WASHINGTON—The Consumer Financial Protection Bureau has refreshed its public website, consumerfinance.gov, while separately taking action against a number of debt settlement and telemarketing firms for numerous violations of the law.
According to the Bureau, the updated website features additional user functionality, an improved layout, more content, and easier access to information. Notably, the CFPB stated, the refresh will also include a new interactive enforcement database to help the public track the Bureau’s enforcement actions. Through these updates, the Bureau aims to increase transparency and make it easier for consumers and stakeholders to locate and access essential resources, the agency said.
“Our website serves as a critical tool for reaching consumers, and we will continue to seek ways to make it more accessible, user-friendly, and informative,” said Consumer Financial Protection Bureau Director Kathleen L. Kraninger. “With this refresh we increased transparency and made it easier for the public to engage with the Bureau.”
Enhancements Added
The CFPB said the website also includes the following enhancements:
- An Interactive Enforcement Database. This new database allows users to quickly find information about the Bureau’s public enforcement actions. Users can view interactive graphs tracking cumulative consumer relief, cumulative enforcement actions, and total enforcement actions per year, the CFPB said.
- A Page for Petitions. “Petitions for rulemaking will be publicly available on the Bureau’s website. Users can now easily search for and find petitions in a centralized location,” the Bureau said.
- Archiving of Older Content. According to the CFPB, blogs, newsroom pages, and reports older than two years old will now be labeled to provide clarity and identify items that may not be the most up to date resources offered by the Bureau. The materials will still be accessible via the search function on the website. Users will be able to clearly see if they are being directed to or are using an archived page, the CFPB said.
The Bureau said it plans to further improve the website in the months ahead.
Suit Against Debt Collection Firm
Meanwhile, the CFPB has filed a lawsuit against DMB Financial, LLC.
The Bureau alleges DMB violated the Telemarketing Sales Rule (TSR) and the Consumer Financial Protection Act of 2010 (CFPA) in connection with its debt-settlement and debt-relief services. DMB, which has its principal place of business in Beverly, Mass., offers to renegotiate, settle, or otherwise alter the terms of unsecured debts owed by consumers to creditors or debt collectors.
The Bureau’s complaint, filed in the United States District Court for the District of Massachusetts, seeks an injunction, as well as redress to consumers, disgorgement of ill-gotten gains, and the imposition of civil money penalties.
The Bureau alleges DMB engaged in abusive and deceptive acts or practices in violation of the TSR. These allegedly unlawful activities include requesting and receiving fees before it performed its promised services and before consumers started payments under any debt settlement, the CFPB said. The Bureau is further alleging that after settling individual debts, DMB collected fees based on increased debt amounts after enrollment rather than the amount of each debt at the time of enrollment.
The Bureau stated DMB failed to disclose to consumers before enrollment when it would make a settlement offer to creditors or debt collectors. In addition, the Bureau alleges that DMB did not disclose the amount of money or the percentage of each outstanding debt the consumer had to accumulate before DMB would make a settlement offer. The Bureau alleges that DMB’s alleged TSR violations also constitute violations of the CFPA.
The Bureau further alleges that DMB misrepresented to consumers that it would not charge fees for its services until after it settled a debt and consumers made a payment under the settlement. The Bureau also alleges that DMB misrepresented in its contracts the debt amount that it would use to determine its fees.
A copy of the complaint filed in federal district court in the District of Massachusetts is available here.
Consent Order Against Auto Loan Payment Program
The CFPB has also filed a lawsuit against FDATR, Inc., and its owners, Dean Tucci and Kenneth Wayne Halverson, while also separately issuing a consent order against a separate firm.
The Bureau alleges FDATR, Tucci, and Halverson violated the Telemarketing Sales Rule (TSR) by engaging in deceptive and abusive telemarketing acts or practices and the Consumer Financial Protection Act of 2010 (CFPA) through deceptive acts or practices. FDATR was a corporation headquartered in Wood Dale, Illinois, that promised to provide student-loan debt-relief and credit-repair services to consumers nationwide.
Tucci and Halverson both owned and managed FDATR, which was involuntarily dissolved in September 2020. The Bureau’s complaint, filed in the United States District Court for the Northern District of Illinois, seeks injunctions against FDATR, Tucci, and Halverson, as well as damages, redress to consumers, disgorgement of ill-gotten gains, and the imposition of civil money penalties.
The Bureau said it specifically alleges from 2011 through at least April 2019, the defendants engaged in abusive telemarketing by requesting and taking payments from consumers for debt-relief and credit-repair services before achieving the results it promised and before it was legally allowed to do so under the TSR.
The Bureau also alleges that during this same period, the defendants used deception in violation of the TSR and CFPA to attract consumers by misrepresenting material aspects of its student-loan debt-relief services.
False Representation
“For example, the defendants falsely represented that its services would reduce or eliminate student-loan payments and improve credit scores,” the CFPB said.
The Bureau further alleges that defendants’ violations of the TSR constituted violations of the CFPA. In addition, the Bureau alleges that Tucci and Halverson are individually liable under the TSR and CFPA because they knew of, directed, and engaged in the violations described in the complaint and substantially assisted FDATR.
A copy of the complaint filed in federal district court in the Northern District of Illinois is available here.
Consent Order Issued
Separately, the CFPB has issued a consent order against U.S. Equity Advantage, Inc. and its owner, Robert M. Steenbergh.
The Bureau said it found the company’s disclosures and advertisements of its auto loan payment program contained misleading statements in violation of the Consumer Financial Protection Act of 2010’s prohibition against deceptive acts or practices. Robert M. Steenbergh is the founder, sole-owner, and chief executive officer of USEA, a nonbank located in Orlando. The consent order imposes a judgment requiring the payment of $9.3 million in consumer redress and contains requirements to prevent future violations.
According to the Bureau, USEA and Steenbergh operate an auto loan payment program called AutoPayPlus, which charges fees to deduct payments from consumers’ bank accounts every two weeks and then forwards those payments every month to the consumers’ lenders. The Bureau said it found that USEA and Steenbergh misrepresented the amount consumers would save when disclosing the program’s benefits by not including a $399 enrollment fee in the calculations presented to consumers.
‘Misleading Impression’
“USEA and Steenbergh created the misleading impression that consumers would save money using its product, when in fact, because of the enrollment fee, the program’s costs ordinarily exceeded any savings,” the agency said.
The Bureau also found USEA and Steenbergh stated in advertising that they have helped hundreds of thousands of customers save $29 million or more in interest by participating in AutoPayPlus when they had no basis for making this claim, and when the program had, in fact, not saved consumers that amount. The Bureau found that more than 100,000 consumers were subject to USEA’s and Steenbergh’s deceptive practices and that consumers should receive $9,300,000 in redress for fees they paid.
The ordered redress amount is suspended upon payment of $900,000 and a $1 civil money penalty to the Bureau. The suspension of the full payment for redress, as well as the $1 civil penalty, is based on USEA’s and Steenbergh’s demonstrated inability to pay more based on sworn financial statements, the CFPB said.
The consent order prohibits USEA and Steenbergh from making any misrepresentations about its payment programs. It also requires them to account for the total costs for its payment programs, as well as the net savings or costs after deducting any fees, whenever they make claims about savings or financial benefits.
The consent order against USEA can be found here.