• What people are saying
• Consumer Action joins national anti-fraud initiatives
• Happy 13th birthday, CFPB!
• Coalition Efforts
• CFPB Watch
• Class Action Database: Settlement benefits Direct Express cardholders
• About Consumer Action

What people are saying

"I have been attending webinar[s] with Consumer Action for the past 3 years, and I have always learned something new. Please keep them coming.” —Lorena Muñoz-Holladay, AFC, Pilar Financiero, North Carolina (subscribe to our mailing list to get email notifications of upcoming webinars)

Consumer Action joins national anti-fraud initiatives

By Anna Flores

As part of Consumer Action’s ongoing commitment to protecting consumers from scams, we recently joined the Fraud.org Forum, became a partner of the BBB Institute for Marketplace Trust, and enlisted as an inaugural member of the Aspen Institute’s National Task Force for Fraud & Scam Prevention—three groups dedicated to turning the tide against fraudsters. 

This summer, Consumer Action joined the Fraud.org Forum, a membership-based organization composed of stakeholders from industry, advocacy organizations and government, all committed to the common goal of stopping scammers. Coordinated by the National Consumers League, the Forum creates opportunities for stakeholders in the fight against fraud to share expertise and research, leading to greater consumer anti-fraud resiliency and better consumer protection laws, regulations and businesses practices.  

The Forum’s summer meeting, which Consumer Action attended, featured a presentation by the Federal Trade Commission on the rise of frauds and scams committed against younger consumers (a topic we’ll explore further in our “What to know about scams and fraud targeting young adults” webinar next month; register for the free event here). We look forward to participating in future meetings and collaborating with members to help ensure consumers are protected from and educated about the latest frauds and scams. 

As an official partner of the BBB Institute for Marketplace Trust, Consumer Action supports the Institute’s mission to educate and protect consumers, establish best practices for businesses, and solve complex marketplace problems, and we share its vision of a trusted marketplace where consumers and businesses can prosper. The Institute’s online tools and resources include a Scam Prevention Guide, a Scam Survival Kit and Scam Tracker—resources we regularly share in our SCAM GRAM newsletter and other scam/fraud-related educational materials.

We also became inaugural members of the Aspen Institute Financial Security Program’s National Task Force for Fraud & Scam Prevention, a new initiative that will bring together leading stakeholders from government, law enforcement, private industry, and civil society to develop a nationwide strategy aimed at helping prevent fraud and scams.

The Task Force will address different aspects of the fraud and scam lifecycle, with a primary focus on prevention. Integral to that effort will be a public education campaign that teaches consumers how to spot and report scams.

The Task Force’s first meeting will take place in Washington, D.C. in September.

Consumer Action is committed to working in collaboration with these and other organizations to ensure a safe and equitable marketplace for vulnerable consumers, and we look forward to actively engaging on these critical initiatives.  

Happy 13th birthday, CFPB!

By Ruth Susswein

Last month, the Consumer Financial Protection Bureau (CFPB) celebrated 13 years of informing, protecting and compensating consumers.

Over the past 13 years, the CFPB has returned $19 billion in financial relief to 195 million consumers. The consumer bureau is the only federal financial regulator whose mission it is to protect consumers and reduce their financial risks. 

Consumer Action’s Ruth Susswein and CFPB Director Rohit Chopra at the Bureau’s 13th birthday celebration in Washington, D.C.

The CFPB created a world-class complaint process that has helped millions of consumers report, review and, in some cases, resolve complaints with financial services companies. The public complaint database hosts more than 4 million complaints that consumers can access to assess a company’s track record before making a financial commitment.

The consumer watchdog has fought to reduce unfair and deceptive, discriminatory and predatory practices in mortgage, auto and credit card lending. It has sued and fined banks for opening fake accounts in consumers’ names and has cracked down on repeat offenders by forcing firms to return billions to harmed consumers. (Read more in this issue’s CFPB Watch.)

The CFPB has created rules that have made home loan documents more understandable, prevented foreclosures with special rules during COVID, required lenders to consider a consumer’s ability to repay a loan before burying them in debt, insisted that costs for money transfers be disclosed, and much more.

Most recently, the CFPB has worked to:

• Curb junk fees, like credit card late fees and overdraft fees, which disproportionally fall on those who can least afford them;
• Remove medical debt from credit reports;
• Prevent foreclosures by improving in-language communication between limited-English-speaking consumers and their mortgage servicers; 
• Protect renters and workers from inaccurate or expunged records in tenant screening and employment background reports;
• Provide dispute rights for “buy now, pay later” customers when they do not get the product or service they paid for; and
• Protect our financial data and provide greater consumer control over our financial accounts.

In its 13 short years, the CFPB has survived detractors who led the agency with the intent to destroy it from within, and prevailed in a Supreme Court case just this year, when the high court ruled that the consumer bureau was properly operating according to the Constitution. With great tenacity, the CFPB has managed to assist and protect consumers despite roadblocks and challenges put up by those who would put corporate profits over people. Consumer Action wishes the Bureau a happy birthday and a long and healthy life.

