Credit, Debit & Prepaid Cards
Practice Overview
Buckley represents issuers and servicers of credit, debit, and prepaid cards in a broad range of regulatory, enforcement, and litigation matters involving consumer, small business, and corporate cards. These products range from general purpose to virtual cards designed for single use. Our experience spans the spectrum of federal laws and regulations, including the Truth in Lending Act (TILA), Equal Credit Opportunity Act (ECOA), Fair Credit Reporting Act (FCRA), Electronic Fund Transfer Act (EFTA), as well as state laws covering a host of issues ranging from small business charge cards to the electronic delivery of disclosures. Our clients include long-standing industry leaders and new entrants that seek high-quality, practical, and effective advice to advance their business goals and ensure compliance with the complex laws and regulations governing this area.
We analyze the regulatory environment in which card issuers and servicers operate, and assist in making the changes necessary to stay compliant with applicable laws and regulations, as well as examiner expectations and industry standards. Our lawyers counsel clients with respect to proposed rules, draft comment letters, and work with regulators to ensure that industry concerns are heard. We analyze new laws, rules, guidance, and enforcement actions so that clients can make appropriate adjustments to their systems, procedures, and disclosures. Our team helps clients respond to changes in state law preemption as a result of Dodd-Frank, and aids them in determining the appropriate compliance approach to specific state laws.
We advise our clients on the development of innovative card products and services within a multifaceted regulatory framework. Our attorneys assist in structuring products and assessing the risk of proposed products, terms, models, and marketing strategies. We develop comprehensive and consumer-friendly disclosures to reduce the risk of both regulatory violations and claims of unfair, deceptive, and abusive acts and practices (UDAAP). We also work with clients in preparing for and responding to examinations, consumer complaints, and pre-litigation issues, as well as stand ready to respond to enforcement actions and defend in litigation if necessary. Our team offers legal counsel on a variety of business transactions for which our card clients are regularly involved, including structuring and negotiating private label deals. We also advise on payment system issues and provide general legal guidance on charter powers, rate exportation, and other banking topics.
Representative work in this area includes:
- Advised numerous large and mid-sized card issuers on the implementation of the amendments to the Military Lending Act regulations
- Helped multiple startups launch credit card programs
- Helped established card issuers redesign existing rewards programs, create benchmarks against best in class standards, conduct risk assessments, integrate grandfathered balances, and terminate legacy programs
- Helped established card issuers launch new small business, charge card, corporate card, and prepaid card programs
- Advising card issuers on matters relating to CFPB examinations, including compliance management, deferred interest, and technical compliance with consumer financial laws and regulations
- Assisting card issuers in standing up and maintaining ongoing fair lending statistical analysis programs; conducted a file review of judgmental overrides
- Represented several card issuers in CFPB enforcement actions relating to add-on products
Articles
"CFPB credit stance has broad specialty finance implications" by Jeffrey P. Naimon (Law360)
The Consumer Financial Protection Bureau issued an advisory opinion at the end of November that could compel specialty-finance companies — including those offering income-share agreements, litigation funding, merchant cash advances and earned wage access products — to take a fresh look at whether...
Articles"Accurate FCRA reporting during Covid-19" by Marshall T. Bell and Jessica L. Pollet (Bloomberg Law)
As financial institutions respond to a flurry of regulatory recommendations and mandates in response to the Covid-19 crisis, those relating to consumer reporting may be among the most difficult to decipher and operationalize. Federal and state authorities have made it clear that they expect...
ArticlesSpecial Alert: CARES Act places significant burdens on servicers of consumer debt but provides some relief to depositories
President Trump late last week signed the Coronavirus Aid, Relief, and Economic Security Act that attempts to soften the negative economic effects of the Covid-19 pandemic on consumers, including by suspending payments for certain student loan borrowers and enabling mortgage loan borrowers to...
Special AlertsSpecial Alert: Madden Class Action Moves Forward
On February 27, the U.S. District Court for the Southern District of New York issued a ruling in Madden v. Midland Funding, LLC , [1] holding that New York’s fundamental public policy against usury overrides a Delaware choice-of-law clause in the plaintiff’s credit card agreement. The court allowed...
ArticlesCredit Cards 2016: Consumer Protection in Focus
The past year has seen heightened CFPB interest in the following areas: (i) deferred interest and rewards, (ii) limited English proficiency consumers, and (iii) the recent revisions to the Military Lending Act (MLA). Pursuing simplicity in the design of product features and closely following...
ArticlesSpotlight on the Military Lending Act, Part 1: Did the Final Rule Improve on the Proposal?
On July 22, 2015, the Department of Defense (“Department”) released its final rule amending the regulations that implement the Military Lending Act (“MLA”), which means that a wider range of credit products—including open-end credit—offered or extended to active duty service members and their...
