CFPB calls on states to lead consumer finance enforcement, a recap of the California Finance Lender license, and more in this issue of Consumer Financial Services Practice Digest

4 min

CFPB Calls on States to Lead Consumer Finance Enforcement

CFPB Acting Director Mick Mulvaney recently addressed the threat of increased state-level enforcement by inviting it. Recall that last December, 17 state attorneys general (AGs) sent President Trump a letter stressing how the CFPB has been, and must remain, an "invaluable partner" in consumer finance enforcement. Perhaps most notably, the letter contained this statement: "If incoming CFPB leadership prevents the agency's professional staff from aggressively pursuing consumer abuse and financial misconduct, we will redouble our efforts at the state level to root out such misconduct and hold those responsible to account." In other words, the AGs intended to become more active in enforcement if the CFPB's enforcement activity decreased. Indeed, an overall increase in enforcement activity brought about by states and/or varied enforcement by different state regulators, which would create a need for multi-state compliance, would not be a desirable outcome for financial services companies.

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financial technology

A Recap of the California Finance Lender License for FinTech Companies

Many state regulators take the view that non-bank FinTech companies must comply with laws regulating loan origination or brokerage and, thus, subject them to licensure, compliance, and examination requirements. Given the size of the state's market and the breadth of activities it covers, the California Finance Lender (CFL) license can be an absolute necessity for any financial services business.

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Ensuring Effective Compliance in Lead Generation

With online lead generation becoming more pervasive, so is the scrutiny by government regulators, consumers and counterparties. During LeadsCon 2018, Jonathan Pompan discussed the latest regulatory developments, how to develop a culture of compliance to avoid legal risk and how to maximize growth.

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request for information

CFPB Expands "Call for Evidence" with Additional RFIs

The CFPB has now issued ten requests for information (RFIs) as part of Acting Director Mulvaney's "Call for Evidence Regarding Consumer Financial Protection Bureau Functions," which we have previously covered. The RFIs provide industry participants a chance to comment on the CFPB's rules, policies, and practices regarding investigations, examinations, enforcement actions, and external engagement.

Current RFIs from the CFPB

RFI Regarding Civil Investigative Demands (CIDs): Comments must be received by April 26, 2018

RFI Regarding Administrative Adjudications: Comments must be received by May 7, 2018

RFI Regarding Bureau Enforcement Processes: Comments must be received by May 14, 2018

RFI Regarding the Bureau's Supervision Program: Comments must be received by May 21, 2018

RFI Regarding Bureau External Engagements: Comments must be received by May 29, 2018

RFI Regarding Bureau Public Reporting Practices of Consumer Complaint Information: Comments must be received by June 4, 2018

RFI Regarding Bureau Rulemaking Processes: Comments must be received by June 7, 2018

RFI Regarding the Bureau's Adopted Regulations and New Rulemaking Authorities: Comments must be received by June 19, 2018

RFI Regarding the Bureau's Inherited Regulations and Inherited Rulemaking Authorities: Comments must be received by June 25, 2018

RFI Regarding Bureau Guidance and Implementation Support: Comments close estimated July 2, 2018

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Advertising Law Tool Kit

From the Advertising Law Tool Kit

In the evolving world of lead generation and performance-based customer acquisition, the quest for profits can lead to big legal risks, some of them too large for advertisers who buy leads through third parties. In the latest edition of the firm's Advertising Law Tool Kit, Venable partner Jonathan Pompan discusses best practices for advertisers to consider when harnessing the power of lead generation.

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April 10, 2018: "What the Arrival of the CFPB Final Rule Means for Consumer Access & the Development of New Products," at the Power of Prepaid Conference

April 17, 2018: "State Law Issues and Challenges," at the Electronic Transactions Association’s TRANSACT conference

April 25-27, 2018: "Consumer Financial Services Legal and Regulatory Update," at the 2018 Financial Counseling Association

May 2, 2018: "Compliance in Action: Use Case Workshop," at MBA’s Legal Issues and Regulatory Compliance Conference 2018

May 11, 2018: "Hot Topics in Financial Services Litigation and Enforcement," at ACI's Women Leaders in Financial Services Law and Compliance Event

May 17, 2018: "The Chief Compliance Officer Perspective," at COMPLY2018 Conference

July 24, 2018: "CFPB/FTC Debt Collection Update," at ACA International 2019 Convention