Fair Lending

Morrison & Foerster regularly represents both banks and non-banks, including loan servicers, auto finance companies, student lenders, and other financial services providers, in regulatory compliance and administrative engagements, litigation, and complex business transactions. We have a team of lawyers at Morrison & Foerster who advise clients on fair lending examinations and enforcement matters across the spectrum of financial services products and services, and have developed unparalleled expertise and experience in this area.

Morrison & Foerster’s cross-disciplinary financial services practice includes one of the premier fair lending practices in the U.S. Our nationally-recognized fair lending professionals are deeply involved in helping clients address the ever-changing regulatory landscape, including new and revised regulations, interpretive bulletins, and informal guidance issued by the Consumer Financial Protection Bureau (CFPB), as well as agency enforcement actions, state attorneys general investigations, and private lawsuits. In doing so, we maintain strong relations with federal and state regulators, and we include two former CFPB regulators within our team of fair lending attorneys.

Our attorneys are technically adept, market-aware advisors to a broad range of clients facing today’s regulatory challenges, including new rules from the CFPB and issues arising under the Fair Housing Act, the Equal Credit Opportunity Act (ECOA), the Home Mortgage Disclosure Act (HMDA), and other applicable federal and state laws. Our fair lending team includes seasoned former financial services regulators and litigators with years of experience representing industry participants and other financial services companies in government investigations and agency enforcement proceedings, including responses to agency subpoenas and investigative demands.

We provide clients with the following services as their needs dictate:

• Regulatory Implementation and Compliance Advice: Provide advice to clients seeking to ensure compliance with requirements of federal and state consumer financial laws. Engagements may involve requests to evaluate the compliance by clients with one or more provisions of these laws, drafting policies and procedures, advising on implementation of modifications required by the CFPB or other federal and state or enforcement agencies, obtaining private letter rulings from government agencies, and commenting on proposed rules on behalf of clients.
   
• Examination Support: Provide advice and guidance through all phases of the CFPB examination process, as well as examinations conducted by other federal and state agencies. Engagements may include reviewing compliance with federal and state consumer financial laws forming the focus of the examination; advising on responses to information and document requests, interactions with examiners, and the preparation of responses to alleged violations, including “Proposed Action, Response Request (PARR)” or “15-Day” Letters; negotiating conditions of proposed corrective actions, including terms of Memorandum of Understanding (MOU); and advising on post-examination submissions to the regulator.
   
• Internal Investigations: Conduct detailed investigations into allegations of potential consumer laws violations, enabling clients to respond deliberately and thoughtfully by making sure they understand the applicable facts and the potential consequences of the alleged violations. Develop document and email search criteria, and review responsive documents; conduct interviews of witnesses and prepare written memoranda memorializing discussions; draft investigative reports setting forth factual findings, legal analysis, and conclusions regarding alleged violations. Advise clients regarding appropriate corrective action, including changes to policies and procedures, consumer remediation, and related discussions with the government agencies.  
   
• Agency Investigations and Enforcement: Provide advice and guidance through all phases of CFPB, Department of Justice (DOJ), Federal Trade Commission (FTC), and Department of Housing and Urban Development (HUD) investigations and enforcement actions. Engagements may include reviewing civil investigative demands (as well as subpoenas and other investigative tools); negotiating with the issuing agency regarding scope and scale of materials requested; reviewing productions to ensure that applicable privileges are claimed and advising on how to present material in the light most favorable to the client; advising clients on responses to “Notice and Opportunity to Respond and Advise (NORA),” “PARR,” “15-Day,” and other notifications of potential action, including developing written and oral responses to the alleged violations; representing clients before the CFPB and other enforcement agencies; and leading negotiations around terms of any consent orders, cease and desist orders, or other enforcement settlements.
   
• Litigation: We believe in doing everything possible to prevent public exposure and avoid litigation in this time of heightened regulatory and customer scrutiny. In litigation, we look for efficient ways to resolve a dispute from the moment we begin work. But, we are ready, willing, and able to litigate aggressively through trial (and any necessary appeals). Our firm includes industry leading, substantive law, and trial experts, leveraging our cross-practice teams with in-depth industry knowledge at every level, from senior partners to paralegals. As a result, we regularly win early dismissal of cases for clients, and strongly and credibly represent clients in negotiations with regulators, enforcement agencies, and private plaintiffs.
   
• Settlement Monitor: Serve as independent legal counsel/settlement monitor in connection with actions required pursuant to consent orders, MOUs, and other settlements. Receive and review periodic reports from the parties; make determinations and findings as to the parties’ compliance with required settlement terms; communicate conclusions to the parties and to any required adjudicative body; work with non-compliant parties to establish and oversee corrective plans, and, if necessary, make recommendations for additional corrective action.
   
• Financial Institution Mergers, Acquisitions, Investments, and Secondary Market Transactions: Evaluate clients’ potential merger, acquisition, and investment targets for regulatory and reputational risk resulting from federal and state consumer financial laws. Evaluate pools of loans in securitizations for regulatory risk associated with federal and state consumer financial laws.