CFPB Issues Supervisory Highlights for Summer 2017

The Consumer Financial Protection Bureau (CFPB) recently published a report on its supervisory activity for the period from January 2017 to June 2017. The purpose of CFPB supervision is to determine if an institution is complying with federal laws and impose correctional measures for violations. During the report’s covered period, the CFPB secured more than $14 million for 104,000 consumers in restitution, as well as $1.75 million in civil penalties from enforcement actions that began through supervision.

In regards to short term, small dollar lending, the Bureau continued its focus on debt collection practices and misrepresentations in advertising. Some of the improper debt collection practices highlighted by the CFPB include repeated collection calls to the consumer’s workplace or other third parties (that acted as a reference to the borrower) and misrepresentations of the consequences of not repaying the debt. Problems with loan advertising were promising no credit checks, ads for products or services not actually offered, and improper comparisons to competitors. Some lenders were singled out for marketing products and services to parties acting as references to potential borrowers.

The Bureau’s report comes as Congress contemplates removing the CFPB’s supervisory authority via an appropriation bill.