WASHINGTON, D.C. — The Pennsylvania Attorney General’s office is taking a more aggressive stance on consumer financial protections, Sam Mirarchi, senior deputy attorney general and assistant director of litigation for the Bureau of Consumer Protection, said during a panel at CBA Live last week. Mirarchi estimates that 30% to 40% of the office’s attention is spent on consumer financial protection. “I think we’re up there with New York, California, and Massachusetts,” he said.
Specifically, the attorney general adheres to the “participation theory” statute, which allows it to sue individuals who might normally be protected by the corporate shield. “We go after [executives] for participation,” Mirarchi said. “They should have known something was happening. They had the authority to stop it and didn’t.”
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Additionally, the attorney general is extending its reach outside state lines, Mirarchi said. The attorney general sued a Delaware-based auto title lender on the grounds that its allegedly deceptive practices impact Pennsylvania consumers. “They were placing liens on, repossessing, and auctioning people’s cars in Pennsylvania, so we had the jurisdiction to sue [the company],” he said. “And we sued the individuals [too], which is important.”
For case filings transferred to federal court, the attorney general tacks on applicable Dodd-Frank Act claims. “One of the positions that the attorney general is taking is that the presence of the Dodd-Frank Act enables it to seek relief for borrowers nationwide, not just in Pennsylvania,” said Christopher Willis, partner at Ballard Spahr LLP.
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