On April 9, 2015, the Consumer Financial Protection Bureau (“CFPB”) announced a settlement with a California-based mortgage lender over claims that the lender engaged in deceptive advertising practices. The company allegedly mailed advertisements bearing the logos of the Department of Veterans Affairs and the Federal Housing Administration, ostensibly to give consumers the impression that their products were sponsored by the VA or FHA. The mailings also had other features suggesting the company’s loan programs were offers from the U.S. Government, and misled consumers about interest rates and monthly payments. According to the CFPB, the conduct by the company violated the Consumer Financial Protection Act (“CFPA”), the Mortgage Acts and Practices and Practices Rule, and the Truth in Lending Act (“TILA”). The company agreed to pay a civil penalty of $250,000, and is now prohibited from falsely implying government affiliation in its advertisements.
Blog Enforcement Watch April 09, 2015