Earlier this week, a federal district court ruled that the Consumer Financial Protection Bureau’s (CFPB’s) failure to provide an advance notice of suit to a defendant in an enforcement action was not a valid affirmative defense. The CFPB’s advance-notice process, known as NORA, is intended “to ensure that potential subjects of enforcement actions have the opportunity to present their positions to the Bureau before an enforcement action is recommended or commenced.” While the CFPB typically provides enforcement targets with such notice, it sometimes does not, for reasons that are unclear. The court’s decision stands for the proposition that there is no legal problem with that. But as a matter of good government, the CFPB should provide such notice except when doing so would undermine the purposes of the litigation. Read more in Mayer Brown’s Legal Update, available here.
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