March 11, 2015

CFPB Showcases Directions of Supervision Program

2 min

On March 11, 2015, the CFPB released its semiannual report on Supervisory Highlights. The report outlines the CFPB's supervisory activities between July 2014 and December 2014.

The Supervisory Highlights report notes the remedial actions taken by the CFPB through its supervision program. The report estimates that recent supervisory resolution pertaining to payday lending, mortgage servicing, and mortgage origination "have resulted in remediation of approximately $19.4 million to more than 92,000 consumers." Supervision by the CFPB can often lead to (or, occasionally, stem from) an enforcement action, and may also result in referrals to other agencies and the Department of Justice.

The CFPB continues to develop and expand its supervision program. The Supervisory Highlights report notes that as of February 6, 2015, CFPB examination staff consisted of approximately 400 examiners supported by both regional management and headquarters staff. Areas included in the report likely forecast directions in which the CFPB will continue to expand its supervisory and enforcement efforts.

Key Supervisory Activities

  • Deceptive student loan debt collection practices: findings of deceptive statements to student loan borrowers that could mislead these consumers about the potential to restore credit and the participation in credit rehabilitation programs.
  • Unfair and deceptive overdraft practices: findings that overdraft fees were assessed or collected in ways that consumers could not understand.
  • Mortgage origination, alleged Regulation Z violations: findings that mortgage originators did not provide required disclosures. Further, the report notes instances when mortgage originators allegedly received compensation based on the terms of the loan.
  • Fair lending, alleged Equal Credit Opportunity Act (ECOA) violations: findings that mortgage applications were rejected because applicants relied on public assistance income; further findings that mortgages were marketed in such a way as to discourage consumers who received public assistance from applying.
  • Mishandling of disputes by consumer reporting agencies: findings that there were inadequate processes that lead to errors in credit files and incorrect dispute investigation outcomes.

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For more information, please contact Venable’s CFPB Task Force.