Bank/Financial Institution Disputes
Bank and financial institution disputes involve any situation where a bank or financial institution takes advantage of a consumer or customer and breaks the law in doing so. Bank and financial institution misconduct became widely recognized after the financial crisis in 2008. The financial crisis was largely a result of the loose practices of financial institutions, banks and Wall Street investment companies.
The response to these loose practices was legislative reform and the establishment of a governmental watchdog. The new legislation included the Dodd-Frank Wall Street Reform Act of 2009 and the establishment of the Consumer Financial Protection Bureau (“CFPB”). The new legislation and the CFPB were set up with one goal in mind—protect the consumers and police the financial institutions and companies that interact with them.
However, this legislation was not unique in the sense that it was established to protect consumers. There are several Federal and State laws that existed prior to this legislation that provide rights to consumers when dealing with banks and financial institutions. These laws include but are not limited to:
- The Fair Debt Collection and Practices Act (FDCPA) 15 U.S.C. § 1692 Et Seq. – This law sets rules for the debt collection practices of creditors and third party debt collectors, including: when collection calls can be made, the volume of collection calls that can be made, the language and tone of the collectors, the statements used by collectors in their collections attempts, the places a collector may call in an effort to reach a borrower, among other things.
- The Truth In Lending Act (TILA) 15 U.S.C. § 1601 Et Seq. – This law sets regulations for making certain consumer loans. It gives a consumer legal claims against a creditor for failure to disclose certain terms associated with the extension of credit. This includes which disclosures must be presented, the form of such disclosures, giving notice of the right to cancel the loan, requirements regarding notice of transfer or servicing of loans and prohibitions on payment to loan originators based upon the conditions of the loan, among several other things.
- The Fair Credit Reporting Action (FCRA) 15 U.S.C. § 1681 Et Seq. – This law sets rules regarding the accurate reporting of consumer credit accounts by both the Consumer Reporting Agencies (Equifax, Experian, TransUnion) and the creditors who report to them. It includes rules for how to report a debt or account that is disputed as well as the investigation and reporting that is required after a debt or account is disputed by a consumer.
- Real Estate Settlement Procedures Act (RESPA) 12 U.S.C. § 2601 Et Seq. – This law regulates the information that must be disclosed by a lender to a consumer in extending a mortgage loan. This includes the disclosure of any affiliated business arrangement, providing a good faith estimate for all the approximate costs of a particular loan and providing a final statement at closing detailing all the costs and expenses charged in the transaction. The law also prohibits kickbacks between lenders and third-party settlement agents involved in the closing of a mortgage loan.
- Telephone Consumer Protection Act (TCPA) 47 U.S.C § 227 Et Seq. – This law protects consumers by restricting unauthorized telemarketing solicitations and the use of automated calling equipment. The law also limits the communications that may be sent by automatic dialing systems, pre-recorded messages, text messages and fax messages. The law controls when a telemarketer may call a consumer and what information must be disclosed when a telemarketer does contact a consumer. This law provides a consumer with a legal claim in the event a company or organization contacted them in violation of the law.
In addition to the above laws, there are several common claims that a consumer may advance against a bank or financial institution guilty of wrongdoing. These include claims for consumer fraud, negligent misrepresentation, negligence, breach of contract and breach of the covenant of good faith and fair dealing, just to name a few.
Although the above consumer protection laws are powerful, they are complicated and complex. The attorneys at the Piccuta Law Group, LLP have experience litigating bank misconduct claims arising from these statutes. If you believe you have been a victim of bank or financial institution misconduct, contact one of our attorneys today for a free case evaluation.