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CFPB Enforcement Actions

The Consumer Financial Protection Bureau (CFPB), a federal agency created by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, regulates the offering and provision of consumer financial products or services under the federal consumer financial laws, and has the authority to bring enforcement actions against financial service providers. While the CFPB accepts tips from whistleblowers, and applicable laws offer whistleblowers protection from retaliation, there is currently no provision for CFPB whistleblowers to receive financial rewards. However, conduct that is regulated by the CFPB may also give rise to a claim under a different whistleblower reward program.

Below are summaries of recent CFPB settlements or successful enforcement actions. If you believe you have information about fraud which could give rise to a claim under a whistleblower reward program, please contact us to speak with one of our experienced whistleblower attorneys.

October 24, 2018

A small-dollar lender that operates in Tennessee, Alabama, Kentucky, and Mississippi, has settled with the CFPB for allegedly violating the Consumer Financial Protection Act (CFPA). Cash Express, LLC allegedly sent letters to its customers to threaten them with lawsuits, misrepresented that it would report negative information to credit agencies, and withheld funds from cashed checks to satisfy prior loans. It has now been ordered to pay restitution of $32,000 as well as a $200,000 penalty. CFPB

Tagged in: Financial Institution Fraud,

July 20, 2018

The CFPB announced a proposed settlement with TCF National Bank regarding the bank’s marketing and sale of overdraft services. TCF allegedly obscured the overdraft fees it charged and made consenting to overdraft fees seem mandatory for new customers to open an account. TCF has agreed to pay $25 million in restitution to customers who were charged overdraft fees and has agreed to an injunction to prevent future violations. CFPB

Tagged in: Financial Institution Fraud,

June 13, 2018

South Carolina-based Security Group Inc. and two of its subsidiaries will pay a $5 million civil penalty to resolve charges they engaged in improper debt collection practices, including calling consumers at work and physically blocking them from leaving their homes. The settlement also resolves allegations the Security Group entities provided inaccurate and incomplete consumer data to credit reporting agencies. CFPB

Tagged in: Financial Institution Fraud,

April 20, 2018

The CFPB assessed a $1 billion penalty against Wells Fargo Bank, N.A. for violating the CFPA in how it administered a mandatory insurance program related to its auto loans and how it charged certain borrowers for mortgage interest rate-lock extensions. CFPB

Tagged in: Financial Institution Fraud,

November 21, 2017

The CFPB ordered Citibank, N.A. to pay $3.75 million in redress to consumers and a $2.75 million civil money penalty for misleading borrowers into believing that they were not eligible for a valuable tax deduction on interest paid on certain student loans, incorrectly charging late fees and added interest to the student loan balances of borrowers who were still in school and eligible to defer their loan payments, and misleading consumers about how much they had to pay in their monthly bills and failing to disclose required information after denying borrowers’ requests to release loan cosigners. CFPB

Tagged in: Financial Institution Fraud,

November 20, 2017

The CFPB fined Xerox Business Services, LLC, now called Conduent Business Services, a $1.1 million civil penalty for software errors that led to the sending of incorrect consumer information about more than one million borrowers to credit reporting agencies. The company also failed to notify all of its auto lender clients about known flaws in its software that led to the errors. CFPB

Tagged in: Financial Institution Fraud,

November 15, 2017

The CFPB sued Think Finance for its role in deceiving consumers into repaying loans that were not legally owed. The Bureau seeks to recoup relief for harmed consumers and impose a penalty. CFPB

Tagged in: Financial Institution Fraud,

November 8, 2017

The CFPB sued Freedom Debt Relief, the nation’s largest debt-settlement services provider, and its co-CEO Andrew Housser for charging consumers without settling their debts as promised, making customers negotiate their own settlements, misleading customers about fees and the reach of its services, and failing to inform customers of their rights to funds they deposited with the company. The Bureau is seeking seeking compensation for harmed consumers, civil penalties, and an injunction against Freedom and Housser to halt their unlawful conduct. CFPB

Tagged in: Financial Institution Fraud,

October 12, 2017

The CFPB sued Federal Debt Assistance Association, LLC, Financial Document Assistance Administration, Inc. (both operating under the name “FDAA”), Clear Solutions, Inc., and their owners, Vincent Piccione, David Piccione, and Robert Pantoulis, for falsely presenting the two FDAA companies as being affiliated with the federal government. The Bureau also alleges that FDAA’s so-called “debt validation” programs violated the law by falsely promising to eliminate consumers’ debts and improve their credit scores in exchange for thousands of dollars in advance fees. The lawsuit seeks to end these deceptive practices, obtain redress for harmed consumers, and impose civil money penalties. CFPB

Tagged in: Financial Institution Fraud,

September 27, 2017

The CFPB ordered real estate settlement services provider Meridian Title Corporation to pay up to $1.25 million in redress to consumers for steering them to a title insurer owned in part by several of its executives without making disclosures about the businesses’ affiliation. CFPB

Tagged in: Financial Institution Fraud,

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