Blog

Remittance Rule Session

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Join us right here on October 16th at 2:30 p.m. EST for a 90-minute live session about the new requirements for remittance transfer providers. We’ll give an overview of the remittance rule and answer questions about compliance.

The session should be useful for money transmitters, banks, credit unions, and other companies that send money abroad for consumers, as well as other organizations that work with or represent consumers who send money abroad. Agents, software providers, foreign banks and others involved in international fund transfers from the United States may also be interested.

We’ve received a number of questions and will address as many as we can during the session. We won’t be able to take additional questions during the session, but our team is also available to answer questions about the remittance rule that are emailed to CFPB_RemittanceRule@CFPB.gov.

Save the date, Seattle, Washington!

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Join us for a field hearing in Seattle, Washington on debt collection.

The field hearing will take place on Wednesday, Oct. 24, 2012, at 10 a.m.

We’ll have remarks from CFPB Director, Richard Cordray, as well as testimony from consumer groups, industry representatives, and members of the public.

This event is open to the public and requires an RSVP.

To RSVP
Email cfpb.events@cfpb.gov with:

  • Your full name
  • Your organizational affiliation (if any)

See you there!

Updates to the consumer complaint database

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We’re excited to announce that we’re no longer in beta with our consumer complaint database.

We launched the beta version on June 19th publishing individual-level consumer complaint data — a first for a federal financial regulator.

Since that time, people have been evaluating and sharing the data on social media and in new apps. Today, we are taking additional steps to expand this service to the American people.

First, and as promised, we are releasing consumer credit card complaint data back to December 1, 2011 in the Consumer Complaint Database.

Second, thanks to all of the great feedback and insight we’ve gotten, we are removing the database’s beta tag. While we will continue to expand functionality, data fields, and the “look and feel” of the database, after performing for three months as designed and without incident, the database is no longer a beta product.

One potential area for database expansion is the inclusion of additional products and services. Over the summer we asked for public comment on this idea and got a wide range of comments from a range of interested stakeholders. We are in the process of evaluating those comments and anticipate a final Bureau decision in early 2013.

In addition to expanding the scope of the products covered by the database we continue to evaluate, among other things, the release of consumer narratives, the potential for normalization of the data to make apples-to-apples comparisons more user friendly, and the expansion of functionality to improve user experience.

Thank you for your help in getting the tool where it is today – we’re excited for what you’ll do with the data next.

Scott Pluta is the Assistant Director for Consumer Response at the Consumer Financial Protection Bureau.

Order: American Express is responsible for compensating customers for illegal practices

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As a result of today’s order, American Express must repay an estimated $85 million to approximately 250,000 consumers. American Express will return the money directly into the accounts of the affected consumers. If the consumer no longer holds the American Express card, American Express will mail a check or credit any outstanding balance.

  • Customers who were promised $300 for signing up for a Blue Sky Credit Card will get the $300.
  • Consumers who paid an illegal late fee will be reimbursed, with interest.
  • Consumers who paid old debt in response to deceptive promises to report payment to credit bureaus will be reimbursed the money they paid plus interest.
  • Consumers who were promised their debt would be forgiven but were denied new American Express cards because the debt was not really forgiven, will receive $100 and a pre-approved offer for a new card with terms we and the FDIC find acceptable. If the consumer already paid the waived or forgiven amount in order to get a new card, they will be refunded that amount plus interest.

Consumers are not required to take any action to receive their credit or check.

If you are one of the consumers affected by the order, American Express will notify you directly. They are responsible for notifying any affected consumers – any other entity that offers to help reclaim your money is likely a scam.

Consumers expect, and deserve, that companies follow the rules

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Today, in close partnership with our fellow banking regulators, we are ordering three subsidiaries of the American Express Company to put some $85 million back into the wallets of consumers. The subsidiary companies will modify various credit card practices found to be illegal, make full refunds to approximately 250,000 customers, and pay $14.1 million in fines.

Over the course of a long, multi-agency investigation, we found that at every stage of the consumer experience − from advertising to enrollment to payment to collection – these American Express subsidiaries had violated various consumer financial laws.

The Federal Deposit Insurance Corporation (FDIC), along with the Utah Department of Financial Institutions, uncovered the problems during a routine examination in February 2011. After the Consumer Financial Protection Bureau (CFPB) opened its doors for business five months later, we inherited many of the consumer protection functions of the FDIC, and the case was passed on to us.

Upon further investigation, we learned that the problems were widespread.

Our investigations found that when consumers were shopping for credit cards, one American Express company sent potential customers misleading credit card offerings in the mail. When consumers applied for cards, the same company engaged in practices that unlawfully discriminated on the basis of age. In connection with consumers paying their bills, American Express companies violated consumer financial laws. For example, we found that these American Express companies charged consumers excessive late fees.

And we found that all three American Express subsidiaries − American Express Centurion Bank and American Express Bank, FSB, along with their parent company and affiliate, American Express Travel Related Services Company, Inc. – misled people into paying off old debt by telling them that it would be reported to the credit bureaus and their credit scores would improve. In fact, the debt was not reported to the credit bureaus and in any event it was so old that it may not have appeared in credit reports anyway.

So today, multiple agencies are joining together to require the American Express companies to refund money to consumers, pay fines, and change their practices. This includes not only the CFPB and the FDIC, but also the Board of Governors of the Federal Reserve System and the Office of the Comptroller of the Currency. The State of Utah will also be taking its own related action through its Department of Financial Institutions.

We are ordering the American Express subsidiaries to make a full refund of approximately $85 million to consumers who were harmed. The American Express subsidiaries will identify those consumers, notify them, and make sure they get their money back. The burden will not fall on customers to pursue their refunds. To ensure compliance with all terms of the agreements, the companies will hire independent auditors to verify that the orders are being carried out.

Under the non-monetary terms of the Consent Order with American Express Centurion Bank, the bank is required to stop deceiving consumers by falsely promising a rebate or a points feature on credit cards or any other card. The company will have to ensure that it does not unlawfully discriminate based on age in deciding who qualifies for a credit card. And the bank and American Express Bank, FSB will properly report disputes to credit bureaus and make sure that cardholders are informed of their rights. They will also stop charging consumers the illegal late fees.

The Bureau is also issuing a consumer advisory today. The advisory will inform consumers who were harmed about how they will benefit from this action and how they will receive money, if they are eligible.

We share the same task with these companies themselves: to make sure that every business is following the rules. Consumers expect and deserve that. We will continue to work steadily toward this objective.

  

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