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Other Federal Enforcement Actions

					
Numerous federal agencies have authority to institute enforcement proceedings against wrongdoers.  These agencies include:


    

  • The Department of the Treasury and its divisions including the Financial Crimes Enforcement Network (FINCEN), which is responsible for safeguarding the U.S. financial system from illicit use and money laundering including through enforcement of the Bank Secrecy Act, and the Office of Foreign Assets Control (OFAC), which enforces economic and trade sanctions. Whistleblowers with knowledge of violations of the Bank Secrecy Act can submit a claim under the Anti-Money Laundering Whistleblower Program.  Violations of other laws enforced by the Department of Treasury may give rise to claims under different whistleblower reward programs.
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  • The Federal Trade Commission (FTC), which is charged with preventing anticompetitive, deceptive, and unfair business practices. The FTC can bring enforcement actions under U.S. antitrust laws and to stop unfair, deceptive and fraudulent business practices. The FTC does not have any authority to pay financial rewards to whistleblowers; however, conduct that is regulated by the FTC may also give rise to a claim under a different whistleblower reward program.
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  • The Consumer Financial Protection Bureau (CFPB), created by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which 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.
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  • The Environmental Protection Agency, which enforces federal environmental laws and regulations. The EPA does not currently have any authority to pay financial rewards to whistleblowers; however, conduct that is regulated by the EPA may also give rise to a claim under a different whistleblower reward program, and a number of federal environmental laws protect government or private employees reporting environmental violations under the statutes from retaliation.
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Below are summaries of recent settlements and successful enforcement actions involving these agencies. 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 27, 2016

				 The CFPB issued issuing warning letters to 44 mortgage lenders and mortgage brokers who may be in violation of requirements to collect, record, and report data about their housing-related lending activity under the Home Mortgage Disclosure Act.  CFPB				 					 

						
Tagged in:
													  Housing and Mortgage Fraud, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
October 17, 2016

				 A federal judge has granted the FTC request for a preliminary injunction against two people and their companies for allegedly tricking small commercial trucking businesses into paying them for federal and state motor carrier registrations by impersonating government transportation agencies, such as the U.S. Department of Transportation.  According to the FTC’s complaint, James P. Lamb, Uliana Bogash, DOTAuthority.com Inc., DOTFilings.com Inc., Excelsior Enterprises International Inc. and JPL Enterprises International Inc. have taken in more than $19 million from thousands of small businesses by sending misleading robocalls, emails, and text messages that create and reinforce the false impression that they are, or are affiliated with, the USDOT, the UCR system, or another government agency.  As noted in the FTC’s complaint, the defendants used official-sounding names, official-looking websites, warnings of $1,000 in civil penalties or fines for non-compliance, and threats of imminent law enforcement to trick consumers into using their registration services instead of using official government website services. FTC				 					 

						
Tagged in:
													  Antitrust Enforcement, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
October 13, 2016

				 Twenty-nine defendants who sold Auravie, Dellure, LéOR Skincare, and Miracle Face Kit branded skincare products have agreed to court orders with the FTC or had default orders entered against them.  Jessica Rich, director of the FTC’s Bureau of Consumer Protection, said “these defendants tricked people into paying for skin care products and abused the credit card system to extend their scheme.” The agency’s original complaint, filed in June 2015, charged seven individuals and 15 companies with selling their skincare products through false advertisements for “risk-free trials.” According to the FTC, the defendants convinced consumers to provide their credit card information, purportedly to pay nominal shipping fees. However, the defendants allegedly used consumers’ credit card information to impose unauthorized recurring monthly charges of up to $97.88 per month for unordered products.  FTC				 					 

						
Tagged in:
													  Defective Products, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
October 11, 2016

				 The CFPB took action against Navy Federal Credit Union for making false threats about debt collection to its members, which include active-duty military, retired service members, and their families. The credit union also unfairly restricted account access when members had a delinquent loan. Navy Federal Credit Union is correcting its debt collection practices and will pay roughly $23 million in redress to victims along with a civil money penalty of $5.5 million.  CFPB				 					 

