New FDCPA Rules Are Now in Effect: Is Your Company Compliant?

The Consumer Financial Protection Bureau (CFPB) recently implemented a new set of rules applicable to collections agencies and others qualifying as “debt collectors” under the FDCPA. These rules, which appear within the amended “Regulation F” of the Federal Register, modernized the ways in which collectors can interact with debtors, as well as revamped rules for debt validation notices. The regulations became effective on November 30, 2021. These are just three of the more notable changes:

CFPB Shutters Lending by VC-Backed Fintech for Violating Agency Order

WASHINGTON, D.C. — Today, the Consumer Financial Protection Bureau (CFPB) announced that LendUp Loans has agreed to halt making any new loans and collecting on certain outstanding loans, as well as to pay a penalty, to resolve a September 2021 lawsuit alleging that it continued to engage in illegal and deceptive marketing in violation of a 2016 CFPB order. The lawsuit also accuses LendUp of violating fair lending regulations.

LendUp shuttering operations after reaching settlement with CFPB

It is a main downfall for the Silicon Valley-backed lender, which had billed itself as a substitute for conventional payday lenders by providing to deliver down debtors’ rates of interest on future loans as they paid again their prior ones. However LendUp repeatedly got here beneath scrutiny from the CFPB, which stated the corporate didn’t stay as much as that promise to tens of hundreds of consumers — even after the company penalized it in 2016.

Credit unions distribute millions in dividends for members

Credit unions around the country provided members with numerous benefits as the year comes to a close. Dividends, fee waivers, and support for local charities are just some of the ways credit unions have given back and said “Thank you” to their members.

CFPB is standing up for civil rights protections

This week, the Consumer Financial Protection Bureau partnered with the Department of Justice, the Federal Reserve Board, and the Federal Trade Commission to oppose a dangerous threat to our nation’s civil rights laws. The CFPB filed a friend-of-the-court (“amicus”) brief in Fralish v. Bank of America, a case in which an individual consumer sued his bank for closing his credit card account without providing an explanation mandated by the Equal Credit Opportunity Act (ECOA). Bank of America’s response to the lawsuit argues that it can disregard ECOA when it comes to the bank’s existing customers – an argument that has been made by other banks and that would undermine the anti-discrimination protections enjoyed by millions of Americans if accepted by the court.

NCUA Board Approves COVID-19 Regulatory Relief Extension

ALEXANDRIA, Va. (Dec. 21, 2021) – The National Credit Union Administration Board unanimously approved, by notation vote, an extension of the effective date of its temporary final rule, which modified certain regulatory requirements to help ensure that federally insured credit unions remain operational and can address economic conditions caused by the COVID–19 pandemic.

Countdown to California License Application Deadline: ACA Has Resources to Help

Dec. 31, 2021, the deadline to apply for a license now required by the California Debt Collection Licensing Act (DCLA), is fast approaching—but if you’re not one of the approximately 600 applicants on the books so far, there is still time to complete the process.

Colorado Fair Debt Collection Practices Act — Validation of Debts

Pursuant to section 5-16-109(1)(c) of the Colorado Fair Debt Collection Practices Act
(“CFDCPA”), C.R.S., in connection with the collection of any debt, a debt collector or
collection agency is required to provide a consumer with a written notice, which discloses
“[t]hat, unless the consumer, within [30] days after receipt of the notice, disputes the
validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt
collector or collection agency . . . .” The section further provides that “if the consumer
notifies the debt collector or collection agency in writing within the thirty-day period that
the debt, or any portion thereof, is disputed, the debt collector or collection agency will
obtain verification of the debt or a copy of a judgment against the consumer and a copy of
the verification or judgment will be mailed to the consumer by the debt collector or
collection agency.” 5-16-109(1)(d), C.R.S.

Jaw-Dropping Stats About the State of Debt in America

Most Americans have some credit card debt. A recent GOBankingRates survey found that 30% of Americans have between $1,001 and $5,000 in credit card debt, 15% have $5,001 or more in credit card debt and about 6% have more than $10,000 in credit card debt. Although 6% may seem like a small amount, that means that based on the survey results, 14 million Americans have over $10,000 of credit card debt.

