Each week, labor and employment attorney Ari Karen writes about the latest hearings and litigation in the financial sector, and offers his viewpoint on diverse compliance and compensation matters. Whether you run a business, work for a financial institution, or are involved in an employment dispute, Mr. Karen provides an important point-of-view on our nation’s volatile regulatory environment. Missed October’s Compensation and Compliance Matters? Catch up with this article round-up:
When a recent third-party service provider contracting with U.S. Bank failed to provide but nonetheless billed customers for credit monitoring services they did not receive, the Consumer Financial Protection Bureau issued a consent order—not to the TPSP, but U.S. Bank. Read what Mr. Karen makes of the CFPB’s decision, and its implications for financial institutions, in his September 29th article for National Mortgage News.
Regulators are continuing to crack down on marketing services agreements, as evidenced by a recently released HUD Audit and CFPB consent decree. Regulators found that a mortgage company had violated section 8 of the Real Estate Settlement Procedures Act, as well the Department of Housing and Urban Development’s conflict of interest rules, through an overreaching marketing services agreement. Get the details and Mr. Karen’s perspective here.
What does “no strings attached” really mean to a consumer? M&T Bank found out the hard way earlier this month, after a the CFPB announced a consent decree against the financial provider for using the phrase in advertisements promoting a free checking account. This is a another example, writes Mr. Karen, “that lenders should look to both for advertising and UDAP compliance.” Check out his full column here.
An exclusivity provision in an MSA does not by itself make the agreement illegal pursuant to RESPA. But in practice, the functional realities of an exclusive MSA incentivize direct marketing activities, which could constitute a violation of RESPA section 8. Mr. Karen looks at the practical implications and advises careful consideration of exclusivity in this column from October 20th.
Fail to comply, and a regulatory fine may be just the beginning of your problems. A recent lawsuit brought against Castle & Cook, right after a CFPB consent decree for the same violation, exemplifies the multifaceted liability facing companies that commit CFPB violations. Mr. Karen offers his opinion and takeaways on the matter here. If you have any questions about these or other compliance and compensation matters please contact Ari Karen at:
firstname.lastname@example.org | 240.507.1740
Ari Karen is an experienced litigator and speaker who has focused his practice in representing financial institutions in both government investigations and litigation before state and federal trial and appellate courts nationwide.
Mr. Karen’s practice is diverse, representing clients on matters concerning banking regulations, Dodd Frank financial reform laws, contractual disputes, employment and labor statutes, wage-hour class actions, employment discrimination and fair lending matters, whistleblower complaints and non-competition claims, among others.