CFPB Settlement Offers Little Guidance on What is “Abusive”
July 12, 2013
The CFPB’s complaint and settlement against a Florida debt relief firm for deceptive and abusive acts or practices sheds little guidance. The agency secured a stipulated judgment against American Debt Settlement Solutions Inc. (ADSS) for knowingly offering ineffective debt settlement services to consumers. One of the findings was that ADSS’s practice of knowingly enrolling consumers whose financial conditions made it highly unlikely that they can complete the program, was abusive under the new UDAAP standard.
But CFPB’s failure to lay a convincing factual foundation for this conclusion leaves institutions subject to its jurisdiction with more questions than answers. See CBA’s Regulatory Compliance Bulletin for more information.