Fifth Third Bank, National Association
Documents in this case
- Complaint · · 17 p.
- Amended complaint · · 43 p.
- Opinion · · 25 p.
Case summary
On March 9, 2020, the Bureau filed a lawsuit in federal district court in the Northern District of Illinois against Fifth Third Bank, National Association. On February 12, 2021, the court granted a motion to transfer the case to the Southern District of Ohio. The Bureau filed an amended complaint on June 16, 2021. The Bureau alleged that, by misleading consumers about the bank’s sales practices, opening products and services and engaging in consumer-account transactions without consumer consent, and failing to adequately address the misconduct, Fifth Third engaged in unfair and abusive acts or practices in violation of the Consumer Financial Protection Act and violated the Fair Credit Reporting Act, the Truth in Lending Act (TILA), the Truth in Savings Act (TISA), and TILA’s and TISA’s implementing regulations. On July 9, 2024, the Bureau filed a proposed stipulated judgment and final order, which the court entered on July 18, 2024. The order requires Fifth Third to pay a $15 million civil money penalty and redress to consumers. It also requires Fifth Third to come into compliance with the law and to not set performance-management and sales goals for its employees that foster the opening of unauthorized accounts.
Complaint ()
PDF of this document (17 pages)
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UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION
Bureau of Consumer Financial ) Protection, ) Case No.
)
Plaintiff, )
) v.
)
)
) Fifth Third Bank, National Association, )
) Defendant.
)
COMPLAINT
The Bureau of Consumer Financial Protection (Bureau) files this Complaint against Fifth Third Bank, National Association (Fifth Third) and alleges as follows.
Introduction 1.
Fifth Third offers and provides to consumers an array of financial products and services.
2.
For years, and continuing through at least 2016, Fifth Third used a “cross-sell” strategy to increase the total number of products and services it provided to existing customers.
3.
To further this cross-sell strategy, and to increase the number of products and services it provided to existing customers, Fifth Third conditioned Case: 1:20-cv-01683 Document #: 1 Filed: 03/09/20 Page 1 of 17 PageID #:1
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employee-performance ratings and, in some instances, continued employment on whether managers and their subordinate employees met ambitious sales goals. Fifth Third also used an incentive-compensation program that rewarded managers and their subordinate employees for selling new products and services to existing customers. 4.
Reasonable sales goals and performance incentives are not inherently harmful. But when such programs are not carefully and properly implemented and monitored, they may create incentives for employees to engage in misconduct in order to meet goals or earn additional compensation.
5.
Despite knowing since at least 2008 that employees were opening unauthorized consumer-financial products and services, Fifth Third took insufficient steps to properly implement and monitor its program, detect and stop misconduct, and identify and remediate harmed consumers. Predictably, Fifth Third’s employees, without consumers’ knowledge or consent, opened deposit accounts in consumers’ names; transferred funds from consumers’ existing accounts to new, improperly opened accounts; issued credit cards; enrolled consumers in online-banking services; and opened lines of credit on consumers’ accounts. In short, Fifth Third focused on its own financial interests to the detriment of consumers. 6.
Fifth Third’s conduct violated the Consumer Financial Protection Act of 2010 (CFPA), the Truth in Lending Act (TILA), the Truth in Savings Act (TISA), and their implementing regulations.
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7.
The Bureau brings this action to stop Fifth Third’s unlawful conduct and to obtain redress for affected consumers and an appropriate penalty and other monetary relief.
8.
The Bureau brings this action under §§ 1031, 1036(a)(1), 1054, and 1055 of the CFPA, 12 U.S.C. §§ 5531, 5536(a)(1), 5564, 5565; TILA, 15 U.S.C. § 1601 et seq., and its implementing regulation, Regulation Z, 12 C.F.R. part 1026; and TISA, 12 U.S.C. § 4301 et seq., and its implementing regulation, Regulation DD, 12 C.F.R. part 1030.
Jurisdiction
9.
This Court has subject-matter jurisdiction over this action because it is brought under “Federal consumer financial law,” 12 U.S.C. § 5565(a)(1); presents a federal question, 28 U.S.C. § 1331; and is brought by an agency of the United States, 28 U.S.C. § 1345.
Venue 10.
Venue is proper in this district because Fifth Third is located, resides, or does business in this district. 12 U.S.C. § 5564(f).
Parties 11.
The Bureau is an independent agency of the United States created by the CFPA and charged with regulating the offering and providing of consumer-financial Case: 1:20-cv-01683 Document #: 1 Filed: 03/09/20 Page 3 of 17 PageID #:3
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products and services under “Federal consumer financial laws.” 12 U.S.C. § 5491(a). The Bureau is authorized to initiate civil actions in federal district court, by its own attorneys, to address violations of “Federal consumer financial law.” 12 U.S.C. § 5564(a)-(b).
12.
Fifth Third operates, among other things, a branch-banking business that offers and provides an array of financial products and services primarily used by consumers for personal, family, or household purposes. Fifth Third is therefore a “covered person” under the CFPA. 12 U.S.C. § 5481(5), (6), (15)(A).
Factual Background 13.
Fifth Third has more than $150 billion in total assets and, through its branch-banking business, operates more than 1,100 full-service branches in Illinois, Florida, Georgia, Indiana, Kentucky, Michigan, North Carolina, Ohio, Tennessee, and West Virginia.
14.
Among the products and services Fifth Third offers through its branchbanking business are checking accounts, savings accounts, credit cards, online banking, and lines of credit.
15.
To increase sales of its products and services, from at least 2010 through at least 2016, Fifth Third imposed sales goals on bank employees and implemented an incentive-compensation program that financially rewarded employees for selling new products and services. Sales goals were often set at a level higher than the anticipated Case: 1:20-cv-01683 Document #: 1 Filed: 03/09/20 Page 4 of 17 PageID #:4
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sales for thousands of employees. Fifth Third used the achievement or nonachievement of sales goals as a key component in performance ratings. Low performance ratings could result in disciplinary action, including termination. 16.
By 2010, at the latest, Fifth Third was aware that employees were opening products and services in consumers’ names without those consumers’ knowledge or consent in order to achieve sales goals or obtain incentive rewards. 17.
Despite Fifth Third’s knowledge of unauthorized consumer-financial products and services, Fifth Third failed to take adequate steps to detect and stop these acts or practices, and to identify, notify, and remediate harmed consumers.
Deposit Accounts 18.
Fifth Third imposed aggressive sales goals for its employees to open new deposit accounts, and its incentive-compensation program rewarded employees for opening new deposit accounts funded with a specified minimum balance within a defined period.
19.
From at least 2010 through at least 2016, Fifth Third opened deposit accounts for existing Fifth Third customers without the customers’ knowledge or consent.
20.
Some of these unauthorized accounts were “funded” when a banker transferred funds to the unauthorized account from the same consumer’s authorized account without the consumer’s knowledge or consent. Often, once an unauthorized Case: 1:20-cv-01683 Document #: 1 Filed: 03/09/20 Page 5 of 17 PageID #:5
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account was “funded,” such that it qualified under the sales-goal tracking or incentive program, the banker transferred the funds back to the consumer’s authorized account, again without the consumer’s knowledge or consent. 21.
Opening deposit accounts without consumers’ knowledge or consent and moving consumers’ funds without their knowledge or consent exposed consumers to risks of harm, including that they would be unable to meet their financial obligations, would incur fees, or would experience negative effects on their consumer-reporting-agency information.
22.
Fifth Third charged unjustified fees to many consumers who had deposit accounts opened without their knowledge or consent and whose funds were transferred from their existing accounts to their new, improperly opened accounts.
Credit Cards 23.
Fifth Third imposed aggressive sales goals for its employees to sell credit cards to consumers, and its incentive-compensation program rewarded employees for selling new credit cards.
24.
From at least 2008 through at least 2016, Fifth Third issued credit cards to existing customers without their knowledge or consent. 25.
By 2009, at the latest, Fifth Third noticed a spike in unauthorized credit cards being issued to consumers.
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26.
Despite recognizing the increasing number of unauthorized credit cards, Fifth Third continued to emphasize sales and to maintain credit-card sales goals and incentive compensation.
27.
Issuing credit cards without consumers’ knowledge or consent exposed consumers to risks of harm, including unjustified fees for the unauthorized credit cards and negative effects on their consumer-reporting-agency information. Fifth Third charged many of these consumers unjustified fees.
Enrollment in Online Banking 28.
Fifth Third imposed aggressive sales goals for its employees to enroll consumers in its online-banking services, and its incentive-compensation program rewarded employees for enrolling consumers in those services. 29.
From at least 2010 through at least 2016, Fifth Third enrolled consumers in online-banking services without their knowledge or consent. 30.
Fifth Third’s enrollment of consumers in online-banking services without their knowledge or consent exposed consumers to the risk of harm, including increased risk of data theft, money theft, and improper personal-data use.
Opening of Early Access 31.
Early Access is a fee-based line of credit that allows Fifth Third’s deposit-account holders to withdraw funds from their deposit accounts before the Case: 1:20-cv-01683 Document #: 1 Filed: 03/09/20 Page 7 of 17 PageID #:7
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funds have been deposited in the accounts. Fifth Third imposed aggressive sales goals for its employees to sell Early Access to consumers, and its incentive-compensation program rewarded employees for enrolling consumers in “fee-based products,” including Early Access.
32.
Fifth Third opened Early Access lines of credit on consumers’ deposit accounts without their knowledge or consent. Fifth Third was aware of this by June 2010, when senior management was notified of an increase in the number of calls by employees to the internal whistleblower hotline regarding the unauthorized opening of Early Access lines of credit.
33.
Fifth Third opened unauthorized Early Access lines of credit from at least 2010 through 2014, and Fifth Third retained unauthorized Early Access lines of credit even after it stopped offering new Early Access lines of credit. 34.
Fifth Third’s opening and retention of these unauthorized lines of credit risked harm to consumers, including to their consumer-reporting-agency information.
Violations of Law 35.
Fifth Third’s conduct, described above, violated and, where uncorrected, continues to violate the CFPA, TILA, TISA, and their implementing regulations.
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The CFPA 36.
The CFPA prohibits “unfair” acts or practices. 12 U.S.C. § 5536(a)(1)(B). An act or practice is unfair if it causes or is likely to cause consumers substantial injury that is not reasonably avoidable and is not outweighed by countervailing benefits to consumers or to competition. 12 U.S.C. § 5531(c)(1). 37.
The CFPA prohibits “abusive” acts or practices. 12 U.S.C. § 5536(a)(1)(B). An act or practice is abusive if it materially interferes with a consumer’s ability to understand a term or condition of a consumer-financial product or service. 12 U.S.C. § 5531(d)(1).
38.
Additionally, an act or practice is abusive if it takes unreasonable advantage of a consumer’s inability to protect his or her interests in selecting or using a consumer-financial product or service. 12 U.S.C. § 5531(d)(2)(B).
Count I Unauthorized Deposit Accounts (Unfairness, in Violation of the CFPA)
39.
The Bureau realleges and incorporates by reference paragraphs 1-38. 40.
Fifth Third’s acts or practices of opening deposit accounts without consumers’ knowledge or consent are likely to cause substantial injury in the form of fees, penalties, and negative effects to consumer-reporting-agency information. 41.
Fifth Third’s acts or practices of transferring funds between consumers’ accounts without their knowledge or consent are likely to cause substantial injury in Case: 1:20-cv-01683 Document #: 1 Filed: 03/09/20 Page 9 of 17 PageID #:9
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the form of fees, penalties, the inability to withdraw funds, and negative effects to consumer-reporting-agency information.
42.
Because these acts or practices occur without consumers’ knowledge, the injuries are not reasonably avoidable by consumers, and they are also not outweighed by countervailing benefits to consumers or to competition. 43.
Therefore, Fifth Third engaged in unfair acts or practices that violate §§ 1031(c)(1) and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(c)(1), 5536(a)(1)(B).
Count II Unauthorized Credit Cards (Unfairness, in Violation of the CFPA)
44.
The Bureau realleges and incorporates by reference paragraphs 1-38. 45.
Fifth Third’s acts or practices of issuing credit cards to consumers without their knowledge or consent is likely to result in fees to consumers that the consumers cannot reasonably avoid because they are not aware that the credit cards have been issued.
