Last May, investigations by the Department of Justice and the Federal Deposit Insurance Corporation into student loans servicing resulted in a $100 million fine against government-contracted servicer Navient for allegedly violating federal laws limiting the amount of interest that can be charged on servicemember student loans. Following those investigations, the Department of Education undertook a review that found its four servicers – including Navient – weren’t cheating military personnel. With such conflicting reports, members of Congress are now getting involved, calling for an investigation into the Dept. of Education’s review process. [More]
fines
Citigroup Facing Federal Investigation Into Student Loan-Servicing Practices
By 8.3.15
Just last month federal regulators announced that an ongoing probe into potentially unscrupulous student loan-servicing practices resulted in nearly $18.5 million in refunds and fines from Discover Bank. Now, regulators appear to have Citigroup in their crosshairs, as the financial company announced it was party to an investigation. [More]
Fiat Chrysler Receives Record $105 Million Fine For Failure To Address 23 Recalls
By 7.27.15
For the second time this year, federal regulators have handed down a record-setting fine to an automaker for failing to properly report and investigate possible defects. The National Highway Traffic Safety Administration levied a $105 million fine against Fiat Chrysler, following months of investigations into the car maker’s leisurely pace in fixing more than 11 million vehicles connected to 23 safety recalls. [More]
Discover Bank Must Pay $18.5 Million Over Illegal Student Loan Servicing Practices
By 7.22.15
As federal regulators continue to probe potentially unscrupulous student loan servicing practices, the Consumer Financial Protection Bureau has ordered Discover Bank and its affiliates to pay nearly $18.5 million in refunds and fines for, among other things, overstating amounts due on student loans and failing to notify borrowers of their rights. [More]
Honda Finance Unit Must Pay $24 Million For Charging Higher Interest To Non-White Borrowers
By 7.14.15
Under the Equal Credit Opportunity Act, creditors are prohibited from discriminating against loan applicants based on race or national origin. But that was a rule Honda’s financing unit allegedly violated, resulting in thousands of African-American, Hispanic, and Asian and Pacific Islander borrowers paying higher interest rates than white borrowers for their auto loans. Now, as part of a settlement with federal regulators to resolve allegations that the company allowed discriminatory loan pricing, the company must provide $24 million in restitution to borrowers. [More]
Time Warner Cable Must Pay Nearly $230,000 For 153 Robocalls To The Wrong Person
By 7.8.15
We can all agree that automated robocalls are an annoying interruption. But you know what’s worse? Receiving those automated calls meant for someone else, telling the company to place you on the Do Not Call list and then continuing to receive a total of 153 prerecorded messages. [More]
Lyft To Pay $300,000 To Resolve Claims It Illegally Operated In Some Areas Of New York
By 6.19.15
Nearly a year after the New York Attorney General’s office and state insurance regulators filed a lawsuit accusing ride-sharing app Lyft of violating state law in certain areas, the company has agreed to pay $300,000 to resolve the complaint. [More]
CFPB Fines Mortgage Company $20M For Pushing Customers Into Spending More Than They Had To
By 6.4.15
While a report earlier this year suggested that consumers don’t spend nearly enough time shopping for the right mortgage, that doesn’t mean lenders are off the hook for purposefully steering potential homeowners into costlier mortgages. Because doing so will land a company in hot water with federal regulators. Just ask RPM Mortgage and its top executive, who must now pay $20 million for their allegedly deceptive practices. [More]
34 Million Takata Airbags Declared Defective, More Recalls To Come
By 5.19.15
After months of resisting federal regulators’ push for a national recall of vehicles containing defective Takata-produced airbags that could spew shrapnel when deployed, the Japanese auto parts maker announced today that it has declared an estimated 34 million vehicles defective because of the potentially deadly safety devices. The declaration is the first step in what will likely be the county’s largest recall of a consumer product. [More]
Black & Decker To Pay $1.57M Penalty For Failing To Report Defects Of Lawnmower That Started On Its Own
By 5.1.15
Under federal law, manufacturers, distributors and retailers are required to immediately report information regarding possible safety defects to the Consumer Product Safety Commission within 24 hours of obtaining reasonable supporting evidence. That 24-hour window allegedly turned into 11 years for Black & Decker and now the company must pay a nearly $1.6 million fine for failing report safety issues related to an electric lawnmower that started spontaneously, injuring at least two consumers. [More]
Brazil Suspends Uber, Uber Keeps Driving
By 4.30.15
Car-hailing app Uber has racked up another municipality on its list of places where the service has been banned, yet drivers remain on the roads anyway. That distinction belongs to the entire nation of Brazil, where a judge has ruled that providing rides to strangers is the exclusive right of licensed taxi services. [More]
Executives & Loan Officers Must Pay $600K For Being Part Of Illegal Mortgage Kickback Scheme
By 4.29.15
Nearly five months after Wells Fargo and JPMorgan Chase agreed to pay more than $35 million – including $11.1 million in redress to affected consumers – for their part in an illegal mortgage kickback scheme, the purported masterminds behind the “pay-to-play” arrangement are finally facing action from federal regulators for their shady dealings. [More]
CFPB Fines Regions Bank $7.5M For Collecting Illegal Overdraft Fees
By 4.28.15
Each year consumers spend nearly $32 million in exorbitant overdraft fees to their banks and credit unions without fully understanding the way in which these fees work or how much they spend on each overdraft. Today, the Consumer Financial Protection Bureau reminded banks that using consumers’ lack of knowledge to collect more fees isn’t acceptable by imposing a $7.5 million fine against Regions Bank for unlawful overdraft practices. [More]
Mortgage Servicer Must Refund Consumers $48M For Array Of Deceptive Practices
By 4.22.15
Every once in a while government agencies team up to take down unscrupulous operations that prey on financially vulnerable consumers. Such was the case this week when the Consumer Financial Protection Bureau and the Federal Trade Commission took action against a mortgage servicer that engaged in a assortment of deceptive practices often resulting in consumers losing their homes. [More]
Military Allotment Processor Must Refund Servicemembers $3.1M For Charging Hidden Fees
By 4.20.15
A company aimed at preserving the financial well-being of deployed servicemembers by processing payments to creditors on the consumers’ behalf instead contributed to customers’ financial distress by charging millions of dollars in hidden fees, the Consumer Financial Protection Bureau alleges in a new complaint. [More]
Dutch Prosecutors Open Criminal Investigation Into Uber Following Violations Of Banned Service
By 4.17.15
Uber’s latest hurdle to provide service in Europe, where many cities and countries have banned the ride-sharing service, comes in the form of a criminal investigation by Dutch prosecutors. [More]
Corinthian Colleges Fined $30M Over Falsified Job Placement Rates At Heald College
By 4.15.15
The Department of Education continued its crackdown on deceptive for-profit college practices Tuesday by levying a $30 million fine against embattled Corinthian Colleges Inc. – operator of Everest University, Heald College and WyoTech – over the use of misstated and inaccurate job placement rates to recruit students. [More]
FCC Fines CenturyLink $16M, Intrado Communications $1.4M For Actions During Massive 911 Outage
By 4.6.15
Last month the Federal Communications Commission ordered Verizon to pay $3.4 million for failing to alert authorities of a preventable programming error that left nearly 11 million people in seven states without access to emergency services for six hours in 2014. While Verizon’s fine was decidedly hefty, it pales in comparison to the $16 million penalty the agency just levied against CenturyLink for the same 911 outage. [More]
