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Consumer Financial Protection Bureau (CFPB)
CFPB to distribute over $191 million to consumers harmed by Tempoe
The CFPB ordered Tempoe to pay more than $191 million in refunds back to 250,000 consumers harmed by the leasing company. This decision came on the heels of Tempoe, LLC tricking customers into expensive leasing agreements by hiding contract terms and costs. Tempoe generated over $192 million in revenue from this unlawful practice. The CFPB ordered these funds to be returned back to customers as well as permanently banning Tempoe from offering consumer leases.
Tempoe, LLC, was a nonbank consumer finance company that offered lease agreements nationwide. The company purchased personal property and services from retailers and then leased them to consumers. The CFPB found that Tempoe did the following:
Funds from this judgement have begun to be mailed out.
CFPB Takes Action to Curb Unchecked Worker Surveillance
The CFPB has issued guidance to protect workers from unchecked digital tracking and opaque decision-making systems. Companies using third-party consumer reports including background dossiers and surveillance-based, “black box” AI or algorithmic scores about their workers, must follow Fair Credit Reporting Act (FCRA) rules.
This means employers must obtain consent, provide transparency about data used in adverse decisions, and allow employees to dispute inaccurate information.
CFPB Director Rohit Chopra stated, “Workers shouldn’t be subject to unchecked surveillance or have their careers determined by opaque third-party reports without basic protections.”
The CFPB addresses the use of third-party consumer reports by employers to make employment decisions about their workers. The reports are currently used to:
The FCRA protections are essential in an era where worker data is increasingly commodified and used to make critical employment decisions. By enforcing these rights, the CFPB aims to ensure workers are protected from abuse and have control over their personal data. To ensure responsible use of worker data, the CFPB plans to work with other federal agencies and state regulators on the matter.
CFPB Orders VyStar Credit Union to Pay $1.5 Million for Illegally Stranding Consumers from Accessing Their Money and Accounts
The CFPB took action against VyStar Credit Union for harming consumers through a botched online banking system rollout. In May 2022, Vystar introduced a new but dysfunctional online banking platform that made it difficult for credit union members to perform basic banking functions for weeks. Due to this inconvenience, members incurred fees and costs associated. The CFPB is now ordering Vystar to pay $1.5 million in civil penalties to the CFPB’s victims relief fund.
VyStar, a Florida-based state-chartered credit union, anticipated banking services being inaccessible for a few days; however, upon launch, the system crashed immediately. VyStar is being accused of launching the system prematurely and failing to establish or follow critical processes to ensure its success.
Per CFPB Director Chopra, “VyStar’s careless errors inflicted financial harm on their members.” NCUA Chairman Todd Harper said, “Credit Unions must prioritize their members, yet VyStar’s due diligence fell far short of what was required for completing a successful conversion of the credit union’s mobile and online banking platforms”.
The CFPB found that VyStar violated the Consumer Financial Protection Act by:
As a result, the CFPB is requiring VyStar to:
CFPB and CMS Take Action to Stop Improper Billing of Lowest-Income Medicare Recipients
The CFPB and Centers for Medicare and Medicaid Services (CMS) issued a joint statement to protect people on Medicare living at or below the poverty line from improper medical bills. These people in the Qualified Medicare Beneficiary group represent about one in eight Medicare recipients nationwide. Federal law generally prohibits healthcare providers who accept Medicare from billing these people – referred to as “QMBs” – for cost-sharing, such as co-pays or deductibles.
The agencies' joint statement emphasizes that Traditional Medicare providers and suppliers, Medicare Advantage providers and suppliers, and debt collectors can be sanctioned by CMS or be liable under federal law for improperly billing these recipients. CMS is also releasing new resources clarifying that healthcare providers must refund any improper charges, regardless of whether they received incorrect information about a recipient's QMB status from Medicare Advantage plans.
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