46.
Fifth Third’s acts or practices of issuing credit cards to consumers without their knowledge or consent is likely to result in harm to consumer-reportingagency information that the consumers cannot reasonably avoid because they are not aware that the credit cards have been issued. 47.
These injuries to consumers are not outweighed by countervailing benefits to consumers or to competition.
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48.
Therefore, Fifth Third engaged in unfair acts or practices that violate §§ 1031(c)(1) and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(c)(1), 5536(a)(1)(B).
Count III Unauthorized Enrollment in Online Banking Services (Abusiveness, in Violation of the CFPA)
49.
The Bureau realleges and incorporates by reference paragraphs 1-38. 50.
Fifth Third’s acts or practices of enrolling consumers in online-banking services without their knowledge or consent materially interferes with consumers’ ability to understand the terms and conditions of online banking. 51.
Fifth Third’s acts or practices of enrolling consumers in online-banking services without their knowledge or consent takes unreasonable advantage of the inability of consumers to protect their interests in selecting or using a consumerfinancial product or service.
52.
Therefore, Fifth Third engaged in abusive acts or practices that violate §§ 1031(d)(1), 1031(d)(2)(B), and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(d)(1), 5531(d)(2)(B), 5536(a)(1)(B).
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Count IV Unauthorized Opening of Early Access (Abusiveness, in Violation of the CFPA)
53.
The Bureau realleges and incorporates by reference paragraphs 1-38. 54.
Fifth Third’s acts or practices of opening Early Access lines of credit on consumers’ deposit accounts without their knowledge or consent materially interferes with consumers’ ability to understand Early Access’s terms and conditions. 55.
Fifth Third’s acts or practices of opening Early Access lines of credit on consumers’ deposit accounts without their knowledge or consent takes unreasonable advantage of consumers’ inability to protect their interests in selecting or using a consumer-financial product or service.
56.
Therefore, Fifth Third engaged in abusive acts or practices that violate §§ 1031(d)(1), 1031(d)(2)(B), and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(d)(1), 5531(d)(2)(B), 5536(a)(1)(B).
Count V Unauthorized Credit Card Issuance (Violations of TILA and Regulation Z) 57.
The Bureau realleges and incorporates by reference paragraphs 1-38. 58.
Under TILA, “no credit card shall be issued except in response to a request or application therefor.” 15 U.S.C. § 1642. Regulation Z requires that “regardless of the purpose for which a credit card is to be used, including business, commercial, or agricultural use, no credit card shall be issued to any person except in Case: 1:20-cv-01683 Document #: 1 Filed: 03/09/20 Page 12 of 17 PageID #:12
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response to an oral or written request or application for the card; or as a renewal of, or substitute for, an accepted credit card.” 12 C.F.R. § 1026.12(a). 59.
Fifth Third issued credit cards to consumers without their knowledge or consent and not in response to an oral or written request or application for the card. 60.
Therefore, Fifth Third violated TILA and Regulation Z.
Count VI Unauthorized Deposit Accounts (Violations of TISA and Regulation DD)
61.
The Bureau realleges and incorporates by reference paragraphs 1-38. 62.
TISA’s purpose is “to require the clear and uniform disclosure of— (1) the rates of interest which are payable on deposit accounts by depository institutions; and (2) the fees that are assessable against deposit accounts, so that consumers can make a meaningful comparison between the competing claims of depository institutions with regard to deposit accounts.” 12 U.S.C. § 4301(b). TISA further authorizes the Bureau to issue implementing regulations, including regulations to carry out these purposes. E.g., 12 U.S.C. § 4308(a). 63.
TISA’s implementing regulation, 12 C.F.R. § 1030.4 (Regulation DD), requires the disclosure of the annual percentage yield and interest rate, compounding and crediting information, balance information, fees, and more. 12 C.F.R. § 1030.4(b). Those disclosures must be made before account opening. 12 C.F.R. § 1030.4(a)(1)(i). Case: 1:20-cv-01683 Document #: 1 Filed: 03/09/20 Page 13 of 17 PageID #:13
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64.
By opening deposit-accounts without consumer authorization and, in the process, failing to make the required disclosures to the affected consumers, Fifth Third violated TISA and Regulation DD.
Count VII Sales Practices Likely to Cause Unauthorized Accounts (Unfairness, in Violation of the CFPA) 65.
The Bureau realleges and incorporates by reference paragraphs 1-38. 66.
Even after learning of unauthorized Fifth Third consumer-financial products and services by 2008, Fifth Third failed to change its sales practices to avoid consumer harm. Instead, Fifth Third continued to foster sales practices that were likely to cause unauthorized products and services. 67.
Fifth Third imposed sales goals on all levels of branch employees as part of its efforts to cross-sell; set goals that thousands of its employees could not achieve; threatened employees with termination or other disciplinary action if they failed to meet their goals; established a system under which managers pressured subordinate employees to sell; failed to take steps to determine and address a root cause of unauthorized accounts, which was consistently said by employees to be intense salespressure; failed to close known loopholes in its collection of proof of consumer authorization, thereby making it easy for employees to open accounts without valid signature cards for deposit accounts or applications for credit products; and failed to Case: 1:20-cv-01683 Document #: 1 Filed: 03/09/20 Page 14 of 17 PageID #:14
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take reasonable steps to identify, notify, and remediate identifiable consumers victimized by unauthorized account-openings.
68.
Fifth Third’s sales practices were likely to cause substantial injury to consumers, including adverse effects on their consumer-reporting-agency information, the imposition of unjustified fees, the theft of funds or private information, and the inability to meet financial obligations. This substantial injury to consumers is a predictable consequence of Fifth Third’s sales practices. 69.
Because any unauthorized products or services and Fifth Third’s conduct, including its failures to detect, notify, and remediate, occurred without consumers’ knowledge, the substantial injury to consumers is not reasonably avoidable by consumers.
70.
Further, the substantial injury to consumers is not outweighed by countervailing benefits to consumers or to competition. 71.
Therefore, Fifth Third engaged in unfair acts or practices that violate §§ 1031(c) and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(c), 5536(a)(1)(B).
Count VIII Additional Violations of the CFPA 72.
The Bureau realleges and incorporates by reference paragraphs 1-38. 73.
By violating TILA, Regulation Z, TISA, and Regulation DD, Fifth Third violated § 1036(a)(1)(A) of the CFPA. 12 U.S.C. § 5536(a)(1)(A). Case: 1:20-cv-01683 Document #: 1 Filed: 03/09/20 Page 15 of 17 PageID #:15
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Demand for Relief The Bureau requests that the Court:
a.
permanently enjoin Fifth Third from, without the consumer’s consent: (1) opening any deposit account; (2) issuing any credit card; (3) enrolling the consumer in online-banking services; and (4) opening any line of credit; b.
order Fifth Third to take all reasonable steps to identify and notify consumers who may have had a consumer-financial product or service opened without their consent, and allow those consumers to have their products or services closed without fees or penalties;
c.
order Fifth Third to correct harmful consumer-reporting-agency information, including but not limited to correction of any harmful trade lines on consumer-credit reports resulting from unauthorized consumer-financial accounts and services at Fifth Third;
d.
order Fifth Third to pay damages, restitution, and other monetary relief to consumers;
e.
order Fifth Third to pay disgorgement or compensation for unjust enrichment;
f.
impose on Fifth Third a civil money penalty under 12 U.S.C. § 5565(c); g.
order Fifth Third to pay the costs incurred in connection with prosecuting this action, under 12 U.S.C. § 5565(b); and Case: 1:20-cv-01683 Document #: 1 Filed: 03/09/20 Page 16 of 17 PageID #:16
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h.
award additional relief as the Court may determine to be just and proper. Dated: March 9, 2020
Respectfully submitted,
Cara Petersen Principal Deputy Enforcement Director Jeffrey Paul Ehrlich Deputy Enforcement Director Kara K. Miller Assistant Litigation Deputy
/s/ Michael G. Salemi
MICHAEL G. SALEMI, IL ARDC 6279741 Email: [email protected] BARRY REIFERSON, NY Reg. #24343893 Email: [email protected] MEGHAN SHERMAN CATER, NY Reg. #4473120 Email: [email protected] LANE C. POWELL, MI Bar #P79432 Email: [email protected] LEANNE E. HARTMANN, CA Bar #264787 Email: [email protected]
230 S. Dearborn Street Suite 1590 Chicago, IL 60604
and
1700 G Street, NW Washington, DC 20552 Telephone: (212) 328-7020 Facsimile: (202) 435-5477
Attorneys for the Bureau of Consumer Financial Protection Case: 1:20-cv-01683 Document #: 1 Filed: 03/09/20 Page 17 of 17 PageID #:17
Amended complaint ()
PDF of this document (43 pages)
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UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF OHIO WESTERN DIVISION
Bureau of Consumer Financial ) Protection, ) Case No. 1:21-cv-262
)
Plaintiff, ) Judge Douglas R. Cole
) v.
)
)
) Fifth Third Bank, National Association, )
) Defendant.
)
AMENDED COMPLAINT
The Bureau of Consumer Financial Protection (Bureau) files this Amended Complaint against Fifth Third Bank, National Association (Fifth Third) and alleges as follows.
Introduction 1.
Fifth Third tells consumers and otherwise creates a reasonable belief that Fifth Third’s consumer-financial-product sales are in the consumers’ best interests. 2.
Contrary to what Fifth Third tells consumers, Fifth Third designs and conducts its consumer-financial-product sales based on its own financial interests. Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 1 of 43 PAGEID #: 58
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3.
Fifth Third has known for more than a decade that its acts or practices have led to the opening of consumer-financial products that are not in consumers’ interests.
4.
Fifth Third has known for more than a decade that its acts or practices have led to the opening of products in consumers’ names without consumers’ knowledge or consent.
5.
Fifth Third admitted in 2017 that it had opened consumer-financial products without consumer authorization during each year from 2010 to 2017. 6.
Fifth Third has known for more than a decade that its employees have, without consumer consent, transferred consumer funds, changed account types, misrepresented terms and conditions, falsified records, and assigned personalidentification numbers and passwords to consumer accounts. 7.
Fifth Third also used or obtained consumer-reporting-agency reports without a permissible purpose.
8.
Yet Fifth Third has taken insufficient steps to identify and remediate affected consumers.
9.
Fifth Third has focused on its own financial interests to the detriment of consumers.
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10.
Fifth Third’s conduct violates the Consumer Financial Protection Act of 2010 (CFPA), the Truth in Lending Act (TILA), the Truth in Savings Act (TISA), the Fair Credit Reporting Act (FCRA), and the TILA and TISA implementing regulations. 11.
The Bureau brings this action to stop Fifth Third’s unlawful conduct and to obtain redress for affected consumers and an appropriate penalty and other monetary relief.
12.
The Bureau brings this action under §§ 1031, 1036(a)(1), 1054, and 1055 of the CFPA, 12 U.S.C. §§ 5531, 5536(a)(1), 5564, 5565; TILA, 15 U.S.C. § 1601 et seq., and its implementing regulation, Regulation Z, 12 C.F.R. part 1026; FCRA, 15 U.S.C. § 1681 et seq.; and TISA, 12 U.S.C. § 4301 et seq., and its implementing regulation, Regulation DD, 12 C.F.R. part 1030.
Jurisdiction
13.
This Court has subject-matter jurisdiction over this action because it is brought under “Federal consumer financial law,” 12 U.S.C. § 5565(a)(1); presents a federal question, 28 U.S.C. § 1331; and is brought by an agency of the United States, 28 U.S.C. § 1345.
Venue 14.
Venue is proper in this district because Fifth Third is located, resides, or does business in this district. 12 U.S.C. § 5564(f). Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 3 of 43 PAGEID #: 60
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Parties 15.
The Bureau is an independent agency of the United States created by the CFPA and charged with regulating the offering and providing of consumer-financial products and services under “Federal consumer financial laws.” 12 U.S.C. § 5491(a). The Bureau is authorized to initiate civil actions in federal district court, by its own attorneys, to address violations of “Federal consumer financial law.” 12 U.S.C. § 5564(a)-(b).
16.
