InfoBytes Blog
CFPB sues regional bank for sales practices
On March 9, the CFPB filed a complaint in the U.S. District Court for the Northern District of Illinois against a regional bank for alleged violations of TILA, the Truth in Savings Act and the Consumer Financial Protection Act relating to the bank’s sales practices. According to the complaint, the bank had instituted a “cross-sell” sales strategy along with sales goals to increase sales to customers. The complaint alleges that, although the bank knew that sales employees “engag[ed] in misconduct in order to meet goals or earn additional compensation,” the bank purportedly “took insufficient steps to properly implement and monitor its program, detect and stop misconduct, and identify and remediate harmed consumers.” The complaint alleges two claims for “abusiveness” in violation of the CFPA, which are the first such allegations since the Bureau issued a policy statement in January regarding its “abusiveness” standard, covered in InfoBytes here. Among other things, the Bureau seeks injunctive relief, monetary relief, disgorgement, and a civil money penalty. After the complaint was filed, the regional bank issued a press release rejecting the charges in the CFPB’s complaint.