						
Tagged in:
													  Financial Institution Fraud, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
October 6, 2016

				 The FTC will require CentraCare Health, a healthcare provider in St. Cloud, Minnesota, to release some physicians from “non-compete” contract clauses, allowing them to join competing practices, under a settlement mitigating likely anticompetitive effects from CentraCare’s proposed merger with St. Cloud Medical Group.  The FTC alleges that by eliminating SCMG as a potential alternative in the St. Cloud area, the acquisition is likely to increase CentraCare’s bargaining power vis-à-vis commercial health plans, allowing it to raise reimbursement rates and secure more favorable terms. The acquisition may also result in a loss of quality and service benefits to patients.  The proposed consent order will permit the acquisition to proceed, but lessens its potential anticompetitive effects by requiring CentraCare to allow a number of adult primary care, pediatric, and OB/GYN physicians to leave the health system and work for other local providers or establish a new practice in the area and to provide certain financial incentives to a number of departing physicians.  FTC				 					 

						
Tagged in:
													  Antitrust Enforcement, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
October 5, 2016

				 Following a public comment period, the Federal Trade Commission has approved a final order settling charges that ON Semiconductor Corporation’s $2.4 billion acquisition of Fairchild Semiconductor International, Inc. is likely anticompetitive.  Under the order, first announced in August 2016, the companies are required to sell ON’s Ignition IGBT business to Chicago-based manufacturer Littelfuse, Inc. within 10 days of the close of the transaction.  FTC				 					 

						
Tagged in:
													  Antitrust Enforcement, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
October 4, 2016

				 A federal court has found that racecar driver Scott A. Tucker and several corporate defendants in a Kansas City-based payday lending scheme violated Section 5 of the FTC Act and has ordered them to pay $1.3 billion for deceiving consumers across the country and illegally charging them undisclosed and inflated fees.  The $1.3 billion order represents the largest litigated judgment ever obtained by the FTC.  It stems from a complaint filed in 2012 by the agency, which alleged that the operators of AMG Services Inc. falsely claimed they would charge borrowers the loan amount plus a one-time finance fee. Instead, the defendants made multiple withdrawals from consumers’ bank accounts and assessed a new finance fee each time, without disclosing the true costs of the loan. The judgment represents the difference between what consumers actually paid on the loans and what they were told they would have to pay. FTC				 					 

						
Tagged in:
													  Financial and Investment Fraud, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
September 27, 2016

				 The CFPB took action against online lender Flurish, Inc., doing business as LendUp, for failing to give consumers the opportunity to build credit and provide access to cheaper loans, as it claimed to consumers it would. The company has been ordered to provide more than 50,000 consumers with approximately $1.83 million in refunds and pay a civil penalty of $1.8 million.  CFPB				 					 

						
Tagged in:
													  Misrepresentations, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
September 27, 2016

				 The FTC will return almost $20 million to more than 145,000 consumers across the country who were victimized by One Technologies LP and its two partner companies, in an online scheme that lured consumers with “free” access to their credit scores and then billed them a recurring $29.95 monthly fee for credit monitoring they never ordered.  The FTC alleged that the defendants violated the FTC Act and the Restore Online Shoppers’ Confidence Act (ROSCA), which prohibits charging consumers for goods or services sold online via a negative option unless the seller clearly discloses all material terms before obtaining the consumer’s billing information, obtains the consumer’s express informed consent before making the charge, and provides a simple way to stop recurring charges.  FTC				 			
	
		
		
	


 			




	
		
		

			

				
				
September 26, 2016

				 The CFPB took action against TitleMax parent company TMX Finance LLC for luring consumers into costly loan renewals by presenting them with misleading information about the deals’ terms and costs. The lender also used unfair debt collection tactics that illegally exposed information about debts to borrowers’ employers, friends, and family. TMX Finance was ordered to stop its unlawful practices and pay a $9 million penalty.  CFPB				 					 

						
Tagged in:
													  Misrepresentations, 
												
						

					
	
							
	
		
		
	


 			


											

						

								

									
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