Last week, the en banc panel of the U.S. Court of Appeals for the District of Columbia Circuit issued its long-awaited decision in the tussle between the CFPB and PHH Corp. The ruling addressed two distinct issues in the dispute, the first being the leadership structure of the CFPB, which PHH alleged was unconstitutional. The district court had previously sided with PHH, but the appeals court reversed that component of the ruling, and did so largely on party lines. On the other hand, the appeals court judges transcended party orientation and sided with PHH on the part of the dispute that deals with the Real Estate Settlement Procedures Act. (See following story.) On the question of the constitutionality of the ...
In response to last week’s ruling by the D.C. Circuit Court of Appeals that confirmed the constitutionality of the CFPB but rejected the bureau’s interpretation of RESPA in its legal dispute with PHH Mortgage, Rep. Jeb Hensarling, R-TX, suggested CFPB Acting Director Mick Mulvaney appeal to the Supreme Court of the United States. “I am deeply disappointed with the court’s decision and hope the Supreme Court will review the ruling in short order,” said Hensarling, chairman of the House Financial Services Committee. “In the meantime, I take great solace in the fact that Mick Mulvaney can use his unchecked, unilateral powers to continue the agency’s transformation into one that will, as he said, ‘exercise [its] statutory authority to enforce the ...
The second part of last week’s ruling by the en banc panel of the U.S. Court of Appeals for the District of Columbia Circuit went in favor of PHH Mortgage in its lengthy legal dispute with the CFPB over issues tied to the Real Estate Settlement Procedures Act. The court upheld the original three-judge panel interpretation of RESPA and its application to PHH in this case, stating that it was improperly applied and that the lender is entitled to the relief granted.More specifically, the en banc court reinstated the Oct. 11, 2016, panel decision related to the RESPA issues, which included vacating the bureau’s order imposing $109 million in disgorgement penalties, and remanded the matter for further proceedings based ...
The CFPB last week moved to restructure how the agency enforces fair lending laws, consolidating that function under the director’s office, which is headed by interim appointee Mick Mulvaney. In a statement provided to Inside the CFPB, John Czwartacki, senior advisor to the acting director, said: “The bureau’s statutory mandate includes the supervision and enforcement of fair lending laws and regulations [and] the bureau will continue to perform those functions.” He added: “The fact is, it never made sense to have two separate and duplicative supervision and enforcement functions within the same agency – one for all cases except fair lending, and the other only for fair lending cases. By announcing our intent to combine these efforts under one roof, we ...
The Consumer Mortgage Coalition recently wrote to CFPB Acting Director Mick Mulvaney to express the continuing, unresolved concerns its members have with some of the bankruptcy-related provisions of the bureau’s mortgage servicing rules. As of April 2018, mortgage servicers will have to send monthly billing statements to consumers in active bankruptcy cases and certain bankruptcy cases in which the debtor’s personal liability was previously discharged. This is problematic for a number of reasons, according to the CMC. First, these proposed rules conflict with well-settled bankruptcy law prohibiting a creditor from collecting from consumers who are in an active bankruptcy case or who have previously been discharged from personal liability in a prior bankruptcy case. “The courts have held these provisions ...
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