ArticlesSpecial Alert Update: OCC Revises Guidance Regarding Consumer Protection Requirements to Overdraft Lines and Protection Services
On March 6, 2015, the OCC issued its revised “Deposit-Related Credit” booklet (“DRC booklet”) of the Comptroller’s Handbook, which replaced the “Deposit-Related Consumer Credit” booklet issued on February 11, 2015 (previously covered in this Special Alert ). While the new booklet covers the same...
ArticlesSpecial Alert: OCC Guidance Applies Consumer Protection Requirements to Overdraft Lines and Protection Services
UPDATE: On February 20, the OCC announced that it would be removing the “Deposited-Related Consumer Credit” booklet, originally issued on February 11, from its website. The OCC’s February 11 booklet seemingly required banks to change overdraft protection services, however the agency has since...
Articles
News & Blogs
CFPB launches medical-debt inquiry with HHS and Treasury
On July 7, the CFPB, Department of Health and Human Services, and the Treasury Department announced they are looking into high-cost specialty financial products such as medical credit cards and installment loans used by patients to pay for health care. These products, the agencies explained, were...
InfoBytesCFPB releases regulatory agenda
The Office of Information and Regulatory Affairs recently released the CFPB’s spring 2023 regulatory agenda . Key rulemaking initiatives that the agency expects to initiate or continue include: Overdraft fees . The Bureau is considering whether to engage in pre-rulemaking activity in November to...
InfoBytes7th Circuit: Time and money spent responding to second verification request is sufficient for standing
On June 7, the U.S. Court of Appeals for the Seventh Circuit held that spending time and money to send a second verification request is enough to confer standing under the FDCPA. Plaintiff’s defaulted credit card debt was purchased by one of the defendants and placed with a collection agency. A...
InfoBytesCFPB announces $9 million settlement with bank on credit card servicing
On May 23, the CFPB announced a settlement to resolve allegations that a national bank violated TILA and its implementing Regulation Z, along with the Consumer Financial Protection Act. The Bureau sued the bank in 2020 (covered by InfoBytes here ) claiming that, among other things, when servicing...
InfoBytesFTC, DOJ sue payment processor for tech support scams
On April 17, the DOJ filed a complaint on behalf of the FTC against several corporate and individual defendants for violating the FTC Act and the Telemarketing Sales Rule (TSR) by allegedly engaging in credit card laundering for tech support scams. (See also FTC press release here .) According to...
InfoBytesCFPB looks to increase card competition
On April 17, CFPB Director Rohit Chopra said the Bureau is focused on finding ways to increase competition and reduce costs as credit card debt continues to rise and interest rates increase. Chopra discussed a proposal announced in February (comments are due May 3), which would ensure that late...
InfoBytes3rd Circuit: Card renewal notices not subject to TILA itemization requirements
On April 11, the U.S. Court of Appeals for the Third Circuit upheld the dismissal of a putative class action suit claiming a national bank’s failure to itemize fees in its credit card renewal notices violated TILA and Regulation Z. Plaintiff alleged that his 2019 card renewal notice listed the...
InfoBytesCFPB updates card survey to improve comparison shopping
On March 21, the CFPB announced updates to its terms of credit card plans (TCCP) survey . The updates are intended to “create a neutral data source” to help consumers comparison shop for credit cards and “find the best interest rates and products,” the Bureau explained. Previously, credit card data...
InfoBytesHouse Republicans question CFPB’s card late-fee proposal
On March 1, several Republican House Financial Services Committee members sent a letter to CFPB Director Rohit Chopra expressing concerns over the Bureau’s credit card late fee proposal. Among other things, the lawmakers claimed that last year the Bureau broke precedent by failing to address, for...
InfoBytesCFPB highlights problems with cash-benefit programs
On March 1, the CFPB released an Issue Spotlight exploring the challenges that recipients of public benefits programs offering cash assistance face when accessing funds through financial products or services. According to the report , financial products used to deliver public benefits, such as...
InfoBytes
Press Releases & Announcements
BuckleySandler Hosts Eighth Annual Fair Lending Today Conference
BuckleySandler LLP hosted its eighth annual Fair Lending Today conference in Washington, DC on March 13-14, 2016. The two-day event featured an evening of interactive roundtable discussions on fair lending issues, followed by a full day of seminars. The sessions were led by BuckleySandler attorneys...
Press ReleasesBuckley Sandler Hosts Annual Fair Lending Today Conference
Buckley Sandler LLP hosted its annual Fair Lending Today conference in Washington, DC, March 15-16, 2015. The two-day event featured an evening of interactive roundtable discussions on fair lending issues, followed by a full day of seminars. The roundtables and seminars were led by Buckley Sandler...
Press Releases
Our Credit, Debit & Prepaid Cards Team
Partners
Recent Blog Posts
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July 7, 2023
CFPB launches medical-debt inquiry with HHS and Treasury
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June 16, 2023
CFPB releases regulatory agenda
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June 16, 2023
7th Circuit: Time and money spent responding to second verification request is sufficient for standing
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May 26, 2023
CFPB announces $9 million settlement with bank on credit card servicing
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April 21, 2023
FTC, DOJ sue payment processor for tech support scams