CFPB Wants Time to Review Lawsuit Against Comerica Bank

The Consumer Financial Protection Bureau (CFPB) asked a federal judge Monday (March 3) to pause the enforcement action that the agency filed against Comerica Bank in December.

CFPB Chief Legal Officer Mark Paoletta said in court papers that the agency was considering next steps and that the new CFPB leadership sought “time to review the matter,” Reuters reported Monday.

Neither the CFPB nor Comerica Bank immediately replied to PYMNTS’ request for comment.

The agency’s request for a stay in its enforcement action — which accused Comerica Bank of “systematically” failing people who receive federal benefits — came after a week in which the CFPB dropped five enforcement actions, including one against Capital One, and at a time when the Trump administration has largely closed down the agency, according to the report.

When the CFPB sued Comerica Bank on Dec. 6, the agency said its complaint centers on the Direct Express program, which Comerica Bank has administered on behalf of the Department of the Treasury since 2008 and enables about 3.4 million federal beneficiaries to receive their monthly benefits payments through prepaid debit cards.

The agency alleged that Comerica Bank deliberately disconnected customer service calls, charged consumers illegal ATM fees, misled fraud victims, imposed illegal terms of service on consumers seeking to stop payments, failed to investigate account problems and forced consumers to close accounts to stop preauthorized payments.

Reached by PYMNTS at the time, Comerica Bank said in an emailed statement that it would continue to defend its record as the financial agent for the Direct Express program and that it filed a lawsuit against the CFPB on Nov. 8 challenging the bureau’s “regulatory overreach and its handling of this case.”

It was reported Thursday (Feb. 27) that the CFPB dropped a lawsuit against Capital One in which the agency accused that bank of cheating consumers out of interest payments on savings accounts.

Reached by PYMNTS at the time, a Capital One spokesperson said in an emailed statement: “We welcome the CFPB’s decision to dismiss this action, which we strongly disputed.”

The Trump administration’s pick to lead the CFPB, Jonathan McKernan, told the Senate Banking Committee during a Thursday (Feb. 27) hearing on his nomination that the agency “has gotten in the way of its own mission” and “has acted in a politicized manner.”