Fifth Third operates, among other things, a branch-banking business that offers and provides an array of financial products and services primarily used by consumers for personal, family, or household purposes. Fifth Third is therefore a “covered person” under the CFPA. 12 U.S.C. § 5481(5), (6), (15)(A). Factual Background 17.
Fifth Third has more than $200 billion in total assets and, through its branch-banking business, operates more than 1,000 full-service branches in Florida, Georgia, Illinois, Indiana, Kentucky, Michigan, North Carolina, Ohio, South Carolina, Tennessee, and West Virginia.
18.
Among the products or services (hereinafter referred to as products) Fifth Third offers through its branch-banking business are checking accounts, savings accounts, credit cards, online banking, overdraft protection, and lines of credit. Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 4 of 43 PAGEID #: 61
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Fifth Third’s Sales Practices 19.
Fifth Third’s product sales are profitable because they improve customer retention and generate fees.
20.
To increase the number of products sold to its consumers, Fifth Third conditioned employee-performance ratings and, in some instances, continued employment on whether managers and their subordinate employees met sales goals. Fifth Third also used an incentive-compensation program that rewarded managers and their subordinate employees for selling new products. 21.
Fifth Third imposed sales goals on all levels of branch—also known as financial center—employees.
22.
Fifth Third’s sales goals have been structured to incentivize employees to push products that are most profitable to the bank. 23.
Fifth Third has hidden the existence of these incentives from consumers.
24.
Fifth Third has trained its employees to tell and to otherwise convince consumers that the products being sold to them are in their best interests. 25.
Fifth Third’s sales goals have included a point-based system, with different point values assigned to different products. 26.
Fifth Third has assigned the point values primarily based on the revenue that each product generates for the bank.
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27.
Fifth Third has set sales goals for thousands of employees at a level higher than their anticipated sales.
28.
Fifth Third has used the achievement or non-achievement of sales goals as a key component in performance ratings and promotion decisions for managers and their subordinate employees. Low performance ratings could result in disciplinary action, including termination.
29.
From at least 2010 through at least 2019, Fifth Third also used a “crosssell” strategy to increase the total number of products it provided to new and existing customers.
30.
According to Fifth Third, cross-selling—which means selling multiple products to each consumer—improves “customer loyalty.” 31.
Cross-selling improves customer retention because it becomes harder for the customer to detach from the bank.
32.
From at least 2010 until at least 2017, Fifth Third set a cross-sell goal of at least four products per customer.
33.
Fifth Third’s cross-sell goal of four products per customer was not based on an analysis of individual consumers’ needs but was instead based on Fifth Third’s goals to increase customer retention and bank revenue. 34.
Fifth Third has instructed its employees to find sales opportunities by conducting what the bank calls a “financial needs assessment” of individual Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 6 of 43 PAGEID #: 63
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consumers. Employees are to use this “assessment” to build their “book of business.” Through this process, consumers are ranked by “relationship potential,” which is a measure of the “cross-sell opportunity” that each customer represents. Employees are instructed to use the “financial needs assessment” to “become the customer’s Trusted Advisor.”
35.
Fifth Third trains its employees engaged in financial-needs assessments to cite tax and other financial concerns to “widen” the gap between the consumer’s “present state” and “desired state,” making the gap “appear larger” in order to promote sales.
36.
Fifth Third’s employees conducting financial-needs assessments are often not qualified to make tax and other financial recommendations. 37.
Fifth Third tracked cross-selling effectiveness and, from at least 2010 to at least 2017, pressured employees to meet cross-selling goals. 38.
In 2010, Fifth Third’s head of retail banking wrote that the bank’s Chicago “leadership team [has] a reputation of less than desirable sales management practices,” and that “[b]ullying and threats are often used to achieve results.” 39.
Fifth Third does not tell consumers about bank-employee sales goals or cross-selling requirements or that the bank and its employees are acting in the bank’s financial interests.
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40.
To the contrary, Fifth Third tells consumers that they can be sure that the bank is acting in consumers’ interests.
Unauthorized Accounts and Transactions 41.
Thousands of Fifth Third branch employees are unable to meet their sales goals even with Fifth Third’s sales tactics. 42.
Fifth Third, without consumers’ knowledge and consent, opened deposit accounts in consumers’ names; transferred funds from consumers’ existing accounts to new, improperly opened accounts; applied for and issued credit cards; enrolled consumers in online banking; opened lines of credit on consumers’ accounts; and enrolled consumers in overdraft protection and other financial products. 43.
Fifth Third has known since at least 2010 that one reason that employees were opening unauthorized consumer-financial products was Fifth Third’s pressure on employees to sell.
44.
By 2010, at the latest, Fifth Third was aware that employees were opening products in consumers’ names without those consumers’ knowledge and consent in order to achieve sales goals or obtain incentive rewards. 45.
In 2010, Fifth Third’s head of retail banking wrote that “there have been consistent problems around unauthorized credit card sales in Chicago.” 46.
Fifth Third’s unauthorized accounts were the predictable result of its acts and practices and occurred in many of the bank’s geographic markets. Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 8 of 43 PAGEID #: 65
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47.
Fifth Third also changed without consumer consent the types of accounts or services in which consumers were enrolled; made false representations about the terms and conditions of consumer-financial products or services to induce consumers to accept, change, or enroll in them; used or obtained consumers’ credit reports without an authorized purpose; and, without consumer authorization, assigned personal-identification numbers or falsified consumer-contact information, including by creating email addresses or using inaccurate email addresses, in order to facilitate unauthorized enrollment of consumers.
48.
Fifth Third has admitted to almost 400 instances of the acts or practices described in paragraph 47.
49.
There were more than 400 instances of the acts or practices described in paragraph 47.
50.
Fifth Third claims to have opened fewer than 1,100 unauthorized consumer-financial products.
51.
Fifth Third opened more than 1,100 unauthorized consumer-financial products.
Deposit Accounts 52.
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opening new deposit accounts funded with a specified minimum balance within a defined period.
53.
Fifth Third opened deposit accounts for Fifth Third consumers without the consumers’ knowledge and consent.
54.
Some of these unauthorized accounts were “funded” when a bank employee transferred funds to the unauthorized account from the same consumer’s authorized account without the consumer’s knowledge and consent. Often, once an unauthorized account was “funded,” such that it qualified under the sales-goal tracking or incentive program, the bank employee transferred some or all of the funds back to the consumer’s authorized account, again without the consumer’s knowledge and consent.
55.
In more than 26,000 instances since 2010, a new Fifth Third depositaccount was funded with $100 or less from an existing Fifth Third account and had no activity other than the subsequent transfer, within 90 days, of those funds back to the original account.
56.
Sometimes, Fifth Third’s employee would fund a consumer’s account initially with the employee’s own money and then take reimbursement funds— without authorization—from the consumer.
57.
Since 2010, more than 124,000 new Fifth Third deposit-accounts have been funded with $100 or less and defunded to a zero balance within 90 days. Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 10 of 43 PAGEID #: 67
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58.
Sometimes, Fifth Third’s employee closed an existing account and immediately opened a new one or reopened the just-closed account, getting sales credit for a new account.
59.
Fifth Third has allowed employees to earn sales credit for “suppression” of paper account-statements, after which the consumer would not receive account statements by mail.
60.
If paper account-statements were suppressed, Fifth Third would send account statements by email.
61.
In thousands of instances, Fifth Third suppressed paper accountstatements and had no consumer email address to which it could send an electronic account-statement for receipt by a consumer.
62.
In almost 7,000 or more instances since 2010, an existing customer’s new deposit-account was funded with $100 or less by cash or internal transfer, had no activity other than the initial funding and defunding, and was associated with a Fifth Third email address even though the consumer was not a Fifth Third employee. 63.
Fifth Third acknowledged that minimum funding, fake email addresses, statement suppression, and new-account funding from an existing account could each indicate a potentially unauthorized deposit account. 64.
Until at least 2020, Fifth Third failed to use any of these indicia or a combination of them to identify unauthorized accounts or victimized consumers. Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 11 of 43 PAGEID #: 68
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65.
Fifth Third charged unjustified fees to many consumers who had deposit accounts opened without their knowledge and consent. Credit Cards 66.
Fifth Third imposed aggressive sales goals for its employees to sell credit cards to consumers, and its incentive-compensation program rewarded employees for selling new credit cards.
67.
Fifth Third applied for and issued credit cards to customers without their knowledge and consent.
68.
Fifth Third credit cards were susceptible to unauthorized applications and issuance in part because Fifth Third bank branches accepted applications over the phone at least until 2017.
69.
Fifth Third allowed its branch employees to take credit-card applications over the phone and to write “phone application” along with the date and time on the signature line of the application. In those instances, and where only a portion of that information was written, the bank retained no other indication of consumer consent. 70.
Fifth Third had no detection capabilities or reporting if an employee failed to forward the phone application to a central repository. 71.
Fifth Third considered disallowing bank-branch phone applications for credit cards by 2010. That year, Fifth Third’s head of retail banking advised the head of Fifth Third’s consumer bank that Fifth Third continued “to have problems with Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 12 of 43 PAGEID #: 69
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unauthorized credit card apps” that could be addressed by suspending “the ability of financial center personnel to take apps without a wet signature.” He further advised that requiring a “wet signature” would “reduce the issue of customers receiving cards they did not anticipate.”
72.
Around that same time, Fifth Third executives discussed the possibility of limiting credit-card sales to instances in which “the customer is physically in the Financial Center” and eliminating phone applications “where we have no customer signature.” Fifth Third chose not to impose that limitation until at least seven years later.
73.
Fifth Third acknowledged that the absence of a credit-card application could indicate an unauthorized card.
74.
Yet Fifth Third did not investigate all issued credit cards for which it has no application on file.
75.
Since 2010, more than 218,000 Fifth Third consumer credit cards have been issued but never activated or used for consumer-initiated transactions. 76.
Since 2010, more than 4,000 Fifth Third consumer credit-card accounts have been opened but have had no consumer-initiated purchases and have been associated with a Fifth Third email address where the consumer was not a Fifth Third employee.
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77.
Fifth Third has failed to examine these account populations for the absence of signed applications or for phone applications or other indicia of nonauthorization.
78.
Fifth Third charged many of these consumers unjustified fees. Online-Banking Services 79.
Fifth Third imposed aggressive sales goals for its employees to enroll consumers in its online-banking services, and its incentive-compensation program rewarded employees for enrolling consumers in those services. 80.
Fifth Third enrolled consumers in online-banking services without their knowledge and consent.
81.
Fifth Third’s sales programs credited employees for enrolling consumers in online-banking services after the consumer logged in to the service at least three times. To effectuate unauthorized enrollments, Fifth Third employees would set up consumers’ passwords without consumers’ knowledge and consent. To obtain credit for unauthorized enrollments, Fifth Third employees would log in at least the requisite number of times without the consumers’ knowledge and consent. 82.
To avoid consumers detecting unauthorized online-banking enrollment, Fifth Third employees sometimes enrolled the consumer using an email address unknown to the consumer, such as a Fifth Third email address. Fifth Third employees also used other nonbank and non-consumer email addresses to avoid detection. Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 14 of 43 PAGEID #: 71
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83.
Fifth Third’s password protocols for online banking have been substandard, increasing the risks to consumers enrolled in online banking knowingly or unknowingly.
84.
Since 2010, Fifth Third has completed more than 48,000 consumer enrollments in online banking using a Fifth Third email address. Of those, more than 12,000 had four or fewer login attempts and more than 1,400 had no login attempts. 85.
Fifth Third has not scrutinized those enrollments to determine consumer authorization.
86.
Fifth Third has not used any systematic or technological method to identify unauthorized or suspicious online-banking enrollments. Early Access Lines of Credit 87.
Early Access is a fee-based line of credit that allows Fifth Third’s checking-account holders to withdraw Fifth Third-supplied funds from their checking account before the account holder’s reimbursement funds have been deposited in the account. Fifth Third imposed aggressive sales goals for its employees to sell Early Access to consumers, and its incentive-compensation program rewarded employees for enrolling consumers in “fee-based products,” including Early Access. 88.
