On July 30, 2024, Heights Finance Holding Co. f/k/a Southern Management Corporation and a group of its wholly-owned, state-licensed subsidiaries (collectively, “Southern”) filed a motion for judgment on the pleadings (the...more
8/15/2024
/ Administrative Procedure Act ,
Borrowers ,
Constitutional Challenges ,
Consumer Financial Products ,
Consumer Financial Protection Act (CFPA) ,
Consumer Financial Protection Bureau (CFPB) ,
Dodd-Frank ,
Financial Institutions ,
Financial Services Industry ,
Judgment on the Pleadings ,
Statute of Limitations ,
UDAAP
We have recently blogged about two other actions in which this issue has been raised (one being a declaratory judgment action filed against the CFPB on July 23, 2024 in the E.D. Tex. and the other being an enforcement action...more
8/8/2024
/ Constitutional Challenges ,
Consumer Financial Products ,
Consumer Financial Protection Act (CFPA) ,
Consumer Financial Protection Bureau (CFPB) ,
Dodd-Frank ,
Enforcement Actions ,
Federal Funding ,
Financial Institutions ,
Financial Services Industry ,
Motion to Dismiss ,
Regulation Z ,
Regulatory Authority ,
Statutory Violations ,
Truth in Lending Act (TILA) ,
UDAAP
We have previously blogged about an enforcement action brought on July 12, 2022 by the CFPB against Populus Financial Group, Inc., d/b/a ACE Cash Express, Inc. in Federal District Court for the Northern District of Texas...more
8/7/2024
/ Constitutional Challenges ,
Consumer Financial Products ,
Consumer Financial Protection Bureau (CFPB) ,
Consumer Lenders ,
Dodd-Frank ,
Enforcement Actions ,
Federal Funding ,
Financial Institutions ,
Financial Regulatory Reform ,
Financial Services Industry ,
Loan Agreements ,
Motion to Dismiss ,
OFR ,
Payment Plans ,
Regulatory Agenda ,
Stays ,
Unfair or Deceptive Trade Practices
Part 1 – The CFPB has no authority to investigate or sue Acima because, under Dodd-Frank and the appropriations Clause of the Constitution, it may only be funded out of combined earnings of the Federal Reserve System and...more
7/31/2024
/ Administrative Agencies ,
Constitutional Challenges ,
Consumer Financial Products ,
Consumer Financial Protection Bureau (CFPB) ,
Consumer Lenders ,
Dodd-Frank ,
Due Process ,
Federal Funding ,
Financial Institutions ,
Financial Regulatory Reform ,
Financial Services Industry ,
Regulatory Authority ,
Rent-to-Own Companies
On June 14, the CFPB announced that its payday lending rule would become effective on March 30, 2025. However, the CFPB ignored the possibility of further litigation in CFSA v. CFPB, the case challenging the payday lending...more
6/24/2024
/ Administrative Procedure Act ,
Constitutional Challenges ,
Consumer Financial Products ,
Consumer Financial Protection Bureau (CFPB) ,
Consumer Financial Protection Bureau v Community Financial Services Association of America Ltd ,
Consumer Lenders ,
Financial Regulatory Reform ,
Financial Services Industry ,
Payday Lending Rule ,
Payday Loans ,
Rulemaking Process ,
UDAAP
On June 19, 2024, the Fifth Circuit dissolved the district court’s order transferring the case challenging the CFPB’s credit card late fee rule. In granting the writ of mandamus filed by the plaintiff trade associations...more
6/20/2024
/ Administrative Procedure Act ,
CARD Act ,
Constitutional Challenges ,
Consumer Financial Products ,
Consumer Financial Protection Bureau (CFPB) ,
Credit Cards ,
Debt Collection ,
Federal Funding ,
Final Rules ,
Financial Institutions ,
Financial Regulatory Reform ,
Financial Services Industry ,
Late Fees ,
Motion to Transfer ,
Preliminary Injunctions
In a blog post published at the end of last week, the CFPB announced that its payday lending rule (Rule) would go into effect on March 30, 2025. Because the Rule’s ability to pay requirements were rescinded, the only...more
6/18/2024
/ Administrative Procedure Act ,
Constitutional Challenges ,
Consumer Financial Products ,
Consumer Financial Protection Bureau (CFPB) ,
Consumer Financial Protection Bureau v Community Financial Services Association of America Ltd ,
Federal Funding ,
Final Rules ,
Financial Institutions ,
Financial Regulatory Reform ,
Financial Services Industry ,
Payday Lending Rule ,
SCOTUS
Although neither the CFPB, the Federal Reserve Board, nor the Treasury has responded to Professor Emeritus Hal Scott’s op-ed on May 20 in the Wall Street Journal, my interview with Professor Scott on our Consumer Finance...more
6/11/2024
/ Administrative Agencies ,
Banks ,
Constitutional Challenges ,
