The CFPB has won a preliminary injunction in its first enforcement action, which was taken against a California attorney and some of his affiliated companies and partners that offered loan modification and foreclosure relief services to homeowners struggling to keep up with their mortgage payments. In Consumer Financial Protection Bureau v. Chance Gordon, et al., filed in July in U.S. District Court for the Central District of California, the judge enjoined the defendants from making various representations alleged by the...

In a move that caught most industry observers by surprise, CFPB Deputy Director Raj Date, widely seen as a possible successor to Director Richard Cordray, has decided he will leave the agency at the end of January, with no immediate plans other than to spend more time with his family. “The timing of his departure will enable Date to help finalize several new mortgage rules this January,” according to one industry trade group source. That would include the qualified mortgage rule, according to attorney Jeffrey Jamison, an...

Staffing levels at the CFPB grew from about 663 employees as of the end of fiscal year 2011 to 970 as of the end of FY 2012 (Sept. 30), an increase of 46.3 percent, according to the bureau’s financial report for FY 2012. By way of comparison, in the first quarter of FY11, the bureau had just 58 positions filled. The CFPB’s division of supervision, enforcement and fair lending had 46.9 percent of employed staff, the division of research, markets and regulations 9.0 percent, as of the end of FY12. The legal division...

The CFPB has taken several steps to develop, document and implement an information security program. However, additional steps are needed if the bureau is to have an information security program that is consistent with the Federal Information Security Management Act of 2002, according to an audit report issued by the Federal Reserve’s Office of Inspector General. “We recommend that the Chief Information Officer develop and implement a comprehensive information security strategy that identifies specific goals...

The five banks that are parties to the $25 billion national mortgage settlement have extended more than $26.11 billion in gross relief to more than 300,000 borrowers, or roughly $84,385 per homeowner, according to a new report from the Office of Mortgage Settlement Oversight. At that pace, the five participating servicers will satisfy their obligations under the settlement two years ahead of the 2015 deadline. “The report discloses that the banks have completed $21.92 billion in consumer relief to borrowers...

The CFPB recently launched Project Catalyst, an initiative it said is designed to encourage consumer] friendly innovation and entrepreneurship in markets for consumer financial products and services. gProject Catalyst is our effort to foster consumer-friendly innovation in the marketplace,h the bureau said. Through Project Catalyst, the CFPB is calling on innovators and entrepreneurs to help it by gimprovingh financial regulation to gbetter foster consumer]friendly innovation,h and in...

Adverse impact violations are the hardest to defend against and the ones causing the biggest settlements, according to Tammy Butler, the director of fair lending and compliance for Optimal Blue, a leading pricing engine. “In a nutshell, this means that your institution has a policy or criterion that has a disproportionate impact on the protected class population of the areas you serve,” she said in a recent blog. This can occur in the way that a lender prices loans or underwriting overlays. “So far, every lender that has been...

Although the CFPB has yet to reach its full staffing levels and seems to have its hands full with mortgage, credit card and payday lending issues, rules and regulations, it also has a number of efforts underway to address a variety of issues related to the financial abuse of older Americans ¨C including coming up with guidance for financial institutions. Last month was the inaugural meeting of the Elder Justice Coordinating Council, an 11©\agency body convened to ¡°shine a light on the disastrous impact of...

Representatives of smaller financial institutions told officials at the CFPB recently they are apprehensive about regulatory overload and the fear that their ability to serve their local communities will be harmed by too much regulation coming too fast. The bureau got that message during separate meetings with its Community Bank Advisory Council and its Credit Union Advisory Council. In discussions about the challenges and opportunities in the post-financial crisis environment, advisory council members...

Two legal cases remain in play that are challenging some controversial recess appointments made by President Barack Obama earlier this year, one directly challenging the appointment of Richard Cordray as director of the CFPB, and another that has implications for the case. In the former, State National Bank of Big Spring, Texas, et al. v. Geithner, et al., currently before the U.S. District Court for the District of Columbia, federal bank regulatory agencies last week told a judge that the lawsuit should be...