Connecticut Attorney General William Tong joined a coalition of 22 attorneys general in urging the Consumer Financial Protection Bureau (CFPB) to prohibit mortgage servicers from charging convenience fees. The coalition argues that these fees are exploitative and unfair, as homeowners have no choice in their servicers and fees often exceed the actual cost of processing payments. They request that the CFPB either ban such fees or limit them to actual costs, and require servicers to document their costs.
In-house legal teams should review all mortgage servicing agreements, loan servicing contracts, and vendor agreements with payment processors for clauses that authorize or define 'convenience fees' or 'payment processing fees.' Specifically examine fee schedules, payment method terms, and cost allocation provisions. Given the coalition's argument that fees often exceed actual processing costs and lack consumer choice, contracts may need amendments to: (1) cap fees at verifiable actual costs, (2) require detailed documentation and disclosure of processing costs to borrowers, and (3) potentially eliminate such fees for non-optional payment channels. Teams should also monitor for any CFPB rulemaking resulting from this petition to ensure future compliance.
Entity
Mortgage Servicers
Industry
Financial ServicesOfficial Press Release
https://portal.ct.gov/ag/press-releases/2022-press-releases/attorney-general-tong-calls-on-cfpb-to-prohibit-mortgage-servicers-from-charging-convenience-fees
state attorneys general multistate comment letter to cfpb co
https://portal.ct.gov/-/media/ag/press_releases/2022/state-attorneys-general-multistate-comment-letter-to-cfpb_convenience-fees_41122_final.pdf?rev=baf6911436064b58814d52d9b75bc789&hash=6DF955F0180BBF28E3F2E9D53692D67A
Connecticut Attorney General Enforcement Page
https://portal.ct.gov/AG/Privacy/Privacy-Resources
$500K
Connecticut Attorney General William Tong announced settlements with SunRun, Inc., Elevate Solar Solutions, and two salespeople over allegations of deceptive solar sales, including impersonating consumers and locking homeowners into long-term contracts without consent. SunRun must pay $300,000 and provide consumer relief; Elevate and the salespeople face a stated $200,000 penalty, with $100,000 suspended subject to ongoing compliance.
$8.0M
Connecticut announced an $8 million settlement with Mylan over allegations that it used agreements to delay generic EpiPen competitors and took other actions that inflated prices. Mylan also agreed to provide 10,000 free EpiPens; the release states that Mylan denies wrongdoing.
Connecticut Attorney General William Tong joined a coalition of 22 attorneys general in filing an amicus brief challenging DHS’s policy and practice of conducting warrantless civil immigration arrests. The press release describes a court challenge, not a privacy enforcement action or monetary penalty.
$625K
Connecticut reached a $625,000 settlement with Frontier Communications Parent Inc. over an April 2024 breach in which compromised employee and vendor credentials were used to access internal systems and exfiltrate unencrypted personal information of 58,841 Connecticut residents. The settlement requires Frontier to strengthen its security program, implement specific safeguards and training, and obtain an independent third-party assessment.
$2.6M
Connecticut and New York found that Boston Children’s Health Physicians and its security vendor, XTIUM, failed to use reasonable safeguards, resulting in hackers accessing sensitive personal, medical, and employee information. The companies agreed to pay penalties totaling $2.64 million and implement enhanced cybersecurity measures.
Connecticut joined a coalition of state attorneys general filing a notice in Character Technologies, Inc.’s bankruptcy proceedings, raising concerns about the company’s safety and privacy practices and the sensitive information it holds. The states seek protections for children and consumers if the company’s business or assets are sold or transferred; the filing does not impose a fine or other remedy.