Fifth Third opened Early Access lines of credit on consumers’ checking accounts without their knowledge and consent. Fifth Third was aware of this by June 2010, when senior management was notified of an increase in the number of calls by Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 15 of 43 PAGEID #: 72
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employees to the internal whistleblower hotline regarding the unauthorized opening of Early Access lines of credit.
89.
Fifth Third did not effectively curtail unauthorized Early Access lines of credit in 2010.
90.
In 2013, Fifth Third found that Early Access was often “being activated without the customer present” and that there was “a 37% error rate in obtaining signatures” on Early Access applications.
91.
Fifth Third employees also sometimes forged consumer signatures on Early Access applications.
92.
Fifth Third opened unauthorized Early Access lines of credit from at least 2010 through 2014, and Fifth Third retained unauthorized Early Access lines of credit even after it stopped offering new Early Access lines of credit. 93.
From 2010 through 2014, more than 19,000 Fifth Third Early Access accounts were opened and closed on the same day without being used. 94.
Fifth Third never further scrutinized the population of Early Access accounts lacking a consumer signature or the population of Early Access accounts opened and closed on the same day without being used. 95.
Fifth Third never used any systematic or technological method to identify unauthorized Early Access enrollments or Early Access enrollments worthy of further scrutiny.
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Other Products 96.
Fifth Third admits to enrolling more than 125 consumers in overdraft protection without their consent in 2015 and 2016. 97.
Fifth Third also admits to opening other unauthorized consumerfinancial products and services, including Express Banking, Identity Alert, and Access 360 prepaid debit cards.
Fifth Third’s Understatement of the Number of Unauthorized Accounts 98.
Fifth Third knows or consciously disregards that its admissions and claims understate the real number of unauthorized account openings and other improper sales conduct.
99.
There are hundreds of thousands of Fifth Third accounts that bear indicia of non-authorization.
100. Fifth Third took insufficient steps to detect and stop sales misconduct and to identify and remediate harmed consumers. 101. Fifth Third failed to implement any system or technology to detect: unauthorized accounts; unauthorized use or obtention of credit reports; unauthorized account changes; false representations of the terms and conditions of consumerfinancial products or services; or falsifications of consumer email addresses or passwords to facilitate unauthorized enrollment of consumers in financial products or services.
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102. Instead, Fifth Third’s detection efforts relied on consumers to selfidentify as victims or employees to allege improper activity. 103. Fifth Third was aware that many consumers did not detect Fifth Third’s improper acts or practices and that many others did not lodge a complaint. 104. Fifth Third was aware that many of Fifth Third’s employees feared retribution for alleging improper conduct.
105. Even when consumers or employees alleged improper sales conduct, Fifth Third only recorded the conduct as improper if the allegation was (1) escalated above the bank-branch level, (2) internally investigated, and (3) determined to a bank investigator’s satisfaction to be “substantiated.” 106. Fifth Third was aware that many consumer and employee allegations were not escalated or recorded.
107. Under Fifth Third’s policies, a consumer complaint must be submitted for escalation only if a consumer complains in writing or “verbally expresses dissatisfaction AND requests to speak to someone else (e.g., a supervisor).” 108. As Fifth Third recognized by at least 2015, many consumer complaints are not escalated, even when consumers have detected and reported questionable conduct.
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109. In March 2015, a senior vice president wrote that 568 Fifth Third branches “did not submit a single escalated complaint” in the prior month, despite a “systemic issue as a company around card issuance” during that same time. 110. Even where allegations were recorded, escalated, and investigated, Fifth Third did not deem sales-misconduct allegations to be substantiated unless the bank’s investigator was satisfied that there was conclusive proof. 111. Fifth Third deemed all sales-misconduct allegations without such conclusive proof, including all “he said/she said” scenarios, to be unsubstantiated. 112. Fifth Third also sometimes failed to substantiate allegations because: a. elderly consumers were deemed by the bank to be “senile” or otherwise confused;
b. consumers were deemed to be confused because English was not their first language;
c. the accused employee or employees resigned before the internal investigation was completed; or d. the investigator assumed that there had been a misunderstanding. 113. Sometimes, even when the employee involved in an allegation had been accused of opening unauthorized accounts more than once or when an allegation was deemed substantiated, Fifth Third failed to investigate any accounts beyond those that were the subject of the specific consumer or employee allegation. Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 19 of 43 PAGEID #: 76
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114. Fifth Third failed to investigate all accounts opened by employees alleged or found to have engaged in improper sales acts or practices. 115. Fifth Third failed to investigate bank branches or branch regions even when the branches or regions were disproportionately the subject of substantiated allegations.
116. Fifth Third failed to investigate bank branches or branch regions even when the branches or regions were known by Fifth Third to have historically engaged in sales misconduct.
117. For example, despite knowing since at least 2010 that Chicago had a history of unauthorized credit cards and questionable sales practices, Fifth Third failed to investigate broadly the Chicago region’s sales acts or practices. 118. Fifth Third has been aware of available methods to identify unauthorized accounts beyond those Fifth Third has already admitted to opening or to identify accounts, employees, and bank branches that should be further scrutinized. 119. Fifth Third has, and members of Fifth Third’s senior management are and have been familiar with, data and other information that would be useful in implementing available unauthorized-account-identification methods for at least years 2010 to 2021.
120. Fifth Third’s current Chairman and Chief Executive Officer—formerly Fifth Third’s Chief Information Officer, Chief Operating Officer, and President—has Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 20 of 43 PAGEID #: 77
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at various times been responsible for reviewing or overseeing Fifth Third’s retailbanking business, its data maintenance and use, and its sales and investigative practices.
121. Fifth Third has failed to use systematic or technological or other reasonable methods to identify unauthorized accounts beyond those it has admitted to opening or to identify accounts, employees, and bank branches that should be further scrutinized.
122. Fifth Third, through its senior management, chose not to attempt to identify unauthorized consumer-financial products beyond those Fifth Third has admitted to opening because greater identification might cause Fifth Third reputational and financial harm.
123. Unauthorized consumer-financial products or services have been likely to cause substantial injury to consumers, including the imposition of unjustified fees, the consumer’s inability to meet other financial obligations, negative effects on consumer-reporting-agency information, and the expenditure of consumer time and effort investigating the facts, seeking closure of unwanted accounts, and monitoring and mitigating harm going forward.
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Violations of Law 124. Fifth Third’s conduct, described above, violated and, where uncorrected, continues to violate the CFPA, FCRA, TILA, TISA, and the TILA and TISA implementing regulations.
The CFPA 125. The CFPA prohibits “unfair” acts or practices. 12 U.S.C. § 5536(a)(1)(B). An act or practice is unfair if it causes or is likely to cause consumers substantial injury that is not reasonably avoidable and is not outweighed by countervailing benefits to consumers or to competition. 12 U.S.C. § 5531(c)(1). 126. The CFPA prohibits “abusive” acts or practices. 12 U.S.C. § 5536(a)(1)(B). An act or practice is abusive if it materially interferes with a consumer’s ability to understand a term or condition of a consumer-financial product or service. 12 U.S.C. § 5531(d)(1).
127. Additionally, an act or practice is abusive if it takes unreasonable advantage of a consumer’s (A) lack of understanding of the material risks, costs, or conditions of the product or service; (B) inability to protect the consumer’s interests in selecting or using a consumer-financial product or service; or (C) reasonable reliance on an offeror to act in the interests of the consumer. 12 U.S.C. § 5531(d)(2).
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Count I Abusive Sales Practices (Abusiveness, in Violation of the CFPA) 128. The Bureau realleges and incorporates by reference paragraphs 1-123. 129. Fifth Third told consumers that the bank was acting in the consumers’ best interests in conducting its product or service sales. 130. For example, Fifth Third trained its sales employees to tell consumers that “you can trust and have confidence that Fifth Third is acting in your best interest.”
131. Fifth Third made public statements that support a reasonable belief that Fifth Third’s sales practices are based on and are always in consumers’ interests. 132. Fifth Third made public statements that support a reasonable belief that Fifth Third’s employees are not incentivized to sell products that are not in consumers’ best interests.
133. Fifth Third’s sales practices have not been based on the consumers’ best interests.
134. Fifth Third incentivized its employees to sell products that are in the bank’s financial interests.
135. Fifth Third conducted assessments of individual consumers that it called a “financial needs assessment” but by which Fifth Third encouraged its employees to determine sales opportunities based on the number of products already cross-sold to Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 23 of 43 PAGEID #: 80
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the consumer’s household, their household’s income-producing assets, and the bank’s rating of further opportunity to cross-sell to the consumer as low, medium, or high. Fifth Third instructed its employees to use this process to “become the consumer’s Trusted Advisor”
136. Until at least 2017, Fifth Third set a cross-selling goal of at least four products per customer and pressured salespeople to deliver that average regardless of consumers’ best interests.
137. The goal of four products per customer was intended by Fifth Third to promote “customer loyalty” and increase Fifth Third’s revenue. 138. Fifth Third earned more than $10 million per year from cross-selling alone.
139. Fifth Third also set a point-total goal for its employees. The employees earned points for selling from an array of consumer-financial products and services. 140. The primary factor for Fifth Third’s assignment of a point value to a product has been the revenue that product generates for Fifth Third. 141. Thousands of Fifth Third’s branch employees could not meet their sales goals and were, therefore, subject to disciplinary action, including employment termination.
142. Fifth Third’s sales practices lead its employees to apply for or open consumer-financial products under false pretenses or without consumer consent; Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 24 of 43 PAGEID #: 81
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change without consumer consent the types of accounts or services in which consumers were enrolled; make false representations relating to the terms and conditions of consumer-financial products or services offered by Fifth Third to induce consumers to accept, change, or enroll in products; use or obtain consumer reports from consumer reporting agencies without a permissible purpose; assign personal-identification numbers without authorization from consumers or falsify consumer-contact information, including by creating email addresses or using inaccurate email addresses, in order to facilitate unauthorized enrollment of consumers in products offered by Fifth Third; and engage in unauthorized transactions on behalf of consumers.
143. Fifth Third’s sales practices take unreasonable advantage of the reasonable reliance by consumers on Fifth Third to act in the interests of the consumers, in violation of §§ 1031(d)(2)(C) and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(d)(2)(C), 5536(a)(1)(B).
144. Fifth Third’s sales practices lead to product issuances and product changes without consumer knowledge and consent, and, thus, Fifth Third’s sales practices take unreasonable advantage of consumers’ lack of understanding of the material risks, costs, or conditions of products or services, and take unreasonable advantage of the inability of consumers to protect the interests of consumers in selecting or using consumer-financial products or services, in violation of Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 25 of 43 PAGEID #: 82
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§§ 1031(d)(2)(A)-(B) and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(d)(2)(A)-(B), 5536(a)(1)(B).
Count II Unauthorized Deposit Accounts (Unfairness and Abusiveness, in Violation of the CFPA)
145. The Bureau realleges and incorporates by reference paragraphs 1-123. 146. Fifth Third’s acts or practices of opening deposit accounts without consumers’ knowledge and consent are likely to cause substantial injury in the form of fees, penalties, negative effects on consumer-reporting-agency information, and expenditure of consumer time and effort.
147. Fifth Third’s acts or practices of transferring funds between consumers’ accounts without their knowledge and consent are likely to cause substantial injury in the form of fees, penalties, the inability to withdraw funds, the inability to meet other financial obligations, negative effects on consumer-reporting-agency information, and expenditure of consumer time and effort.
148. Fifth Third has charged many of these consumers unjustified fees. 149. Because these acts or practices occur without consumers’ knowledge and consent, the injuries are not reasonably avoidable by consumers, and they are also not outweighed by countervailing benefits to consumers or to competition. 150. Therefore, Fifth Third engaged in unfair acts or practices that violate §§ 1031(c)(1) and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(c)(1), 5536(a)(1)(B). Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 26 of 43 PAGEID #: 83
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151. Fifth Third’s acts or practices of opening deposit accounts without consumers’ knowledge and consent materially interfere with consumers’ ability to understand the terms and conditions of the deposit accounts. 152. Fifth Third’s acts or practices of opening deposit accounts without consumers’ knowledge and consent take unreasonable advantage of the inability of consumers to protect their interests in selecting or using a consumer-financial product or service.
