§5565 — Title 12 Banks and Banking | U.S. Code

Summary

Lets courts and the Bureau order fixes when federal consumer finance rules are broken. They can cancel or change contracts, return money or property, award refunds or restitution, force someone to give up unfair profits, order money damages, require public notice about the problem, limit what a person or business can do, and impose civil money penalties. They may not award punitive or exemplary damages. If the Bureau, a State attorney general, or a State regulator sues and wins, they can recover the costs of bringing the case. Anyone who violates these rules must pay civil penalties. The normal limit is $5,000 per day for each continuing violation. If the violation was reckless, the limit is $25,000 per day. If it was knowing, the limit is $1,000,000 per day. When setting a penalty, the Bureau or court must consider the person’s size and good faith, how serious the violation was, harm to consumers (including how many products or services were involved), past violations, and other matters justice requires. The Bureau can settle, reduce, or cancel penalties. The final penalty is separate from any court costs the person owes the United States, and the government may deduct the penalty from money it owes the person. Penalties can only be assessed after the person gets notice and a hearing or after a court orders the penalty in favor of the Bureau.

Title 12, §5565

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(a)(1)The court (or the Bureau, as the case may be) in an action or adjudication proceeding brought under Federal consumer financial law, shall have jurisdiction to grant any appropriate legal or equitable relief with respect to a violation of Federal consumer financial law, including a violation of a rule or order prescribed under a Federal consumer financial law.

(2)Relief under this section may include, without limitation—

(A)rescission or reformation of contracts;

(B)refund of moneys or return of real property;

(C)restitution;

(D)disgorgement or compensation for unjust enrichment;

(E)payment of damages or other monetary relief;

(F)public notification regarding the violation, including the costs of notification;

(G)limits on the activities or functions of the person; and

(H)civil money penalties, as set forth more fully in subsection (c).

(3)Nothing in this subsection shall be construed as authorizing the imposition of exemplary or punitive damages.

(b)In any action brought by the Bureau, a State attorney general, or any State regulator to enforce any Federal consumer financial law, the Bureau, the State attorney general, or the State regulator may recover its costs in connection with prosecuting such action if the Bureau, the State attorney general, or the State regulator is the prevailing party in the action.

(c)(1)Any person that violates, through any act or omission, any provision of Federal consumer financial law shall forfeit and pay a civil penalty pursuant to this subsection.

(2)(A)For any violation of a law, rule, or final order or condition imposed in writing by the Bureau, a civil penalty may not exceed $5,000 for each day during which such violation or failure to pay continues.

(B)Notwithstanding paragraph (A), for any person that recklessly engages in a violation of a Federal consumer financial law, a civil penalty may not exceed $25,000 for each day during which such violation continues.

(C)Notwithstanding subparagraphs (A) and (B), for any person that knowingly violates a Federal consumer financial law, a civil penalty may not exceed $1,000,000 for each day during which such violation continues.

(3)In determining the amount of any penalty assessed under paragraph (2), the Bureau or the court shall take into account the appropriateness of the penalty with respect to—

(A)the size of financial resources and good faith of the person charged;

(B)the gravity of the violation or failure to pay;

(C)the severity of the risks to or losses of the consumer, which may take into account the number of products or services sold or provided;

(D)the history of previous violations; and

(E)such other matters as justice may require.

(4)The Bureau may compromise, modify, or remit any penalty which may be assessed or had already been assessed under paragraph (2). The amount of such penalty, when finally determined, shall be exclusive of any sums owed by the person to the United States in connection with the costs of the proceeding, and may be deducted from any sums owing by the United States to the person charged.

(5)No civil penalty may be assessed under this subsection with respect to a violation of any Federal consumer financial law, unless—

(A)the Bureau gives notice and an opportunity for a hearing to the person accused of the violation; or

(B)the appropriate court has ordered such assessment and entered judgment in favor of the Bureau.

Statutory Notes and Related Subsidiaries

Effective Date

Section effective on the designated transfer date, see section 1058 of Pub. L. 111–203, set out as a note under section 5561 of this title.

§5565 Relief available

Summary

Title 12, §5565

Notes & Related Subsidiaries

Statutory Notes and Related Subsidiaries

Effective Date

Citations & Metadata