United States: CFPB Supervisory Highlights - November 9, 2015

Last Updated: November 16 2015
Article by Laura A. Lange and Jodie H. Lawson

The Consumer Financial Protection Bureau (CFPB) recently released its ninth supervisory highlights report, which includes new findings from its supervisory program from May – August 2015.   Overall, the report focuses on examination of the student loan servicing, mortgage origination and servicing, consumer reporting, and debt collection markets. In addition, the report highlights the CFPB's recent revisions to the appeal process for examinations.

In the report, the CFPB highlighted the following findings:

Credit Reporting

  • While furnishers of information under the Fair Credit Reporting Act (FCRA) generally have adequate policies and procedures for the accurate reporting of credit accounts, the policies were lacking in the area of deposit accounts.
  • With regard to consumer disputes and investigations under the FCRA, the CFPB noted that furnishers did not always provide notice of the results of investigations of direct disputes to the consumers, did not monitor or track direct and indirect disputes they received, and failed to distinguish disputes from other communications (e.g., complaints) they received.
  • The CFPB directed these entities to update and implement dispute-handling policies and procedures and to create a coordinated monitoring system in order to ensure all direct and indirect disputes of deposit information are tracked, investigated and resolved completely within the timeframes required.

Debt Collection

  • In connection with its supervision and enforcement over debt collectors under the Fair Debt Collection Practices Act (FDCPA), the CFPB noted that it had observed that collectors did not always state during subsequent phone calls that the calls were from debt collectors. The CFPB directed the debt collectors to improve training with regard to the FDCPA's requirement to provide these disclosures.
  • When consumers made verbal requests to debt collectors regarding phone calls, such as a request not to be called at work, the debt collectors' agents would note the request in one of several places in the account notes, but did not remove or block the affected telephone numbers in their dialer systems. The CFPB directed the collectors to improve their training so agents would annotate accounts and check for dialing restrictions in a consistent manner.
  • The CFPB directed debt collectors to establish and implement reasonable written policies and procedures as required by Regulation V.

Mortgage Servicing

  • Certain mortgage servicers were found to be violating the FDCPA when they charged fees for taking mortgage payments over the phone to borrowers whose mortgage instruments did not expressly authorize collecting such fees and/or resided in states that do not expressly permit collecting such fees.
  • Certain mortgage servicers were found to be violating the FDCPA when they sent debt validation letters listing debt amounts that the servicers could not verify as accurate. The servicers had listed estimates of the debt amounts rather than the actual amounts the borrowers owed. The CFPB advised that servicers should list only accurate and verifiable debt amounts in their debt validation letters.
  • Certain mortgage servicers were found to be violating the FDCPA when they failed to send debt validation letters to borrowers within five days after the initial communications about the debts, where the borrowers' loans were in default when servicing rights were obtained.

Student Loan Servicing

  • The CFPB criticized student loan servicers that allocate partial payments proportionally to multiple student loans, finding that this policy may result in separate fees for each loan and, in some cases, the total amount of fees charged was higher than if the servicer allocated the payment in another manner. The CFPB recommended that servicers allocate partial payments among current loans to the loan with the highest interest rate first, and then the loan with the next-highest interest rate. In addition, the CFPB emphasized that the servicers should clearly inform borrowers of their ability to direct payments to individual loans.
  • The CFPB found servicers were unfairly processing automatic debits early, which could trigger unexpected overdraft charges because a borrower may not have had sufficient funds in time for the early withdrawal.
  • Similarly, when automatic payments fell on a weekend or bank holiday, payments typically were processed on the next business day, causing additional interest to accrue. The CFPB found that servicers should be crediting payments back to the due date when this delay occurred − a practice that would reverse the additional interest accrual.
  • Some student loan servicers for Department of Education loan notes were representing to consumers that late fees may be charged even though the Department of Education's current policy is to not allow the charging of any late fees. The CFPB felt that such representations were misleading to the borrowers.
  • The CFPB also noted that confusion remained for borrowers who attempted unsuccessfully to pay off loans with lump-sum payments. The CFPB encouraged servicers to continue to communicate with borrowers during paid-ahead periods so borrowers are aware when a remaining balance exists, which can help borrowers seeking to fully pay off their loans understand that they still owe money.

Revised Appeal Process

The CFPB also released a revised appeals process for any report or exam on or after Sept. 21, 2015. Changes to the process, according to the report, include the following:

  • Expressly allowing members of the Supervision, Enforcement, and Fair Lending (SEFL) Associate Director's staff to participate on the appeal committee, replacing the existing requirement that an Assistant Director serve on the committee
  • Permitting an odd number of appeal committee members in order to facilitate resolution of appeals
  • Limiting oral presentations to issues raised in the written appeal
  • Providing additional information on how appeals will be decided, including the standard the committee will use to evaluate the appeal
  • Preventing an institution from appealing adverse findings or an unsatisfactory rating related to a recommended or pending investigation or public enforcement action until the enforcement investigation or action has been resolved

Changing the expected time to issue a written decision on appeals from 45 to 60 days

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.