153. Fifth Third’s acts or practices of transferring funds between consumers’ accounts without their knowledge and consent take unreasonable advantage of the inability of consumers to protect their interests in using a consumer-financial product or service.
154. Therefore, Fifth Third engaged in abusive acts or practices that violate §§ 1031(d)(1), 1031(d)(2)(B), and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(d)(1), 5531(d)(2)(B), 5536(a)(1)(B).
Count III Unauthorized Credit Cards (Unfairness and Abusiveness, in Violation of the CFPA)
155. The Bureau realleges and incorporates by reference paragraphs 1-123. 156. Fifth Third’s acts or practices of applying for or issuing credit cards to consumers without their knowledge and consent are likely to cause substantial injury Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 27 of 43 PAGEID #: 84
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in the form of fees, negative effects on consumer-reporting-agency information, and expenditure of consumer time and effort.
157. Consumers cannot reasonably avoid these injuries because the creditcard applications and issuances occur without their knowledge and consent. 158. The injuries to consumers are not outweighed by countervailing benefits to consumers or to competition.
159. Therefore, Fifth Third engaged in unfair acts or practices that violate §§ 1031(c)(1) and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(c)(1), 5536(a)(1)(B). 160. Fifth Third’s acts or practices of applying for or issuing credit cards to consumers without consumers’ knowledge and consent materially interfere with consumers’ ability to understand the terms and conditions of the credit cards. 161. Fifth Third’s acts or practices of applying for or issuing credit cards to consumers without consumers’ knowledge and consent take unreasonable advantage of the inability of consumers to protect their interests in selecting or using a consumer-financial product or service.
162. Therefore, Fifth Third engaged in abusive acts or practices that violate §§ 1031(d)(1), 1031(d)(2)(B), and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(d)(1), 5531(d)(2)(B), 5536(a)(1)(B).
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Count IV Unauthorized Enrollment in Online-Banking Services (Unfairness and Abusiveness, in Violation of the CFPA)
163. The Bureau realleges and incorporates by reference paragraphs 1-123. 164. Fifth Third’s acts or practices of enrolling consumers in online-banking services without consumers’ knowledge and consent are likely to cause substantial injury in the form of the increased risk of data theft, money theft, and improper personal-data use, and the expenditure of consumer time and effort determining the facts and attempting to monitor and mitigate the harm. 165. Because these enrollments occur without consumers’ knowledge and consent, the injuries are not reasonably avoidable by consumers, and they are not outweighed by countervailing benefits to consumers or to competition. 166. Therefore, Fifth Third engaged in unfair acts or practices that violate §§ 1031(c)(1) and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(c)(1), 5536(a)(1)(B). 167. Fifth Third’s acts or practices of enrolling consumers in online-banking services without their knowledge and consent materially interfere with consumers’ ability to understand the terms and conditions of online banking. 168. Fifth Third’s acts or practices of enrolling consumers in online-banking services without their knowledge and consent take unreasonable advantage of the inability of consumers to protect their interests in selecting or using a consumerfinancial product or service.
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169. Therefore, Fifth Third engaged in abusive acts or practices that violate §§ 1031(d)(1), 1031(d)(2)(B), and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(d)(1), 5531(d)(2)(B), 5536(a)(1)(B).
Count V Unauthorized Opening of Early Access (Unfairness and Abusiveness, in Violation of the CFPA) 170. The Bureau realleges and incorporates by reference paragraphs 1-123. 171. Fifth Third’s acts or practices of opening Early Access lines of credit on consumers’ deposit accounts without their knowledge and consent are likely to cause substantial injury in the form of negative effects on consumers’ credit profiles and expenditure of consumer time and effort.
172. Because these acts or practices occurred without consumers’ knowledge, the injuries were not reasonably avoidable by consumers, and they were also not outweighed by countervailing benefits to consumers or to competition. 173. Therefore, Fifth Third engaged in unfair acts or practices that violate §§ 1031(c)(1) and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(c)(1), 5536(a)(1)(B). 174. Fifth Third’s acts or practices of opening Early Access lines of credit on consumers’ deposit accounts without their knowledge and consent materially interfere with consumers’ ability to understand Early Access’s terms and conditions. 175. Fifth Third’s acts or practices of opening Early Access lines of credit on consumers’ deposit accounts without their knowledge and consent take unreasonable Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 30 of 43 PAGEID #: 87
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advantage of consumers’ inability to protect their interests in selecting or using a consumer-financial product or service.
176. Therefore, Fifth Third engaged in abusive acts or practices that violate §§ 1031(d)(1), 1031(d)(2)(B), and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(d)(1), 5531(d)(2)(B), 5536(a)(1)(B).
Count VI Unauthorized Enrollment in Overdraft Protection (Unfairness and Abusiveness, in Violation of the CFPA)
177. The Bureau realleges and incorporates by reference paragraphs 1-123. 178. Fifth Third enrolled consumers in overdraft protection, including linkedaccount protection and line-of-credit protection, without the consumers’ knowledge and consent. In some instances, the line-of-credit overdraft protection was in the form of a credit card that the consumer also did not know of and authorize. 179. Fifth Third’s acts or practices of enrolling consumers in overdraft protection without consumers’ knowledge and consent are likely to cause substantial injury in the form of fees, expenditure of consumer time and effort, and negative effects on consumer-reporting-agency information. 180. Because these acts or practices occurred without consumers’ knowledge, the injuries were not reasonably avoidable by consumers, and they were also not outweighed by countervailing benefits to consumers or to competition. Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 31 of 43 PAGEID #: 88
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181. Therefore, Fifth Third engaged in unfair acts or practices that violate §§ 1031(c)(1) and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(c)(1), 5536(a)(1)(B). 182. Fifth Third’s acts or practices of enrolling consumers in overdraft protection without their knowledge and consent materially interfere with consumers’ ability to understand the terms and conditions of overdraft protection and, where applicable, the accompanying credit card.
183. Fifth Third’s acts or practices of enrolling consumers in overdraft protection without their knowledge and consent take unreasonable advantage of the inability of consumers to protect their interests in selecting or using a consumerfinancial product or service.
184. Therefore, Fifth Third engaged in abusive acts or practices that violate §§ 1031(d)(1), 1031(d)(2)(B), and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(d)(1), 5531(d)(2)(B), 5536(a)(1)(B).
Count VII Unauthorized Enrollment in Other Consumer-Financial Products (Unfairness and Abusiveness, in Violation of the CFPA)
185. The Bureau realleges and incorporates by reference paragraphs 1-123. 186. Fifth Third, without consumer knowledge and consent, enrolled consumers in other consumer-financial products, including Express Banking, Identity Alert, and Access 360 prepaid debit cards.
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187. Fifth Third’s acts or practices of enrolling consumers in consumerfinancial products, including Express Banking, Identity Alert, and Access 360 prepaid debit cards, without consumers’ knowledge and consent are likely to cause substantial injury in the form of expenditure of consumer time and effort. 188. Because these acts or practices occurred without consumers’ knowledge, the injuries were not reasonably avoidable by consumers, and they were also not outweighed by countervailing benefits to consumers or to competition. 189. Therefore, Fifth Third engaged in unfair acts or practices that violate §§ 1031(c)(1) and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(c)(1), 5536(a)(1)(B). 190. Fifth Third’s acts or practices of enrolling consumers in consumerfinancial products, including Express Banking, Identity Alert, and Access 360 prepaid debit cards, without their knowledge and consent materially interfere with consumers’ ability to understand the terms and conditions of those products. 191. Fifth Third’s acts or practices of enrolling consumers in consumerfinancial products, including Express Banking, Identity Alert, and Access 360 prepaid debit cards, without their knowledge and consent take unreasonable advantage of the inability of consumers to protect their interests in selecting or using a consumerfinancial product or service.
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192. Therefore, Fifth Third engaged in abusive acts or practices that violate §§ 1031(d)(1), 1031(d)(2)(B), and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(d)(1), 5531(d)(2)(B), 5536(a)(1)(B).
Count VIII Unauthorized Credit-Card Issuance (Violations of TILA and Regulation Z) 193. The Bureau realleges and incorporates by reference paragraphs 1-123. 194. Under TILA, “no credit card shall be issued except in response to a request or application therefor.” 15 U.S.C. § 1642. Regulation Z requires that “regardless of the purpose for which a credit card is to be used, including business, commercial, or agricultural use, no credit card shall be issued to any person except in response to an oral or written request or application for the card; or as a renewal of, or substitute for, an accepted credit card.” 12 C.F.R. § 1026.12(a). 195. Fifth Third issued credit cards to consumers without their knowledge or consent and not in response to an oral or written request or application for the card. 196. Therefore, Fifth Third violated TILA and Regulation Z, 15 U.S.C. § 1642; 12 C.F.R. § 1026.12(a).
Count IX Unauthorized Deposit Accounts (Violations of TISA and Regulation DD)
197. The Bureau realleges and incorporates by reference paragraphs 1-123. Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 34 of 43 PAGEID #: 91
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198. TISA’s purpose is “to require the clear and uniform disclosure of— (1) the rates of interest which are payable on deposit accounts by depository institutions; and (2) the fees that are assessable against deposit accounts, so that consumers can make a meaningful comparison between the competing claims of depository institutions with regard to deposit accounts.” 12 U.S.C. § 4301(b). TISA further authorizes the Bureau to issue implementing regulations, including regulations to carry out these purposes. E.g., 12 U.S.C. § 4308(a). 199. TISA’s implementing regulation, 12 C.F.R. § 1030.4 (Regulation DD), requires the disclosure of the annual percentage yield and interest rate, compounding and crediting information, balance information, fees, and more. 12 C.F.R. § 1030.4(b). Those disclosures must be made before account opening. 12 C.F.R. § 1030.4(a)(1)(i). 200. By opening deposit-accounts without consumer authorization and, in the process, failing to make the required disclosures to the affected consumers, Fifth Third violated TISA and Regulation DD, 12 U.S.C. § 4301(b); 12 C.F.R. § 1030.4. Count X Unauthorized Consumer Reports (Violations of FCRA)
201. The Bureau realleges and incorporates by reference paragraphs 1-123. 202. Section 604(f) of FCRA mandates that consumer reports be used or obtained only for permissible purposes enumerated in the statute. 15 U.S.C. § 1681b(f).
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203. Under FCRA, a “person shall not use or obtain a consumer report for any purpose unless—(1) the consumer report is obtained for a purpose for which the consumer report is authorized to be furnished” and one other condition is met. 15 U.S.C. § 1681b(f).
204. The authorized purposes specified in FCRA include consumer reports furnished “in connection with a credit transaction involving the consumer on whom the information is to be furnished and involving the extension of credit to, or review or collection of an account of, the consumer.” 15 U.S.C. § 1681b(a)(3)(A). 205. It was Fifth Third’s practice to obtain consumer reports in the course of considering consumers for new credit cards and other credit products. 206. Fifth Third used or obtained consumer reports to consider consumers for new credit products even when the consumers had not applied for or did not want the products and where Fifth Third had no permissible purpose for the consumer reports.
207. Fifth Third used or obtained consumer reports without a permissible purpose in connection with unauthorized applications for credit cards, overdraft protection linked to a credit card, other consumer-credit products, and Fifth Third’s attempts to sell consumer-credit products.
208. By using or obtaining consumer reports without a permissible purpose, Fifth Third violated § 604(f) of FCRA, 15 U.S.C. § 1681b(f). Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 36 of 43 PAGEID #: 93
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Count XI Unfair Sales Practices (Unfairness, in Violation of the CFPA) 209. The Bureau realleges and incorporates by reference paragraphs 1-123. 210. Even after learning by 2008 of unauthorized Fifth Third consumerfinancial products and services and applications therefor, Fifth Third failed to change its sales practices to avoid consumer harm. Instead, Fifth Third continued to foster sales practices that were likely to cause unauthorized products and services and applications therefor.
211. Fifth Third imposed sales goals on all levels of branch employees; set goals that thousands of its employees could not achieve; threatened employees with termination or other disciplinary action if they failed to meet their goals; established a system under which managers pressured subordinate employees to sell; failed to take steps to determine and address a root cause of unauthorized accounts, applications, and obtention of credit reports, which was consistently said by employees to be intense sales-pressure; and failed to close known loopholes in its collection of proof of consumer authorization.
