CFPB and OCC Complete $389 Million Enforcement Action
On September 19, 2013, the Consumer Financial Protection Bureau (CFPB) and the Office of the Comptroller of the Currency (OCC) issued orders in their most recent joint enforcement action for “unfair billing practices” in using identity theft products tied to credit card agreements. This marks the third action taken by the CFPB in coordination with a fellow regulator to address illegal practices with respect to credit card add-on products.
Under the terms of its order, the CFPB demanded $309 million in restitution to be paid to the approximately 2.1 million customers harmed by the alleged “unfair, deceptive, and abusive practices” – including refunds of charges for credit-monitoring products and over-the-limit fees resulting from those charges. An additional $20 million must be paid into the CFPB’s Civil Penalty Fund. For its own part, the OCC ordered the company to pay a $60 million civil money penalty, bringing the total payment to $389 million.
Practical Effect
This $389 million enforcement action is the CFPB’s newest and largest, following in the footsteps of three 2012 actions totaling $210 million, $214 million, and $112.5 million. Troutman Sanders has previously discussed the former two here and here.
About Troutman Sanders
Troutman Sanders is an accomplished and experienced leader in providing litigation and regulatory advice to a broad spectrum of financial services institutions. Troutman Sanders’ CFPB Team monitors the development and activities of the CFPB on its CFPB Report blog and also advises clients on CFPB and Dodd-Frank issues. Additionally, Troutman Sanders’ Financial Services Litigation practice group has successfully litigated a wide variety of individual and class action litigation, as well as other federal and state consumer protection laws now under the umbrella of the CFPB.
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