Dec. 22, 2023: CFPB Updates This Week


CFPB and Justice Department Sue Developer and Lender Colony Ridge for Bait-and-Switch Land Sales and Predatory Financing

The Consumer Financial Protection Bureau (CFPB) and the Justice Department today sued Colony Ridge, a Texas-based developer and lender, for operating an illegal land sales scheme and targeting tens of thousands of Hispanic borrowers with false statements and predatory loans. The lawsuit filed in federal district court alleges Colony Ridge sells unsuspecting families flood-prone land without water, sewer, or electrical infrastructure, and that the company sets borrowers up to fail with loans they cannot afford. Roughly 1-in-4 Colony Ridge loans ends in foreclosure, after which the company repurchases the properties and sells them to new borrowers. The CFPB and Justice Department are seeking redress for borrowers harmed by Colony Ridge and an immediate end to its illegal practices. This is the CFPB’s first federal court lawsuit charging a defendant with violations of the Interstate Land Sales Full Disclosure Act. Read more


CFPB Issues Report Showing Many Americans Are Surprised by Overdraft Fees

he Consumer Financial Protection Bureau (CFPB) today issued a new report finding that many consumers are still being hit with unexpected overdraft and nonsufficient fund (NSF) fees, despite recent changes implemented by banks and credit unions that have eliminated billions of dollars in fees charged each year. In a recent CFPB Making Ends Meet survey, more than a quarter of consumers responded that someone in their household was charged an overdraft fee or NSF fee within the past year, and that only 22% of households expected their most recent overdraft. Many consumers who were charged overdraft fees had access to a cheaper alternative, such as available credit on a credit card. Read more


CFPB Orders U.S. Bank to Pay $21 Million for Illegal Conduct During COVID-19 Pandemic

The Consumer Financial Protection Bureau (CFPB) today ordered U.S. Bank to pay nearly $21 million for keeping out-of-work consumers from accessing unemployment benefits at the height of the COVID-19 pandemic. U.S. Bank froze tens of thousands of accounts. However, it failed to provide people a reliable and quick way to regain access. The bank also failed to provide provisional account credits, while investigating potentially unauthorized transfers. Today’s order requires U.S. Bank to pay $5.7 million to consumers harmed by its actions and to pay a $15 million penalty.

The Office of the Comptroller of the Currency (OCC) separately find U.S. Bank $15 million. The CFPB and OCC coordinated during their investigations into U.S. Bank’s illegal conduct. Read more


CFPB Report Finds Many College-Sponsored Financial Products Charge High and Unusual Fees

The Consumer Financial Protection Bureau (CFPB) issued a report today highlighting that many college-sponsored financial products have higher fees and worse terms and conditions compared to typical market products. The CFPB report identifies college-sponsored deposit accounts with fees above prevailing market rates, which institutions are required to consider under Department of Education rules designed to protect students’ interests. Read more

The CFPB has issued two annual threshold adjustment final rules.

First, the CFPB has announced the asset-size exemption thresholds for depository institutions under Regulation C.  Second, the CFPB has announced the asset-size exemption thresholds for certain creditors under the escrow requirements and small creditor portfolio and balloon-payment qualified mortgage requirements, and the small creditor exemption from the prohibition against balloon-payment high-cost mortgages under Regulation Z.

These adjustments are effective on January 1, 2024, consistent with relevant statutory or regulatory provisions.

You can access the Regulation C notice at:

You can access the Regulation Z notice at:


CFPB Shuts Down Commonwealth Financial Systems for Illegal Debt Collection Practices

The Consumer Financial Protection Bureau (CFPB) today took action against a medical debt collector, Commonwealth Financial Systems, for illegally trying to collect unverified medical debts after consumers disputed the validity of the debts. Under the order issued today, the company will cease operations and pay a $95,000 penalty to the CFPB’s victims relief fund.

Commonwealth Financial Systems is a nonbank corporation with its principal place of business in Dickson City, Pennsylvania. Commonwealth is a third-party debt collector that specializes in the collection of past-due medical debts and furnishes information about consumer collection accounts to consumer reporting companies.

Commonwealth’s actions violated the Fair Credit Reporting Act because the company failed to conduct reasonable investigations of disputed debts and failed to inform consumer reporting companies that certain information was being disputed. Commonwealth also violated the Fair Debt Collection Practices Act because it continued to attempt to collect disputed debts without substantiating documentation. Read more