On Thursday, May 29, 2014, defendant New England Motor Freight (“NEMF”) agreed to a $870,500 settlement of a putative class action claim under the Fair Credit Reporting Act pending in New Jersey federal court. The class complaint alleged that NEMF had purchased consumer reports for potential job applicants from various wholesalers without first asking for
FTC Urges Regulation of Data Brokers
On May 27, 2014, the Federal Trade Commission issued a long-awaited report on the data broker industry. The report, titled “Data Brokers: A Call for Transparency and Accountability,” is the result of an eighteen-month study of certain data brokers that represent a cross-section of the industry.
The report encouraged Congress to step in to enact
CFPB Announces Spring 2014 Rulemaking Agenda and More…
CFPB Announces Spring 2014 Rulemaking Agenda, Confirms Development of “Larger Participant” Definition for Auto Finance Market
On May 23, 2014, the Consumer Financial Protection Bureau posted its updated semi-annual rule-making agenda, which covers several important categories of upcoming regulatory action.
Defining Larger Participants in Auto Lending Market for Regulation
Through use of its rulemaking
Seventh Circuit Affirms Dismissal of Challenges to Validation Notices
On January 23, 2014, the Seventh Circuit Court of Appeals affirmed the dismissal of four lawsuits against debt collectors that challenged validation notices under 1692g(a)(4).
The disputed provision of the letters involved the 30-day language notifying consumes of their right to dispute the debt, which letters read in relevant part:
“Unless you notify this office
CFPB Succumbs to Pressure, Opens Advisory Board and Council Meetings to Public
Beginning in June, the Consumer Financial Protection Bureau will provide the public with access to the meetings of the Consumer Advisory Board (CAB)and the CFPB’s three Councils. Anyone may attend or watch the full meetings live online the same way most other agencies allow under the Federal Advisory Committee Act.
As we previously discussed,
CFPB Issues Supervisory Highlights Focusing on Nonbank Compliance Programs
On May 22, 2014, the Consumer Financial Protection Bureau issued its spring 2014 supervisory highlights report. The report zeros in on the debt collection and consumer reporting industries, highlighting numerous violations uncovered at payday lenders, debt collection firms, and consumer reporting agencies. Specifically, it appears that the CFPB’s largest concerns with these groups surrounds
Mortgage Lead Generator to Pay $225,000 to Settle FTC Lawsuit Alleging Deceptive Advertising of Mortgage Rates
On May 7, 2014, the Federal Trade Commission filed a complaint in the U.S. District Court for the Southern District of Texas, Case No. 4:14cv1262, against GoLoansOnline.com (“GoLoansOnline”), an online company that finds potential borrowers for mortgage companies, alleging violations of the Federal Trade Commission Act, the Mortgage Acts and Practices Advertising Rule, the Truth
Maryland Court of Appeals Explains Evidentiary Rules for Debt Buyers
On May 19, 2014, the Maryland Court of Appeals held that plaintiff-debt buyers that pursue judgments against defaulted debtors based on affidavits must produce certain documents that are “sufficient to pass muster” under the business records exception to the hearsay rule. Nevertheless, the high court further ruled that, once a small-claim action is contested and
FTC Settles $4 Million Enforcement Action Against California Debt Collectors
Asset Capital and Management Group (“Asset”), a debt collector based in Southern California, has agreed to a $4 million settlement with the Federal Trade Commission to resolve allegations that it extorted payments from consumers by using false threats. According to the FTC, Asset and its principals employed a vast network of related companies and used
Legislation Introduced To Amend The FDCPA To Limit A Prevailing Defendant’s Ability To Recover Costs
On May 9, 2014, U.S. Representative Matt Cartwright introduced H.R. 4624 to amend the Fair Debt Collections Practices Act to prohibit a court from awarding costs to a prevailing defendant in the absence of a finding that an action was brought in bad faith.
This legislation is in response to the United States Supreme Court’s