CFPB Enforcement Sees Highest New Case Volume In 5 Years

Eric Mogilnicki is quoted in Law360 regarding the rising number of CFPB enforcement cases in the last five years. Mr. Mogilnicki says, “I think it's a coincidence. These cases take time to germinate, and the bureau has been working on the assumption that Seila Law wouldn't disrupt its enforcement activities. I can't imagine they were holding back waiting for Seila Law.”

Concerning the number of cases from the past quarter, he says given the nature of these purported violations, the cases would have been fairly straightforward for the agency to put together. These are relatively efficient cases to bring because the documents demonstrate the legal violation. “There's no need for extensive witness testimony. You can see on the face of the advertising if lenders are purporting to have a relationship with the [government] that they don't have,” he adds.

But while the mortgage companies themselves aren't especially prominent and the fines they agreed to pay to settle with the CFPB aren't especially large — the total is just over $2.6 million — he adds this “sweep” approach to enforcement can still provide a strong deterrent against misconduct, sometimes getting even more of a return for the resources invested than a blockbuster case would.

“It's an interesting approach that could be applied by the bureau to other issues. In fact, if there were a new bureau administration, this focused use of a 'sweep' of related cases could be applied to other issues, such as racial or other discrimination in lending,” he says.