Consumer Financial Products ,
Consumer Financial Protection Bureau (CFPB) ,
Dodd-Frank ,
Federal Funding ,
Federal Reserve ,
Financial Institutions ,
Financial Regulatory Reform ,
Financial Services Industry
Special guest Professor Hal Scott of Harvard Law School joins us today as we delve into the thought-provoking question of whether the Supreme Court’s recent decision in the landmark case of CFSA v. CFPB really hands the CFPB...more
In a replay of earlier events, in response to an emergency petition for writ of mandamus and administrative stay of transfer filed by the plaintiffs in the lawsuit challenging the legality of the CFPB’s credit card late fee...more
5/31/2024
/ Constitutional Challenges ,
Consumer Financial Products ,
Consumer Financial Protection Bureau (CFPB) ,
Consumer Lenders ,
Credit Cards ,
Debt Collection ,
Final Rules ,
Financial Institutions ,
Financial Regulatory Reform ,
Financial Services Industry ,
Late Fees ,
Motion to Transfer ,
Regulatory Agenda ,
Writ of Mandamus
On May 16, Justice Thomas issued the majority opinion in which the Supreme Court held, by a 7-2 vote, that the CFPB’s funding mechanism comported with the Appropriations Clause of the Constitution which states, in relevant...more
5/23/2024
/ Banks ,
Constitutional Challenges ,
Consumer Financial Products ,
Consumer Financial Protection Bureau (CFPB) ,
Consumer Financial Protection Bureau v Community Financial Services Association of America Ltd ,
Dodd-Frank ,
Federal Funding ,
Final Rules ,
Financial Institutions ,
Financial Services Industry ,
SCOTUS
The U.S. Supreme Court’s ruling last week in CFSA v. CFPB that the CFPB’s funding mechanism does not violate the Appropriations Clause of the U.S. Constitution removes what many observers consider to be the last remaining...more
5/22/2024
/ Constitutional Challenges ,
Consumer Financial Protection Bureau (CFPB) ,
Consumer Financial Protection Bureau v Community Financial Services Association of America Ltd ,
Credit Cards ,
Dodd-Frank ,
Financial Services Industry ,
Late Fees ,
Payday Loans ,
Proposed Rules ,
Regulatory Agenda ,
SCOTUS ,
Small Business Loans ,
UDAAP
The U.S. Supreme Court, in a 7-2 decision, ruled yesterday that the CFPB’s funding mechanism does not violate the Appropriations Clause of the U.S. Constitution....more
5/17/2024
/ Constitutional Challenges ,
Consumer Financial Products ,
Consumer Financial Protection Bureau (CFPB) ,
Consumer Financial Protection Bureau v Community Financial Services Association of America Ltd ,
Credit Cards ,
Dodd-Frank ,
Federal Funding ,
Financial Institutions ,
Financial Regulatory Reform ,
Financial Services Industry ,
Late Fees ,
Preliminary Injunctions ,
SCOTUS
The CFPB (or “Bureau”) filed a cross-motion for summary judgment in the lawsuit regarding the small business lending data collection and reporting rule, also known as the 1071 rule based on the Dodd-Frank section that...more
4/29/2024
/ Constitutional Challenges ,
Consumer Financial Products ,
Consumer Financial Protection Bureau (CFPB) ,
Consumer Financial Protection Bureau v Community Financial Services Association of America Ltd ,
Data Collection ,
Dodd-Frank ,
Financial Institutions ,
Financial Services Industry ,
HMDA ,
Motion for Summary Judgment ,
SCOTUS ,
Section 1071 ,
Small Business
Our special guest is Jeff Sovern, Professor at the University of Maryland Francis King Carey School of Law. In March 2022, the CFPB announced that it had revised its exam manual to instruct its examiners to apply the...more
Last week, by a vote of 221-202, the House of Representatives voted to approve S.J. 32, the resolution introduced under the Congressional Review Act to override the CFPB’s final Section 1071 small business lending rule (1071...more
12/6/2023
/ Administrative Procedure Act ,
Biden Administration ,
Congressional Review Act ,
Constitutional Challenges ,
Consumer Financial Protection Bureau (CFPB) ,
Fair Lending ,
Financial Institutions ,
Financial Services Industry ,
Payday Lending Rule ,
Presidential Veto ,
Regulatory Requirements ,
SCOTUS ,
Section 1071 ,
Small Business ,
Small Business Loans
Earlier this month, the CFPB filed a notice with the Texas federal district court that it is appealing to the Fifth Circuit the district court’s order granting summary judgment to a group of trade associations in their...more
11/21/2023
/ Appeals ,
Banking Examinations ,
Constitutional Challenges ,
Consumer Financial Products ,
Consumer Financial Protection Bureau (CFPB) ,
