Kris Kully, of Mayer Brown’s Financial Services and Regulatory Enforcement group, will speak to credit union mortgage lenders at the 20th Annual Conference of the American Credit Union Mortgage Association in Washington, DC.

On September 19th, she will discuss the next wave of compliance regulations and enforcement priorities.  On September 20th, she will participate in a panel discussion of compliance matters ranging from the Department of Labor’s treatment of mortgage loan originators under the Fair Labor Standards Act, the Consumer Financial Protection Bureau’s regulation of originator compensation, and any other issues the audience requests!

If you think the shadow of the Consumer Financial Protection Bureau (“CFPB”) is hiding behind a tree, you may well be right. On July 7th, the CFPB posted a Request for Information (“RFI”) on the federal government contracts website, called FedBizOpps.gov, in which it “pre-solicited” vendor capabilities to develop an automated technology solution for nonbank financial institutions to register with the CFPB.  It noted that such a potential registration system “might also be used to collect financial and operational data as well as organizational structure data.”  In other words, in the name of supervision, the CFPB might condition your future ability to offer goods and services on your advance registration and satisfaction of ongoing reporting requirements. Continue Reading Papers Please: CFPB Advances Plans to Register Nonbank Financial Services Providers

Five Mayer Brown attorneys in the Financial Services Regulatory & Enforcement group presented at the American Bar Association Business Law Section Annual Meeting in Boston last week.

Ori Lev spoke on a panel discussing the CFPB’s enforcement track record.  The panel addressed a study by Professor Chris Peterson of the S.J. Quinney College of Law at the University of Utah that provided an empirical analysis of the CFPB’s enforcement cases and Ori’s analysis of the CFPB’s use of its new abusiveness authority.

Matthew Bisanz moderated, and Jeff Taft participated on, a Banking Law Committee panel discussion of current cybersecurity issues for large financial institutions, including the regulatory and enforcement posture of the federal banking agencies; examiner expectations; government response to cyber events at financial institutions; and the relevance of the CFPB’s consent order against Dwolla to larger banking organizations.

David Beam moderated a panel on legal issues presented by various applications of blockchain technology, particularly in connection with consumer financial products.  Panelists included representatives of American Express Company, Capital One, and the Federal Trade Commission.

Alicia Kinsey spoke on a panel discussing BSA/AML compliance challenges for community banks, which included a discussion of FinCEN’s new customer due diligence rule, NYDFS AML/sanctions rule on transaction monitoring and filtering programs, as well as observations on AML compliance issues from regulators from the FRB and NCUA.

Tomorrow, September 13, 2016, Mayer Brown partner Jeff Taft will be speaking at the inaugural Marketplace Lending Policy Summit in Washington, D.C.  Jeff will be on a panel covering “Hot Legal Topics in Marketplace Lending.”

David Beam, Keisha Whitehall-Wolfe, and Eric Mitzenmacher also will be attending the conference.

 

Several of Mayer Brown’s Consumer Financial Services partners will be featured at this month’s Regulatory Compliance Conference in Washington, DC, sponsored by the Mortgage Bankers Association.

On Sunday, September 18th, Kris Kully will participate in the Compliance Essentials Workshop outlining how the Dodd Frank Act changed the regulatory framework for mortgages.  This panel will be useful for attendees looking for an introduction or refresher course in mortgage origination compliance, and those seeking MBA certification.

Also on Sunday the 18th, Krista Cooley will participate on the Servicing Essentials panel, which will include a discussion of the latest updates to the CFPB’s servicing rules, the TCPA, and the FDCPA.

Melanie Brody will participate on a Sunday panel addressing fair lending and HMDA.

Phil Schulman will participate on a panel on Monday, September 19th, discussing how the CFPB’s views affect marketing and advertising campaigns under RESPA. If the Circuit Court releases its opinion in the PHH case before the Conference, Phil will discuss how the court’s opinion will affect future RESPA compliance.

We look forward to seeing you there!

The Consumer Financial Protection Bureau (CFPB) recently proposed changes to its rules governing confidential information. The proposed rules would restrict recipients of civil investigative demands (CIDs) from voluntarily disclosing the receipt of a CID, while at the same time giving the CFPB more leeway to disclose confidential supervisory information to other government agencies. The proposed simultaneous tightening and loosening of restrictions on the disclosure of confidential information can have important implications for parties subject to CFPB enforcement and supervisory jurisdiction, who should consider whether to submit comments, which are due by October 24, 2016. Read more about the decision in Mayer Brown’s Legal Update, available here.

