Consumer Financial Services Law Monitor

Monitoring the financial services industry to help companies navigate through regulatory compliance, enforcement, and litigation issues

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The Pennsylvania Supreme Court has ruled that employers have a legal duty to use reasonable care to safeguard the sensitive personal information of employees stored on an Internet-accessible computer system. In Dittman v. UPMC, former and present employees of the University of Pittsburgh Medical Center filed a putative class action against UPMC arising from a data breach in which the personal and financial information – including names, birth dates, Social Security numbers, addresses, tax forms,…
In A-1 Premium Acceptance, Inc. v. Hunter, the Missouri Supreme Court upheld the circuit court’s order denying counterclaim defendant A-1’s motion to compel arbitration because the plain language of the consumer arbitration agreement limited the arbitrator to the National Arbitration Forum (NAF).  After the parties executed the arbitration agreement, NAF entered into a consent decree with the Minnesota Attorney General requiring NAF immediately to stop providing arbitration services for consumer claims nationwide. The parties’…
On December 10, the Bureau of Consumer Financial Protection issued proposed revisions to its 2016 Policy on No-Action Letters and proposed a BCFP Product Sandbox. The proposed new policy has two parts: Part I is a revision of a 2016 policy on No-Action Letters, and Part II is a description of the BCFP Product Sandbox. The revised No-Action policy would eliminate the data-sharing requirement of the 2016 Policy, which required applicants to commit to sharing…
The district court in the Northern District of Illinois granted summary judgment to the defendant in a TCPA case on the grounds that its dialing system no longer fit the definition of an automatic telephone dialing system (“ATDS”) because it dialed numbers from a stored list.  In doing so, the Court reversed its previous decision on summary judgment and clearly rejected the FCC’s previous guidance on the issue.  The case is Johnson v. Yahoo!, Inc.,…
On November 29, the Third Circuit Court of Appeals reversed a district court’s grant of summary judgment to Drexel University in a Fair Debt Collection Practices Act case brought by a former student.   In Tiene v. Law Office of J. Scott Watson PC, No. 18-1221 (3d Cir. Nov. 29, 2018), Philip Tiene, a former Drexel University student, argued that the district court erred in granting summary judgment to the University on his FDCPA claims. …
The Bureau of Consumer Financial Protection has continued its series of guidelines specifically addressing servicemembers’ purchases of automobiles.  Recent posts on the Bureau’s blog have provided advice for servicemembers on shopping for auto financing, options for buying new cars versus used cars, as well as recommendations on how to trade in a vehicle. With regard to auto finance, the BCFP advises servicemembers to shop around for financing terms rather than only considering the financing options…
On December 4, the Federal Trade Commission announced that it is seeking comment on whether the agency should make changes to rules requiring that financial institutions and creditors take certain steps to detect signs of identity theft that may affect their customers. In a press release, the FTC stated that as part of its periodic review of its rules and guidelines, it is seeking comment on whether modifications should be made to the Red…
On November 21, in Sweely Holdings LLC v. SunTrust Bank et al., the Supreme Court of Virginia issued an opinion that is beneficial to the mortgage industry in Virginia because it upheld a bank’s right to foreclose, even if it could have pursued other options under a forbearance agreement.  In doing so, the Court affirmed settled principles of contract interpretation, where provisions are understood in light of their plain language and place within the contract…
On November 28, Senators Dianne Feinstein (D-Calif.) Richard Blumenthal (D-Conn.), and Amy Klobuchar (D-Minn.) introduced the REAL PEACE Act, short for “Robocall Elimination At Last Protecting Every American Consumer’s Ears.”  The goal of the legislation is to provide the Federal Trade Commission with the power to regulate companies that facilitate robocalls and, of particular importance, end the common carrier exemption in the Federal Trade Commission Act that purports to enable illegal robocalling. With respect to…
Effective July 1, 2018, Virginia’s unlawful detainer laws were amended to include new language beneficial to mortgagees and other foreclosure sale purchasers who seek to recover possession of foreclosed property by filing suit in a general district court.    A new subsection of the statute, Virginia Code § 8.01-126(C)(4), codifies common law and confirms that a former owner who continues to occupy a property after foreclosure is a tenant at sufferance. The tenancy may be terminated…