212. Fifth Third’s sales practices were likely to cause substantial injury to consumers, including negative effects on their consumer-reporting-agency information, the expenditure of consumer time and effort, the imposition of unjustified fees, the theft of funds or private information, and the inability to meet Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 37 of 43 PAGEID #: 94
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financial obligations. This substantial injury to consumers is a predictable consequence of Fifth Third’s sales practices.
213. Because any unauthorized applications, products, or services and Fifth Third’s conduct occur without consumers’ knowledge, the substantial injury to consumers is not reasonably avoidable by consumers. 214. Further, the substantial injury to consumers is not outweighed by countervailing benefits to consumers or to competition. 215. Therefore, Fifth Third engaged in unfair practices that violate §§ 1031(c) and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(c), 5536(a)(1)(B). Count XII Failure to Identify and Remediate Affected Consumers (Abusiveness, in Violation of the CFPA) 216. The Bureau realleges and incorporates by reference paragraphs 1-123. 217. Fifth Third is aware of reasonable methods available to it to identify additional consumers that it subjected to unauthorized financial products or services or applications therefor.
218. Fifth Third declined, and still declines, to make reasonable efforts to identify additional consumers that it subjected to unauthorized financial products or services or applications therefor.
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219. Fifth Third declined to make these reasonable efforts because it believes that identification of additional affected consumers would cause it reputational and other harm.
220. Some consumers who Fifth Third victimized with unauthorized products or services had those products or services open for months or years without their knowledge.
221. Compounding the harm to consumers, Fifth Third made statements to consumers that could cause reasonable consumers to believe that Fifth Third acts in their interests and has identified and remediated all consumers that it subjected to unauthorized financial products or services.
222. These acts or practices take unreasonable advantage of a lack of understanding on the part of consumers of the material risks, costs, or conditions of Fifth Third’s products or services.
223. These acts or practices take unreasonable advantage of the inability of consumers to protect the interests of consumers in selecting or using consumerfinancial products or services because the consumers are unaware of those products or services.
224. These acts or practices take unreasonable advantage of the reasonable reliance by consumers on Fifth Third to act in the interests of the consumers. Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 39 of 43 PAGEID #: 96
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225. Therefore, Fifth Third engaged in abusive acts or practices that violate §§ 1031(d)(2)(A), 1031(d)(2)(B), 1031(d)(2)(C), and 1036(a)(1)(B) of the CFPA. 12 U.S.C. §§ 5531(d)(2)(A), 5531(d)(2)(B), 5531(d)(2)(C), 5536(a)(1)(B). Count XIII Fifth Third’s Additional Violations of the CFPA 226. The Bureau realleges and incorporates by reference paragraphs 1-123. 227. By violating TILA, Regulation Z, FCRA, TISA, and Regulation DD, Fifth Third violated § 1036(a)(1)(A) of the CFPA. 12 U.S.C. § 5536(a)(1)(A). Demand for Relief The Bureau requests that the Court:
a.
permanently enjoin Fifth Third from, without the consumer’s consent: (1) opening any deposit account; (2) transferring funds between deposit accounts; (3) issuing any credit card; (4) enrolling the consumer in online-banking services; (5) opening any line of credit; (6) submitting any credit-card application; and (7) using or obtaining the consumer’s consumer-reporting-agency report; b.
order Fifth Third to take all reasonable steps to avoid and correct any statement to consumers by Fifth Third that its sales acts and practices are in consumer interests when they are not or may not be in consumer interests; c.
order Fifth Third to take all reasonable steps to identify and notify consumers who may have had a consumer-financial product or service opened or Case: 1:21-cv-00262-DRC Doc #: 73 Filed: 06/16/21 Page: 40 of 43 PAGEID #: 97
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applied for without their consent, and allow those consumers to have their products or services closed without fees or penalties; d.
order Fifth Third to take all reasonable steps to identify and notify consumers who, because of Fifth Third’s acts or practices, may have had their consumer-reporting-agency report furnished to or used by Fifth Third without a permissible purpose;
e.
order Fifth Third to correct harmful consumer-reporting-agency information, including but not limited to correcting any harmful trade lines on consumer-credit reports resulting from unauthorized consumer-financial products or services at Fifth Third or applications therefor; f.
order Fifth Third to pay damages, restitution, and other monetary relief to consumers;
g.
order Fifth Third to pay disgorgement or compensation for unjust enrichment;
h.
impose on Fifth Third a civil money penalty under 12 U.S.C. § 5565(c); i.
order Fifth Third to pay the costs incurred in connection with prosecuting this action, under 12 U.S.C. § 5565(b); and j.
award additional relief as the Court may determine to be just and proper.
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Dated: June 16, 2021
Respectfully submitted,
Cara M. Petersen Acting Enforcement Director Jeffrey Paul Ehrlich Deputy Enforcement Director Kara K. Miller Assistant Litigation Deputy
/s/ Barry E. Reiferson
. . . . . . . . . .. .. BARRY E. REIFERSON, NY Reg. #24343893 (Trial Attorney) Email: [email protected] LEANNE E. HARTMANN, CA Bar #264787 Email: [email protected] LANE C. POWELL, MI Bar #P79432 Email: [email protected] MEGHAN SHERMAN CATER, NY Reg. #4473120 Email: [email protected]
1700 G Street, NW Washington, DC 20552 Telephone: (212) 328-7020 Facsimile: (202) 435-5477
Attorneys for the Bureau of Consumer Financial Protection
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Certificate of Service I certify that, on June 16, 2021, the foregoing AMENDED COMPLAINT was filed electronically using the Court’s CM/ECF system, and notice of this filing will be sent to attorneys of record who are registered users of the system. /s/Barry Reiferson
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Opinion ()
PDF of this document (25 pages)
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UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF OHIO WESTERN DIVISION
BUREAU OF CONSUMER FINANCIAL PROTECTION,
Plaintiff,
v.
FIFTH THIRD BANK, N.A.,
Defendant.
Case No. 1:21-cv-262
JUDGE DOUGLAS R. COLE
OPINION AND ORDER
In this case, the Bureau of Consumer Financial Protection (the Bureau) alleges that Fifth Third Bank, N.A., (Fifth Third) violated various federal consumer protection statutes in its dealings with its customers, mainly by opening accounts or adding products or services to existing accounts, without customer authorization, thereby causing those customers to incur fees. (Am. Compl., Doc. 73). The parties have now settled their dispute. Or, rather, they are willing to settle their dispute, contingent upon this Court’s approving a consent decree they jointly submitted. (Doc. 151).
While consent decrees are a common method for resolving disputes like this, at least some courts confronted with them have nonetheless raised concerns. These concerns extend to both the court’s basic authority to enter such decrees in an otherwise-settled matter (i.e., jurisdictional concerns) and the scope of the court’s remedial authority under traditional principles of equity to enter what amounts to permanent injunctive relief.
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The Court, however, will not belabor those points here. That is because, in a thoughtful opinion, Judge Beaton has recently explored both issues in detail. Lexington Ins. Co. v. Ambassador Grp., LLC, 581 F. Supp. 3d 863 (W.D. Ky. 2021). This Court echoes the concerns raised there, but it has little to add beyond the careful analysis that opinion articulates.
More relevant here, the Court agrees with Judge Beaton that, whatever the merits of either the jurisdictional concerns or the remedial concerns if this Court were writing on a blank slate, the Sixth Circuit has already resolved them in binding decisions. Id. at 868, 870. On the jurisdictional front, the Sixth Circuit instructs that a court has jurisdiction to enter a consent decree in support of settlement so long as the decree (1) “spring[s] from and serve[s] to resolve a dispute within the court’s subject-matter jurisdiction,” (2) “com[es] within the general scope of the case made by the pleadings,” and (3) “further[s] the objective of the law upon which the complaint was based.” Benalcazar v. Genoa Twp., 1 F. 4th 421, 425 (6th Cir. 2021) (quoting Local No. 93, Int’l Ass’n of Firefighters v. City of Cleveland, 478 U.S. 510, 525 (1986)). And the Sixth Circuit has also confirmed that whether the Court should actually issue a permanent injunction (which is what a consent decree amounts to) is largely guided by traditional equitable principles, under which the Court is to determine “whether the decree is fair, adequate, and reasonable, as well as consistent with the public interest.” Lexington Ins., 581 F. Supp. 37 at 870 (quoting United States v. Lexington- Fayette Urb. Cnty. Gov’t, 591 F.3d 484, 489 (6th Cir. 2010)). Beyond that, “the district court’s inherent power is broad and the court’s choice of remedies is reviewed for Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 2 of 25 PAGEID #: 2227
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abuse of discretion.” Id. (quoting United States v. Bd. of Cnty. Comm’rs of Hamilton Cnty., 937 F.3d 679, 688 (6th Cir. 2019)) (cleaned up). How do those two frameworks play out here? Start with jurisdiction. The proposed consent decree clearly springs from and serves to resolve a dispute within this Court’s subject-matter jurisdiction. This action involves allegations that Fifth Third violated federal statutes that the Bureau has the authority to enforce. That suffices to establish subject-matter jurisdiction. 28 U.S.C. § 1331. And the parties engaged in vigorous negotiations to resolve this matter, which strongly suggests the consent decree (one of the terms they negotiated) is necessary to resolution. As to the second element, the proposed consent decree falls well within the general scope of the case. The consent decree orders Fifth Third not to violate the very provisions that the Bureau sought to enforce against Fifth Third’s past conduct here in the future. (Doc. 151-1, #2211, 2213–14). Beyond that, it also requires Fifth Third to maintain various policies and procedures designed to serve that goal, to adopt a compliance plan along those lines, to engage in certain ongoing reporting, and to maintain various records relating to all of these actions. (Id. at #2214–17, 2221–22). That all strikes the Court as related to the scope of the case here. Finally, the Court concludes that the terms of the consent decree also further the objective of the law. Congress presumably adopted these laws (and the Bureau, its corresponding regulations) based on the view that compliance with them would serve customers’ interests. Consumer Financial Protection Act of 2010 (CFPA) § 1021, 12 U.S.C § 5511 (“The Bureau shall seek to implement and, where applicable, [to] enforce Federal consumer financial law Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 3 of 25 PAGEID #: 2228
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consistently for the purpose of ensuring that all consumers have access to markets for consumer financial products and services and that markets for consumer financial products and services are fair, transparent, and competitive.”). Accordingly, steps designed to ensure such compliance, or to detect non-compliance, would further those objectives.
