On December 17th, the CFPB filed a lawsuit against Sprint Corp. for alleged violations of the Dodd-Frank Act for “cramming”—illegally billing wireless consumers for unauthorized third-party charges. Specifically, the CFPB argues that Sprint unfairly billed its customers for unauthorized charges by:

  • Enrolling customers in third-party billing without their authorization;
  • Giving third parties access to its customers and its billing system without implementing adequate compliance controls;
  • Failing to adequately resolve customer disputes; and
  • Ignoring warnings from customers, government agencies, and public-interest groups.

CFPB Director Richard Cordray delivered prepared remarks at a press call, “[a]s the use of mobile payments grows, we will continue to hold wireless carriers accountable for illegal third-party billing.” The CFPB seeks to compensate affected consumers and penalize Sprint to deter unauthorized third-party charges in the future.


On December 17th, the CFPB announced an enforcement action against Union Workers Credit Services (UWCS), a Texas-based company, for alleged violations of the Consumer Financial Protection Act and the Fair Credit Reporting Act for “deceiving consumers into paying fees to sign up for a sham credit card.” The CFPB argues that “the company falsely advertises a general-use credit card that, in actuality, can only be used to buy products from the company.” Additionally, the CFPB alleges that UWCS “deceptively implies an affiliation with unions by, among other things, using pictures of nurses, firefighters, and other public servants in its advertising.” According to Director Cordray, “[h]undreds of thousands of people, including a great many union members who were specially targeted, have been tricked into spending millions of dollars for a socalled credit card that can really only be used to buy the company’s own products.” Consequently, the CFPB’s enforcement action seeks to compensate the victims and enjoin UWCS from such action.


College Credit Card Agreements

On December 15th, the CFPB published a report entitled, “2014 College Credit Card Agreements: Annual Report to Congress.” The report includes information that card issuers submitted to the CFPB concerning agreements between credit card issuers and colleges or organizations affiliated with higher education institutions. Specifically, the report details the number of new accounts opened that resulted from agreements between issuers and colleges, as well as the compensation issuers paid to these institutions. The findings of the report include:

  • The number of colleges, universities, and affiliated organizations sponsoring credit card programs decreased in 2013;
  • The number of overall accounts issued under college credit card agreements also decreased in 2013; and
  • The amount of compensation paid by issuers to institutions pursuant to these agreements decreased from the prior year, as listed in the report.

In addition to the report, the CFPB published a corresponding article and blog post discussing the continued decline of college credit card agreements.



On December 15th, the CFPB published in the Federal Register amendments to the 2013 Mortgage Rules under the Real Estate Settlement Procedures Act (Regulation X) and the Truth in Lending Act (Regulation Z). “These proposed amendments focus primarily on clarifying, revising, or amending provisions regarding forceplaced insurance notices, policies and procedures, early intervention, and loss mitigation requirements under Regulation X’s servicing provisions; and periodic statement requirements under Regulation Z’s servicing provisions,” according to the Federal Register notice. The proposed amendments also concern proper compliance for “certain servicing requirements when a consumer is a potential or confirmed successor of interest, is in bankruptcy, or sends a cease of communication request under the Fair Debt Collection Practices Act.” The comment period will be open until March 16, 2015.


On December 15th, the CFPB published a notice in the Federal Register increasing, in accordance with inflation, the ceiling for 2015 for allowable charges under Section 612(f) of the Fair Credit Reporting Act. Consumer reporting agencies may now impose a reasonable charge to the consumer of up to $12.00 for a file disclosure.


Project Catalyst / Consumer Saving

On December 12th, the CFPB announced a Project Catalyst research pilot on consumer saving. The purpose of Project Catalyst is to “examine the effectiveness of efforts to promote consumer saving among prepaid card users,” according to the announcement. Specifically, the research will focus on low- and moderate-income prepaid card users who may not have access to traditional savings accounts. “This project can help [the CFPB] better understand how to promote saving among consumers, especially those who may be low-income and economically vulnerable,” CFPB Director Richard Cordray stated. According to the announcement, American Express will share insights with the CFPB on a trial program on encouraging saving among certain prepaid card users. In addition to the Project Catalyst research announcement, the CFPB published a corresponding blog post entitled, “Evaluating Ways to Promote Regular Saving Habits Among Prepaid Card Users.”