Key takeaways:

• By bringing consumer financial enforcement actions under Section 1042 of the Dodd-Frank Act, state officials may enjoy access to better discovery tools and potentially could obtain higher penalties.
• Increased state use of Section 1042 may spark increased concurrent and follow-on federal enforcement activity.
• A proliferation of state enforcement actions could lead, in the near term, to conflicting judicial interpretations of Dodd-Frank’s consumer financial protection provisions.