Troutman Pepper Consumer Financial Services Weekly Bulletin – August 2022 #3 | Troutman pepper


To help you keep abreast of relevant activities, below is a breakdown of some of the biggest federal and state level events impacting the consumer financial services industry in the past week:

Federal activities

State activities

Federal activities:

  • On August 12, VantageScore announced that it had completed an in-depth analysis of the impact of recent changes to consumer credit score models on how medical collection accounts are reported, including changes brought about by the COVID pandemic. -19. VantageScore has decided to remove medical debt from its calculations. For more information, click here.
  • On August 11, the Consumer Financial Protection Bureau (CFPB) said in a circular that financial companies can violate federal consumer financial protection law when they fail to protect consumer data. The circular provided guidance for consumer protection officials, including examples of where companies can be held liable for lax data security protocols. For more information, click here.
  • On August 11, the Federal Trade Commission (FTC) announced that it would explore rules to crack down on harmful commercial surveillance and lax data security. Commercial surveillance refers to the activity of collecting, analyzing and exploiting information about people. Mass surveillance has increased the risks and stakes of data breaches, deception, manipulation, and other abuses. The FTC’s Advance Notice of Proposed Rulemaking invites public comment on the harms resulting from commercial surveillance and the need for new rules to protect people’s privacy and information. For more information, click here.
  • On August 10, the CFPB released an interpretative rule, outlining when digital marketing providers for financial businesses must comply with the federal financial consumer protection law. Digital marketers involved in the identification or selection of potential customers or the selection or placement of content to affect consumer behavior are generally considered service providers for the purposes of the law. Digital marketers acting as service providers may be held liable by the CFPB or other law enforcement agencies for engaging in unfair, deceptive, or abusive acts or practices, as well as other breaches of protection. consumer finance. For more information, click here.
  • On August 10, US Senators Elizabeth Warren (D-MA), Dick Durbin (D-IL), Sheldon Whitehouse (D-RI), and Bernie Sanders (I-VT) sent a letter to the Office of the Comptroller of the Currency. (OCC), directing Acting OCC Michael Hsu to rescind previously issued cryptocurrency guidance and replace it with more comprehensive guidance in coordination with other prudential regulators. Lawmakers also demanded details on the extent to which banks currently engage in crypto-related activities. For more information, click here.
  • On August 10, the Federal Housing Finance Agency (FHFA) announced that Fannie Mae and Freddie Mac will require managers to obtain and maintain fair loan data on their loans and that this data be transferred with the service throughout the term of the mortgage loan. Fair loan data to keep includes age, race, ethnicity, gender, and preferred language of borrowers. Repairers must implement this change as of March 1, 2023. For more information, click here.
  • On August 9, the FTC issued an order denying a motion to dismiss a civil investigation request involving the FTC’s investigation into whether operators of a cryptocurrency exchange engaged in deceptive, unfair or otherwise illegal acts or practices relating to the marketing and operation of BitMart. exchange services in violation of Section 5 of the FTC Act (15 USC § 45) or the Gramm-Leach-Bliley Act (15 USC §§ 6801-27). For more information, click here.
  • On August 9, the Securities and Exchange Commission (SEC) issued a cease and desist order to Bloom Protocol LLC (Bloom) for its failure to register its Bloom tokens, a form of crypto asset, before selling the tokens first. coin offering. The SEC found Bloom sold the tokens as securities, but did not register the offering and did not qualify for any applicable exemptions under the Securities and Exchanges Act of 1933 (securities law). The SEC, however, accepted Bloom’s settlement offer and set out in its order several actions for Bloom to take to rectify its violations of Sections 5(a) and (c) of the Securities Act. For more information, click here.
  • On August 8, the US Treasury Department’s Office of Foreign Assets Control (OFAC) sanctioned a virtual currency mixer accused of laundering more than $7 billion since its inception in 2019. For more information, click on here.
  • On August 8, the Department of Justice (DOJ) resolved Servicemembers Civil Relief Act (SCRA) claims against two Virginia-affiliated landlords for allegedly obtaining illegal judgments against military tenants. To settle the claims, the owners agreed to pay compensation to the affected service members, a civil penalty in the United States, and various injunctions. The action represents the latest in aggressive enforcement of SCRA by the DOJ, which since 2011 has secured more than $476 million in monetary relief for more than 121,000 service members. For more information, click here.
  • On August 5, President Biden signed the COVID-19 Economic Injury Disaster Loan Fraud Statute of Limitations Act (R.7334) and the Paycheck Protection Program and Anti-Bank Fraud Harmonization Act (HR7352) in the law. HR7334 establishes a 10-year statute of limitations for fraud by borrowers under the Small Business Administration’s (SBA) COVID-19 economic disaster lending programs, while HR7352 establishes a 10-year statute of limitations for fraud by borrowers under the SBA’s Paycheck Protection Program. . For more information, click here.

State activities:

  • On August 11, Michigan Attorney General Dana Nessel joined a coalition of 19 attorneys general in a letter of comment, supporting a joint effort by the Federal Reserve Board of Governors, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency to revise and strengthen regulations under the Community Reinvestment Act (CRA). Attorney General Nessel said, “Since its enactment, ARC has helped Michigan residents access capital for investments such as mortgages and small business loans that have helped them transform their neighborhoods. However, the CRA can do more. That’s why I join my colleagues in calling for the enforcement rule to be strengthened to respond to the financial crises precipitated by COVID-19, a crisis that disproportionately affects low- and middle-income communities. For more information, click here.
  • On August 8, California Attorney General Rob Bonta issued a press release, urging Californians to take advantage of recent changes to the Public Service Loan Forgiveness (PSLF) and Expanded Public Service Loan Forgiveness programs. temporary (TEPSLF). According to the press release, “[l]Last year, the Department of Education (ED) launched a limited-time PSLF waiver opportunity that extends through October 31, 2022, allowing eligible borrowers to receive credit for past payments made on loans that would otherwise not be eligible for the PSLF program. Attorney General Bonta said, “Our officials work on behalf of the people of California day in and day out as nurses, teachers, first responders, state employees, and more. As students, they took out student loans only to find themselves burdened with debt and deprived of the help they had been promised. For more information, click here.

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