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On Friday, May 10th, Judge Mark Pittman of the United States District Court for the Northern District of Texas granted a preliminary injunction stopping the CFPB's credit card late fee rule from taking effect on May 14th. By way of reminder, the rule would have capped credit card late fees at $8 for large card issuers (those with one million or more open and active credit card accounts). In his opinion, Judge Pittman said that the rule should be stayed pending resolution of CFPB v. Community Financial Services Association of America , a case about whether the CFPB's funding structure is constitutional. That case was argued before the Supreme Court in October 2023, with a decision expected any day. Stay tuned for more details from Michael Christians Consulting, LLC!

The Federal Reserve Board and the Consumer Financial Protection Bureau have issued the revised Regulation CC thresholds, a full 13 months ahead of schedule. By way of reminder, a 2020 rulemaking indexed several Regulation CC thresholds to inflation. Those thresholds are subject to change on July 1st of every fifth year. Effective July 1, 2025, the following changes will take effect: Increase from $225 to $275 the amount of certain check deposits that must be made available on the next business day following the date of deposit (12 CFR 229.10(c)(1)(vii)) Increase the new account exception hold threshold from $5,525 to $6,725. Beginning 7/1/2025, a financial institution may delay the availability of funds in excess of $6,725 deposited to a new account in any one banking day (12 CFR 229.13(a)(1)(ii)) Increase the large deposit exception threshold from $5,525 to $6,725. Beginning 7/1/2025, a financial institution may delay the availability of funds in excess of $6,725 deposited to an existing account in any one banking day (12 CFR 229.13(b)) Change the definition of repeated overdrafts. Beginning 7/1/2025, an account will be considered repeatedly overdrawn if - On 6 or more banking days within the preceding 6 months, the account balance was negative or would have become negative had checks or other charges to the account been paid, or on 2 or more banking days within the preceding 6 months, the account balance was negative or would have become negative in an amount of $6,725 or more (12 CFR 229.13(d)(2)). You can access the final rule here .

Earlier this month, Fannie Mae, Freddie Mac, and FHA announced new requirements for lenders to establish and implement reconsideration of value (ROV) policies and procedures. Fannie Mae and Freddie Mac Lenders must establish policies and procedures that include the steps a borrower can take to appeal an appraisal when they believe the opinion of value is: Unsupported, Deficient due to unacceptable appraisal practices, or Reflects discriminatory appraisal practices. Borrowers must be notified at the time of application and again upon delivery of the appraisal of their right to request an ROV. The new requirements apply to loan applications dated on or after August 8, 2024. Federal Housing Administration Lenders must disclose the following to a borrower at the time of application and again upon delivery of the appraisal: The borrower has the right to initiate an ROV request, The information that he/she will be required to provide in connection with their request, and Expected processing times. The new requirements apply to loans that have an FHA case number assigned on or after September 2, 2024.

The United States Department of Labor (DOL) has issued a final rule that expands the definition of an investment advice fiduciary under the Employee Retirement Income Security Act of 1974 (ERISA). Under the final rule, an investment advice fiduciary is a person who, for a fee or other compensation, provides professional investment recommendations to investors on a regular basis as part of their business and the recommendations are made under circumstances that would indicate to a reasonable investor in like circumstances that the recommendation: Is based on review of the retirement investor's particular needs or individual circumstances, Reflects the application of professional or expert judgment to the retirement investor's particular needs or individual circumstances, and May be relied upon by the retirement investor as intended to advance the retirement investor's best interest. Investment advice fiduciaries are required to adhere to stringent conduct standards and mitigate their conflicts of interest. Financial institutions should review the final rule, available here , to determine what activities (if any) would cause one or more of their employees to meet the revised definition of an investment advice fiduciary.

On April 25th, the Consumer Financial Protection Bureau (CFPB) issued the 33rd edition of its Supervisory Highlights publication. This issue highlighted certain unfair, deceptive, or abusive acts and practices and other regulatory violations related to mortgage servicing. First, examiners found that certain servicers unfairly charged late fees that exceeded the amount allowed for in the underlying loan agreement. Second, mortgage servicers failed to adequately describe fees on a borrower’s periodic statement as required by Regulation Z. Third, servicers failed to make timely payments out of a borrower’s escrow account, resulting in those borrowers incurring penalties due to late payments. Finally, examiners found that mortgage servicers engaged in deceptive acts and practices by sending inaccurate loss mitigation eligibility and/or delinquency notices. You can access the CFPB's latest Supervisory Highlights here .

