Consumer Financial Services Law Monitor

Consumer Financial Services Law Monitor

monitoring the financial services industry to help companies navigate through regulatory compliance, enforcement, and litigation issues

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Avis Settles FCRA Background Check Lawsuit for $2.7 Million

Posted in ALL CFS Blog Entries, Background Screening
On November 17, car rental company Avis filed its memorandum in support of final approval of a $2.7 million class action settlement to resolve Fair Credit Reporting Act claims related to its background screening practices. The case is Angela Fuller v. Avis Budget Car Rental LLC, et al., No. 2:15-cv-03856, pending in the U.S. District… Continue Reading

Auto Finance Company Unable to Shake TCPA Class Action

Posted in ALL CFS Blog Entries, Auto Finance
The Third Circuit recently clarified in important ways its ascertainability standard for class actions under Rule 23 in a case that arose from the efforts of an auto finance company to generate business by marketing efforts directed at automobile dealers.  The decision reflects two key findings:  (1) that defendants who argue a class is not… Continue Reading

FCC Adopts New Rules on Blocking Robocalls

Posted in ALL CFS Blog Entries, Cyber Security, Information Governance & Privacy
On November 16, the Federal Communications Commission adopted new rules to allow telephone carriers to block robocalls as potentially fraudulent when they come from certain types of phone numbers. According to the FCC’s press release, robocalls are the top consumer complaint submitted to the FCC, with more than 200,000 annually.  The FCC’s report also highlights… Continue Reading

President Likely Has Authority To Appoint Acting Director To Replace Cordray At CFPB

Posted in ALL CFS Blog Entries, Featured Posts, State Attorneys General, CFPB, & FTC
Consumer Financial Protection Bureau (CFPB) Director Richard Cordray’s announced yesterday (as covered here) that he will be resigning from his position by the end of this month. The Administration appears poised to announce Office of Management and Budget Director Mick Mulvaney as an interim replacement until a permanent director can be selected by the President and… Continue Reading

CFPB Director’s Resignation Sparks Conjecture About Future Leadership

Posted in ALL CFS Blog Entries, State Attorneys General, CFPB, & FTC
On November 15, as has been widely reported, the Director of the Consumer Financial Protection Bureau, Richard Cordray, announced by email to his staff that he would be resigning at the end of the month.  While he did not state the reason for his departure, it is believed that Cordray, a former Ohio attorney general,… Continue Reading

Supreme Court Declines to Hear Appeal of Ninth Circuit Decision on FCRA Willfulness in Disclosure Forms

Posted in ALL CFS Blog Entries, Background Screening
One of 2017’s more significant Fair Credit Reporting Act court opinions was the Ninth Circuit’s January 20 decision in Syed v. M-I, LLC, a putative FCRA class action.  In its decision, the Ninth Circuit Court of Appeals held that a prospective employer willfully violated the FCRA by including a liability waiver in its background check… Continue Reading

CFPB Solicits Comments on Access to Free Credit Scores

Posted in ALL CFS Blog Entries, Credit Reporting & Data Brokers
In recent years, many financial institutions and credit card companies have begun offering consumers free access to their credit score. On November 13, the Consumer Financial Protection Bureau published a request for information in the Federal Register regarding consumers’ experiences “with access to free credit scores and the experience of companies, and nonprofits, offering their… Continue Reading

New York AG Proposes Changes to Data Breach Law

Posted in ALL CFS Blog Entries, Cyber Security, Information Governance & Privacy, State Attorneys General, CFPB, & FTC
New York Attorney General Eric Schneiderman has introduced a bill that would expand that state’s existing data breach laws. This proposed legislation, called the Stop Hacks and Improve Electronic Data Security Act, or the SHIELD Act, is sponsored by two Democratic members of the state legislature (Senator David Carlucci and Assembly member Brian Kavanagh). Schneiderman stated in… Continue Reading

Illinois General Assembly Overrides Veto of Illinois Student Loan Servicing Rights Act

Posted in ALL CFS Blog Entries, State Attorneys General, CFPB, & FTC
With both houses of the Illinois General Assembly overriding the veto of Governor Bruce Rauner, the Illinois Student Loan Servicing Rights Act will become law.  Surpassing the three-fifths supermajorities needed for an override, the Senate voted by a margin of 37-19 and the House of Representatives by 98-16.  The Act takes effect on December 31,… Continue Reading

Tax Preparation Firm Settles FTC Claims Flowing from Data Breach

Posted in ALL CFS Blog Entries, Cyber Security, Information Governance & Privacy, State Attorneys General, CFPB, & FTC
On November 8, the Federal Trade Commission announced that it had approved a final order settling claims arising out of a data breach at Georgia-based tax preparation firm TaxSlayer, LLC. In late 2015, hackers hit TaxSlayer with a “list validation” or “credential stuffing” attack.  With that type of attack, hackers attempt to use login credentials… Continue Reading

District Court Relies on Spokeo to Dismiss FACTA Suit

Posted in ALL CFS Blog Entries, Payment Processing & Cards
On November 6, a judge in the Southern District of New York dismissed a proposed class action alleging that Wolfgang’s Steakhouse impermissibly printed payment card expiration dates on customers’ receipts, relying on the U.S. Supreme Court’s decision in Spokeo to find that customers were not actually harmed by any information revealed. Relying on the Second… Continue Reading

CA Federal Court Denies TransUnion’s Post-Trial Motions in $60M Ramirez Case

Posted in ALL CFS Blog Entries, Credit Reporting & Data Brokers
On November 6, in Sergio L. Ramirez v. TransUnion LLC, Magistrate Judge Jacqueline Corley of the United States District Court for the Northern District of California denied TransUnion’s post-trial motion for judgment as a matter of law, for a new trial, and to reduce the $60 million verdict previously entered by the jury.  Ramirez remains… Continue Reading

