U.S. consumers’ access to credit may be worse than previously thought: Fed study

(Reuters) - As many as 60 million Americans tend to have a hard time qualifying for credit cards and other loans, making it more difficult for them to recover from financial setbacks, according to a report released on Tuesday by the New York Federal Reserve.   The findings show that the number of Americans who cannot easily access loans may be twice as many as previously estimated, when people who cannot easily qualify for loans because of blemishes in their credit histories are taken into account.

Berger: Regulators, Congress must coordinate on fintech

NAFCU President and CEO Dan Berger urged key members of the Federal Financial Institutions Examination Council (FFIEC) to consider enacting regulation to achieve a level playing field between fintech companies and traditional financial institutions as he shared the association's new fintech whitepaper.

Noticeable August auto default rise happens again

NEW YORK - The noticeable upturn in defaults finance companies might be used to seeing from July into August unfolded again this year, according to the S&P/Experian Consumer Credit Default Indices. Data through August from S&P Dow Jones Indices and Experian showed the auto loan default rate climbed 9 basis points to 0.98%, mimicking a track that analysts have seen several times during this segment of the year. After remaining steady last year, S&P and Experian reported the July to August upward movement in 2017 was 10 basis points after coming in at 8 basis points in 2016. The rise during this stretch in 2015 was just 4 basis points. But in 2014, it was also was 8 basis points.

FTC Testifies before House Appropriations Subcommittee On the Agency’s Work to Protect Consumers and Promote Competition

In testimony before the House Appropriations Subcommittee on Financial Services and General Government, the Federal Trade Commission described its work to protect consumers and promote competition through vigorous enforcement, education, advocacy, and policy work, and by anticipating and responding to changes in the marketplace.

Blend bringing “one-tap” mortgage pre-approvals to U.S. Bank. Is Wells Fargo next?

When Quicken Loans launched Rocket Mortgage nearly four years ago, the lender kicked off a revolution that has seen nearly all large lenders take their mortgage process digital. Rocket Mortgage claims it’s as simple as “Push Button. Get Mortgage,” and enables borrowers to be approved for a mortgage in mere minutes. Consider the ante upped. Digital mortgage tech provider Blend, which powers the digital mortgage experiences of U.S. Bank, Wells Fargo, and a number of other sizable lenders, announced this week that it is now offering a “one-tap” mortgage pre-approval.

Former Fed Official Kocherlakota Signals Concern for Repo Market

Former Federal Reserve policy maker Narayana Kocherlakota says that while the recent disruptions in U.S. money markets won’t undermine the central bank’s ability to achieve its goals, they underscore that something is wrong with the plumbing of the financial system. In an opinion piece for Bloomberg published Wednesday, the former Minneapolis Fed president said the “deeper issue” is that since the financial crisis, regulatory reforms “have constrained the ability of flush banks to lend, and of tight banks to borrow.” While the central bank can temporarily inject cash into the markets to control short-term rates, Kocherlakota said it’s hard to understand how funding markets will respond to future shocks.

5 changes lenders want from CFPB’s rewrite of QM rule

WASHINGTON — The Consumer Financial Protection Bureau should not hold back in revamping its mortgage underwriting rule, according to public comment letters from the industry. The effects of that rule, which requires lenders to verify borrowers' ability to repay and provides legal protection for "qualified mortgages" with low debt-to-income ratios, so far has been limited. That is because Fannie Mae- and Freddie Mac-backed loans are automatically QM regardless of their DTI thanks to a temporary exemption known as the "patch."

U.S. consumers’ access to credit may be worse than previously thought: Fed study

(Reuters) - As many as 60 million Americans tend to have a hard time qualifying for credit cards and other loans, making it more difficult for them to recover from financial setbacks, according to a report released on Tuesday by the New York Federal Reserve. The findings show that the number of Americans who cannot easily access loans may be twice as many as previously estimated, when people who cannot easily qualify for loans because of blemishes in their credit histories are taken into account.

