Last Week, This Morning

June 29, 2026

Below you will find several key developments in the financial services industry, including related developments in information privacy and data security, from the past week. We add an "Amicus Brief(ly)¹" comment to each item, where we briefly (see what we did there?) note for friends (and again?) of CounselorLibrary the important takeaways from the developments outlined in the email. Our legal reporters - CARLAW, HouseLaw, InstallmentLaw, PrivacyLaw, and BizFinLaw - provide more comprehensive, real-time updates of federal and state laws, regulations, litigation, and other industry items of interest. For a personal guided tour and free trial of any of these legal reporters, please contact Michael Willer at 614-855-0505 or mwiller@counselorlibrary.com.

On June 24, the Consumer Financial Protection Bureau announced several changes to its consumer complaint portal. The CFPB's news release states that the changes address, in part, purported abuse of the complaint process by consumers, noting specifically that the volume of complaints about credit reporting has increased 3,700% from 2019 to 2025 and that the nationwide consumer reporting agencies do not have a uniform process for responding to this growing number of consumer complaints. The CFPB has made, or intends to make, the following changes:

• The CFPB issued a new Company Portal Manual that provides a standardized process for CRAs and other companies to follow when responding to consumer complaints and categorizing responses to complaints.
• The CFPB now requires consumers to use two-factor authentication. The CFPB also added clarifying text and new relationship categories to emphasize that third parties must disclose their involvement in the complaint process. The CFPB plans to implement address validation at the complaint submission step. The CFPB also plans to provide user support materials so adult children of aging parents, spouses of servicemembers, and other authorized representatives know how to submit complaints.
• The CFPB added a notice informing consumers that they must first exhaust their disputes of inaccurate or incomplete information directly with CRAs in accordance with the Fair Credit Reporting Act before submitting a complaint to the CFPB. The CFPB is also considering adding an additional administrative response option so CRAs can efficiently return complaints where the consumer has not exhausted his or her FCRA dispute obligations.
• The CFPB intends to provide greater specificity regarding when to use existing administrative response categories and may add additional administrative response categories, such as when a consumer appears to be abusing the complaint process.
• The CFPB has developed resources to educate consumers about how to address errors in their credit reports, including materials highlighting the costs and risks of credit repair and how to spot fraud and scams.
• The CFPB is implementing technology that will increase the efficiency of the complaint process.

Amicus Brief(ly): Not bad, CFPB. Not bad. The complaint portal has been a dumping ground for consumer complaints, both warranted and frivolous, especially about consumer reporting. One of the industry's biggest concerns about the portal has been its relative unaccountability - a consumer could post a complaint with or without a legitimate basis. Responding to consumers' complaints submitted through the CFPB's portal, as well as through ordinary company channels for consumer dispute intake and management, adds a material burden to financial services providers already keyed in on consumer concerns. We are grateful for the new requirement for consumers to exhaust their FCRA dispute avenues before posting disputes in the portal. As complaints about consumer reporting have increased steadily over the past decade or so, the FCRA kept pace by providing direct and indirect dispute methods that allow a consumer to challenge information in a tradeline directly with the furnisher (creditor) or indirectly through the CRAs. Directing consumers to those processes first should reduce the duplicative complaints while allowing creditors and servicers to focus on investigations and responses through those established channels.

On June 25, the Consumer Financial Protection Bureau, the Securities and Exchange Commission, the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, the National Credit Union Administration, the Federal Housing Finance Agency, the Commodity Futures Trading Commission, and the Department of the Treasury issued a final rule that establishes uniform, technical standards for data submitted by financial entities to the federal regulatory agencies. The joint final rule is required under the Financial Data Transparency Act of 2022 to promote interoperability of financial regulatory data across the agencies. According to the CFPB's news release, "[t]he new standards being adopted establish common identifiers for entities, geographic locations, dates, and certain products and currencies. The standards include a principles-based joint standard with respect to data transmission and schema and taxonomy formats, which would allow financial institutions to submit high-quality, machine-readable data to the agencies."

Amicus Brief(ly): This rulemaking should result in some efficiency in the gathering, collating, and publishing of market data reported to the various federal agencies by their regulated constituencies. We note that the supplementary information in this rulemaking identifies mixed comments the agencies received related to the proposal to adopt a Financial Instrument Global Identifier for financial instruments, which the agencies ultimately did not adopt. The FIGI would have co-existed with CUSIP numbers and other widely used identifiers, but commenters convinced the agencies to leave it aside as redundant and potentially burdensome. This final rule is likely to ease some of the agencies' burdens with respect to aggregating and publishing information from regulated entities, but the rule makes clear that the new joint standards will not have a direct economic impact on regulated entities because they are only applicable to the agencies.

On June 23, the Federal Housing Administration published multiple policy updates to its Single Family mortgage insurance program in accordance with President Trump's Executive Order "Promoting Access to Mortgage Credit." The updates address mortgage origination, servicing, and quality control. The FHA issued the following Mortgagee Letters:

• Updates to FHA Quality Control Requirements for Appraisal Field Reviews. Through this ML, the FHA makes field reviews an optional component of the appraisal quality control process. The FHA previously required mortgagees to obtain appraisal field reviews on at least 10% of their origination and underwriting QC samples. The FHA notes that appraisal field reviews represent one of the most expensive QC components of the lender appraisal review process, and this update will significantly reduce those costs.
• Increase in the Maximum Number of Draw Requests for Limited 203(k) Rehabilitation Mortgage Insurance Program. Through this ML, the FHA increases the maximum number of allowable draws under its Limited 203(k) program from two to four per contractor. It further clarifies draw disbursement procedures for both the Limited and Standard 203(k) programs.
• Eliminating Unnecessary Requirements for FHA Mortgagee Approval and Quality Control. This ML, among other things: (1) creates a permanent exception to exempt early payment defaults from the required monthly QC review sample for certain mortgages impacted by a Presidentially Declared Major Disaster Area, eliminating the need for the FHA to issue a waiver for each PDMDA; (2) removes outdated policy that required mortgagees to provide their staff with online access to or hard copies of current FHA guidance; and (3) removes the requirement for the mortgagee officer in charge to be a full-time corporate officer exclusively employed by the mortgagee.
• Rescission of the Important Notice to Homebuyers Form HUD-92900-B Requirement. This ML permanently removes the requirement for mortgagees to provide borrowers form HUD-92900-B, Important Notice to Homebuyers, and retain the executed copy in the case binder. Removing this form will reduce the amount of closing paperwork and ease document retention requirements.
• Updates to Loss Mitigation Requirements. Through this ML, the FHA clarifies its loss mitigation requirements governing Trial Payment Plans and borrower evaluation for loss mitigation assistance.

Amicus Brief(ly): As best we can tell, there is strong industry support for these updates designed to reduce regulatory burdens in FHA lending and increase access to affordable mortgage loans for qualified homebuyers. After conventional mortgage loans, FHA loans are the most common mortgage loan type in the U.S., and because they are insured by the government, they offer better access to mortgage loans for first-time homebuyers and consumers with imperfect but decent credit. These updates coincide with a broader bipartisan housing affordability initiative in an otherwise stagnant Congress, which recently sent the "21st Century ROAD to Housing Act" (H.R. 6644) to the White House for signature (more to come on that development this week, if the rumors are true). These recent deregulation efforts attempt to streamline financing and provide support to local efforts to increase the supply of affordable housing, which has become an increasing concern across the country.

The Colorado Supreme Court recently held that a complaint filed by a debt buyer seeking to collect a consumer's credit card debt did not comply with the Colorado Fair Debt Collection Practices Act because the complaint lacked a non-affidavit attachment establishing that the debt buyer owned the debt.

The facts of the case show that, after the consumer defaulted on a credit card debt, the debt buyer purchased her defaulted balance. The debt buyer then sued the consumer to collect the debt. As proof of the debt and its ownership of the debt, the debt buyer attached: (1) a bill of sale between the credit card issuer and the debt buyer with a blank asset schedule that did not identify the consumer's account number or balance; (2) two of the consumer's credit card statements; and (3) an affidavit from the debt buyer's custodian of records stating that the credit card issuer had sold the consumer's account to the debt buyer. As an affirmative defense, the consumer claimed that the debt buyer's complaint and supporting documentation were deficient and violated the Colorado FDCPA. The trial court ruled in favor of the debt buyer, finding that the affidavit supplemented the bill of sale for purposes of establishing an unbroken chain of ownership. The consumer appealed, and the intermediate appellate court affirmed.

The Colorado Supreme Court reversed the decisions of the lower courts. The Colorado FDCPA requires debt buyers to attach non-affidavit documentation establishing ownership of specific debts being collected. The high court reasoned that the bill of sale with a blank asset schedule established only that the debt buyer purchased some debts, not necessarily that it purchased the consumer's debt. Further, the high court explained that, under the plain language of the Colorado FDCPA, the affidavit could not substitute for proof of an unbroken chain of ownership. Accordingly, the high court remanded the case to the trial court for consideration of the appropriate remedies for the consumer.

Amicus Brief(ly): The Colorado Supreme Court was not as accommodating as the lower courts of the debt buyer's apparent misstep in the filing of its collection complaint. There are a number of states that require material proof of the chain of title to a consumer's specific account as part of collection lawsuit documentation. For a while, it was good (but expensive) practice to obtain and provide that documentary support for a complaint even when state procedure rules did not require it, but then certain judges in certain jurisdictions, fatigued by the frequency with which creditors settled for default judgments when consumer defendants failed to appear for assigned court dates, imposed document support requirements from the bench. As these requirements become more prevalent in the courts, especially for buyers of defaulted debts, it will be increasingly important for creditors to provide good information and for anyone seeking to enforce credit agreements through the courts to be able to document not just the consumer's obligation to pay but also the plaintiff's ownership of that debt.

