Consumer Law & Policy Blog

FTC issues annual report on enforcement of three consumer statutes

The Federal Trade Commission yesterday issued its Annual Financial Acts Enforcement Report to the Consumer Financial Protection Bureau. The report discusses the FTC's enforcement-related activities regarding Regulation Z (Truth in Lending Act), Regulation M (Consumer Leasing Act), and Regulation E (Electronic Fund Transfer Act).

The FTC's press release explains:

The report addresses, among other things, the FTC’s enforcement actions related to non-mortgage credit (including automobile purchases and financing, and payday lending), mortgage loan advertising, and forensic audit scams; rulemaking, research, and policy development related to truth in lending; and consumer and business education regarding truth in lending requirements. It also addresses consumer leasing enforcement actions, as well as negative option and other cases involving electronic fund transfers.

Public Citizen report documents injuries to nurses

A new Public Citizen report, “The Healthcare Industry’s Castoffs,” documents the nature and repercussions of injuries suffered by nurses. This report is the first in a five-part series spotlighting injuries to health care workers, potential methods to reduce these injuries, the policy positions of stakeholders and the implementation of solutions.

As Public Citizen reported in 2013, more health care and social assistance workers are forced to miss work due to injury than workers in any other profession.

Bloomberg: Banks’ Billions in Overdraft Fees Seen Dodging Tough U.S. Rules

Here.  (HT: Matt Bruckner). Excerpt:

After studying overdraft fees for more than three years, the Consumer Financial Protection Bureau is leaning against subjecting banks to tough new rules that would cap the size of charges or limit how frequently they can be imposed on consumers, said two people briefed on the agency’s work.

More likely, when the CFPB proposes regulations later this year or in early 2016, it will probably bar lenders from reordering transactions in a way that triggers overdrafts and also require better disclosure of policies that allow consumers to avoid the fees, said the people who asked not to be named because the agency hasn’t finalized its rules.

Department of Transportation issues self-critical report on GM ignition defect

Two internal reports released by the Department of Transportation identify a series of failings by the National Highway Traffic Safety Administration (a part of the Department) that allowed millions of defective GM cars to go unrepaired for more than a decade. The ignition switch could suddenly turn off, stalling the engine and disabling the airbags. The reports focus blame for the defect on GM, but they also include an unusually blunt assessment of mistakes made by regulators.

Among other things, the agency admitted that it failed to pay attention to signs of the defect and failed to use its authority to hold GM accountable,

The New York Times reports on the Department's findings and its response.

CFPB reports on misleading ads for reverse mortgages

The Consumer Financial Protection Bureau is reporting on its just-completed study of advertisements for reverse mortgages:

Ads for reverse mortgages are found on television, radio, in print, and on the internet, and many ads feature celebrity spokespeople discussing the benefits of reverse mortgages without mentioning risks. We looked closely at many ads and found incomplete and inaccurate statements used to describe the loans. In addition, most of the important loan requirements were often buried in fine print if they were even mentioned at all. These advertisements may leave older homeowners with the false impression that reverse mortgage loans are a risk-free solution to financial gaps in retirement.

The CFPB consumer advisory is here.

Senators urge CFPB to issue "strongest possible rules" for payday lending

"As the Consumer Financial Protection Bureau (CFPB) considers new rules to rein in predatory practices in payday and similar types of lending, Senator Merkley and 31 of his Senate colleagues expressed their support today for the initial steps the agency has taken and urged the agency to issue the strongest possible rules to combat the 'cascade of devastating financial consequences' that these high-priced loans often have on consumers."

Read the Senators' full press release here. The Senators' letter is reprinted at the end of the release.

Wikileaks documents show regulations at risk in proposed TISA "trade" pact with EU

Proving yet again that proposed "free trade" deals are about a lot more than trade, Wikileaks has released a set of documents showing how the proposed "Trade in Services Agreement," or TISA, "would take a major step towards deregulating financial industries, and could affect everything from local maritime and air traffic rules to domestic regulations on almost anything if an internationally traded service is involved."

The Huffington Post has the story.

Federal financial agencies report that lending is becoming riskier

A joint report by the Federal Reserve, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency concludes that "[d]espite vigorous new regulatory controls adopted in the wake of the recent financial crisis, financial lending has only become riskier." The report cites banks' leveraged lending, which involves making a loan and then selling the debt to a third party, often an investment fund.

In general, banks are seeking higher returns and in return are accepting a higher level of risk. The report also notes that banks have yet to come into full compliance with regulatory guidance issued last year regarding, among other things, risk management.

Risky practices... regulatory non-compliance... sound familiar?

You can read the story in Reg Blog here.

HHS report: 6.4 million could lose health insurance if Supreme Court rules against Obamacare

The Huffington Post has the story.

Inglewood Mayor James T. Butts and JoAnna Esty Misusing Copyright Law to Bully a City Critic

The Los Angeles Times carries an op-ed  about a copyright infringement lawsuit filed by the City of Inglewood, California, against a local resident who has taken portions of the city’s own recordings of public meetings to highlight conduct by the city’s elected mayor that he deemed inappropriate.  The defendant has a web site that lambastes mayor James T. Butts, and from which he links to a series of You Tube videos that take small bits of city council meetings on which he superimposes his own comments in captions and adds audio of his own voice overs.   Classic fair use, you would think.  But the city claims copyright in these public records  and seeks injunctive relief taking down the videos as well as damages and attorney.  Happily, the complaint also contains hyperlinks to the videos in question, so viewers can click on the links as provided on archive.org to make their own fair use judgments.

Represented pro bono by Davis Wright Tremaine, Teixera has moved to dismiss under Rule 12(b)(6), arguing both that California law bars local governments from asserting copyright in public records and that the videos, which can be considered because they are linked from the complaint, are fair use.  Inglewood’s lawyer JoAnna Esty (or Joanna -- her web site does not always capitalize the second "a") contends that Teixerra’s use is “commercial” even though there is not even a hint of revenue-raising on his web site, that posting excerpts with captions superimposed is not transformative, and that a deadpan video of a city council meeting is highly creative.  Esty’s claimed expertise in intellectual property law is rather belied by the silly and even dishonest arguments that she makes in her brief.

The proposed new federal anti-SLAPP law should not be needed to enable Teizeira to recover his attorney fees because this lawsuit is so far beyond the pale; Esty herself might be held liable on a sanctions theory, as well as suffering a well-deserved hit to her personal reputation for agreeing to handle this case for the plaintiff.   The pity is that the residents of Inglewood will have to pay for both sets of lawyers, and that there is no obvious way to impose the expense of this abusive litigation on whichever public officials caused it to be filed.

Ht to Adam Steinbaugh and Sherwin Siy for their pointers to this case.