BMO to buy Bank of the West from BNP Paribas for $16.3B

Bank of Montreal (BMO) has agreed to buy San Francisco-based Bank of the West, the U.S. retail presence of French lender BNP Paribas, for $16.3 billion, the banks said Monday.

CUNA encourages CFPB look into large tech company payments programs

CUNA supports the Consumer Financial Protection Bureau’s (CFPB) inquiry into the tech companies’ payments practices and strongly encourages the CFPB to carefully examine and regulate these entities moving forward, it wrote to the CFPB Monday.

CFPB Issues Orders to Companies Offering BNPL Credit

On December 16, the CFPB issued a series of orders to five companies offering “buy now, pay later” (BNPL) credit.  The orders seek to collect information on the risks and benefits of these “fast-growing” products over concerns about “accumulating debt, regulatory arbitrage, and data harvesting in a consumer credit market already quickly changing with technology.”  BNPL is a deferred payment option that allows consumers to split a purchase into smaller installments, typically four or less, often with a down payment of 25 percent due at checkout.  To underscore BNPL’s current popularity, a report issued by the California Department of Financial Protection and Innovation recently reported that “[t]he top six buy now pay later lenders accounted for 10,924,547, or 91 percent, of the total consumer loans originated in 2020” (we discussed this report in an earlier Consumer Finance & FinTech Blog post here).

Convoke Looks Back on Successful Year 2021

ARLINGTON, Va., Dec. 21, 2021 /PRNewswire/ -- Convoke, a leader in SaaS solutions for the debt collection market, is pleased to announce the completion of another successful year for the company. Despite the challenges created by the COVID-19 pandemic, Convoke has still outperformed and has achieved continued company growth and product development.

AG Ferguson: Kitsap County towing company to repay former Navy sailor for selling his car at auction

PORT ORCHARD — Attorney General Bob Ferguson announced today a court order will require a Kitsap County towing company to pay a former Navy sailor for illegally selling his car at auction. The order also requires it to implement specific policies so it will not harm service members in the future

Navy Federal Auto Lending Earns Highest Score for Overall Satisfaction

VIENNA, Va.--(BUSINESS WIRE)--Navy Federal Credit Union announced today it received the highest score in the J.D. Power 2021 U.S. Consumer Financing Satisfaction Study,℠. The study, now in its 25th year, measures overall customer satisfaction by examining five factors: Application and Approval Process, Account Management and Communication, Billing and Payment Process, Customer Service Experience and New Customer Orientation.

NCUA issues letter on third-party digital asset services

NCUA issued a Letter to Credit Unions (21-CU-16) to provide clarity on the already existing authority of federally insured credit unions to establish relationships with third-party providers that offer digital asset services to the members, provided certain conditions are met.

Regulators: Credit Unions Can Partner With Digital Asset Providers

The National Credit Union Administration (NCUA) — the federal regulator that oversees credit unions — announced that credit unions may partner with third-party digital asset service providers to give members access to cryptocurrencies and other digital assets.

Justice Department and CFPB Put Landlords and Mortgage Servicers on Notice About Servicemembers’ and Veterans’ Rights

The Department of Justice and Consumer Financial Protection Bureau (CFPB) issued two joint letters today regarding important legal housing protections for military families. One letter was sent to landlords and other housing providers regarding protections for military tenants. A second letter was sent to mortgage servicers regarding military borrowers who have already exited or will be exiting COVID-19 mortgage forbearance programs in the coming weeks and months.

FTC Joins Amicus Brief in John Fralish v. Bank of America

The Federal Trade Commission joined the Consumer Financial Protection Bureau, the U.S. Department of Justice and the Board of the Federal Reserve in an amicus brief filed with the United States Court of Appeals for the Seventh Circuit in the case John Fralish v. Bank of America. The brief urges the court to adopt a reading of the Equal Credit Reporting Act, which the Commission enforces through Section 5 of the FTC Act, that reflects statutory text, history, and purpose.

