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Parties Reach Deal to Vacate Credit Card Late Fee Rule

Michael Christians • April 15, 2025

On April 14^th, the Chamber of Commerce of the United States and the Consumer Financial Protection Bureau (CFPB) filed a joint motion for entry of consent judgment to resolve litigation in the US District Court for the Northern District of Texas regarding the CFPB’s credit card late fee rule.

In March 2024, the CFPB issued a final rule that would have limited large card issuers (those with more than 1 million open and active credit card accounts) from charging a late fee that exceeds $8. Almost immediately, a lawsuit was brought by the US Chamber of Commerce in federal district court asserting that the rule violated the CARD Act. To resolve this litigation, the parties have jointly asked the court to vacate the rule.

Once the terms of the settlement have been approved by the court, card issuers will return to the safe harbor fee amounts outlined in 12 CFR 1026.52.

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Recent Blog Posts

CFPB to Reopen Small Business Lending Data Collection Rule

By Michael Christians • April 5, 2025

In a filing submitted in connection with a lawsuit in the US District Court for the Southern District of Florida challenging the small business lending data collection rule, the Consumer Financial Protection Bureau (CFPB) has indicated its intent to reopen the rule to make changes. According to the filing, the agency intends to issue a notice of proposed rulemaking as expeditiously as reasonably possible. By way of reminder, the rule is currently stayed by the 5th Circuit in companion litigation, but only for members of the American Bankers Association, America’s Credit Unions and other plaintiffs/intervenors. All other covered financial institutions are required to begin complying with the rule as soon as July 18, 2025 (depending on loan volume). However, the CFPB’s filing in the Florida case also agreed that “subjecting similarly situated entities to different compliance dates for Section 1071’s data collection requirements would not serve the public interest.” As a result, it is anticipated that the agency will announce that it does not intend to enforce the rule, in its current form, against any institution. Stay tuned for further developments.

CFPB Will Not Prioritize Enforcement of Payday Lending Rule

By Michael Christians • April 3, 2025

On March 28, 2025, the Consumer Financial Protection Bureau (CFPB) announced that it will not prioritize enforcement or supervision actions with regard to the payday lending rule. In its press release , the CFPB said that it is contemplating issuing a notice of proposed rulemaking that would further narrow the scope of the rule. As a reminder, the payday lending rule, which took effect on March 30th, requires covered financial institutions to: Obtain new and specific automatic payment authorization for a covered loan after two consecutive automatic payment attempts have failed, and Provide specific disclosures and notices in connection with a covered loan. Only lenders that originate 2,500 or more covered loans in a calendar year are covered by the requirements of the rule.

FinCEN Guts Beneficial Ownership Reporting Requirements under the CTA

By Michael Christians • March 24, 2025

The Financial Crimes Enforcement Network (FinCEN) has issued an interim final rule removing the requirement for domestic reporting companies to file their beneficial ownership information directly with the agency. The Corporate Transparency Act (CTA), passed by Congress in 2020, required reporting companies to submit information about their beneficial owners directly to FinCEN. The interim final rule now exempts domestic reporting companies from this registration requirement. A domestic reporting company is defined as any corporation, limited liability company, or other entity that is created by a filing with the secretary of state (or similar office) under the laws of any state or Indian tribe. Foreign reporting companies will continue to be subject to the reporting requirement; however, will not have to report information about any of its beneficial owners that are US persons. Existing foreign reporting companies will have 30 days from the rule's publication in the Federal Register to submit their information to FinCEN. New foreign reporting companies will have 30 days from formation to submit their information. FinCEN's interim final rule does not change the 2018 customer due diligence requirements, which charge financial institutions with collecting beneficial ownership information about legal entity customers at the time of account opening.

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Michael Christians Consulting, LLC

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