Until recently, Florida courts had not determined what happens to liens placed on a property between the time of final judgment of foreclosure and sale. On August 24, 2016, Florida’s Fourth Appellate District decided Ober v. Town of Lauderdale-by-the-Sea, which resolved the issue, holding that liens placed on the property after the final judgment of foreclosure but prior to judicial sale are not discharged by Florida’s lis pendens statute. Continue Reading Florida Appeals Court Holds That Post-Foreclosure Judgment Liens Are Not Discharged At Sale

A federal district court in California handed the Consumer Financial Protection Bureau (CFPB) a big win on Wednesday, August 31, 2016, granting the agency summary judgment on liability in its lawsuit against CashCall, Inc., its affiliated entities and its owner. In a 16-page decision and order, the US District Court for the Central District of California ruled that CashCall engaged in deceptive practices by servicing and collecting on loans in certain states where the interest rate on the loans exceeded the state usury limit and/or where CashCall was not a licensed lender. The decision represents an additional judicial touchpoint on the important question of who is a “true lender” in a transaction and validates, at least for now, the CFPB’s theory that collecting on loans that state law renders void and/or uncollectable constitutes a violation of federal law. Read more about the decision in Mayer Brown’s Legal Update, available here.

 

On September 12, 2016, the Nationwide Multistate Licensing System (“NMLS” or “the System”) will begin receiving and tracking Electronic Surety Bonds (“ESB”). In an unprecedented departure from the traditional uploading of a copy of a surety bond document to the applicant’s or licensee’s record followed by the delivery of the paper bond to the state, regulators in Idaho, Indiana, Iowa, Massachusetts, Texas, Vermont, Washington, and Wisconsin have publicly announced the adoption of ESB in 2016 for several license types.  This is the first group of states to “bond on line,” but all states are expected to have a common bond process through the NMLS.

Many states require licensed financial services businesses to get a surety bond so that state regulators or consumers may file claims against the bond to cover fines or penalties assessed, or provide restitution to consumers if the licensee fails to comply with licensing or regulatory requirements.  The NMLS reports that 177 license authorities currently managed on the system require a licensed company to maintain a surety bond as a condition of licensure.  States have even imposed bond requirements on individual mortgage loan originators (“MLOs”), in accordance with the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (the “SAFE Act”), but allow for MLOs to be covered under a company bond.

NMLS was created to serve as a comprehensive system of record for licensing information. However, as it relates to surety bonds, the System’s current functionality is antiquated, limited, and does not allow for the tracking of bond requirements, or the maintenance of bond information validated by authorized surety companies and/or bond producers. State regulators have also cited the tracking of surety bond compliance as a reason for processing delays in license applications, amendment filings, and renewal approvals. For those reasons, the State Regulatory Registry LLC, which administers the NMLS, believed a fully electronic surety bond process would provide efficiencies for both industry and regulators.

The first phase of this ESB process entailed the creation of an account by each participating surety company and association with those accounts by surety bond producers. The second phase, which will begin September 2016, entails implementation of bond issuance, tracking, and maintenance.

If you have not already done so, and especially if you are licensed or intend to become licensed in one of the eight states listed above that will be implementing this new functionality in September, you should ensure that your surety bond company has created an account in the system and be aware of the new application and conversion deadlines that are listed on the NMLS ESB Adoption Map and Table.

NMLS is offering a complimentary training webinar on the upcoming ESB enhancements. The training is expected to provide an overview of the ESB enhancements, including the bond creation and management process, a demonstration of the new functionality, the resources available on the NMLS Resource Center, and a live question-and-answer opportunity.  Mayer Brown’s Regulatory Compliance Analysts have completed the training, and are available to assist our clients in this transition.

Friday, August 26, 2016

1:00 – 2:30 p.m. ET.

Click here to log in to the NMLS Learning Management System (“LMS”) and enroll in the webinar. NMLS intends to make a recording available within five business days of the webinar.

If you do not have an LMS account, click here for instructions on how to register.

*Mr. Prost is not admitted to practice law in the District of Columbia.

The Consumer Financial Protection Bureau (the “Bureau” or “CFPB”) has taken another step towards improving its consumer complaint process and the Consumer Complaint Database.  On August 1, 2016, the Bureau published a Notice and Request for Comment in the Federal Register on its new information collection, “Consumer Response Company Response Survey.”  The purpose of the information collection is to incorporate a short survey into the CFPB’s complaint closing process.  The survey builds on a Notice and Request for Comment issued by the Bureau in March 2015 seeking input on how to highlight positive consumer experiences with providers of financial products and services. Continue Reading CFPB Seeks Input on Changes to Consumer Complaint Process