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Voluntary Protection Products: A Matter of Interest for State and Federal Regulators | Hudson Cook, LLP

Voluntary Protection Products: A Matter of Interest for State and Federal Regulators | Hudson Cook, LLP
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CFPB Bites of the Month - May Top 10 | Hudson Cook, LLP

To embed, copy and paste the code into your website or blog: Each month, we host a 30-minute webinar outlining the month s key announcements and takeaways from the Consumer Financial Protection Bureau (CFPB) for financial services providers to consider. In this month s article, we share some of our top bites covered during the May 26 webinar. So what happened at the CFPB in the past month? Bite #10 - The CFPB and NY AG moved to seize personal assets from the owner of a debt collection operation. The CFPB and New York Attorney General sued the owner of a debt collection company previously involved in a regulatory action, in an effort to seize a $1.6 million home, that the owner allegedly transferred fraudulently. In 2019, the CFPB and the NY AG settled with that debt collection operation and its owners over allegations that the involved companies harassed, threatened, and deceived millions of consumers across the nation into paying inflated debts or amounts they did not owe.

CFPB Alleges Unfair Acts with Auto Finance Add-On Product

Tuesday, June 1, 2021 On May 21, 2021, the Consumer Financial Protection Bureau (CFPB) and 3rd Generation, Inc. d/b/a California Auto Finance entered into a Consent Order in which the CFPB alleged unfair acts or practices in connection with an auto finance add-on product. What was the add-on product? According to the Consent Order, 3rd Generation purchases and services “subprime auto loans by taking assignment of retail-installment-sales contracts that automobile dealers make with borrowers.” As part of its loan agreement, 3rd Generation requires consumers to use its Loss Damage Waiver (LDW) product. 3rd Generation places the LDW product on the consumer’s account when the consumer has insufficient insurance; it “covers cancellation of the borrower’s debt in the event of a total vehicle loss, or the cost of a repair if the vehicle is not a total loss.” The addition of the LDW product on the consumer’s account results in a monthly LDW fee.

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