CFPB Sues ACE Cash Express

CFPB Sues Payday Lender - The CFPB filed a lawsuit accusing payday lender ACE Cash Express of concealing free repayment plans from struggling borrowers. Because of ACE’s illegal practices, individual borrowers paid hundreds or thousands of dollars in reborrowing fees, when they were in fact eligible for free repayment plans. These practices generated at least $240 million in fees for ACE, while keeping borrowers in debt. The CFPB also alleges that ACE lied to borrowers about the number of times it would attempt to debit their bank accounts for repayment of loans and fees. In a 2014 CFPB enforcement action, ACE paid $10 million in penalties and borrower refunds for using illegal debt-collection tactics, and the company is still bound by the order from that case.

LIBOR Legacy Playbook Gives Recommendations

LIBOR Legacy Playbook – The Alternative Reference Rates Committee published its LIBOR Legacy Playbook to assist financial institutions through the last years of LIBOR. The recommendations in the Playbook are not requirements, but regulators are expected to give them significant weight during reviews.  

CFPB Issues UDAP Order Against BOA

$225 million in Penalties – The CFPB issued an order against Bank of America for unfair acts or practices by denying prepaid debit cardholders’ notice of error and freezing the cards solely on the basis of the bank’s flawed fraud filter. The CFPB also found that the bank engaged in abusive acts or practices by retroactively applying its fraud filter to deny notices of error submitted by prepaid debit cardholders that it had previously investigated and paid. 

Department of Justice

Money Laundering Indictment – A brother and sister duo were indicted for laundering more than $42 million worth of drug trafficking proceeds. Using approximately 85 United States bank accounts belonging to at least 22 California-based ‘shell’ corporations, the duo deposited cash proceeds of drug sales into U.S.-based bank accounts and layered those deposits across multiple corporate accounts before finally transferring the funds to accounts in Mexican-based financial institutions.

FTC Investigates Fraud against Military Community

Fraud Against the Military Community – In testimony before a House committee, the FTC detailed its enforcement actions to crack down on fraud against the military community. One topic addressed was illegal auto sales and financing practices. “Young servicemembers are an attractive target for unscrupulous auto dealers, and representatives from the Armed Forces have repeatedly expressed concern about unscrupulous and predatory auto sales practices, including “payment packing” (slipping unwanted add-ons into a purchase agreement), bait-and-switch tactics, and extra junk fees.” In June the FTC proposed a rule to ban junk fees and bait-and-switch advertising tactics and eliminate the tricks and traps that make it hard or impossible to comparison shop or leave consumers saddled with thousands of dollars in unwanted charges.