The Roundup: Reshaping Marketing Regulations, Data on Mortgage Lending, and Marketing Compliance and Enforcement Actions in Q2 2024
Welcome to the PerformLine Regulatory Compliance Roundup, home of the latest news, articles, and reports from our industry, curated for you. Let’s get into it.
In this edition: The Supreme Court rulings could reshape marketing regulations, the CFPB issues a proposed rule amending mortgage servicing rules, six ways the CFPB wants to keep its eyes on fintech middlemen, the FFIEC publishes 2023 data on mortgage lending, the CFPB proposes a rule to clarify the costs and fees of paycheck advance products, and marketing compliance and enforcement actions in Q2 2024.
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Supreme Court Rulings Could Reshape Marketing Regulations
The Supreme Court’s recent rulings, which reduce judicial deference to federal agencies and limit the timeframe for challenging regulations, could significantly impact marketing regulations. Despite potential legal challenges, the FTC remains assertive in data privacy, AI, and influencer disclosures. Some say the decisions may encourage more aggressive advertising practices and increase challenges to the FTC’s authority.
CFPB Issues Proposed Rule Amending Mortgage Servicing Rules
The CFPB proposed amendments to mortgage servicing rules under Regulation X, aiming to streamline loss mitigation processes and enhance foreclosure protections. Fundamental changes include defining a “loss mitigation review cycle,” revising borrower response times, and introducing new language access requirements. The proposal seeks to improve borrower protections and ensure clear communication while addressing early intervention and error resolution procedures.
Significant Stat: 76%: The percentage of websites and apps offering subscription services examined by the FTC, ICPEN, and GPEN that used at least one manipulative dark pattern. Read more
6 Ways the CFPB Wants to Keep Its Eyes on Fintech Middlemen
At an event, CFPB Director Rohit Chopra emphasized rigorous oversight of fintech intermediaries to prevent high fees, surveillance, and anti-competitive practices. Chopra highlighted concerns about data misuse and gatekeeping, stressing the need for clear rules to avoid regulatory arbitrage. He also discussed the finalization of open banking rules, the regulation of “buy now, pay later” services, and the need for updated privacy and surveillance laws. Chopra expects increased litigation on rulemaking following the rollback of the Chevron doctrine.
FFIEC Publishes 2023 Data on Mortgage Lending
The FFIEC released 2023 mortgage lending data, revealing insights from 5,113 U.S. financial institutions. Key findings include a 14.6% increase in reporting institutions and a drop in home loan applications from 14.3 million in 2022 to 10 million in 2023. Non-depository, independent mortgage companies originated 63.1% of first-lien home-purchase loans. The data also highlight mortgage denial rates among different racial and ethnic groups, aiding fair lending assessments and regulatory efforts.
CFPB Proposes Rule to Clarify the Costs and Fees of Paycheck Advance Products
The CFPB proposed an interpretive rule to ensure transparency for paycheck advance products, requiring lenders to disclose costs and fees under the Truth in Lending Act. The rule addresses products marketed as “earned wage” advances, highlighting issues like high annual percentage rates (APRs) and fees for expedited services. The proposal aims to protect workers from predatory lending practices and mandates clear disclosures to help workers understand loan costs.
Marketing Compliance and Enforcement Actions Review: Q2 2024
In the second quarter, federal and state regulators finalized 12 marketing compliance and consumer protection enforcement actions, totaling $71M in monetary fines. The Marketing Compliance and Enforcement Actions Quarterly Review examines the most recent data and trends affecting consumer finance companies. Driven by comprehensive compliance monitoring and industry analysis, it provides essential insights to help businesses navigate the evolving regulatory landscape.
