New laws in Hawaii, Louisiana, Nevada, and Rhode Island will have consequences for mortgage servicers operating in those states. Recently enacted legislation in Hawaii and Nevada imposes new licensing and compliance obligations on servicers. In addition, legislation in Louisiana and Rhode Island set to go into effect has licensing implications for those entities that are mere holders of mortgage servicing rights (“MSRs”), but that do not actually service the loans.
Partner Shanda Hastings and Associate Noam Kutler, members of the K&L Gates Government Enforcement group, co-authored the article titled “6 Critical Issues When Responding to Government Subpoenas” appearing in the June 16 edition of Corporate Counsel magazine. In their article, they discuss six critical issues that could cause significant problems for a bank or financial institution if overlooked when responding to a government subpoena for documents.
To read the full article, click here.
The Sixth Circuit recently held that a facsimile which lacks commercial components on its face does not constitute an advertisement under the Telephone Consumer Protection Act and ruled that the possibility of remote economic benefit to a defendant is “legally irrelevant” to determining whether the fax violates the TCPA. The Sixth Circuit’s narrow rule stands out among decisions from other courts that have adopted an expansive interpretation of “advertisement” under the TCPA, and demonstrates that the scope of the TCPA is indeed subject to limitations.
The New York Department of Financial Services (“DFS”) has updated its FAQ on the debt collection regulations that took effect on March 3, 2015. We analyzed the regulations in a client alert and covered an earlier version of the FAQ in a previous blog post.
Section 342 of the Dodd-Frank Act – which established additional federal oversight over the diversity policies and practices at financial services institutions – has become a reality for regulated institutions with the release on June 9th of an interagency policy statement establishing the final standards. The standards impact a broad swathe of business activity and focus on self-assessment and voluntary disclosure of diversity practices. What do legal, compliance and risk management leaders at regulated financial services institutions need to do to comply?
By: Paul F. Hancock
The Court’s decision today resolves an important legal issue about which there has been principled disagreement among White House administrations, as well as among advocacy and industry groups, for decades. While the Court, by a razor thin margin, upheld the application of disparate impact under the Fair Housing Act, the Court also imposed important limitations on the application of the legal theory. For example, the Court held that a racial imbalance, without more, does not establish a case of discrimination, and directed lower courts to “examine with care” the claims presented at the pleading stage. The Court further directed that remedial orders in disparate impact cases must “concentrate on the elimination of the offending practice” and employ “race-neutral [remedial] means.” The limitations that were announced were believed necessary by the Court to “avoid serious constitutional questions that might arise” and “to protect potential defendants against abusive disparate-impact claims.”
On June 23, the Consumer Financial Protection Bureau (CFPB or Bureau) released its latest Supervisory Highlights, outlining key findings from supervisory work completed between January and April 2015. Recent supervisory resolutions across all industries have resulted in remediation of approximately $11.6 million to more than 80,000 consumers. The report highlights recent supervisory observations in the following areas:
Earlier this month, the Consumer Financial Protection Bureau (CFPB) issued the Director’s final decision in the CFPB’s enforcement action against PHH Corp. (PPH). The decision is the agency’s first ruling in a contested administrative proceeding and sheds light on how the agency—at least under the leadership of Director Richard Cordray—will approach these matters. Most strikingly, Director Cordray overturned several key rulings by the Administrative Law Judge (ALJ), resulting in a decision requiring PHH to pay over $109 million in disgorgement, nearly 17 times as much as the $6.4 million recommended by the ALJ.
At its June 18, 2015, open meeting, a sharply divided Federal Communications Commission made good on Chairman Tom Wheeler’s recent promise to bolster the Telephone Consumer Protection Act’s already strict rules and to bring about “one of the most significant FCC consumer protection actions since it established the Do-Not-Call Registry with the FTC in 2003.” While plaintiffs’ class action lawyers are likely to applaud the new measures, businesses are concerned that the new rules could unfairly restrict legitimate communications with customers.
On May 28, 2015, the DOJ and the CFPB filed a complaint and proposed consent order against Provident Funding Associates (Provident) alleging that the mortgage lender violated the Fair Housing Act and ECOA by charging African American and Hispanic borrowers higher broker fees than it charged white borrowers. To resolve these claims, Provident will pay $9 million to approximately 14,000 borrowers who allegedly paid higher interest rates and/or fees for mortgages between 2006–2011. The agencies did not impose a civil money penalty against Provident.