Page 38 - GIADA Nov-Dec 2020

THE CARLAWYER ©

The CARLAWYER ©

By Eric Johnson and Tom Hudson

We hope you and your loved ones are all a 2015 consent order that resolved similar comments and information to assist
safe and healthy. We’re really glad that allegations. the CFPB in developing regulations to
NCAA college football is back with the Big implement Section 1033 of the Dodd-Frank
10 joining the fray. Like last month, there Specifically, the CFPB’s lawsuit alleged Act, which provides consumers access to
isn’t a great deal going on this month by way that, since September 2015, Encore and their financial records.
of business and legal developments, but its subsidiaries violated the consent order
there have been a few. Here’s our monthly by suing consumers without possessing Specifically, Section 1033 provides that,
article on selected legal developments required documents, using law firms subject to CFPB rules, a consumer financial
we think might interest the auto sales, and an internal legal department to services provider must make available to
finance, and leasing world. This month, engage in collection efforts without a consumer information in the provider’s
we note developments at the Consumer providing required disclosures, and failing control or possession concerning the
Financial Protection Bureau, the Federal to provide consumers with required consumer financial product or service the
Trade Commission and other federal loan documentation after consumers consumer obtained from the provider.
agencies. requested it. The CFPB also alleged This requirement includes information
that the defendants violated the consent relating to any transaction, to any series of
As usual, our article features the “Case of order, the CFPA, and the FDCPA by transactions, or to the account, including
the Month” and our “Compliance Tip.” suing consumers to collect debts even costs, charges, and usage data. Such
Note that this column does not offer legal though the statutes of limitations had run information must be made available in an
advice. Always check with your lawyer to on those debts and violated the consent electronic form usable by consumers.
learn how what we report might apply to order by attempting to collect debts for
you or if you have questions. which the statutes of limitations had run In the ANPR, the CFPB recognized that
without providing required disclosures. companies, including traditional financial
FEDERAL DEVELOPMENTS In addition, the CFPB alleged that the institutions and non-bank financial
companies violated the CFPA by failing to technology companies, increasingly
CFPB Issues Policy Statement on Early disclose possible international transaction access consumer data with consumers’
Termination of Consent Orders. On fees to consumers. Finally, the CFPB authorization and provide services to
October 5, the CFPB issued a policy alleged that each violation of the consent consumers using data from the consumers’
statement that sets forth a process order violated the CFPA. various financial accounts. This type
by which an entity subject to an of access to consumer financial records
administrative consent order may apply Among other requirements, the settlement benefits both consumers and financial
for early termination of the order and will require the defendants to pay $79,308 institutions, but there are risks associated
outlines the standards the CFPB intends in redress to consumers and a $15 million with consumers authorizing such access.
to use when evaluating applications for civil money penalty. Ouch!
early termination. The ANPR seeks comments and
FTC Launches Fraud Reporting Website. information on how the CFPB might
CFPB Settles Lawsuit Against Largest On October 22, the FTC announced effectively and efficiently implement the
U.S. Debt Collectors and Debt Buyers. its new fraud reporting website for financial record access rights described
On October 15, the CFPB filed a consumers, www.ReportFraud.ftc.gov. in Section 1033, recognizing that various
proposed stipulated final judgment and The site will provide consumers who file market participants have helped authorized
order to settle its lawsuit against Encore a report advice on actions to take based data access become more secure, effective,
Capital Group, Inc., and its subsidiaries, on their report. The site replaces the FTC and subject to consumer control. In the
Midland Funding, LLC, Midland Credit Complaint Assistant. ANPR, the CFPB posed a series of questions
Management, Inc., and Asset Acceptance seeking comments and information
Capital Corp., the nation’s largest debt CFPB Requests Information on on topics including costs and benefits
collectors and debt buyers. The CFPB Consumer Access to Financial Records. of consumer data access, competitive
alleged improper debt collection practices On October 22, the CFPB issued an incentives, standard-setting, access scope,
by the defendants, in violation of the advance notice of proposed rulemaking consumer control and privacy, and data
Consumer Financial Protection Act and requesting information on consumer security and accuracy. Comments are due
the Fair Debt Collection Practices Act, access to financial records. The CFPB within 90 days after the ANPR’s publication
and alleged that they violated the terms of issued the ANPR to solicit public in the Federal Register.

36 | GIADA Independent Auto Dealer NOV/DEC 2020