CFPB Releases Report on Servicemember Complaints

more+
less-

The CFPB released a report summarizing the recent complaints of servicemembers, veterans, and their families regarding various financial products and services. The report, which is the CFPB’s second such report, covered complaints that the CFPB received from July 21, 2011 through February 1, 2014. In connection with the report, the CFPB also announced that military consumers have recovered more than $1 million in relief since July 2011 and other non-monetary relief (e.g., correction of account information). The report also noted that the top three complaints related to mortgages, debt collection, and credit cards. The CFPB expressed particular concern about certain practices affecting military consumers, including alleged “aggressive and deceptive” tactics used in the collection of debts from military members. Despite a relatively small number of complaints related to payday loans, the CFPB also expressed concern that lenders were circumventing the Military Lending Act by lending just outside the MLA’s narrow parameters. The MLA generally prohibits creditors from charging servicemembers interest rates higher than 36% and prohibits mandatory waivers of consumer protection laws, arbitration, and allotments, among other things. Of import, the report noted the CFPB’s concerns that mortgage servicers lack knowledge about military-specific programs and short sale guidelines, such as the permanent change of station guidelines issued by the CFPB and other federal agencies (see June 26, 2012 Alert) and the Federal Housing Finance Agency’s 2012 short sale guidelines for Fannie Mae and Freddie Mac loans.

IRS Circular 230 Disclosure: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this informational piece (including any attachments) is not intended or written to be used, and may not be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.

Topics:  CFPB, Debt Collection, Military Lending Act, Military Service Members, Servicemember Complaint Report, Veterans

Published In: Consumer Protection Updates, Finance & Banking Updates, Military Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Goodwin Procter LLP | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »