The Consumer Financial Protection Bureau and TransUnion on Friday filed a joint stipulation of dismissal of a lawsuit filed by the regulator against the credit reporting agency in 2022 that accused the company and one of its executives of violating a 2017 order issued by the Bureau. This marks the seventh enforcement action that the CFPB has stopped in the past month following the firing of Rohit Chopra and replacing him with Russell Vought as the Bureau’s Acting Director. But the news for companies being sued by the Bureau is not all positive, with the CFPB announcing plans to continue at least one enforcement action that was initiated by Chopra’s CFPB.
The CFPB’s amended complaint, filed on May 24, 2023, alleged that TransUnion and the executive violated multiple provisions of the Consumer Financial Protection Act (CFPA) by enrolling consumers in negative option products without consent, failing to provide a simple cancellation process, and not offering required disclosures. The Bureau also accused TransUnion of deceptive marketing practices, including misleading claims about the pricing and characteristics of its credit-related products, such as misrepresenting their costs as “free” or $1, and falsely stating that consumer payment information would be used solely for identification purposes. Additionally, the CFPB alleged that TransUnion violated the Electronic Fund Transfer Act (EFTA) by charging consumers’ debit cards without obtaining written authorization.
The dismissal came a day after the CFPB had dropped a handful of other enforcement action lawsuits against other companies.
But the CFPB did decide to continue with another enforcement action, this one against MoneyLion, which was sued back in 2022 by the Bureau for charging members of the military illegally high interest rates. In a filing with the court on Friday, the CFPB indicated that it was planning “continued prosecution” of the lawsuit.
The Bureau also filed a motion seeking a temporary stay in its lawsuit against Reliant Holdings to allow the Acting Director “sufficient time” to review and consider whether to proceed. The defendants have objected to the request for the stay in the proceedings. Reliant was accused of charging consumers significant fees for opening up a credit card and then making it nearly impossible to cancel the agreement.
