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In this issue, we discuss the importance of the Federal Trade Commission activities in the consumer finance world and the big changes on the horizon for credit reporting of public records data; provide an update on the PHH Corp. v. Consumer Financial Protection Bureau case; discuss the expansion of New York Licensing Laws and the rejection of "Part EE" by State Legislature; deliver an in-depth analysis of the Eastern District of North Dakota's dismissal of the Bureau's complaint against Intercept Corp.; highlight an upcoming Fair Debt Collection Practices Act case that could eliminate a significant source of consumer class action litigation against many consumer finance companies; and feature an article from the March 2017 issue of Collector magazine on the importance of compliance management systems. You will also find a list of upcoming industry events you may be interested in attending. |
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| IN DEPTH | |
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Federal Trade Commission Requires Substantiation to Support Debt Collection Communications With all eyes on the Consumer Financial Protection Bureau and its future fate, it's easy to overlook the Federal Trade Commission's activities in the consumer financial services world – and that would be a mistake. The Federal Trade Commission continues to share enforcement jurisdiction with the Consumer Financial Protection Bureau over many industries, including consumer lending by non-banks, credit reporting, and debt collection. |
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Big Changes on Horizon for Credit Reporting of Public Records Data On the heels of the Consumer Financial Protection Bureau's publication of a Special Edition of its Supervisory Highlights focused on consumer reporting, the three nationwide credit reporting agencies are making significant changes to how public records will be reported on credit reports. Starting July 1, civil judgments and tax liens will be excluded from credit reports unless they meet heightened data standards. |
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Court Retracts the Bounds of Unfair, Deceptive, or Abusive Acts or Practices in Dismissing Consumer Financial Protection Bureau v. Intercept Corp. Complaint The Consumer Financial Protection Bureau's enforcement actions pursuant to the prohibition of unfair, deceptive, or abusive acts or practices are often broad but not, it seems, boundless. On March 17, 2017, the Eastern District of North Dakota dismissed without prejudice the Bureau's complaint against Intercept Corp., a payments processor that allegedly harmed consumers by ignoring fraudulent and abusive activities by its merchant partners in violation of the Consumer Financial Protection Act. |
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Administration Sides with PHH in En Banc Appeal as the U.S. Department of Justice and PHH File Briefs The Consumer Financial Protection Bureau's structure continues to be a source of debate and disagreement. The U.S. Department of Justice recently filed its amicus curiae brief with the D.C. Circuit in PHH Corp. v. Consumer Financial Protection Bureau, a closely watched case that we have been following. In its brief, the U.S. Department of Justice argued that the Consumer Financial Protection Bureau's "for-cause removal" should be severed from the Dodd-Frank Act, meaning that the Consumer Financial Protection Bureau director could be removed at will by the President. |
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Rejection of Expanded License Law May Not Slow New York DFS The New York Department of Financial Services plays a role in regulating many forms of fintech, but a proposal to expand the scope of the NY lender licensing laws recently hit a snag. |
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Supreme Court to Consider Whether the Fair Debt Collection Practices Act Applies to Buyers of Defaulted Debt The U.S. Supreme Court will hear oral argument in a case to decide whether purchasers of defaulted debt are governed by the federal Fair Debt Collection Practices Act on April 18, 2017. |
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Collector magazine Quotes Alex Megaris and Jonathan Pompan on the Importance of Compliance Management Systems Venable counsel Alex Megaris and partner Jonathan Pompan were quoted in the March 2017 issue of Collector magazine on the importance of compliance management systems. The Consumer Financial Protection Bureau has emphasized the need for a robust compliance management system that includes at a minimum, management oversight, a compliance program, a system for managing consumer complaints, and a compliance audit. While there is not a one-size-fits-all formula for an effective compliance management system, it is important that a program be tailored to the company. |
| RECENT EVENT | |
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Lead Generation Regulation and Enforcement: Government Perspectives The presentation materials from the program, Lead Generation Regulation and Enforcement: Government Perspectives, at the 2017 LeadsCon Conference in Las Vegas, NV, are available here. This panel discussion gives an overview of the FTC staff perspectives from lead generation workshop, recent state Attorneys General initiatives and enforcement activity, including development of a code for education lead generation, and practical advice about how to protect your business from regulatory risks. |
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| UPCOMING EVENTS | |
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April 4, 2017: An Update from Washington at the 6th Annual Community Bankers Conference April 28, 2017: Consumer Financial Services Legal and Regulatory Update at the 2017 Financial Counseling Association of America (FCAA) Annual Conference May 3, 2017: Webinar - Consumer Finance Enforcement Activity in a New Administration; registration to open soon May 7-10, 2017: MBA's Legal Issues & Regulatory Compliance Conference 2017 May 24, 2017: Federal Legal and Legislative Update at the 2017 National Association of Consumer Credit Administrators (NACCA) 2017 Annual Meeting and Regulators Training Symposium June 7, 2017: What's Changing in the Regulatory Environment? Hear From Your Federal and State Regulators at COMPLY2017 – The RegTech and Compliance Conference. Join Venable and other leading professionals interested in compliance, education, marketing and RegTech solutions. Save $100 off your registration with the discount code VENABLEVIP. |
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FTC requirements for debt collectors, credit reporting of public records data, and more in this issue of Consumer Financial Services Practice Digest
5 min