Cash & the Regulation: Look to client safety company to show up the warmth | Enterprise

The Bureau for Financial Consumer Protection is about to change the guard. (The real name is the Bureau of Consumer Financial Protection, but nobody calls it that.)

President Joe Biden has named Rohit Chopra to head the agency, and he’ll likely move the agency back to where it was when it was born in 2010 under the Dodd-Frank Reform and Consumer Protection Act on Wall Street . During the Trump administration, the CFPB’s enforcement activities were greatly reduced and, for the most part, it ceased to draft and enact new regulations.

Chopra knows the CFPB well. He worked with Senator Elizabeth Warren on its creation. Prior to his appointment in 2018 as one of the five commissioners of the Federal Trade Commission, another major government agency with a consumer protection mandate, he was also its deputy director. CFPB observers expect Chopra to focus on issues related to student loans, credit reports, privacy, fair living, payday loans, and other issues that are regularly on the wish list of consumer protection advocates. Chopra is also expected to lead the CFPB to impose more aggressive sanctions on malefactors. During his time at the FTC, he rejected settlements that he felt were too weak for consumer scoffers.

Although the Trump administration rejected the burners for CFPB enforcement, the agency has not been entirely idle and it is always interesting to see what fraudulent and consumer harmful activity the CFPB has uncovered. For example, the CFPB and the states of Virginia, Massachusetts and New York sued a company called Libre in February for allegedly running a scam that prosecuted non-English speakers in immigration and customs detention centers who were waiting for the police (very slow) resolution of their immigration cases. Libre signed its victims of expensive English-only contracts related to ICE bonding requirements, deceptively claiming that it was helping to meet those requirements. To encourage payment of the contract amounts, Libre would face deportation as a sanction for non-payment.

In January, the CFPB announced the settlement of a lawsuit against LendUp Loans, an Oakland, California-based company that marketed expensive online loan products to service members.

In the lawsuit, the CFPB alleged that LendUp violated the Military Lending Act, including its annual percentage cap of 36% on the interest rate. As part of the settlement, LendUp pays consumers $ 300,000 in redress and a civil fine of $ 950,000 – and promises to clean up its act.

In December, the CFPB settled a case against Discover Bank and an affiliate, The Student Loan Corp.. These companies have violated a prior agreement and the Electronic Fund Transfer Act, an important federal law regulating electronic withdrawals from bank accounts, in connection with their activities to service personal student loan debts. As punishment for their sins, companies pay consumers “at least” $ 10 million in reparation and an additional $ 25 million in civil fines.

For more information on the activities of the CFPB, please visit its user-friendly website. On the home page, click News, then select Press Releases.

Jim Flynn is with Flynn & Wright LLC in Colorado Springs. You can contact him at