Arizona Governor Signs Executive Order Banning the Box

Posted in ALL CFS Blog Entries, Background Screening
On November 6, Arizona governor Doug Ducey signed an executive order making Arizona the most recent state to adopt a “ban the box” law.  The state joins Pima County and Tucson – Arizona localities that have already joined the “ban the box” movement. Under the new policy, state agencies will delay questions related to an… Continue Reading

Cordray Discusses CFPB’s Priorities During November Consumer Advisory Board Meeting

Posted in ALL CFS Blog Entries, State Attorneys General, CFPB, & FTC
On November 2, Consumer Financial Protection Bureau Director Richard Cordray delivered remarks during the Consumer Advisory Board meeting in Tampa.  Cordray’s public pronouncements reflect and foreshadow the CFPB’s regulatory priorities, and his recent comments indicate the CFPB’s focus on reverse mortgages, consumers with limited English proficiency, and short-term loans. Cordray mentioned the CFPB’s recently-released report… Continue Reading

Another Big-Dollar TCPA Settlement as Payment Processor Agrees to $9M Deal

Posted in ALL CFS Blog Entries, Credit Reporting & Data Brokers, Debt Buyers & Collectors, Featured Posts, Mortgage Lenders & Servicers, Payment Processing & Cards
A Texas-based payment processor agreed on November 1 to pay $9 million to settle a putative class action brought under the Telephone Consumer Protection Act in the United States District Court for the Northern District of California.  According to the plaintiffs, Pivotal Payments, Inc. failed to ensure that a third party it hired to make… Continue Reading

Sodexo Escapes FCRA Putative Class Action

Posted in ALL CFS Blog Entries, Background Screening
As we previously reported, consumer plaintiff Robert Piveronas filed a putative Fair Credit Reporting Act class action in Pennsylvania state court against Sodexo, Inc., alleging that the multinational corporation routinely violates the FCRA’s mandate that employers provide consumers with a “clear and conspicuous” background check disclosure, consisting solely of the disclosure, before procuring a consumer… Continue Reading

Illinois Federal Court Denies Certification of Junk Fax TCPA Class Action

Posted in ALL CFS Blog Entries, Cyber Security, Information Governance & Privacy
The November 3 decision in Alpha Tech Pet, Inc. v. Lagasse, LLC, et al. highlights that one of the key individualized issues present in many TCPA class actions – whether consumers provided their consent to be called, texted, or, as in this case, sent faxes – can defeat class claims. In its complaint, Alpha Tech… Continue Reading

Current Balance Decision Creates Uncertainty in Eastern District of New York

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors
On October 31, the United States District Court in the Eastern District of New York held that a debt collector violated the Fair Debt Collection Practices Act by failing to disclose whether interest and fees may accrue on an account.  Specifically, the Court denied a debt collector’s summary judgment motion, stating that a collection letter… Continue Reading

CFPB Issues Interim Final Rule Amending Time Requirement for Servicers to Send Subsequent Early Intervention Notices

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors
On October 4, the Consumer Financial Protection Bureau issued an interim final rule which will amend a portion of the 2016 Mortgage Servicing Final Rule for Regulation X of the Real Estate Settlement Procedures Act. Specifically, the interim rule will amend the amount of time mortgage servicers have under amended § 1024.39(d)(3)(iii) to “provide modified… Continue Reading

President Trump Officially Kills Arbitration Rule

Posted in ALL CFS Blog Entries, State Attorneys General, CFPB, & FTC
On November 1, President Donald J. Trump signed a resolution passed by Congress to nullify the Consumer Financial Protection Bureau’s Arbitration Rule.  As we reported here, the Senate narrowly passed a resolution to repeal the Rule in late October, ensuring that the controversy would make its way to the President’s desk.  Trump’s signature ensures that… Continue Reading

BIPA: Not Just for Cyber Companies

Posted in ALL CFS Blog Entries, Cyber Security, Information Governance & Privacy, Featured Posts
The recent onslaught of putative class actions alleging violations of Illinois’ Biometric Information Privacy Act (“BIPA”), codified at 740 ILCS 14/1 et. seq., has left many Illinois companies scrambling to find answers (and defense lawyers). While BIPA putative class actions have been filed against web-based companies like Shutterfly, Google, and Facebook, more recently it has… Continue Reading

Alabama AG Shuts Down Credit Repair Services Company

Posted in ALL CFS Blog Entries, Credit Reporting & Data Brokers
Alabama Attorney General Steve Marshall recently filed a complaint against Scott’s Credit Repair and its owners, John C. Scott and Krystal Scott, in Montgomery, Alabama Circuit Court.  The complaint alleged that “from beginning to end, the consumer experience with Scott’s Credit Repair is rooted in deception and illegality.”  More specifically, the complaint alleged that the… Continue Reading

District Court Skeptical of Consent to Obtain Consumer Report

Posted in ALL CFS Blog Entries, Credit Reporting & Data Brokers
The District Court for the District of Nevada recently addressed the reach of a consumer’s written authorization to obtain a consumer report under the Fair Credit Reporting Act.  In Rodriguez v. Your First Choice, LLC, it implicitly limited a business’s ability to obtain a report based on “written authorization” to situations when a permissible purpose… Continue Reading

FTC Settles Lawsuit with Company that Promotes Post-Secondary Schools to Military Families

Posted in ALL CFS Blog Entries, State Attorneys General, CFPB, & FTC
The FTC has reached a proposed consent agreement with Victory Media, Inc., resolving allegations that Victory violated Section 5 of the FTC Act.  The allegations stem from Victory’s promotion of post-secondary schools to members of the armed forces. Victory advertises to members of the armed forces in a variety of ways, including through its publications… Continue Reading