An Illinois appellate court recently affirmed a trial court's denial of a car dealership's motion to compel arbitration of a car buyer's claims where the retail installment sale contract's arbitration provision and separate dispute resolution agreement signed in connection with the car purchase conflicted with respect to certain arbitration terms.

The used car buyer filed a class action complaint against the dealership and its purported parent company, alleging fraud, breach of contract, and civil conspiracy for improperly charging him for a rust and corrosion prevention product. The defendants moved to dismiss the complaint and compel arbitration of the claims pursuant to an arbitration provision in the RISC and a separate DRA that the car buyer signed in connection with the vehicle purchase. The trial court found that the parent company of the dealership was not a party to the RISC and the DRA and, therefore, could not compel arbitration. The trial court then denied the dealership's motion to compel arbitration of the car buyer's claims because the RISC's arbitration provision and the DRA conflicted with respect to the proper forum for arbitration, who decides arbitrability, and the parties' responsibility for arbitration fees. The dealership appealed.

The Illinois appellate court affirmed. The appellate court agreed with the trial court that the RISC's and the DRA's provisions regarding the arbitration forum could not be reconciled. The RISC provides for arbitration before the American Arbitration Association, National Arbitration and Mediation, or another arbitration organization by agreement. The DRA, however, provides that the parties will exclusively use the dispute resolution procedure in that agreement, which requires arbitration before the Better Business Bureau of Chicago.

The appellate court also agreed with the trial court that the two documents' provisions regarding who decides arbitrability could not be reconciled. The RISC provides that the arbitrator decides the issue of arbitrability. The DRA, however, has no arbitrability provision, leaving the issue to the court.

Finally, the appellate court agreed with the trial court that the two documents' provisions regarding arbitration fees could not be reconciled. The RISC provides that the dealership will pay up to $5,000 in arbitration fees unless the law or rules of the arbitration organization require otherwise, and charges over $5,000 will be paid by the dealership and the buyer according to the rules of the chosen arbitration organization. The DRA, however, provides that the buyer pays the first $100 in arbitration fees and the dealership pays the remainder.

The appellate court rejected the dealership's argument that these conflicts were minor procedural details.

Amicus Brief(ly): We have seen a flurry of cases over the past couple of years where dealers and finance companies could not enforce their arbitration provisions because of incongruity in those provisions across the purchase and financing documentation. This case comes down just like the others, holding that if there are irreconcilable differences in arbitration provisions or agreements in distinct but related purchase and financing documents, the court will not compel arbitration. The result is really another warning to finance companies that prefer to resolve claims through arbitration to review contracts approved for use by dealers to ensure that there is harmony in the way the arbitration provisions work in the separate sale and financing documents. If there is not, then attempts to resolve claims by arbitration to minimize the potential for successful class action claims will run into the problems identified in this Illinois case.

On June 23, Rhode Island Governor Daniel McKee signed two identical bills - House Bill 7867 and Senate Bill 3075 - that establish capital and liquidity requirements and corporate governance requirements for nonbank mortgage servicers. The laws are effective immediately.

The new laws state that a covered mortgage servicer satisfies the capital and liquidity requirements by complying with the Federal Housing Finance Agency's Eligibility Requirements for Enterpriser Single Family Seller/Servicers for capital, net worth ratio, and liquidity, regardless of whether the servicer is approved for government sponsored enterprise servicing by Fannie Mae or Freddie Mac. Covered mortgage servicers must maintain written policies and procedures implementing these requirements.

The new laws also establish corporate governance requirements for nonbank mortgage servicers. The laws require covered mortgage servicers to establish and maintain a board of directors responsible for oversight of the servicer, to receive an annual external audit conducted by an independent public accountant, and to establish a risk management program that identifies, measures, monitors, and controls risk sufficient for the servicer's level of sophistication.

Amicus Brief(ly): Rhode Island's new, broad requirements that are effective immediately appear to line up well with the requirements of other states that impose these kinds of net worth and corporate governance requirements. While more regulation at any level (federal, state, or local) is typically unwelcome for industry providers already heavily regulated, larger mortgage servicers subject to the new Rhode Island rules can likely satisfy these requirements fairly easily. Lenders and investors that rely on third-party mortgage servicers may take some comfort in these new requirements that are primarily designed for the lenders' and investors' benefit.

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¹ For the unfamiliar, an “Amicus Brief” is a legal brief submitted by an amicus curiae (friend of the court) in a case where the person or organization (the “friend”) submitting the brief is not a party to the case, but is allowed by the court to file the brief to share information or expertise that bears on the issues in the case.