumer Financial Protection Bureau (CFPB) announced that it had entered into a consent order with a California-based telemarketer that offered student loan debt relief services resolving allegations that the company charged illegal advance fees and misled student loan borrowers.  This telemarketer allegedly claimed to be affiliated with the Department of Education and used lead generators for marketing, selling, and administering student loan debt relief services.  The CFPB alleged their practices harmed nearly 6,000 consumers to the tu ..read more
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