Coalition Efforts

By Monica Steinisch

Consumer Action and its allies recently called on policymakers and regulators about these important issues:

Prescription drug prices. Consumer Action expressed support for the Affordable and Safe Prescription Drug Importation Act, legislation introduced by U.S. Representative Jan Schakowsky (IL-09) that would allow American wholesalers, pharmacies and individuals to import affordable and safe drugs from Canada, the UK, the EU, and Switzerland in order to take advantage of significantly lower prices. Right now, some brand-name drug prices are over four times higher in the U.S. than in other countries. As a result, U.S. drug purchases constitute more of Big Pharma’s profits than the purchases of the rest of the world combined. This bill would ensure that American patients can access prescription drugs at fair prices, instead of being gouged by Big Pharma. Read the letter here.

Tenant rights. Consumer Action has endorsed the National Tenants Bill of Rights, created by the National Low Income Housing Coalition, National Housing Law Project, and Tenant Union Federation to shift the balance of power between tenants and landlords. If enacted, the National Tenants Bill of Rights would enshrine tenants’ right to organize as well as their rights to: a fair housing application, a fair lease, freedom from discrimination and harassment, habitable homes, reasonable rents and costs, and safeguards against eviction. Strong and enforceable tenant protections are essential for solving the issues of housing affordability and supply, and for redressing racial and social inequities and advancing housing justice. Read the letter here.

A strong regulatory system. The Coalition for Sensible Safeguards, of which Consumer Action is a member, wrote to House Speaker Johnson and Democratic Leader Jeffries to express strong support for the Stop Corporate Capture Act (HR 1507). The legislation would codify Chevron deference into law in order to prevent the longstanding legal precedent from being overturned in the future. “Chevron deference,” coined after a landmark case involving the Chevron corporation, calls for the court to defer to a government agency’s interpretation of a statute when it is not unreasonable to do so, rather than substitute the court’s own interpretation for that of the agency. In the wake of the Supreme Court’s decision to overturn Chevron deference in a recent EPA-related case, Congress must act to codify the long-standing legal precedent so that government agencies’ ability to do their jobs is not undermined and the judiciary does not usurp power that Congress delegated to the regulatory system. Read the letter here.

Federal Home Loan Bank reform. In response to a Request for Input regarding a review of the mission statement of Federal Home Loan Banks (FHLBanks), the Coalition for Federal Home Loan Bank Reform (CFR) and dozens of other advocacy organizations, including Consumer Action, submitted a letter to the Federal Housing Finance Authority. FHLBanks are 11 U.S. government-sponsored banks that provide liquidity to financial institutions to support housing finance and community investment. In the letter, CFR and signers urged reforms that would help the FHLBanks system fully leverage all its activities, lending and investments toward fair and affordable housing and community development. Advocates see the current system as focused less on meaningful housing improvements and more on member profits. The four targets for reform presented in the letter are: clarification of the mission of the FHLBanks as providing liquidity for fair and affordable housing and community development; revision of the activities listed in the Core Mission Achievement regulation to focus on those that aid lower-income families, rural areas, Native American communities, and communities of color; review of how the FHLBanks invest and leverage their capital; and development of membership incentive programs that reward members who are mission-consistent. Read the letter here.

CFPB Watch

By Ruth Susswein

Relief may be in sight for homeowners at risk of foreclosure, thanks to the Consumer Financial Protection Bureau’s (CFPB) new proposed rule to require mortgage servicers to focus on preventing foreclosure rather than on foreclosing.  

The rule proposes to:

• Require mortgage servicers to exhaust all options before moving to foreclose;
• Reduce the paperwork needed to temporarily modify a borrower’s loan; 
• Provide homeowners with more detailed and tailored notices to receive help; and 
• Improve communications for limited-English-speaking borrowers to encourage access to loan modification options.

To assist limited-English-speaking consumers, the CFPB is requiring servicers to translate several key documents into Spanish, briefly note in five languages (chosen by the servicer) that help is available in-language, and make oral interpretation available for borrowers who were marketed to in another language and request in-language assistance.

Language barriers should never be the reason a family loses their home. Consumer Action has been working in coalition with other nonprofits, for nearly a decade, to encourage lenders and government agencies to ensure that limited-English-speaking borrowers have a meaningful opportunity to save their homes. 

To help get the word out about the proposed rule, Consumer Action’s Nelson Santiago and Jamie Woo have translated the news into Spanish and Mandarin, and have shared it with multilingual media. 

Read the Spanish release here.

Read the Chinese release here.

Bureau demands Fifth Third Bank settle up with harmed consumers

Cheated customers of Fifth Third Bank, who had fake accounts opened in their names, were charged for duplicate auto insurance coverage, and had cars repossessed for no good reason, will receive financial relief.

“The CFPB has caught Fifth Third Bank illegally loading up auto loan bills with excessive charges, with almost 1,000 families losing their cars to repossession,” said CFPB Director Rohit Chopra. “We are ordering the senior executives and board of directors at Fifth Third to clean up these broken business practices or else face further consequences.”

