Today's Headlines

    AFSA Participates in 9th Circuit FCRA Case

    On Nov. 28, AFSA asked for leave to file an amicus brief in a Fair Credit Reporting Act (FCRA) case in the Ninth Circuit Court of Appeals. AFSA has in interest in this matter because its members often face litigation under the FCRA in connection with consumer bankruptcies.

    The plaintiffs in the case, Green v. Experian Information Solutions, claim that the FCRA requires an information furnisher to change its reporting to match the terms of a confirmed Chapter 13 bankruptcy plan, even though the status of the underlying debt does not legally change until discharge. The plaintiffs’ counsel has filed hundreds of cases in the Northern District of California arising from the reporting of accounts that are subject to a pending bankruptcy case.

    This area of law requires careful attention and AFSA has a strong interest in ensuring that courts and parties are aware and mindful of intricacies surrounding these issues. AFSA wrote, “The district court correctly held that the furnishers’ reporting in these cases was not inaccurate for FCRA purposes as a matter of law, and the district court’s order should be affirmed.”

    Are You Complying with Borrower Communication Requirements?

    Complying with all the federal, state and judicial requirements impacting the vehicle finance industry can be daunting for many lenders and servicers, which typically lack the legal and compliance resources of larger financial institutions. If not interpreted correctly, lenders and servicers are exposed to penalties, class action lawsuits, and more. 

    This webinar will be next week on December 7and  will examine new and current regulations lenders need to be aware of:

    • What regulators expect regarding content
    • Timing and mailing methods
    • Best practices to mitigate risk
    • Avoid additional legal expenses
    • Building operational efficiencies into the compliance process

    Some of the topics we’ll look at will be the revisions made to the Federal Rules of Bankruptcy Procedure, specifically focusing on rules that affect auto creditors.  We will also look at recent developments in the areas of the TCPA, FDCPA, and SCRA.  Other important topics will include:

    • Repossession
    • Personal property
    • Collateral protection  

    We’ll review state attorney general enforcement actions and take a look at state law changes that will affect the auto industry.  We look forward to presenting this information to you on December 7th, join us then!

    Start 2018 Off Right – AFSA’s Law & Compliance Symposium

    Since the recession and passage of Dodd-Frank, federal and state financial regulators have emphasized the importance of consumer protection and stressed the necessity of strong compliance programs. In response, consumer finance companies have increased their compliance efforts and in so doing, have faced new challenges including conflicting regulations, statements, enforcement orders, and guidance.

    AFSA's first Law & Compliance Symposium will help members meet those challenges head on by providing insights and guidance on critical federal and state compliance issues for the financial services industry. The inaugural gathering will be held at the Omni San Diego from January 29-31 in San Diego, Calif.

    The program will kickoff in the afternoon on Monday the 29th with an opening session highlighted by Jerry Kilgore, former attorney general for Virginia. AFSA staff will provide a robust overview of legal regulatory developments and key experts will talk about litigation developments and strategy. Tuesday will see a session on trend in debt collection, followed by a series of critical breakout sessions designed to get attendees thinking about their compliance and legal practices. Wednesday will close with a CEO Panel, discussing the role of compliance and its evolving stature in their respective companies, and a closing keynote from Ron Insana, CNBC’s leading business journalist.

    The registration and hotel deadlines are rapidly approaching so be sure to register soon! CLE credits are available.

    Visit afsaonline.org/compliance for more information.

    Mulvaney Confirmed as Acting CFPB Director

    AFSA Staff

    On Tuesday November 28, U.S. District Court Judge Timothy Kelly, a Trump appointee, denied Consumer Financial Protection Bureau (CFPB) Deputy Director Leandra English's request for a temporary restraining order preventing President Donald Trump's appointment of OMB Director Mick Mulvaney as the CFPB Acting Director.

    The next step is for the judge to rule on the merits of English's claim pursuing an outright declaratory judgment that she has the authority to serve as Acting Director of the bureau. Judge Kelly has not yet scheduled a time to make his judgment.

    English argued that the deputy director "shall" become the acting director "in the absence or unavailability of the director." The Department of Justice responded that English's claim is not strong enough to supersede the purview of the Vacancies Reform Act and that her argument to the contrary rests on a "bureaucratic 'sleight-of-hand' on the final day of former CFPB Director Richard Cordray's tenure.

    On Friday November 24, then-CFPB Director Richard Cordray named English Deputy Director of the CFPB and announced that she would serve as Acting Director upon his resignation. Cordray then submitted his letter of resignation, effective Friday evening. Following Cordray's resignation, the Administration released a statement appointing Office of Management and Budget (OMB) Director Mick Mulvaney as Acting Director of the Bureau.

    On Sunday, November 26, English
    filed suit in the US District Court for the District of Columbia, naming President Donald Trump and Mulvaney as defendants. English's suit claims that the statute in the Dodd-Frank Act grants her the authority to "...serve as the acting Director in the absence or unavailability of the Director." There is currently no timetable for any judgment from the Court.

    In support of the President's action naming Mulvaney as Acting Director, the Department of Justice released a
    memo upholding the Administration's use of the Vacancies Act. In addition, the Cordray appointed General Counsel of the Bureau also stated that, "It is my legal opinion that the president possesses the authority to designate an acting director for the bureau. I advise all bureau personnel to act consistently with the understanding that Director Mulvaney is the acting director of the CFPB."

    Hudson Cook has produced a thorough legal analysis,
    linked here.

    Mulvaney arrived at the Bureau on November 27 and assumed his role as Acting Director, taking meetings and working from the Director's office.

    AFSA Comments on Texas OCCC Recordkeeping Rule Proposal

    AFSA Staff

     

    AFSA yesterday submitted a comment letter to the Texas Office of Consumer Credit Commissioner (OCCC) regarding its precomment draft amendments to the rules for motor vehicle recordkeeping.

     

    The proposed rule amendments would require licensees to maintain full copies of any debt cancellation agreement or guaranteed asset protection (GAP) contract in each consumer’s file, whereas most companies currently only retain the first and only unique page of the contract. The proposed rules would also require licensees to maintain a copy of each Gramm-Leach-Bliley privacy notice sent to a consumer in the customer’s file.

     

    AFSA’s letter urged the OCCC to consider that the proposed rules would be overly burdensome by requiring companies to maintain numerous duplicative documents not unique to an individual consumer. AFSA’s letter also requested a delayed effective date for any rule changes in order to allow companies adequate time to update systems.

     

    The OCCC will formally present and consider the draft rule amendments at its December 15 meeting. AFSA will continue to monitor the review process and keep members apprised of any future changes.