Pub. 16 2019 Issue 3

12 O V E R A C E N T U R Y : B U I L D I N G B E T T E R B A N K S - H E L P I N G N E W M E X I C O R E A L I Z E D R E A M S A REVIEW OF THE CFPB’S LATEST SUPERVISORY HIGHLIGHTS By Victoria E. Stephen, Compliance Alliance T he Consumer Financial Protection Bureau (CFPB) recently released its Summer 2019 Supervisory Highlights, which includes key findings from the CFPB’s exams. For the most part, key findings are between December 2018 to March 2019. In each edition, the Bureau chooses the areas where it has seen the most supervisory activity, and for this one, it highlighted auto loan origination, credit card account management, debt col - lection practices, FCRA information furnishing, and mortgage loan origination. Auto Loan Origination In the auto loan origination space, the CFPB called out lenders who sell “GAP insurance” to consumers with low loan- to-value ratios because they likely would not benefit from the additional coverage. If the vehicle were stolen or damaged, the difference in the amount owed on the loan and the amount ob - tained from the insurance company is likely to be low. As such, the Bureau found that consumers showed “that they lacked an understanding of a material aspect of the product” by purchas - ing a product they would not benefit from, and that lenders had enough information to know this and sold the insurance to them anyway. This was considered an “abusive” practice because it took an “unreasonable advantage” of this lack of un - derstanding. As a result, a lot of GAP insurance was refunded. Credit Card Account Management The first issue in this area was with so-called “triggering terms” found in Reg. Z, 12 CFR 1026.16(b). In some exams, institutions included triggering terms in their advertisements and failed to provide some or all of the required additional dis - closures. In others, there were issues with the “one click away”