FTC’s Amended Safeguards Rule Imposes Significant Requirements on Covered Entities

On October 27, 2021, the Federal Trade Commission (“FTC”) announced new updates to the Gramm-Leach-Bliley Act (“GLBA”) by amending the Standards for Safeguarding Customer Information, known as the “Safeguards Rule,” and issuing a final rule (the “Final Rule”). The Safeguards Rule is designed to protect the security and integrity of consumer personal information that is collected by financial institutions by ensuring that financial institutions put in place administrative, technical, and physical safeguards to protect personal information.

CFPB and DOJ Put Landlords and Mortgage Servicers on Notice About Servicemembers’ and Veterans’ Rights

WASHINGTON, D.C. — The Consumer Financial Protection Bureau (CFPB) and U.S. Department of Justice (DOJ) issued two joint letters today regarding important legal housing protections for military families. One letter was sent to landlords and other housing providers regarding protections for military tenants. A second letter was sent to mortgage servicers regarding military borrowers who have already exited or will be exiting COVID-19 mortgage forbearance programs in the coming weeks and months.

Financial Stability Oversight Council Releases 2021 Annual Report

WASHINGTON – The Financial Stability Oversight Council (Council) today unanimously approved its 2021 annual report.  This year’s report describes activities of the Council over the past year, as the U.S. economy has continued to rebound from the disruptions caused by the COVID-19 pandemic. Monetary and fiscal policy, substantial progress in vaccinations, and broadly accommodative financing conditions have together supported this recovery and bolstered the financial condition of households and businesses.  Additionally, the Council’s annual report describes significant financial market and regulatory developments, potential emerging threats to U.S. financial stability, and recommendations to promote U.S. financial stability. 

SEC, CFTC fine JPMorgan Chase $200M for recordkeeping violations

JPMorgan Chase will pay $200 million in fines to settle charges brought by two federal regulators regarding the bank’s failure to maintain records of communications on securities, commodities, and swaps business matters made on bank employees’ personal devices.

Luetemeyer Introduces FDIC Board Accountability Act

WASHINGTON, D.C. – Yesterday, Congressman Blaine Luetkemeyer (MO-03) introduced a bill that would remove the Consumer Financial Protection Bureau Director from the Federal Deposit Insurance Corporation (FDIC) Board of Directors, and put term limits in place for FDIC Board of Directors members’ service. All House Financial Services Committee Republicans signed onto this bill.etkemeyer Introduces FDIC Board Accountability Act

Edmunds Experts See Significant Pent-Up Consumer Demand, Forecast 15.2 Million New Vehicles Will Be Sold in 2022

SANTA MONICA, Calif., Dec. 16, 2021 /PRNewswire/ -- The car shopping experts at Edmunds say that the automotive industry faces yet another challenging year marked by inventory shortages amid strong consumer demand, forecasting that 15.2 million new cars will be sold in 2022. Edmunds analysts note that this would represent a 1.2% increase from their estimate of 15 million new vehicle sales in 2021.

Federal Court Holds That Student Loan Trusts Are Subject to CFPB Enforcement Authority: What This Means for Consumer Securitizations and Other Whole Loan Buyers

On December 13, 2021, Judge Stephanos Bibas, visiting judge in the U.S. District Court for the District Delaware from the U.S. Court of Appeals for the Third Circuit, denied a motion to dismiss a lawsuit brought by the Consumer Financial Protection Bureau (“CFPB” or the “Bureau”) in Consumer Financial Protection Bureau v. The National Collegiate Master Student Loan Trusts, allowing the enforcement action to proceed directly against The National Collegiate Student Loan Trusts (the “Trusts”). 

FirstCash Completes Acquisition of American First Finance

FORT WORTH, Texas, Dec. 17, 2021 (GLOBE NEWSWIRE) -- FirstCash Holdings, Inc. (“FirstCash” or the “Company”) (Nasdaq: FCFS) today announced that it has closed its previously announced acquisition of American First Finance (“AFF”). The completion of the acquisition establishes FirstCash’s entry into the large and growing lease to own and point-of-sale payment space. “This is an exciting day as we welcome AFF to the FirstCash team,” said Rick Wessel, FirstCash’s chief executive officer. “Together, we are well positioned to drive further expansion and growth in both pawn and the complementary retail point-of-sale payment space and further diversify our revenue opportunities, while serving our customers with a wider set of innovative capabilities.”

