Showing 6 posts from November 2017.

New York Federal Court Demands that FDCPA Plaintiffs Read Entire Debt Collection Letter to Determine Creditor's Identity

In Goldstein v. Diversified Adjustment Serv., the Eastern District of New York may have walked back one of the new favorite Fair Debt Collection Practices Act  (the "FDCPA") claims—namely that the creditor was not properly identified pursuant to § 1692g of the FDCPA. Although the debt collection letter at issue listed Sprint several times, Goldstein's complaint nonetheless alleged that the debt collection letter violated the FDCPA by failing to adequately identify to whom the debt was owed and what Sprint's role was. More ›

Trouble With A Capital C: Cordray’s Move To Name His Own Successor At The CFPB

In contrast to his big wins on Jeopardy! in the 1980s, Richard Cordray lost badly in 2017 after staking so much on the Consumer Financial Protection Bureau’s (“CFPB”) Final Rule, which would have prohibited the use of class action waivers in the arbitration clauses of consumer financial contracts, such as credit card agreements and mortgages. The CFPB’s Final Rule drew sharp, valid criticism from both the U.S. Treasury Department and the Office of the Comptroller of the Currency. After the House of Representatives and the Senate acted pursuant to the Congressional Review Act to nullify the Final Rule, Mr. Cordray pleaded unsuccessfully with President Trump for a veto. It is unsurprising, really, that he decided to step down far earlier than anticipated.

Mr. Cordray’s parting-shot - his effort to name his own successor by appointing a presumably sympathetic Deputy Director - will likely miss its mark. Under the provision of Dodd-Frank that Senator Elizabeth Warren has cited in support of Mr. Cordray’s maneuver, the CFPB’s Deputy Director serves as acting Director only “in the absence or unavailability of the Director” (12 U.S.C. § 5491(b)(5)), not in the event the Director resigns. Moreover, 12 U.S.C. § 5491(b)(3) states that, “…the Director shall be appointed by the President, by and with the advice and consent of the Senate.”  Senator Warren’s November 24th “tweet,” that “if there is a [CFPB] Director vacancy, the Deputy Director becomes the Acting Director … [and] [President Trump] can’t override that[,]” simply appears to read too much into the provision of Dodd-Frank she cites. More ›

CFPB Director Richard Cordray Resigning

In news that is still breaking, the first and only Consumer Financial Protection Bureau director, Richard Cordray, has announced he will be resigning at the end of this month. He announced his departure in an email to staff that was reported out by several news agencies. His term was set to expire in July, 2018. Many predict Cordray will make a run for Ohio governor. More ›

Illinois Student Loan Bill of Rights Becomes Law

Yesterday, the Illinois House of Representatives voted 98-16 to override Governor Bruce Rauner's veto of the Illinois Student Loan Bill of Rights. The IL student loan bill provides for the licensing of student loan servicers and imposes numerous, detailed requirements concerning the servicing of student loans. Among other things, the bill sets forth certain information that must be provided to borrowers, some of which must be provided through a trained repayment specialist. Non-exempt servicers have until December, 2018 to become compliant. Illinois is the 4th jurisdiction to create such a law, following Connecticut, California and the District of Columbia. More ›

Buccaneers Could Lose On and Off the Field: Attempt to Reverse Auction TCPA Class Settlement Batted Down by Eleventh Circuit

A leading Plaintiff's TCPA firm filed a class action against the Buccaneers in 2013, arguing certain company faxes violated the TCPA. The faxes in question contained advertisements promoting football ticket sales, and were alleged to have been sent without consent. While the class certification motion was pending in the original class action, one of the plaintiff's attorneys left the firm and moved to another Plaintiff's firm. More ›

A New HUD Rule for Reverse Mortgages, with Additional Rule Changes Proposed in Congress

This past month, Washington was busy with rule changes and proposed legislation that underscores the ongoing debate over the origination and foreclosure of reverse mortgages. First, the U.S. Department of Housing and Urban Development reduced the maximum amount a reverse mortgage applicant can borrow. Previously, the maximum amount was exclusively tied to the property's value (at either 60% or 70%). Under the new rule, HUD has tied that maximum amount to three criteria: applicant's age, loan rates and the value of the property. While it is unclear how these new criteria will impact the maximum amount, the Wall Street Journal reports that Lending Tree's chief sales officer anticipates that a typical applicant will now be able to borrow 58% on the property's value, down from an average of 64%. Second, HUD increased the upfront insurance premium charged on any reverse mortgage from between .5%-2.5% percent and depending on the amount borrowed to a flat 2%. Given the reduction in amount that an applicant can borrow and an increase in upfront insurance payments, HUD's new rules appear aimed at benefiting lenders. The new rules went into effect on October 2, 2017. More ›