Like most industries today, Consumer Finance Services businesses are being significantly impacted by the novel coronavirus (COVID-19). Troutman Pepper has developed a dedicated COVID-19 Resource Center to guide clients through this unprecedented global health challenge. We regularly update this site with COVID-19 news and developments, recommendations from leading health organizations, and tools that businesses can use free of charge.
To help you keep abreast of relevant activities, below find a breakdown of some of the biggest COVID-19 driven events at the federal and state levels to impact the Consumer Finance Services industry this past week:
Privacy and Cybersecurity Activities
- On December 22, President Joe Biden announced that the pause on federal student loan repayments would be extended for an additional 90 days through May 1, 2022. For more information, click here.
- On December 22, the Federal Reserve issued an update to the Federal Reserve Payments Study to include findings from recent survey data. The findings highlight changes in card payments and increased adoption of innovative payment methods following the emergence of COVID-19. For example, recent data shows that the number and value of both in-person and remote (e.g., online, over-the-phone) card payments grew in 2019, broadly in line with recent trends. The year 2020, by contrast, saw an unprecedented decline of 11.7 billion, or almost 13%, in the number of in-person card payments accompanied by a similarly unprecedented surge of 8.7 billion, or almost 24%, in the number of remote card payments. For more information, click here.
- On December 22, the Federal Trade Commission (FTC) gave final approval to a settlement with a mortgage industry data analytics firm that will require the company to bolster its data security protections and oversight of its vendors to ensure third-party providers also comply with those safeguards. For more information, click here.
- On December 20, the Consumer Financial Protection Bureau and U.S. Department of Justice issued two joint letters regarding important legal housing protections for military families. One letter was sent to landlords and other housing providers on protections for military tenants. A second letter was sent to mortgage servicers on military borrowers who have already exited or will be exiting COVID-19 mortgage forbearance programs in the coming weeks and months. For more information, click here.
- On December 7, the final version of the National Defense Authorization Act (NDAA) for fiscal year 2022 was sent to President Biden and now awaits his signature. This version expands the coverage of the Servicemembers Civil Relief Act (SCRA) protections dealing with the termination of residential or motor vehicle leases and telephone service contracts. The provision amends the SCRA to make those protections applicable to foreign service members posted abroad at a foreign service post. For more information, click here.
- On January 1, 2022, California’s medical debt law will take effect, which means agencies licensed in the state will have limits on collection actions and their health care clients will be required to have a written policy on how they send accounts to third-party debt collectors. For more information, click here.
- On January 1, 2022, Idaho Department of Finance new guidance will take effect, which means that individual employees of licensed financial services companies may engage in remote work activities without the requirement to license or register the employee’s noncommercial remote location where certain conditions are met. For more information, click here.
- On December 20, the Colorado Department of Law, which administers the Colorado Fair Debt Collection Practices Act, issued an advisory opinion seeking to clarify disclosure conflicts with Regulation F. The opinion states that the administrator “does not intend to take an administrative, disciplinary, or enforcement action for a collection agency or debt collector” that uses a date consistent with Regulation F’s validation period instead of the disclosure required under state law. For more information, click here.
Privacy and Cybersecurity Activities:
- On December 20, the U.S. Court of Appeals for the Seventh Circuit issued its long-awaited ruling on claim accrual in Cothron v. White Castle Sys., No. 20-3202 (7th Cir.). Specifically, this decision addressed the issue of accrual for claims made under Sections 15(b) and 15(d) of the Illinois Biometric Information Protection Act (BIPA). In its decision, the Seventh Circuit panel elected to certify this issue to the Illinois Supreme Court, acknowledging that it is “genuinely uncertain” about how to rule on this state-law issue. This decision is important for the timeliness of this suit and many others in which the initial alleged BIPA violation precedes the applicable limitations period (which is disputed in this case; however, the parties agree it is no longer than five years). The pandemic further heightened the significance of this decision as businesses will likely face a wave of BIPA-related claims concerning COVID-19 employee screening programs. For more information click here.
- On December 21, the FTC finalized an order banning Support King LLC and its CEO, Scott Zuckerman, from “offering, promoting, selling, or advertising any surveillance app, service, or business” in the United States. Earlier this year, the FTC alleged that Support King LLC and Zuckerman published applications that allowed purchasers to monitor photos, text messages, GPS locations, and other information from a phone on which the application was installed without the device owner’s knowledge. For more information click here.