Go to:

May 2018
< Apr Jun >
Leaguer Email Subscription

You are not currently subscribed. Click Subscribe below to receive the Leaguer email.

CFPB Supervisory Actions Return $24.5M to Consumers Harmed by Illegal Activities
Friday, July 1, 2016 6:40 AM

The CFPB has announced that its supervisory actions in the first four months of the year uncovered illegal activities in auto finance and payments that led to approximately $24.5 million in restitution to more than 257,000 consumers. The report also highlights issues that CFPB examiners found through the agency’s examination of businesses in auto loan origination, debt collection, mortgage origination, and small-dollar lending.

Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, the CFPB has authority to supervise certain nonbanks, including mortgage companies, private student lenders, and payday lenders, as well as nonbanks the Bureau defines through rulemaking as “larger participants.” To date, the Bureau has issued rules to supervise the larger participants in the markets of consumer reporting, consumer debt collection, student loan servicing, international money transfers, and auto finance.

The CFPB often finds problems during supervisory examinations that are resolved without an enforcement action. Recent non-public supervisory actions resulted in restitution of about $24.5 million to more than 257,000 consumers for auto finance and payments issues. Supervisory work in connection with debt sales also aided an enforcement action that returned nearly $5 million to consumers and imposed $3 million in civil money penalties.

Today’s report, the 12th edition of Supervisory Highlights, covers activities completed generally between January 2016 and April 2016. Examiners uncovered issues across an array of financial markets, including:

  • Deception by auto lenders about loan terms.
  • Incorrect calculation of loan financing amounts.
  • Failure to properly disclose interest on interest-only loans.
  • Ineligible accounts sold to debt sellers.
  • Consumers misled about debt repayment options.
  • Failure to provide adverse action notices.
  • Illegally requiring consumers to use an affiliated business.

The report shares information to help industry comply with federal consumer financial law. To protect confidentiality, the report does not refer to specific institutions, unless they were subject to public enforcement actions. The CFPB ordered corrective actions that include better training for employees, improvements to how the businesses field and respond to consumer complaints, and the development of improved policies and procedures and enhanced monitoring systems to ensure compliance with federal rules. In addition, the Bureau has referred some exam findings for further action where appropriate.

More detailed information on uncovered issues.

Review Supervisory Highlights