As political developments affecting the federal regulatory landscape continue, one key area that consumer financial services practitioners will want to monitor is the future of nonbank small-dollar lending regulation and enforcement. The Consumer Financial Protection Bureau (CFPB) has altered the small-dollar landscape in recent years, taking what was chiefly a state-regulated activity and making it a federal priority. The CFPB has taken enforcement actions against small-dollar lenders and proposed the first federal regulation expressly covering small-dollar lending.
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In Johnston v. Midland Credit Mgmt., No. 16-437, 2017 U.S. Dist. LEXIS 10610 (W.D. Mich. Jan. 26, 2017), the court recently dismissed a class action complaint alleging a violation of the Fair Debt Collection Practices Act (“FDCPA”) for lack of Article III standing. Johnston is notable as the first FDCPA claim dismissed for lack of Article III standing in the Sixth Circuit. In addition, Johnston provides an interesting case study regarding some of the issues that may need to be considered prior to filing a motion premised on lack of Article III standing.
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The House Financial Services Committee’s previous passage of the Creating Hope and Opportunity for Investors, Consumers, and Entrepreneurs” Act (“CHOICE Act”) provides a roadmap to potential financial regulatory reform early during the Trump administration, including reform of the Dodd-Frank Act’s and BASEL III’s bank capital requirements. House Committee on Financial Services Chairman Jeb Hensarling (R-TX-5) has indicated a desire to introduce a “2.0” version of the bill early in 2017 when the new Congress convenes.
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