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The Consumer Financial Protection Bureau (CFPB or Bureau) released its 14th annual report to Congress in fulfillment of its requirements under the Credit Card Accountability Responsibility and Disclosure (CARD) Act. For the report, the CFPB reviewed information available on college websites on the financial products offered directly to students or jointly marketed to students with third-party providers. According to the CFPB, its research showed that college-sponsored financial products have higher fees and less favorable terms and conditions compared to typical market products.

On December 15, the Consumer Financial Protection Bureau (CFPB) announced it had reached a settlement with medical debt collector Commonwealth Financial Systems, Inc. (Commonwealth) in its lawsuit over alleged illegal debt collection practices. Specifically, the CFPB alleged that Commonwealth failed to conduct reasonable investigations of disputes and violated the Fair Debt Collection Practices Act (FDCPA) by attempting to collect disputed debt without obtaining substantiating documentation. Under the settlement agreement, Commonwealth is banned from debt collection activities, must request CRAs to delete all consumer accounts to which it had previously furnished information, and must pay a $95,000 penalty to the CFPB’s victims relief fund.

On December 13, by a vote of 4-1, the Federal Communications Commission (FCC) adopted new rules aimed at “closing the ‘lead generator’ robocall/robotexts loophole.” Specifically, the rule requires telemarketers to obtain consumer consent to receive robocalls and robotexts one seller/brand at a time, instead of allowing a single consent to apply to multiple telemarketers. This is also known as one-to-one consent. The order does not specifically define “robocall” or “robotext.”

On December 13, New York Governor Kathy Hochul signed into law S4907A, which prohibits hospitals, medical providers, or ambulance services from providing negative information about medical debt to consumer reporting agencies (CRAs). The law also requires that these entities include a provision in their contracts with collection agencies prohibiting the reporting of any portion of a medical debt to a CRA. Any debt that is reported to a CRA will be deemed void. The law became effective immediately after it was signed.

On December 12, the Federal Trade Commission (FTC) published the long-awaited regulation specific to motor vehicle dealers to address concerns of consumer deception in the sales process (Final Rule). We covered the proposed rule, introduced in June 2022, in a blog post here and podcast here. In a 3-0 vote, the FTC approved the issuance of the Final Rule, which will be published in the Federal Register in the coming weeks.

On December 4, a federal district court for the Central District of California granted summary judgment in favor of the Commissioner of the California Department of Financial Protection and Innovation (DFPI) finding that regulations adopted last year under California’s Commercial Financing Disclosures Law (CFDL) do not violate the plaintiff’s First Amendment rights and are not preempted by the Truth in Lending Act (TILA). Under the CFDL, providers are required to give certain disclosures similar to consumer transactions, such as the amount of funding the small business will receive, the APR, a payment amount (if applicable), the term, details related to prepayment policies, and (for products without a monthly payment) an average monthly cost.

Yesterday, the Office of the Comptroller of the Currency (OCC) issued guidance to banks on managing the risks associated with “buy now, pay later” (BNPL) lending. Specifically, the bulletin addresses BNPL loans that are payable in four or fewer installments and carry no finance charges. The stated aim of the OCC’s guidance is to ensure that these loans are offered in a manner that is safe, sound, and compliant with applicable laws and regulations.