Consumer Compliance Outlook: Second-Third Issue 2023


CCO has been publishing articles on a variety of consumer compliance topics under federal law since 2008. In this table, we list some of our most popular articles.

Fair Lending

Advanced Topics in Adverse Action Notices Under the Equal Credit Opportunity Act (ECOA) (Fourth Issue 2021)

Adverse Action Notice Requirements Under the ECOA and the FCRA (Second Quarter 2013)

The 2021 article discusses advanced adverse action notice (AAN) requirements, including counteroffers, incomplete applications, and withdrawn applications, as well as the differences among an inquiry, a prequalification, and a preapproval, along with the notice requirements for each. The article also reviews the AAN requirements when multiple creditors are involved in a credit transaction. In addition, the article discusses the emerging issue of the AAN considerations when a credit decision is based on innovative credit practices, such as credit models using alternative data sets, artificial intelligence, or machine learning.

The 2013 article reviews the AAN requirements of both the ECOA and the Fair Credit Reporting Act (FCRA), explains the disclosure requirements under the FCRA mandated by the Dodd–Frank Wall Street Reform and Consumer Protection Act, and discusses common adverse action violations.

From Catalogs to Clicks: The Fair Lending Implications of Targeted, Internet Marketing (Third Issue 2019)

Keeping Fintech Fair: Thinking About Fair Lending and UDAP Risks (Second Issue 2017)

The 2019 article focuses on the risks of the increased use of internet-based marketing practices to target audiences by personal characteristics, geography, or even hobbies. This practice may explicitly or implicitly classify users by prohibited characteristics protected under fair lending laws — such as race, national origin, or sex — and risk making financial inclusion out of reach for millions of consumers.

The 2017 article offers general guideposts for evaluating the risks of unfair or deceptive acts or practices and fair lending violations related to fintech, with a focus on alternative data.

Regulation B and Marital Status Discrimination: Are You in Compliance? (Fourth Quarter 2008)

Examiners frequently cite violations of the spousal signature requirements under the ECOA and Regulation B. This article reviews the requirements, including:

  • improperly requiring spousal signatures on loan documents;
  • failing to establish the intent to apply for joint credit;
  • improperly limiting additional parties to spouses; and
  • improperly taking marital status into account during underwriting.

Regulation E (Electronic Fund Transfers Act)

Error Resolution and Liability Limitations Under Regulations E and Z: Regulatory Requirements, Common Violations, and Sound Practices (Second Issue 2021)

Error Resolution Procedures and Consumer Liability Limits for Unauthorized Electronic Fund Transfers (Fourth Quarter 2012)

Regulation E specifies procedures that institutions must follow for investigating and resolving errors alleged by consumers for electronic fund transfers (EFTs), such as an unauthorized ATM withdrawal. The 2012 article reviews the regulation’s error resolution and consumer liability provisions.

The 2021 article reviews the regulatory requirements for error resolution and liability issues under Regulations E and Z and discusses examiner observations and sound practices to help financial institutions comply with these regulations.

Regulation V (Fair Credit Reporting Act)

Furnishers’ Obligations for Consumer Credit Information Under the CARES Act, FCRA, and ECOA (Second Issue 2020)

Most creditors rely on the information in credit reports in deciding whether to grant credit. These reports can also be used, among other permissible purposes, to help landlords determine eligibility for rental housing, to help insurers set premiums, and to help employers assess job applicants. The FCRA and the ECOA impose certain requirements on entities that furnish information about consumers to consumer reporting agencies.

Because of the importance of credit reporting information, as well as the changes under the Coronavirus Aid, Relief, and Economic Security (CARES) Act to the FCRA requirements, this article reviews these requirements, including the duty to provide accurate information, the duty to investigate disputes filed with the CRAs, and additional duties under the Fair and Accurate Credit Transactions Act.

Regulation H (Flood Disaster Protection Act of 1973)

Flood Insurance Compliance Requirements (Third/Fourth Quarter 2015)

Agencies Issue Final Rule for New Flood Insurance Requirements (Third/Fourth Quarter 2015)

Floods are the most common and costly natural disaster in the United States. In 2005, for example, Hurricane Katrina resulted in claim payments of $16.3 billion from the National Flood Insurance Program (NFIP), ranking as the most expensive flood since the NFIP’s inception in 1968. In 2015, CCO published a special issue focusing on flood insurance. The first article in the issue updated a 2011 article to reflect regulatory changes.

A companion article reviewed the final rule implementing provisions of the Biggert–Waters Flood Insurance Reform Act of 2012 and the Homeowner Flood Insurance Affordability Act of 2014, including:

  • escrow requirements;
  • detached structure exemption;
  • recoupment of force-placed insurance premiums and fees; and
  • refunding premiums for duplicate coverage.

Commercial Flood Insurance Compliance — Washing Away Common Pitfalls (Second Issue 2022)

This article discusses some common pitfalls for commercial flood insurance compliance, provides examples to assist in ensuring that appropriate flood insurance coverage is in place, and reviews the Federal Emergency Management Agency’s Risk Rating 2.0 initiative and its effect on premiums for commercial properties. It also includes eight examples showing how to calculate the correct amount of commercial coverage.

Regulation Z (Truth in Lending Act)

Understanding Finance Charges for Closed-End Credit (First Issue 2017)

The finance charge disclosure under the Truth in Lending Act (TILA) informs consumers about the cost of credit expressed as a dollar amount. It is also used in calculating other TILA disclosures, including the annual percentage rate (APR). Accurately computing and disclosing the finance charge is important because consumers may rely on it as well as related disclosures whose calculations are based on it, particularly the APR, when shopping for credit and evaluating credit offers. In addition, inaccurate finance charges and APR disclosures can result in restitution to the consumer if the errors exceed regulatory tolerances and can trigger the right of rescission in mortgage transactions subject to rescission. This article reviews the regulation’s requirements for determining when a charge must be included in the finance charge, identifies common pitfalls, and offers tips and tools to assist lenders in avoiding and detecting finance charge violations.

HELOC Plans: Compliance and Fair Lending Risks When Property Values Change (Third Quarter 2013)

Regulation Z imposes both disclosure requirements and substantive limitations on home equity lines of credit (HELOCs). This article provides an overview of the compliance requirements and fair lending risks when a creditor takes action on a HELOC because of a change in property value.

Credit and Debit Card Issuers’ Obligations When Consumers Dispute Transactions with Merchants (First Issue 2016)

This article reviews a card issuer’s obligations under Regulations Z and E when a cardholder disputes a transaction with a merchant for goods or services purchased with a credit or debit card.

Electronic Signatures in Global and National Commerce Act (E-Sign Act)

Moving from Paper to Electronics: Consumer Compliance Under the E-Sign Act (Fourth Quarter 2009)

To facilitate and encourage electronic commerce, Congress enacted the E-Sign Act in 2000. The act states that the validity or enforceability of a contract, electronic record, or signature for a transaction affecting interstate commerce cannot be challenged solely because it is in electronic form or because an electronic signature or record was used in the formation of the contract. This article provides an overview of the E-Sign Act’s consumer compliance requirements.

Regulation X (Real Estate Settlement Procedures Act)

Mortgage Servicers’ Duties Under Regulation X to Respond to Notices of Error and Requests for Information (Third Issue 2021)

Regulation X requires servicers to timely and properly respond to a written error notice and/or requests for information pertaining to a servicing issue. A servicer’s failure to comply can lead to examination issues and legal risk because of the potential for consumer harm. This article reviews a servicer’s obligations in responding to error notices under §1024.35 and requests for information under §1024.36.