On October 27, two law firms accused by the Consumer Financial Protection Bureau of violating the Consumer Financial Protection Act responded to the CFPB’s allegations that they failed to provide consumers with promised legal representation by accusing the CFPB of “improperly [attempting] to create a new federal common law definition of the practice of law.”
CFPB Obtains Judgment in Excess of $500 Million Against Defunct College Chain for Student Lending Scheme
On October 27, the U.S. District Court for the Northern District of Illinois awarded the Consumer Financial Protection Bureau $531.2 million against for-profit college chain Corinthian Colleges, Inc. for what the Bureau described as a “predatory” student lending program that the company administered. Prior to its liquidation through bankruptcy earlier this year, Corinthian was one
CFPB Files Lawsuit Against Nationwide Student Financial Aid Scam and Continues Crackdown on Student Financial Aid Industry
On October 29, the Consumer Financial Protection Bureau filed a complaint in the Southern District of California against Global Financial Support, Inc. and its owner and CEO, Armond Aria, for allegedly engaging in a nationwide student financial aid scam.
The Bureau claims that Defendants violated the UDAAP provisions of the Consumer Financial Protection Act when
CFPB Director Provides Additional Commentary on Efforts to Address Arbitration Issues
On October 22, Consumer Financial Protection Bureau Director Richard Cordray delivered prepared remarks to the Consumer Advisory Board. At the meeting, Cordray discussed arbitration and issues relating to non-English or limited English–speaking consumers.
The issue of arbitration, however, was at the forefront of the discussion. As we previously reported, the CFPB intends
Protecting the Attorney-Client Privilege: Companies Sue CFPB For Not Allowing Them to Attend Their Former Counsel’s Investigatory Testimony
In July 2015, several companies that were the targets of non-public Consumer Financial Protection Bureau investigations sued the Bureau after it refused to allow their current counsel to attend the Bureau’s investigative testimony of one of the companies’ former attorneys. The companies wanted one of their current attorneys to attend the testimony and assert the
CFPB Director’s Remarks at MBA Annual Convention: Progress, Updated HMDA Reporting, and Warning to Parties Engaged in Marketing Services Agreements
Consumer Financial Protection Bureau Director Richard Cordray addressed the Mortgage Bankers Association at its Annual Convention on October 19. In his remarks, Cordray:
- Summarized the progress the CFPB has made in addressing the serious problems confronting consumers in the mortgage market and steps taken by the Bureau to restore the American Dream of homeownership;
CFPB Holding Consumer Advisory Board Meeting in October; Topics Will Include Arbitration
The Consumer Financial Protection Bureau announced that it will hold a meeting of the Consumer Advisory Board with Director Richard Cordray discussing topics such as arbitration, trends, and themes in the marketplace, and reaching limited English-speaking consumers.
The meeting will take place on Thursday, October 22, from 10:00 a.m. until 3:30 p.m. EDT in the
Inspector General Chimes In on CFPB Management Challenges
On September 30, the Office of the Inspector General released its report of the four major management challenges facing the Consumer Financial Protection Bureau, including ensuring an effective information security program, building and sustaining a high-performing and diverse workforce, strengthening controls over management operations, and maintaining physical infrastructure. Through the use of audit and evaluation
CFPB Plans to Pave the Way for Yet More Class Actions Against Financial Services Companies
According to remarks made by Consumer Financial Protection Bureau (“CFPB”) Director Richard Cordray on October 7, 2015 (and a subsequent press release), the CFPB is planning to issue regulations that would prohibit many financial services companies from requiring consumers to waive their right to bring a class action lawsuit via a pre-dispute arbitration agreement
The CFPB Cracks Down on Another Auto Lender for UDAAP
On October 1, 2015, the Consumer Financial Protection Bureau entered into a consent order with an indirect finance company, Westlake Services, LLC, and its auto title lending subsidiary, Wilshire Consumer Credit, LLC (collectively, “Respondents”). Westlake specializes in purchasing and servicing subprime and near-subprime auto loans. Wilshire extends auto title loans directly to consumers. Respondents agreed