On May 10, the CFPB filed a brief and the DOJ filed a separate “Statement of Interest of the United States of America” opposing a request by the Attorneys General of Connecticut, Indiana, Kansas, and Vermont (State AGs) to intervene in a CFPB lawsuit to address the distribution of unclaimed settlement funds.

As previously reported in InfoBytes, in December 2014 the CFPB sued a telecommunications company over allegations that it violated Dodd-Frank and the Consumer Financial Protection Act by knowingly allowing third-party aggregators to bill unauthorized charges to its wireless telephone customers and failing to respond to consumer complaints for nearly a decade. Under the terms of the 2015 Stipulated Final Judgment and Order, the company was required to set aside $50 million for consumer redress. The consumer claims period expired with approximately $15 million remaining unclaimed, and the State AGs sought to have those funds deposited with the National Association of Attorneys General to be used for “consumer protection purposes.” Specifically, in their January 3 Memorandum in Support of Joint Motion to Intervene to Modify Stipulated Final Judgment and Order, the State AGs asked that, “[a]ny funds not used for such equitable relief will be deposited . . . with the National Association of Attorneys General”—instead of being deposited in the Treasury as disgorgement—to be used to “train, support and improve the coordination of the state consumer protection attorneys charged with enforcement of the laws prohibiting the type of unfair and deceptive practices alleged by the CFPB in this [a]ction.”

In its memorandum opposing the joint request to intervene, the CFPB countered that although the redress plan provides that the Bureau may, in consultation with certain states and the FCC, apply unused redress funds to “other equitable relief reasonably related to the Complaint’s allegations,” it has not proposed doing so and any undistributed amounts are to be directed to the Treasury. The DOJ supported the CFPB’s position, arguing that the State AGs’ motion is untimely because that the States were “well aware of this action” over 18 months before filing their motion. The DOJ further asserted that “beyond being consulted by the CFPB if remaining funds were to be devoted to further equitable relief, the Consent Order afforded the States no role with respect to distribution of the remaining Redress Amount funds.”