CFPB Solicits Whistleblowers to Strengthen Enforcement of Consumer Financial Protection Laws

In its revamped whistleblower webpage, the CFPB is enlisting the help of whistleblowers to provide tips about the following issues:

• Any discrimination related to consumer financial products or services or small businesses
• Any use of artificial intelligence/machine learning models that is based on flawed or incomplete data sets, that uses proxies for race, gender, or other group characteristics, or that impacts particular groups or classes of people more than others; ...

U.S. CFPB asks ‘buy-now, pay-later’ companies for data on products, practices

WASHINGTON, Dec 16 (Reuters) - The U.S. Consumer Financial Protection Bureau (CFPB) on Thursday asked five "buy-now, pay-later" companies for information on their business practices, amid concerns that the financing products are putting consumers at risk. The agency issued the order to Affirm Holdings (AFRM.O), Afterpay Ltd (APT.AX), Klarna, PayPal (PYPL.O) and Zip Co (Z1P.AX) in the wake of a boom in "buy-now, pay-later" services, which allow consumers to split purchase payments into installments, driven in part by online shopping growth during the coronavirus pandemic.

Reverse Mortgage Lenders: Upbeat on 2022 Lending Limit, Wary of Potential Issues

Reverse mortgage lenders are optimistic about the recently-announced rise of the Home Equity Conversion Mortgage (HECM) lending limit to $970,800 in 2022, but one thing that comes to mind for some is that proprietary reverse mortgages for years have been offering lending limits of up to $4 million in most cases.

30-year mortgage rates sit just above 3% for 7th straight day | Dec. 16, 2021

What this means: Resting at 3.125% since Dec. 8, 30-year mortgage interest rates have been lower just once in the past 24 days. Experts are widely predicting rate increases on the horizon, with Freddie Mac forecasting an average of 3.5% for 30-year mortgage rates in 2022. Although the holiday season isn’t traditionally prime homebuying time, buyers may want to lock in one of today’s low mortgage rates ahead of the coming increases next year. 

Federal Regulator Says Credit Unions Can Partner With Crypto Providers

Federally insured credit unions (FICUs) can partner with third-party digital asset service providers, the National Credit Union Administration (NCUA) said in a statement Thursday.

FTC Staff Report on ISP Privacy Practices Paves the Way for an FTC Privacy Rulemaking in the New Year

Following up on a mandatory 2019 request for information issued by the Federal Trade Commission (FTC) to the largest Internet Service Providers (ISPs) in the United States, the FTC staff in late October issued a Report titled – A Look at What ISPs Know About You: Examining the Privacy Practices of Six Major Internet Service Providers. Among the agency staff’s general findings on ISP data collection and use practices, the most striking perhaps is the apparent degree of integration among ISPs and advertisers with respect to their data collection and use practices.

Consumer Financial Protection Bureau Opens Inquiry into “Buy Now, Pay Later” Credit

WASHINGTON, D.C. — Today the Consumer Financial Protection Bureau (CFPB) issued a series of orders to five companies offering “buy now, pay later” (BNPL) credit. The orders to collect information on the risks and benefits of these fast-growing loans went to Affirm, Afterpay, Klarna, PayPal, and Zip. The CFPB is concerned about accumulating debt, regulatory arbitrage, and data harvesting in a consumer credit market already quickly changing with technology.

New VA System Release Published

As part of the Loan Guaranty Service (LGY) end-to-end modernization plan, VA published the latest release notes in a VALERI Servicer Newsflash dated November 23, 2021.  The Newsflash also contains information regarding:

Transworld Systems Inc. completes acquisition of EOS North America

LAKE FOREST, Ill., Dec. 16, 2021 /PRNewswire/ -- Transworld Systems Inc. (TSI), the largest U.S. technology-enabled provider of accounts receivable management (ARM) solutions, announced today it has completed its acquisition of EOS North America, a leading first- and third-party collection agency serving government, financial services, healthcare, telecom and utility clients in the United States and Canada. Transaction terms were not disclosed.

Senate passes compromise NDAA without CUNA-opposed language

The Senate passed a compromise version of the fiscal year 2022 National Defense Authorization Act (NDAA) Wednesday, just over a week after the House passed the same bill. Neither version contains language CUNA, Leagues, and credit unions fought to exclude that would have allowed banks the ability to operate rent-free on military bases.

