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CONSUMER FINANCIAL PROTECTION BUREAU ANNOUNCES ACTION AGAINST CITIZENS BANK, N.A.

FOR IMMEDIATE RELEASE:
January 30, 2020

MEDIA CONTACT:
Office of Communications
Tel: (202) 435-7170

CONSUMER FINANCIAL PROTECTION BUREAU ANNOUNCES ACTION AGAINST CITIZENS BANK, N.A.

WASHINGTON, D.C. – Today the Consumer Financial Protection Bureau (Bureau) filed suit against Citizens Bank, N.A. (Citizens), a national banking association headquartered in Providence, Rhode Island.  The Bureau’s complaint alleges violations of the Truth in Lending Act (TILA) and TILA’s implementing Regulation Z, including violations of amendments to TILA contained in the Fair Credit Billing Act (FCBA) and the Credit Card Accountability Responsibility and Disclosure Act (CARD Act).

As described in the complaint, the Bureau alleges that for several years Citizens violated TILA, as amended by the FCBA, and Regulation Z by failing to properly manage and respond to credit card disputes.  The complaint alleges that Citizens automatically denied consumers’ billing error notices and claims of unauthorized use in certain circumstances.  The complaint further alleges that Citizens failed to fully refund finance charges and fees when consumers asserted meritorious disputes or fraud claims, and failed to send consumers required acknowledgement letters and denial notices in response to billing error notices.

The Bureau further alleges that for several years Citizens violated TILA by violating provisions passed under the CARD Act.  The Bureau alleges that Citizens violated TILA and Regulation Z by failing to provide credit counseling referrals to consumers who called Citizens’ toll-free number designated for that purpose.  These alleged violations of TILA—including those under the FCBA and the CARD Act—and Regulation Z also constitute violations of the Consumer Financial Protection Act.

The Bureau filed its complaint in the U.S. District Court for the District of Rhode Island on January 30, 2020.  The Bureau’s complaint seeks, among other remedies, an injunction against defendants and the imposition of civil money penalties.

The complaint is not a finding or ruling that the defendant has violated the law.

The complaint is available at: https://files.consumerfinance.gov/f/documents/cfpb_citizens-bank_complaint_2020-01.pdf.

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The Consumer Financial Protection Bureau is a 21st century agency that helps consumer finance markets work by regularly identifying and addressing outdated, unnecessary, or unduly burdensome regulations, by making rules more effective, by consistently enforcing federal consumer financial law, and by empowering consumers to take more control over their economic lives. For more information, visit consumerfinance.gov.

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AGENCIES ANNOUNCE DOLLAR THRESHOLDS IN REGULATIONS Z AND M FOR EXEMPT CONSUMER CREDIT AND LEASE TRANSACTIONS

FOR IMMEDIATE RELEASE:
October 31, 2019

MEDIA CONTACT:
Office of Communications
Tel: (202) 435-7170

AGENCIES ANNOUNCE DOLLAR THRESHOLDS IN REGULATIONS Z AND M FOR EXEMPT CONSUMER CREDIT AND LEASE TRANSACTIONS

WASHINGTON, D.C. – The Consumer Financial Protection Bureau (CFPB) and Federal Reserve Board today announced the dollar thresholds in Regulation Z (Truth in Lending) and Regulation M (Consumer Leasing) that will apply for determining exempt consumer credit and lease transactions in 2020. These thresholds are set pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) amendments to the Truth in Lending Act and the Consumer Leasing Act that require adjusting these thresholds annually based on the annual percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). If there is no annual percentage increase in the CPI-W, the Federal Reserve Board and the Bureau will not adjust this exemption threshold from the prior year. However, in years following a year in which the exemption threshold was not adjusted, the threshold is calculated by applying the annual percentage change in CPI-W to the dollar amount that would have resulted, after rounding, if the decreases and any subsequent increases in the CPI-W had been taken into account. Transactions at or below the thresholds are subject to the protections of the regulations.

Based on the annual percentage increase in the CPI-W as of June 1, 2019, the protections of the Truth in Lending Act and the Consumer Leasing Act generally will apply to consumer credit transactions and consumer leases of $58,300 or less in 2020. However, private education loans and loans secured by real property (such as mortgages) are subject to the Truth in Lending Act regardless of the amount of the loan.

Although the Dodd-Frank Act generally transferred rulemaking authority under the Truth in Lending Act and the Consumer Leasing Act to the Bureau, the Federal Reserve Board retains authority to issue rules for certain motor vehicle dealers. Therefore, the agencies are issuing these notices jointly.

The Regulation M notice is available in the Federal Register here: https://www.federalregister.gov/documents/2019/10/30/2019-21554/consumer-leasing-regulation-m.

The Regulation Z notice is available in the Federal Register here: https://www.federalregister.gov/documents/2019/10/30/2019-21557/truth-in-lending-regulation-z.

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Media Contacts:

Federal Reserve Susan Stawick (202) 452-2955

CFPB Marisol Garibay (202) 435-5169

The Consumer Financial Protection Bureau is a 21st century agency that helps consumer finance markets work by regularly identifying and addressing outdated, unnecessary, or unduly burdensome regulations, by making rules more effective, by consistently enforcing federal consumer financial law, and by empowering consumers to take more control over their economic lives. For more information, visit consumerfinance.gov.

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PRESS RELEASE: CONSUMER FINANCIAL PROTECTION BUREAU RELEASES REPORT ON THIRD-PARTY DEBT COLLECTIONS

FOR IMMEDIATE RELEASE:
July 18, 2019

MEDIA CONTACT:
Office of Communications
Tel: (202) 435-7170

CONSUMER FINANCIAL PROTECTION BUREAU RELEASES REPORT ON THIRD-PARTY DEBT COLLECTIONS

WASHINGTON, D.C. – The Consumer Financial Protection Bureau (Bureau) released a report today that found that more than one-in-four consumers with a credit report have at least one debt in collection by third-party debt collectors.

Today’s report, which covers 2004 to 2018, is drawn from the Bureau’s Consumer Credit Panel (CCP), a nationally representative sample of approximately 5 million de-identified credit records maintained by one of the three nationwide credit reporting companies. Close to 900 third-party debt collectors furnished collection tradelines in the CCP. A tradeline is information about a consumer account that is sent, generally on a regular basis, to a credit reporting company. Tradelines contain data such as account balance, payment history, and status of the account.

Today’s findings show that more than one-in-four consumers (28 percent) with a credit report in the CCP in 2018 had at least one third-party collections tradeline on their file. The study also found that more than three-out-of-four third-party collections tradelines are for non-financial debt. More than half (58 percent) of these tradelines are for medical debt and another 20 percent for telecommunications or utilities debt. Positive payment information is generally not furnished for medical or telecommunications debt.

Banks and other original creditors may collect their own debts or hire third-party debt collectors. In some instances, the original creditors may sell the debts to debt buyers. The buyers may try to collect on these debts, or hire other third-party debt collectors. There are approximately 9,330 debt collectors and debt buyers in the United States.

“Market Snapshot: Third-Party Debt Collections Tradeline Reporting” can be found at: https://content.consumerfinance.gov/data-research/research-reports/market-snapshot-third-party-debt-collections-tradeline-reporting/

The Consumer Financial Protection Bureau is a 21st century agency that helps consumer finance markets work by regularly identifying and addressing outdated, unnecessary, or unduly burdensome regulations, by making rules more effective, by consistently enforcing federal consumer financial law, and by empowering consumers to take more control over their economic lives. For more information, visit consumerfinance.gov.