A summary of activities at the Consumer Financial Protection Bureau (CFPB) during its first six months under the leadership of Kathleen Kraninger, who became director in December, is just that – a summary – but it appears that the bureau’s enforcement actions during this period has yielded $22 million in civil money penalties (CMPs).
That’s the total amount of CMP assessments cited for the period, though just what those penalties were for is difficult to discern since the report omits the names of the individuals or firms targeted, as well as any individual penalty assessments and redress imposed.
Here’s how the civil money penalties noted above appear to break down, based on past reporting:
- $1 was the penalty assessed against Mark Corbett for his role in scamming veterans. The bureau said Corbett, a broker who offered high-interest credit to veterans, really was setting up contracts where veterans were required to assign to investors all or part of their monthly pension or disability payments. This was despite the fact that federal law bars agreements under which another person acquires the right to receive a veteran’s pension payments. Vets were also required to purchase life insurance policies to ensure payments, the bureau said. This is what the CFPB report appears to refer to when listing action “against an individual who brokered contracts offering high-interest credit to veterans for violating the Consumer Financial Protection Act.”
- $1.75 million was assessed against Freedom Mortgage Corporation under an order announced last week. The bureau said the company, from 2014 through 2017, intentionally falsified race and ethnicity information it submitted under Home Mortgage Disclosure Act (HMDA) reporting requirements. This seems to be what CFPB meant in noting action “against one of the 10 largest HMDA reporters for violating HMDA and Regulation C.”
- $3.9 million was assessed against Conduent Education Services, LLC, in a settlement announced this may. CES, a New Jersey-based firm formerly known as ACS Education Services, engaged in unfair practices by failing to adjust in a timely manner principal balances of student loans made under the Federal Family Education Loan Program, the bureau said. In addition to paying the CMP, the firm was to adjust other balances and make any additional redress called for. This seems to match up with the bureau’s listing of “action against a student loan servicing company that engaged in unfair practices that violated the Consumer Financial Protection Act.”
- $3.2 million was assessed against payday lender Enova International, Inc., based in Chicago. This was in a settlement over Enova’s illegal debiting of consumers’ accounts and other violations. The bureau said that while consumers authorized the firm to deduct payments from certain accounts, it would often debit different ones instead. The bureau said Enova also failed to honor loan extensions it granted. This is likely what the CFPB report means in noting “action against an online lender that extends unsecured payday and installment loans for violating the Consumer Financial Protection Act.”
- $100,000 was assessed against payday lender Cash Tyme. Announcing action in February, the bureau said Cash Tyme, with operations in multiple states, committed multiple violations of consumer protection law and violated privacy notice requirements. The firm was also ordered to refund unauthorized overcharges. This is likely what was meant in the report by “action against a company that violated the Consumer Financial Protection Act; the Gramm-Leach-Bliley Act; Regulation P; the Truth in Lending Act; and Regulation Z.”
- $10 million was assessed against Sterling Jewelers, Inc., of Akron, Ohio, by the bureau (and another $1 million by New York state). The bureau said the penalties were assessed in a settlement over the firm’s opening store credit-card accounts without customer consent; enrolling customers in payment-protection insurance without their consent; and misrepresenting to consumers the financing terms associated with the credit-card accounts. The bureau and New York state together settled with the firm. This is likely what is referred to in today’s report as “action against a company that violated the Consumer Financial Protection Act; the Gramm-Leach-Bliley Act; Regulation P; the Truth in Lending Act; and Regulation Z.”
- $200,000 was assessed against mortgage servicer BSI Financial Services (BSI) of Irving, Texas. The bureau in May said the firm failed, among other things, to ensure that information it obtained from prior servicers for mortgage loans it acquired was complete and accurate. The company also agreed to pay restitution of $36,000. (The bureau said BSI Financial Services was the operating name for Servis One, Inc.) This, based on previous reporting, is likely what the bureau report meant in the list item on “action against a mortgage servicer for violating the Consumer Financial Protection Act; RESPA; Regulation X; the Truth in Lending Act; and Regulation Z.”
- $3.5 million was assessed against USAA Federal Savings Bank, was also ordered to pay $12 million in restitution. The CFPB, announcing the consent order in January, said the $82 billion institution, one of the largest financial institutions serving active and retired members of the military, submitted to the fine in a consent order citing it for failing to properly honor consumers’ stop payment requests on preauthorized EFTs; and for reopening deposit accounts consumers had previously closed, without seeking proper authorization or providing adequate notice. This is behind the list item regarding “action against a federally chartered savings association for violating the Consumer Financial Protection Act; the Electronic Fund Transfer Act; and Regulation E.”
RR: For allegedly swindling veterans on pensions, broker banned permanently – and ordered to pay $1 (Jan. 23, 2019)
RR: Consumer bureau announces $1.75 million civil money penalty against Freedom Mortgage Corporation, cites HMDA violations (June 5, 2019)
RR: Student loan servicer will pay $3.9 million fine; admits to engaging in unfair practices (May 1, 2019)
RR: Bureau fines online payday lender $3.2 million for illegal debiting, more (Jan. 25, 2019)
RR: Southeast-based payday lender assessed $100,000 fine, ordered to pay refunds, for multiple violations (Feb. 5, 2019)
RR: Expansive jewelry retailer agrees to $11 million in fines from consumer agency, NY state (Jan. 16, 2019)
RR: Bureau assesses penalty of $200k, directs restitution of $36k, for Texas mortgage servicers’ shortcomings (May 29, 2019)
RR: Consumer bureau slaps USAA bank with $3.5 million penalty, orders restitution of $12 million (Jan. 3, 2019)
CFPB release: Highlights of Director Kraninger’s First Six Months