Consumer Financial Protection Bureau v Community Financial Services Association of America Ltd ,
Federal Funding ,
Financial Institutions ,
Financial Regulatory Reform ,
Financial Services Industry ,
SCOTUS ,
Summary Judgment ,
Trade Associations ,
UDAAP
A Nevada federal district court has stayed an action filed by the CFPB to enforce a civil investigative demand (CID) issued to a small-dollar lender pending the U.S. Supreme Court’s decision in Community Financial Services...more
11/14/2023
/ Administrative Proceedings ,
Civil Investigation Demand ,
Constitutional Challenges ,
Consumer Financial Protection Bureau (CFPB) ,
Consumer Financial Protection Bureau v Community Financial Services Association of America Ltd ,
Federal Funding ,
Financial Institutions ,
Financial Services Industry ,
Regulatory Agencies ,
SCOTUS ,
Small Dollar Lenders ,
Stays
On November 29, 2023, the U.S. Supreme Court will hear oral argument in Jarkesy v. Securities and Exchange Commission, a case in which the respondents are challenging the constitutionality of the SEC’s use of administrative...more
11/7/2023
/ Administrative Law Judge (ALJ) ,
Administrative Proceedings ,
Amicus Briefs ,
Article II ,
Constitutional Challenges ,
Consumer Financial Protection Bureau (CFPB) ,
Federal Trade Commission (FTC) ,
Oral Argument ,
Regulatory Authority ,
SCOTUS ,
SEC v Jarkesy ,
Securities and Exchange Commission (SEC) ,
Securities Fraud ,
Seventh Amendment
On October 3, 2023, the U.S. Supreme Court held oral argument in CFSA v. CFPB, a case with profound potential implications for the future of the CFPB. The Court will rule on whether the CFPB’s funding mechanism violates the...more
The Texas federal district court hearing the lawsuit challenging the validity of the CFPB’s final rule implementing Section 1071 of the Dodd-Frank Act (Rule) has issued an order that preliminarily enjoins the CFPB from...more
10/31/2023
/ Administrative Procedure Act ,
Constitutional Challenges ,
Consumer Financial Products ,
Consumer Financial Protection Bureau (CFPB) ,
Consumer Financial Protection Bureau v Community Financial Services Association of America Ltd ,
Dodd-Frank ,
Federal Funding ,
Financial Institutions ,
Financial Services Industry ,
Preliminary Injunctions ,
SCOTUS ,
Section 1071 ,
Small Business ,
Small Business Loans
On Wednesday, by a vote of 53-44, the Senate voted to approve S.J. 32, the resolution introduced under the Congressional Review Act (CRA) to override the CFPB’s final Section 1071 small business lending rule (1071 Rule)....more
10/20/2023
/ Congressional Review Act ,
Constitutional Challenges ,
Consumer Financial Protection Bureau (CFPB) ,
Consumer Financial Protection Bureau v Community Financial Services Association of America Ltd ,
CRA ,
Financial Institutions ,
Financial Services Industry ,
First Amendment ,
OCC ,
Preliminary Injunctions ,
Section 1071 ,
Small Business ,
Small Business Loans ,
True Lender
This week, the U.S. Supreme Court held oral argument in Community Financial Services Association of America Ltd. v. Consumer Financial Protection Bureau, a case we have been following closely on Consumer Finance Monitor...more
On September 14th, the Federal District Court for the Eastern District of Kentucky granted the plaintiff’s motion to preliminarily enjoin the CFPB from implementing the Small Business Lending Rule (Rule) promulgated under...more
9/25/2023
/ American Bankers Association ,
Beneficiaries ,
Constitutional Challenges ,
Consumer Financial Products ,
Consumer Financial Protection Act (CFPA) ,
Consumer Financial Protection Bureau (CFPB) ,
Consumer Financial Protection Bureau v Community Financial Services Association of America Ltd ,
Consumer Lenders ,
Debt Collection ,
Dodd-Frank ,
Financial Institutions ,
Financial Services Industry ,
Preliminary Injunctions ,
Section 1071 ,
Small Business
On September 14th, the Federal District Court for the Eastern District of Kentucky granted the plaintiff’s motion to preliminarily enjoin the CFPB from implementing the Small Business Lending Rule (“Rule”) promulgated under...more
9/19/2023
/ CFPB v Community Financial Services Association of America ,
Constitutional Challenges ,
Consumer Financial Products ,
Consumer Financial Protection Act (CFPA) ,
Consumer Financial Protection Bureau (CFPB) ,
Federal Funding ,
Financial Institutions ,
Financial Services Industry ,
Motion To Enjoin ,
Preliminary Injunctions ,
Section 1071 ,
Small Business ,
Small Business Loans