What about the propriety of the requested permanent injunctive relief (via the entry of a consent decree) as a matter of equitable principles? The types of harms alleged here—unauthorized fees—strike the Court as harms for which there is generally an adequate remedy at law. E.g., CFPA § 1055(c), 12 U.S.C. § 5565(c). But two further thoughts. First, the alleged harms are diffuse and inflicted on unknowing customers, so a remedy at law might not be so easy after all. Second, and more importantly, the interest the Bureau’s suit seeks to advance is its own separate regulatory interest in preventing such violations in the first instance. True, the statute makes civil penalties available for violations, which means the Bureau could wait for the harm to occur and to seek a remedy on the back end. But those civil penalties do not really “remedy” the regulatory interest in preventing such harms up front. Beyond that, at least one of the statutes under which the Bureau proceeds here, the CFPA, specifically authorizes the Bureau to seek “equitable relief including a permanent or temporary injunction as permitted by law,” CFPA § 1054(a), 12 U.S.C. § 5564(a), which demonstrates that Congress agrees that injunctive relief should be available in cases prosecuted under that statute. True, the statute’s reference to the availability of such relief does not render the other elements traditionally required to Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 4 of 25 PAGEID #: 2229
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obtain injunctive relief unnecessary. See Starbucks Corp. v. McKinney, 144 S. Ct. 1570, 1576–77 (2024). But it certainly suggests that Congress sees the harms at issue as irreparable. And, as noted, the Court agrees. The balance of harms likewise favors the relief, as both the Bureau and Fifth Third have agreed to it. That suggests both parties view the entire settlement as providing more benefits than harms and that relief at law will not, on its own, adequately remedy the alleged harms. Cf. McGowan v. Parish 237 U.S. 285, 295–96 (1915) (noting that a party’s proffer of a consent decree can waive his objection that a legal remedy may be available and may therefore bar equitable relief in a cause that properly invokes the court’s equity authority). Beyond that, the Court also concludes that the settlement is “fair, adequate, and reasonable,” and “consistent with the public interest.” Lexington Ins., 581 F. Supp. 37 at 870 (citation omitted). As just noted, the consent decree emerged from hard-fought negotiations between the parties. That suggests each side has concluded that it is fair, adequate, and reasonable. Having reviewed the consent decree, the Court sees no reason to upset that conclusion. Cf. Hawes v. Macy’s Inc., No. 1:17-cv- 754, 2023 WL 8811499, at *11 (S.D. Ohio Dec. 20, 2023) (“Each party entered mediation with separate sets of goals and each extracted concessions from the other. The Court therefore presumes the settlement negotiations were not plagued by fraud or corruption.”). As for the public interest, as already described above, the injunctive relief under the consent decree is largely directed at preventing and detecting future violations, a result that presumably serves that interest. And then there is also the underlying public policy that favors settling disputes, thereby avoiding (or at least Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 5 of 25 PAGEID #: 2230
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reducing the length of) complex, costly, time-consuming litigation. See Aro Corp. v. Allied Witan Co., 531 F.2d 1368, 1372 (6th Cir. 1976) (“Public policy strongly favors settlement of disputes without litigation.”); Kukla v. Nat’l Distillers Prods. Co., 483 F.2d 619, 621 (6th Cir. 1973) (“The power of a trial court to enter a judgment enforcing a settlement agreement has its basis in the policy favoring the settlement of disputes and the avoidance of costly and time-consuming litigation.”). Finally, the Court addresses one additional issue that is appropriate for courts to consider whenever parties ask the court to enter an order that will require ongoing judicial monitoring: administrability. Cf. Ramirez v. Collier, 595 U.S. 411, 433–34 (2022) (discussing the administrability of the equitable remedy requested as a factor weighing in favor of granting the relief that a court considers as part of its weighing the balance of equities). Whether categorized as an aspect of reasonableness, or instead as a public policy consideration, the point is that courts should hesitate to enter judicial orders that are difficult to administer. Such concerns have at least two facets. The first is definiteness. Any obligations that an order imposes on a party must be stated with sufficient clarity for a court to ascertain whether the party has transgressed them or not. See Fed. R. Civ. P. 65(d)(1)(C) (“Every order granting an injunction and every restraining order must: … describe in reasonable detail—and not by referring to the complaint or other document—the act or acts restrained or required.”); accord Perez v. Ohio Bell Tel. Co., 655 F. App’x 404, 410–12 (6th Cir. 2016). Based on the Court’s review, the proposed order here passes that test. Second, a court should consider whether an order makes an unwarranted claim on scarce Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 6 of 25 PAGEID #: 2231
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judicial resources, or in some way requires a judge to go beyond the scope of his traditional role and duties as a judge. So, for example, an order that obligated a court to spend hours routinely poring over extensive reports may fall short on the former. While an order that obligated a court to perform detailed statistical analyses of the information contained in those reports may raise concerns under the latter. Put simply, even when all parties are amenable to an order, courts nonetheless must remain mindful of their own limitations, in terms of both resources, expertise, and statutory authority. Nw. Airlines, Inc. v. Transp. Workers Union of Am., 451 U.S. 77, 95–98 (1981) (defining federal courts’ very narrow role in fashioning remedies, especially when Congress has chosen very specific remedies under statute). All that said, the proposed order here does not raise any concerns on this front either. In sum, the Court concludes that it has the jurisdiction to enter the proposed consent decree and that doing so constitutes an appropriate exercise of the Court’s equitable remedial powers. The Court therefore adopts and enters the proposed order (Doc. 151-1) as follows:
CONSENT ORDER The Bureau of Consumer Financial Protection (Bureau) commenced this civil action on March 9, 2020, to obtain injunctive and monetary relief and civil penalties from Fifth Third Bank, N. A. (Fifth Third). The Amended Complaint alleges violations of §§ 1031 and 1036(a)(1)(B) of the Consumer Financial Protection Act of 2010 (CFPA), 12 U.S.C. §§ 5531 and 5536(a)(1)(B); the Truth in Lending Act (TILA), 15 U.S.C. § 1601 et seq., and its implementing regulation, Regulation Z, 12 C.F.R. Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 7 of 25 PAGEID #: 2232
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part 1026; the Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681 et seq., and the Truth in Savings Act (TISA), 12 U.S.C. § 4301 et seq., and its implementing regulation, Regulation DD, 12 C.F.R. part 1030, in connection with Fifth Third’s sales and business practices relating to Consumer Financial Products and Services. The Bureau and Fifth Third agree to entry of this Stipulated Final Judgment and Order (Order), without adjudication of any issue of fact or law, to settle and resolve all matters in dispute arising from the conduct alleged in the Amended Complaint (Doc. 73).
FINDINGS 1.
This Court has jurisdiction over the parties and the subject matter of this action.
2.
Fifth Third neither admits nor denies the allegations in the Amended Complaint, except as specified in this Order. For purposes of this Order, Fifth Third admits the facts necessary to establish the Court’s jurisdiction over the parties and the subject matter of this action.
3.
Fifth Third waives all rights to seek judicial review or otherwise to challenge or to contest the validity of this Order and any claim it may have under the Equal Access to Justice Act, 28 U.S.C. § 2412, concerning the prosecution of this action to the date of this Order. Each Party agrees to bear its own costs and expenses, including, without limitation, attorneys’ fees.
4.
Entry of this Order is in the public interest.
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DEFINITIONS 5.
The following definitions apply to this Stipulated Final Judgment and Order:
a. “Account-Opening Affected Consumers” means any consumer subjected to any Unauthorized-Account-Opening Acts or Practices during the Redress Period.
b. “Board” means Fifth Third’s duly elected and acting Board of Directors. c. “Consumer Financial Product or Service” is defined in 12 U.S.C. § 5481 and means any financial product or service that is described in one or more categories under (A) paragraph (15) of 12 U.S.C. § 5481 and is offered or provided for use by consumers primarily for personal, family, or household purposes; or (B) clause (i), (v), (vii), (ix), or (x) of paragraph (15)(A) of 12 U.S.C. § 5481 and is delivered, offered, or provided in connection with a Consumer Financial Product or Service referred to in 12 U.S.C. § 5481(5)(A).
d. “Consumer Reporting Agency” means a Consumer Reporting Agency as defined by 15 U.S.C. § 1681a(f).
e. “Effective Date” means the date on which this Stipulated Final Judgment and Order is entered.
f. “Fifth Third” means Fifth Third Bank, N. A., and its successors and assigns.
g. “Redress Period” means January 1, 2010, through December 31, 2016. Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 9 of 25 PAGEID #: 2234
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h. “Related Consumer Action” means a private action by or on behalf of one or more consumers or an enforcement action by another governmental agency brought against Fifth Third based on substantially the same facts as described in the Amended Complaint (Doc. 73). i. “Supervision Director” means the Supervision Director for the Bureau, or their delegate.
j. “Unauthorized-Account-Opening Acts or Practices” means any of the following:
i. applying for, opening, issuing, activating, or enrolling a consumer in any Consumer-Financial Product or Service, including but not limited to lines of credit, credit cards, deposit accounts, and onlinebanking services, without the consumer’s consent; and ii. transferring funds between a consumer’s accounts without the consumer’s consent or authorization.
CONDUCT PROVISIONS I Prohibited Conduct IT IS ORDERED that:
6.
Fifth Third and its officers, agents, servants, employees, and attorneys who receive actual notice of this Order, whether acting directly or indirectly, may not violate §§ 1031 and 1036(a)(1)(B) of the Consumer Financial Protection Act of 2010 (CFPA), 12 U.S.C. §§ 5531 and 5536(a)(1)(B); the Truth in Lending Act (TILA), 15 Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 10 of 25 PAGEID #: 2235
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U.S.C. § 1601 et seq., and its implementing regulation, Regulation Z, 12 C.F.R. part 1026; the Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681 et seq., and the Truth in Savings Act (TISA), 12 U.S.C. § 4301 et seq., and its implementing regulation, Regulation DD, 12 C.F.R. part 1030, by engaging in Unauthorized-Account-Opening Acts or Practices.
7.
Fifth Third and its officers, agents, servants, employees, and attorneys who receive actual notice of this Order, whether acting directly or indirectly, will not represent to any consumer that Fifth Third is acting in a fiduciary capacity with respect to that consumer unless Fifth Third has reasonably confirmed that any Consumer Financial Product or Service recommended to that consumer is in the consumer’s best interests.
II Required Conduct 8.
Fifth Third must maintain policies and procedures that: a. ensure the Bank does not set performance-management and sales goals for its employees that foster Unauthorized-Account- Opening Acts or Practices; this includes, but is not limited to, maintaining, or continuing to maintain, policies and procedures that: (i) do not allow product-specific sales goals; (ii) utilize incentive-compensation clawback policies for employees found to have engaged in Unauthorized-Account-Opening Acts or Practices; (iii) do not incentivize employees to open accounts that Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 11 of 25 PAGEID #: 2236
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do not get used or funded; (iv) provide contemporaneous notifications to customers when accounts are opened; and (v) otherwise ensure rigorous control and auditing functions to detect and prevent employee misconduct relating to potential unauthorized accounts.
b. require the collection and retention of evidence demonstrating that a consumer has authorized the application, issuance, or opening of any Consumer Financial Product or Service; and c. ensure that Fifth Third (i) appropriately handles consumer inquiries or complaints concerning Unauthorized-Account- Opening Acts or Practices; (ii) appropriately handles employee inquiries, concerns, or complaints concerning sales pressure or Unauthorized-Account-Opening Acts or Practices; (iii) tracks indicia of Unauthorized-Account-Opening Acts or Practices; (iv) identifies unauthorized account openings and remediates affected consumers; and (v) provides employee training reasonably designed to prevent Unauthorized-Account-Opening Acts or Practices.
9.
Fifth Third must periodically evaluate the policies and procedures required by Paragraph 8 and revise, expand, and supplement them as needed to ensure they are compliant.
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III Compliance Plan IT IS FURTHER ORDERED that:
9.
Within 90 days of the Effective Date, Fifth Third must create and implement a comprehensive compliance plan designed to ensure that Fifth Third’s account-opening acts or practices comply with §§ 1031 and 1036(a)(1)(B) of the Consumer Financial Protection Act of 2010 (CFPA), 12 U.S.C. §§ 5531 and 5536(a)(1)(B); the Truth in Lending Act (TILA), 15 U.S.C. § 1601 et seq., and its implementing regulation, Regulation Z, 12 C.F.R. part 1026; the Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681 et seq., and the Truth in Savings Act (TISA), 12 U.S.C. § 4301 et seq., and its implementing regulation, Regulation DD, 12 C.F.R. part 1030, and the terms of this Order. The Compliance Plan must include, at a minimum:
a. detailed steps Fifth Third has taken or will take to address each action required by this Order;
b. a mechanism to ensure that the Board is kept apprised of the status of compliance actions; and c. specific timeframes and deadlines for implementation of the steps described above, if not already implemented.
Fifth Third will provide the Compliance Plan to the Bureau upon request. Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 13 of 25 PAGEID #: 2238
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IV Role of the Board and Executives IT IS FURTHER ORDERED that:
10.
Fifth Third’s Board has the ultimate responsibility for ensuring that Fifth Third complies with this Order.
11.
Fifth Third’s Board and Chief Executive Officer must review all plans and reports required by this Order and any submissions to the Bureau before such submission.
12.
One year after the Effective Date, Fifth Third must submit to the Supervision Director an accurate written compliance progress report (Compliance Report) that has been approved by the Board, the accuracy of which is sworn to under penalty of perjury, and which, at a minimum: a. describes the steps that Fifth Third’s Board has taken to reasonably assess whether Fifth Third is complying with the Redress Plan, Compliance Plan, and each applicable paragraph and subparagraph of this Order; b. describes in detail whether and how Fifth Third has complied with the Redress Plan, Compliance Plan, and each applicable paragraph and subparagraph of this Order, including the manner of verification of such compliance and any corrective actions taken to remedy potential noncompliance with the applicable requirement, paragraph, or subparagraph; and c. attaches a copy of each Order Acknowledgment obtained under Section IX, unless previously submitted to the Bureau.