This month, the Consumer Financial Protection Bureau (CFPB) published issue 32 of its Supervisory Highlights. The document focused on Fair Credit Reporting Act (FCRA) requirements specific to both consumer reporting agencies as well as financial institutions. A couple of highlights covering FCRA requirements for financial institutions that we have seen before: Under 12 CFR 1022.43, a financial institution that receives a direct dispute from a consumer regarding inaccurate information reported by the institution on the consumer's credit report must investigate and respond within 30 days. If the institution's investigation determines that inaccurate information was in fact reported about the consumer, the financial institution must promptly provide any information necessary to the consumer reporting agency to correct the error. However, the document also references a couple of other FCRA requirements that many financial institutions are probably less familiar with: Under 15 USC 1681s-2(a)(3), a financial institution investigating a direct dispute must do one of the following during the investigation - Suspend information reporting for the consumer until the investigation has been completed, or Include with any information reported to the consumer reporting agency a statement that the information is being disputed by the consumer. Under 15 USC 1681s-2(a)(6)(B), if a financial institution receives a notice of identity theft from a consumer, it may not report information about the consumer to the consumer reporting agency unless it knows or is subsequently informed by the consumer that the information is correct. You can access a copy of the Supervisory Highlights document here .

On March 5th, the Consumer Financial Protection Bureau (CFPB) issued its long-awaited final rule regarding credit card penalty fees. The rule, which goes into effect 60 days following its publication in the Federal Register, does the following: Large Card Issuers A large card issuer is defined as an issuer with one million or more open credit card accounts. A large card issuer may charge: A late fee not to exceed $8 The following penalty charges for violating the terms or other requirements of a credit card account - $32 for the initial violation $43 for a subsequent violation of the same type that occurs during the same billing cycle or in one of the next six billing cycles Small Card Issuers A small card issuer is defined as an issuer with fewer than one million open credit card accounts. A small card issuer may charge: Late fees and other penalty charges for violating the terms or other requirements of a credit card account that do not exceed - $32 for the initial violation $43 for a subsequent violation of the same type that occurs during the same billing cycle or in one of the next six billing cycles The $32 and $43 amounts will be adjusted annually for inflation; however, the $8 maximum late fee charge for large card issuers will not change. You can access a copy of the final rule here .

The Federal Communications Commission (FCC) has finalized an order on how businesses must handle revocation requests under the Telephone Consumer Protection Act (TCPA). Under the TCPA, businesses must obtain prior express consent from a called party before initiating autodialed calls or text messages with a marketing or advertising purpose. This consent may be revoked by the consumer using "any reasonable means." The order clarifies that a reply text message with any of the following words constitutes revocation: stop, quit, end, revoke, opt out, cancel, or unsubscribe. The order goes on to specify that a business has 10 days to process a revocation request and that a one-time text message to confirm the called party's revocation does not violate the TCPA so long as it is sent within five minutes of receipt of the opt-out request. You can access the FCC's order here .

On February 12th, the Federal Financial Institutions Examination Council (FFIEC), on behalf of its member entities, issued a statement of examination principles designed to mitigate appraisal bias. According to the statement, during a consumer compliance examination, examiners will consider the following when determining whether an institution's risk management practices are appropriate to identify and address valuation discrimination: Board and senior management oversight of its real estate valuation program, The institution's due diligence and ongoing monitoring of third-party valuation providers, Policies and procedures in place to detect discriminatory valuation practices, and Evaluation of consumer complaints alleging potential valuation discrimination. The statement goes on to remind institutions that their real estate valuation programs must also comply with the following laws and regulations: Equal Credit Opportunity Act; Truth in Lending Act; prohibition against unfair, deceptive, and abusive acts and practices; Uniform Standards of Professional Appraisal Practice (USPAP); and other appraisal regulations (e.g., NCUA Part 722). You can access the FFIEC's statement here .