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FTC shares 2021 enforcement report with CFPB

Federal Issues FTC CFPB Enforcement TILA CLA EFTA Consumer Finance UDAP

Federal Issues

On June 3, the FTC announced that it submitted its 2021 Annual Financial Acts Enforcement Report to the CFPB. The report covers FTC enforcement activities regarding the Truth in Lending Act (TILA), the Consumer Leasing Act (CLA), and the Electronic Fund Transfer Act (EFTA). Highlights of the enforcement matters covered in the report include, among other things:

  • Automobile Credit and Leasing. The report discussed the FTC’s July 2021 settlement with the owners of car dealerships in Arizona and New Mexico (collectively, “defendants”) resolving claims that the defendants misrepresented consumer information on finance applications and misrepresented financial terms in advertisements in violation of TILA and CLA (covered by InfoBytes here).
  • Payday Lending. The report highlighted the FTC’s settlement against a payday lending enterprise for allegedly overcharging consumers millions of dollars, deceiving them about the terms of their loans, and failing to make required loan disclosures. According to the report, the owners and operators of the settling entities are banned from making loans or extending credit, nearly all debt held by the company will be deemed paid in full, and the companies involved are being liquidated, with the proceeds to be used to provide redress to consumers harmed by the company.
  • Credit Repair and Debt Relief. The report discussed the FTC’s settlement with the operators of a student loan debt relief scheme, who were charged with falsely promising consumers the company could lower or eliminate student loan balances, illegally imposing upfront fees for credit repair services, and signing consumers up for high-interest loans to pay the fees without making required loan disclosures in violation of TILA. The order bans the defendants from providing debt relief services and collecting any further payments from consumers who purchased the services, and requires the defendants to return money to be used to refund consumers.

Additionally, the report addressed the FTC’s research and policy efforts and highlighted the FTC’s Military Task Force’s work on military consumer protection issues.

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