Goodwin Releases Annual Report of Major Changes and Predictions in the Consumer Financial Services Industry

Report Finds That Federal Agencies Have Slowed Enforcement Activity,
Predicts Slowdown Will Continue Throughout 2019

WASHINGTON–(BUSINESS WIRE)–Global 50 law firm Goodwin announced today the release of its fourth
annual Consumer
Finance 2018 Year in Review
, highlighting key litigation,
enforcement actions and regulations that have impacted the consumer
finance industry over the past year and outlines the key developments to
watch in the year ahead.

Produced by Goodwin’s industry-leading Financial Industry Practice, the
report analyzes consumer finance developments across key issues in the
mortgage, credit card, debt collection, credit reporting, student
lending, auto lending, payday lending and Telephone Consumer Protection
Act areas. It also delves into the implications of key cases decided in
2018. Finally, the report offers an analysis of changes made to the
Consumer Financial Protection Bureau (CFPB) following the confirmation
of Kathy Kraninger as Director.

“2018 was a year of significant change in the consumer financial
services space due to the political currents at play in our Nation’s
Capital,” said Anthony
Alexis
, a Goodwin partner and head of the firm’s Consumer Financial
Services Enforcement Practice who co-authored the report. “Acting
Director Mulvaney’s initiatives came to a halt when the Senate confirmed
Kathy Kraninger as the permanent Director of the CFPB last December. In
addition, 2018 saw the swearing in of conservative Justice Brett
Kavanaugh to the Supreme Court and the beginning of a divided Congress
after the midterm elections.”

“At the beginning of 2018, we predicted a downturn in activity from
federal agencies, which we did indeed see play out through the rest of
the year,” said Kyle
Tayman
, a Goodwin partner and a co-author of the report. “Based on
what we are hearing, we believe federal agencies in 2019 will continue
to slow-walk enforcement action – but we do expect to see an uptick in
state actions, given the growing number of Democrat-controlled state
legislatures and enforcement agencies following last year’s midterm
elections.”

“As we look ahead to the rest of 2019, there are several key areas we’re
watching. One is privacy and data security given Congress’ signals that
it will remain at the top of their agenda,” said Sabrina
Rose-Smith
, a Goodwin partner and a co-author of the report. “The
outcome of the renewed litigation against the OCC for accepting FinTech
Charter applications is also going to have major implications for banks
and Fintech firms.”

The report’s key findings and predictions for 2019 include:

  • The federal agencies that have historically been some of the most
    active saw a substantial decline in activity in 2018. Collectively,
    enforcement actions and other measurable activity by the Department of
    Justice, Federal Trade Commission and Department of Housing and Urban
    Development decreased by about 52 percent compared to the year prior.
  • However, the total damages, penalties and costs obtained through
    enforcement actions increased since 2017.
  • In 2019, Goodwin predicts that federal agencies will continue to slow
    their enforcement activity – or at least hold steady with the level of
    activity exhibited in 2018 – given the lengthy federal government
    shutdown which kicked off the year.

To view the full analysis, download the report here.

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Contacts

Somna Maraj
Senior Manager of Communications
SMaraj@goodwinlaw.com
212-459-7212

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