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13.
Fifth Third’s Board must:
a. authorize whatever actions are necessary for Fifth Third to assess whether Fifth Third is complying with the Redress Plan, Compliance Plan, and each applicable paragraph and subparagraph of this Order; b. authorize whatever actions, including corrective actions, are necessary for Fifth Third to fully comply with the Redress Plan, Compliance Plan, and each applicable paragraph and subparagraph of this Order; and c. require timely reporting by management to Fifth Third’s Board and Chief Executive Officer on the status of compliance obligations. MONETARY PROVISIONS V Order to Provide Redress 14.
Within 30 days of the Effective Date, Fifth Third must submit to the Supervision Director for review and non-objection a comprehensive written plan for providing redress to Account-Opening Affected Consumers during the Redress Period consistent with this Stipulated Final Judgment and Order (Redress Plan). The Redress Plan must, at a minimum:
a. describe the steps Fifth Third has taken or will take, including the use of data analytics and other methods available, to reasonably identify Account- Opening Affected Consumers and the types and amounts of any fees or other harm, including adverse effects on Consumer Reporting Agency information, incurred by each Account-Opening Affected Consumer as a result of Unauthorized-Account-Opening Acts or Practices; Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 15 of 25 PAGEID #: 2240
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b. provide, or confirm the prior provision of, redress to Account-Opening Affected Consumers. The Redress Plan must also include and describe procedures for Fifth Third to support and provide to the Bureau any determination made by Fifth Third that providing redress to particular Account-Opening Affected Consumers is impracticable; c. return, or confirm the prior return of, all fees and costs incurred by Account- Opening Affected Consumers as a result of Unauthorized-Account-Opening Acts or Practices, and request correction of any errors in furnishing information to Consumer Reporting Agencies resulting from the Unauthorized-Account-Opening Acts or Practices; d. detail how Fifth Third has located or will locate Account-Opening Affected Consumers for payment of redress and the steps Respondent has taken or will take with respect to consumers whose redress payments are returned as undeliverable or not cashed within a prescribed time; and e. provide the Bureau with a copy of the form of the letter or notice that was or will be sent to Account-Opening Affected Consumers notifying them of any redress and offering to close the products or end the services without fees or penalties.
15.
Within 180 days after completing the Redress Plan, Fifth Third’s internal audit department must review and assess compliance with the terms of the Redress Plan and validate that the Redress Plan has been properly executed and Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 16 of 25 PAGEID #: 2241
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must report the results of the review and assessment in a written submission to the Board and to the Supervision Director.
16.
Fifth Third must provide all redress under the Redress Plan within one year of the Supervision Director making a determination of non-objection to the Redress Plan, unless the Supervision Director grants an extension of that deadline. 17.
Fifth Third may not condition the payment of any redress to any Account-Opening Affected Consumer on that Account-Opening Affected Consumer waiving any right.
VI Order to Pay Civil Money Penalty IT IS FURTHER ORDERED that:
18.
Under Section 1055(c) of the CFPA, 12 U.S.C. § 5565(c), by reason of the violations of law alleged in the Complaint, Fifth Third must pay a civil money penalty of $15 million to the Bureau.
19.
Within 10 days of the Effective Date, Fifth Third shall pay the civil money penalty by wire transfer to the Bureau or to the Bureau’s agent in compliance with the Bureau’s wiring instructions.
20.
The civil money penalty paid under this Order will be deposited in the Civil Penalty Fund of the Bureau as required by Section 1017(d) of the CFPA, 12 U.S.C. § 5497(d).
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21.
Fifth Third shall treat the civil money penalty paid under this Order as a penalty paid to the government for all purposes. Regardless of how the Bureau ultimately uses those funds, Fifth Third may not: a. claim, assert, or apply for a tax deduction, tax credit, or any other tax benefit for any civil money penalty paid under this Order; or b. seek or accept, directly or indirectly, reimbursement or indemnification from any source, including but not limited to payment made under any insurance policy, with regard to any civil money penalty paid under this Order.
VII Additional Monetary Provisions 22.
In the event of any default on Fifth Third’s obligations to make payment under this Order, interest, computed under 28 U.S.C. § 1961, as amended, will accrue on any outstanding amounts not paid from the date of default to the date of payment and will immediately become due and payable.
23.
Fifth Third relinquishes all dominion, control, and title to the funds paid under this Order to the fullest extent permitted by law and no part of the funds may be returned to Fifth Third.
24.
The facts alleged in the Complaint will be taken as true and be given collateral estoppel effect, without further proof, in any proceeding based on the entry of the Order, or in any subsequent civil litigation by or on behalf of the Bureau, Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 18 of 25 PAGEID #: 2243
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including in a proceeding to enforce its rights to any payment or monetary judgment under this Order, such as a nondischargeability complaint in any bankruptcy case. 25.
The facts alleged in the Complaint establish all elements necessary to sustain an action by the Bureau under Section 523(a)(2)(A) of the Bankruptcy Code, 11 U.S.C. § 523(a)(2)(A), and for such purposes this Order will have collateral estoppel effect against Fifth Third, even in Fifth Third’s capacity as debtor-inpossession.
26.
Fifth Third acknowledges that its Taxpayer Identification Number, which Fifth Third previously submitted to the Bureau, may be used for collecting and reporting on any delinquent amount arising out of this Order, in accordance with 31 U.S.C. § 7701.
27.
Within 30 days of the entry of a final judgment, order, or settlement in a Related Consumer Action, Fifth Third must notify the Supervision Director of the final judgment, order, or settlement in writing. That notification must indicate the amount of redress, if any, that Fifth Third paid or is required to pay to consumers and describe the consumers or classes of consumers to whom that redress has been or will be paid. To preserve the deterrent effect of the civil money penalty in any Related Consumer Action, Fifth Third may not argue that Fifth Third is entitled to, nor may Fifth Third benefit by, any offset or reduction of any monetary remedies imposed in the Related Consumer Action because of the civil money penalty paid in this action or because of any payment that the Bureau makes from the Civil Penalty Fund. If the court in any Related Consumer Action offsets or otherwise reduces the Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 19 of 25 PAGEID #: 2244
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amount of compensatory monetary remedies imposed against Fifth Third based on the civil money penalty paid in this action or based on any payment that the Bureau makes from the Civil Penalty Fund, Fifth Third must, within 30 days after entry of a final order granting such offset or reduction, notify the Bureau and pay the amount of the offset or reduction to the U.S. Treasury. Such a payment will not be considered an additional civil money penalty and will not change the amount of the civil money penalty imposed in this action.
COMPLIANCE PROVISIONS VIII Reporting Requirements IT IS FURTHER ORDERED that:
28.
Fifth Third must notify the Bureau of any development that may affect compliance obligations arising under this Order, including but not limited to, a dissolution, assignment, sale, merger, or other action that would result in the emergence of a successor company; the creation or dissolution of a subsidiary, parent, or affiliate that engages in any acts or practices subject to this Order; the filing of any bankruptcy or insolvency proceeding by or against Fifth Third; or a change in Fifth Third’s name or address. Fifth Third must provide this notice at least 30 days before the development or as soon as practicable after the learning about the development, whichever is sooner.
29.
Within 7 days of the Effective Date, Fifth Third must: Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 20 of 25 PAGEID #: 2245
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a. designate at least one telephone number and email, physical, and postal addresses as points of contact that the Bureau may use to communicate with Fifth Third; and b. identify all businesses for which Fifth Third is the majority owner, or that Fifth Third directly or indirectly controls, by all of their names, telephone numbers, and physical, postal, email, and Internet addresses. 30.
Fifth Third must report any change in the information required to be submitted under Paragraph 28 at least 30 days before the change or as soon as practicable after learning about the change, whichever is sooner. IX Order Distribution and Acknowledgment IT IS FURTHER ORDERED that:
31.
Within 7 days of the Effective Date, Fifth Third must submit to the Supervision Director an acknowledgment of receipt of this Order, sworn under penalty of perjury.
32.
Within 30 days of the Effective Date, Fifth Third must deliver a copy of this Order to each of its Board members and executive officers, as well as to any managers, employees, service providers, or other agents and representatives who have responsibilities related to the subject matter of the Order. 33.
For 5 years from the Effective Date, Fifth Third must deliver a copy of this Order to any business entity resulting from any change in structure referred to in Section VIII, any future Board members and executive officers, as well as to any Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 21 of 25 PAGEID #: 2246
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managers, employees, service providers, or other agents and representatives who have responsibilities related to the subject matter of the Order, before they assume their responsibilities.
34.
Fifth Third must secure a signed and dated statement acknowledging receipt of a copy of this Order within 30 days of delivery, from all persons receiving a copy of this Order under this Section.
35.
Ninety days from the Effective Date, Fifth Third must submit to the Bureau a list of all persons and their titles to whom this Order has been delivered under the Section of this Order titled “Order Distribution and Acknowledgment” and a copy of all signed and dated statements acknowledging receipt of this Order under Paragraph 32.
X Recordkeeping IT IS FURTHER ORDERED that:
36.
Fifth Third must create, for at least 5 years from the Effective Date, the following business records: All documents and records necessary to demonstrate full compliance with each provision of this Order, including all submissions to the Bureau. Fifth Third must retain these documents for at least 5 years after creation and make them available to the Bureau upon the Bureau’s request. 37.
All documents and records must be maintained in their original electronic format. Data should be centralized, and maintained in such a way that access, retrieval, auditing and production are not hindered. Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 22 of 25 PAGEID #: 2247
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XI Notices IT IS FURTHER ORDERED that:
38.
Unless otherwise directed in writing by the Bureau, Fifth Third must provide all submissions, requests, communications, or other documents relating to this Order in writing, with the subject line, “CFPB v. Fifth Third Bank, National Association, SDOH Case No. 1:21-cv-262,” and send them by email to [email protected] addressed as follows: ATTN: Supervision Director Consumer Financial Protection Bureau Office of Supervision XII Compliance Monitoring IT IS FURTHER ORDERED that:
39.
Within 14 days of receipt of a written request from the Bureau, Fifth Third must submit additional compliance reports or other requested information, which must be sworn under penalty of perjury; provide sworn testimony; or produce documents.
40.
Fifth Third must permit Bureau representatives to interview any employee or other person affiliated with Fifth Third who has agreed to such an interview regarding: (a) this matter; (b) anything related to or associated with the conduct described in the Amended Complaint; or (c) compliance with this Order. The person interviewed may have counsel present.
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41.
Nothing in this Order will limit the Bureau’s lawful use of compulsory process, under 12 C.F.R. § 1080.6.
XIII Transfer or Assignment of Operations IT IS FURTHER ORDERED that:
42.
Should Fifth Third seek to transfer or assign all or part of its operations that are subject to this Order, Fifth Third must, as a condition of sale, obtain the written agreement of the transferee or assignee to comply with all applicable provisions of this Order.
XIV Release IT IS FURTHER ORDERED that:
43.
The Bureau releases and discharges Respondent from all potential liability for law violations that the Bureau has or might have asserted based on the practices described in its Amended Complaint, to the extent such practices occurred before the Effective Date and the Bureau knows about them as of the Effective Date. The Bureau may use the practices described in the Amended Complaint in future enforcement actions against Respondent and its affiliates, including, without limitation, to establish a pattern or practice of violations or the continuation of a pattern or practice of violations or to calculate the amount of any penalty. This release does not preclude or affect any right of the Bureau to determine and ensure compliance with this Order, or to seek penalties for any violations of this Order. Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 24 of 25 PAGEID #: 2249
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XV Retention of Jurisdiction IT IS FURTHER ORDERED that:
44.
All pending motions are hereby denied as moot. The Court will retain jurisdiction of this matter for purposes of construction, modification, and enforcement of this Order. The Court DIRECTS the Clerk to TERMINATE this case on its docket.
SO ORDERED.
July 18, 2024
DATE
DOUGLAS R. COLE
UNITED STATES DISTRICT JUDGE Case: 1:21-cv-00262-DRC Doc #: 152 Filed: 07/18/24 Page: 25 of 25 PAGEID #: 2250