By John A. Kimble & Michael R. Guerrero on
Posted in CFPB, Earned Wage Access, Payday Lending, State Licensing
On December 22, 2023, the Attorney General of Montana released an opinion (the “Opinion”) concluding that certain earned wage access (EWA) products are not “consumer loans” or “deferred deposit loans” under Montana law and do not, therefore, require licensure by the Montana Division of Banking and Financial Institutions. The Opinion only applies to EWA products that are:
- fully non-recourse, meaning providers do not: have any legal or contractual right to repayment from consumers, engage in any debt collection activities, sell or assign any balances, or report any non-payment to a consumer reporting agency;
- not conditioned on payment of any mandatory interest, fee, or other compensation; and
- limited in amount to the consumer’s accrued income.
By Erik L. Johnson on
Posted in CFPB, Litigation and Court Decisions, Payday Lending
On April 5, 2023, the Consumer Financial Protection Bureau (CFPB) brought an action against James R. Carnes and Melissa C. Carnes, both individually and as co-trustees of the James R. Carnes Revocable Trust and the Melissa C. Carnes Revocable Trust, for allegedly hiding money through a series of fraudulent transfers in order to avoid paying more than $40 million in restitution and penalties for illegal payday lending activities.… Continue Reading
The CFPB and All American Check Cashing have filed a status report with the Mississippi federal district court indicating that they have agreed to a settlement conference before a magistrate judge.
The case was remanded to the district court by the en banc Fifth Circuit, which ruled that the CFPB’s enforcement action against All American could proceed despite the unconstitutionality of the CFPB’s single-director-removable-only-for-cause-structure at the time the enforcement action was filed.… Continue Reading
By Elanor A. Mulhern on
Posted in Fair Lending, Payday Lending, Regulatory and Enforcement
Proponents of the Payday Loan Interest Rate Cap ballot initiative in Michigan met the June 1, 2022 deadline to appear on the November 2022 ballot in the state. If not picked up by the state legislature this summer, the proposal would ask voters to approve a state statute capping payday loan interest rates, that can currently reach over 370% APR, at no more than 36% APR.… Continue Reading
The Fifth Circuit held oral argument yesterday in the appeal filed by the trade groups challenging the payment provisions in the CFPB’s 2017 final payday/auto title/high-rate installment loan rule (2017 Rule). Click here for the recording of the oral argument.
The trade groups have appealed from the district court’s final judgment granting the CFPB’s summary judgment motion and staying the compliance date for the payment provisions until 286 days after August 31, 2021 (which would have been until June 13, 2022).… Continue Reading
By Alan S. Kaplinsky on
Posted in CFPB, Payday Lending, Regulatory and Enforcement
A new CFPB report, “Market snapshot: Consumer use of State payday loan extended payment plans,” describes the requirements of state payday loan extended payment plan laws in the 16 states that have such laws.
The report also compares extended payment plan usage to payday loan rollover and default rates.… Continue Reading
By Alan S. Kaplinsky on
The Fifth Circuit has scheduled oral argument for May 11, 2022 in the appeal filed by the trade groups challenging the payment provisions in the CFPB’s 2017 final payday/auto title/high-rate installment loan rule.
The trade groups have appealed from the district court’s final judgment granting the CFPB’s summary judgment motion and staying the compliance date for the payment provisions until 286 days after August 31, 2021 (which would have been until June 13, 2022).… Continue Reading
By Barbara S. Mishkin on
Posted in CFPB, Payday Lending, Podcasts, Regulatory and Enforcement
Profs. Zywicki and Miller have co-authored a soon-to-be published study, “The Effects on Consumers from Two State-Level Regulations of the Payday Loan Market,” in which they analyzed 15.6 million storefront payday loans made to 1.8 million unique borrowers in 2013 to determine whether the number of loans a consumer takes in a year is a meaningful assessment of consumer welfare.… Continue Reading
By Ballard CFS Group on
Posted in CFPB, Litigation and Court Decisions, Payday Lending
The D.C. federal district court has granted the motions filed by the CFPB and the Consumer Financial Services Association (CFSA) to dismiss the lawsuit brought by the National Association for Latino Community Asset Builders (NALCAB). (The CFSA had intervened in the lawsuit.) In the lawsuit, the NALCAB sought to overturn the CFPB’s July 2020 final rule (2020 Rule) rescinding the “ability-to-repay” (ATR) or “mandatory underwriting provisions” in its 2017 final payday/auto title/high-rate installment loan rule (2017 Rule).… Continue Reading
By Ballard CFS Group on
Posted in CFPB, Litigation and Court Decisions, Payday Lending
The CFPB has filed its brief with the Fifth Circuit in the appeal filed by the trade groups challenging the payment provisions in the CFPB’s 2017 final payday/auto title/high-rate installment loan rule (2017 Rule). The trade groups have appealed from the district court’s final judgment granting the CFPB’s summary judgment motion and staying the compliance date for the payment provisions until 286 days after August 31, 2021 (which would have been until June 13, 2022).… Continue Reading
