A community bank in Texas and two DC-based nonprofit groups recently filed a petition with the U.S. Supreme Court challenging the constitutionality of the CFPB’s sole-director structure. The State National Bank of Big Spring, 60 Plus Association, and Competitive Enterprise Institution originally filed a lawsuit in 2012 in the U.S. District Court for the District of Columbia, alleging the CFPB’s structure violated the U.S. Constitution’s separation of powers. The district ...

A court panel recently declined to enforce a civil investigative demand issued by the CFPB because the language is too broad and generic. Attorneys said it was the second strike against the bureau for aggressive interpretation of its authority after the D.C. circuit ruled a CID invalid last year. A panel of the U.S. Court of Appeals for the Fifth Circuit held that a CID issued to Source for Public Data – a company that provides public records through an internet-based ...

CFPB Updates Model Disclosures Under Fair Credit Reporting Act . The CFPB last week issued an interim final rule updating two model disclosures to reflect changes made to the FCRA by the recent Dodd-Frank reform act.The Economic Growth, Regulatory Relief, and Consumer Protection Act, which became law in May, requires nationwide consumer reporting agencies to provide “national security freezes” free of charge to consumers. The [Includes three briefs] ...

The CFPB late last week issued a rule to clarify partial HMDA exemptions for small financial institutions ushered in under the Dodd-Frank reform act. The Economic Growth, Regulatory Relief, and Consumer Protection Act, signed into law in May, exempts depositories – including credit unions – that originated fewer than 500 closed-end mortgages or 500 open-end lines of credit in each of the two preceding calendar years from certain expanded reporting ...

It’s just a matter of time, but it appears that Republican Kathy Kraninger, a career government worker, will become the next permanent director of the Consumer Financial Protection Bureau. In late August, the Senate Committee on Banking, Housing, and Urban Affairs approved Kraninger’s nomination by a party-line vote of 13 to 12. The approval, though close, was not a surprise. “There is nothing significantly controversial about her candidacy that will change ...

The CFPB announced that it will hold a day-long symposium, “Building a Bridge to Credit Visibility,” to explore challenges many consumers face in getting credit. This event will take place on Sept. 17 in the CFPB’s Washington, DC, headquarters, and will be streamed live. The CFPB said the symposium “will convene a diverse set of stakeholders to explore challenges in overcoming barriers to expand fair, equitable, and non-discriminatory access to credit [Includes three briefs] ...

Experts disagree on whether the CFPB would pull back in the enforcement of mortgage servicing. Jaret Seiberg, a financial services and housing policy analyst for Cowen Washington Research Group, said there is a huge shift in regulating financial services since Republicans gained control of the White House. Loan servicers, particularly, could see “material differences” in the way federal agencies treat their businesses. “We have seen far less enforcement ...

The CFPB recently signaled it will seek to appeal the constitutionality ruling by a New York federal judge. The CFPB has filed a letter with Judge Loretta Preska of the U.S. District Court for the Southern District of New York, requesting the court to “enter a final judgement” in the RD Legal Funding case. If this request is granted, the CFPB will be able to appeal Preska’s ruling that the CFPB’s structure is unconstitutional to the U.S. Court of Appeals for the Second Circuit ...

The Mortgage Bankers Association called upon Congress to pass legislation to restore Ginnie Mae eligibility for so-called orphaned VA loans, which have caused a temporary disruption in the government-backed secondary market. In written testimony to the Senate Committee on Veterans’ Affairs last week, the MBA urged lawmakers to make technical corrections to restore the eligibility of certain Interest Rate Reduction Refinance Loans for pooling. The MBA estimated the VA orphan loan mess at roughly $500 million. Due to new loan seasoning requirements in the recently enacted Economic Growth, Regulatory Relief, and Consumer Protection Act, sime IRRRLs were rendered ineligible for Ginnie MBS pools. The loans were in transit when legislation addressing the problem of VA loan churning and serial refinancing became law in May. The new law’s seasoning provisions turned out to be ...

A federal judge in Ohio recently sided with a law firm in a debt collection enforcement action taken by the CFPB. Industry attorneys said the ruling calls into question whether the bureau should bring future actions against such firms. The CFPB filed a lawsuit in April 2017 against the debt collection law firm Weltman, Weinberg & Reis for falsely representing in collection letters sent to consumers that attorneys were involved in collecting the debt. In most cases ...