Fifth Third Bank is on the CFPB’s list of repeat offenders. In 2015, the Bureau ordered the bank to pay Black and Hispanic borrowers $18 million for discriminatory auto loan pricing and $3 million for illegal credit card practices. In 2020, the Bureau sued the bank for opening up fake bank and credit card accounts in customers’ names.

This time, the CFPB has ordered Fifth Third to make 35,000 harmed borrowers whole for these offenses and pay $20 million in fines that will go into the Bureau’s victims relief fund.

Money returned to misled LendUp borrowers

Deceived customers of LendUp Loans LLC have been sent payments from the CFPB to compensate for the company’s not honoring its commitments.

LendUp, marketed as a payday loan alternative, pitched its product using the “LendUp Ladder.” Borrowers were told that those who repaid loans on time and took free LendUp courses would qualify for larger future loans at lower rates. But, the Bureau said, tens of thousands of consumers “climbed the ladder,” yet still did not receive lower rates or bigger loans.

Nearly $40 million was distributed to more than 118,000 misled LendUp borrowers. Compensation came from the Bureau’s victims relief fund. For questions about payment, contact .(JavaScript must be enabled to view this email address) or call 888-622-1598. 

LendUp is also on the Bureau’s list of repeat offenders. After multiple lawsuits, the CFPB has permanently banned LendUp from making new loans.

Class Action Database: Settlement benefits Direct Express cardholders

By Monica Steinisch

Among recent settlements added to the Consumer Action Class Action Database is the $4.8 million settlement reached in a case alleging that Bleacher Report, a sports website, violated the Video Privacy Protection Act (VPPA) by disclosing the personally identifiable information of account holders to Facebook via the Meta Pixel without consent. Consumers who had a Bleacher Report account between Jan. 25, 2021, and May 21, 2024, may be eligible for payment. The deadline for claims is Aug. 23, 2024.  

Of note is the $1.2 million settlement reached in a case alleging that Comerica and Conduent, the companies that issue and administer the Direct Express Debit Mastercard, a prepaid debit card allowing federal benefits recipients to receive their money electronically even if they don’t have a bank account, mishandled fraud claims made by Direct Express cardholders. Plaintiffs alleged that the companies violated the Electronic Fund Transfer Act (EFTA), which provides rights to consumers who use electronic fund transfers, including debit and credit card transactions. Among the alleged violations, plaintiffs accused the defendants of failing to investigate and handle consumer reports of fraudulent transactions according to the provisions of the EFTA and Regulation E. Plaintiffs also asserted that the defendants failed to limit cardholders’ liability for unauthorized transactions to no more than $50 (if notification of unauthorized use is made within two business days) or $500 (if notification of unauthorized use is not made within two days), as required by law and the cardholder agreement.  

According to the suit, the defendants’ “sham investigations and improper denial of meritorious claims regarding fraudulent charges and unauthorized uses” and their disregard for the limitations of liability language contained in the Terms of Use left Direct Express Debit Mastercard users “holding the bag on hundreds, thousands, and even tens of thousands of dollars of fraudulent charges by unauthorized persons.” 

If you submitted one or more fraudulent transaction or error claims between Feb. 12, 2018, and Sept. 28, 2022, and Conduent and/or Comerica denied your claim(s), you may be eligible for payment. The deadline for claims is Sept. 12, 2024.

About Consumer Action

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Consumer Action is a nonprofit organization that has championed the rights of underrepresented consumers nationwide since 1971. Throughout its history, the organization has dedicated its resources to promoting financial and consumer literacy and advocating for consumer rights both in the media and before lawmakers to promote economic justice for all. With the resources and infrastructure to reach millions of consumers, Consumer Action is one of the most recognized, effective and trusted consumer organizations in the nation.

Consumer education. To empower consumers to assert their rights in the marketplace, Consumer Action provides a range of educational resources. The organization’s extensive library of free publications offers in-depth information on many topics related to personal money management, housing, insurance and privacy. At Consumer-Action.org, visitors have instant access to important consumer news, downloadable materials, an online “help desk,” the Take Action advocacy database, and more. Our in-language media outreach allows us to share scam alerts and other timely consumer news with a wide non-English-speaking audience.

Community outreach. With a special focus on serving low- and moderate-income and limited-English-speaking consumers, Consumer Action maintains strong ties to a national network of more than 6,500 community-based organizations. Outreach services include in-person and web-based training and dissemination of financial and consumer education materials in many languages, including English, Spanish, Chinese, Korean and Vietnamese. Consumer Action’s network is the largest and most diverse of its kind.

Advocacy. Consumer Action is deeply committed to ensuring that underrepresented consumers are represented in the national media and in front of lawmakers. The organization promotes pro-consumer policy, regulation and legislation by taking positions on dozens of bills at the state and national levels and submitting comments and testimony on a host of consumer protection issues. Additionally, its diverse staff provides the media with expert commentary on key consumer issues supported by solid data and victim testimony.