Silver State Schools Credit Union Receives Gold Award for “Best Credit Union” With the 2021 Best of Las Vegas Award 56,000 Member Credit Union Honored as GOLD Winner for Four Consecutive Years

Silver State Schools Credit Union (SSSCU), a Las Vegas-based financial institution, celebrating over 70 years of serving over 56,000 members, with more than $1.1 Billion in Assets, is the proud recipient of the Gold Award as the winner for “Best Credit Union” in the Las Vegas Review-Journal’s annual “Best of Las Vegas” reader’s poll.

Tyndall Federal Credit Union Shares $11 Million of Profits with its Members—and Eliminates All Account Maintenance Fees

PANAMA CITY, Fla., December 16, 2021--(BUSINESS WIRE)--Tyndall Federal Credit Union returned $11 million of profits to its members. The profit-sharing payout was distributed among 50,000 qualifying members and deposited directly into accounts on December 16^th. Tyndall also eliminated all account maintenance fees, including fees for memberships, ATMs, among others.

Easing Standards Benefit Middle-Market, Commercial Borrowers as Economy Rebounds

BALTIMORE, Dec. 16, 2021 /PRNewswire/ -- Cerebro Capital, a commercial loan marketplace, today released its Q3 2021 survey on non-bank lending for middle-market commercial and industrial (C&I) loans. Cerebro reports lenders continued to ease lending standards, making it easier for businesses to get loans, which in turn has driven up loan demand. 

CuneXus and Equifax Team Up to Offer Lenders Premium Financial Support

SANTA ROSA, Calif. and ATLANTA, Dec. 16, 2021 /PRNewswire/ -- CuneXus and Equifax (NYSE: EFX) today have teamed up to offer CuneXus credit union customers a better view of their members' financial wellness and help ensure they are receiving the most relevant offers in a timely and effective manner. The CuneXus CPLXpress platform will leverage insights and predictive analytics from the Data-driven Marketing capability that 'Only Equifax' can provide in the pre-screen and segmentation phases of the loan process, allowing for a near-instant loan activation process that can help remove many of the hassles and obstacles to consumer lending.

OCC Enforcement Actions and Terminations

WASHINGTON—The Office of the Comptroller of the Currency (OCC) today released new enforcement actions taken against national banks, federal savings associations, and individuals currently and formerly affiliated with national banks and federal savings associations.

CFPB Calls Tech Workers to Action

Clear, actionable information is critical for workers when they’re deciding how to raise concerns and consider becoming whistleblowers. I am pleased to announce the Consumer Financial Protection Bureau (CFPB) has used human-centered design, including usability testing, to streamline how tech workers can alert us to potential violations of federal consumer financial laws.

Advertising Platform OpenX Will Pay $2 Million for Collecting Personal Information from Children in Violation of Children’s Privacy Law

California-based online advertising platform OpenX Technologies, Inc. will be required to pay $2 million to settle Federal Trade Commission allegations that the company collected personal information from children under 13 without parental consent, a direct violation of a federal children’s privacy protection law. The FTC also alleged that despite offering an opt-out option, OpenX collected geolocation information from users who specifically asked not to be tracked.

Idaho Central Credit Union Launches NYDIG Bitcoin Services Via Alkami Platform

PLANO, Texas, Dec. 15, 2021 /PRNewswire/ -- Alkami Technology Inc. (NASDAQ: ALKT) ("Alkami"), a leading cloud-based digital banking solutions provider for U.S. banks and credit unions, has announced Idaho Central Credit Union ("ICCU") has implemented bitcoin services through NYDIG and the Alkami Platform. Already a leader in ebranch, mobile, and digital banking, ICCU's partnership with NYDIG will allow Idaho Central members to buy and sell bitcoin within its mobile app and online banking platform.

Collection Agency Licensing and Exemptions

With the new collection agency rule of the Consumer Financial Protection Bureau (“CFPB”) having taken effect on November 30, 2021,¹ we thought we could help round out your understanding of the collection agency laws by providing an overview of the licensing of collection agencies by the states.

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