Clients Friends Memo: The Consumer Financial Protection Bureau, the Controversial New Regulator, Begins with an Aggressive Enforcement Settlement against a Financial Services Company

Cadwalader Client Friends Memo. On July 17, 2012, the Consumer Financial Protection Bureau ("CFPB") reached a groundbreaking $165 million settlement with a credit card issuer in its first enforcement action, ordering Capital One Bank (USA), N.A. to refund $140 million to two million customers who had purchased its credit card "add-on" products, and to pay a $25 million fine into the CFPB's Civil Penalty Fund. The CFPB is a powerful regulatory agency that was created by the Dodd-Frank Act to implement and enforce federal consumer financial laws and to promote fair, transparent, competitive and accessible markets for consumer financial services and products. After a quiet first year, the CFPB now has aggressively asserted its vast enforcement powers, and levied significant financial penalties in its regulation of the marketing and sale of consumer financial products.

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