Only 31% of Employees Get Annual Training on Cyber Security

The Chubb’s Third Annual Cyber Report reveals employee education is key for small businesses to prevent cyberattacks. Even with headline after headline about the latest data breach, people are not encouraged to defend against their cyber exposure. The goal of the report is to determine the level of understanding individuals have about their cyber risks. While at the same time looking at the steps they are taking to protect themselves.

Consumer survey finds bipartisan support for effective debt collection regulation

A new survey asked likely voters across the country what they thought of a proposed debt collection rule. The response was strong and had broad opposition. Proposed earlier this year by Consumer Financial Protection Bureau (CFPB) Director Kathleen Kraninger, the rule would authorize debt collectors to expand how often consumers could be contacted as well as the ways such contacts could be made: email, text messages, and more. Conducted by Lake Research Partners and Chesapeake Beach Consulting, the poll was jointly commissioned by the Americans for Financial Reform (AFR) and the Center for Responsible Lending (CRL). The results, released on September 11, found stark opposition by consumers to regulatory reforms announced by the CFPB. Consumers are strongly united in wanting more and better protection in this area of financial regulation.

Experian study finds fintechs more than doubled personal loan market-share in four years

COSTA MESA, Calif., Sept. 24, 2019 /PRNewswire/ -- Experian today released its first Fintech Marketplace Trends Report, highlighting the latest findings in fintech unsecured personal loans. According to the report, competition in personal lending between traditional financial institutions and fintechs is increasing with fintechs more than doubling their market share in four years to 49.4 percent, up from 22.4 percent in 2015. Experian data also shows that the unsecured personal loan category has grown significantly in the past four years as new loan originations were 1.3 million in March 2019 compared to 656,000 in March 2015." data-reactid="12" style="margin: 0px 0px 1em; color: #26282a; font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif; font-size: 15px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: #ffffff; text-decoration-style: initial; text-decoration-color: initial;">COSTA MESA, Calif., Sept. 24, 2019 /PRNewswire/ -- Experian today released its first Fintech Marketplace Trends Report, highlighting the latest findings in fintech unsecured personal loans. According to the report, competition in personal lending between traditional financial institutions and fintechs is increasing with fintechs more than doubling their market share in four years to 49.4 percent, up from 22.4 percent in 2015. Experian data also shows that the unsecured personal loan category has grown significantly in the past four years as new loan originations were 1.3 million in March 2019 compared to 656,000 in March 2015.

Industry players encourage CFPB to remove DTI requirements from QM rule

A major industry player is urging the CFPB to remove DTI requirements from its qualified mortgage rule once the so-called “QM patch” comes to an end in 2021. According to its data, DTI “is a weaker predictor of default than other risk measures” and “its centrality to the current QM rule distorts the market by misrepresenting true loan risk.”

Belizean Bank to Pay $23 Million and Cease Operations to Settle FTC Charges It Provided Substantial Assistance to the Sanctuary Belize Real Estate Scam

Under a proposed consent order, Belize’s Atlantic International Bank Limited (AIBL) will pay $23 million, representing approximately all of its U.S.-based assets, to settle Federal Trade Commission charges that it assisted various related entities (the Sanctuary Belize Enterprise, or SBE) in deceiving U.S. consumers as part of a scheme to sell property in Sanctuary Belize.

WebRecon Stats for Aug 2019: They don’t call it “Fall” for nuthin’…

After everything (FDCPA, TCPA, FCRA) was up by double-digit percentages last month, everything is down by double-digit percentages this month. Well, almost. FDCPA had to be difficult and mess up my sweeping allegory by keeping its toe just under the line at 9.9%. But with that one exception, everything is double digits.

Measuring the Effects of Loan Forgiveness

The impact of student loan forgiveness goes far beyond a reduced debt balance for borrowers, according to a new study.   Researchers from Harvard Business School, Indiana University and Georgia State University examined the effects of debt cancellation for borrowers whose private student loans were tossed out in court after their creditor, National Collegiate Student Loan Trusts, couldn’t prove the chain of title. In recent years, judges have tossed out numerous lawsuits against student borrowers because National Collegiate couldn't establish in documents that the company actually owned the debt.

Kraninger pushes for axing policy intervention

Consumer Financial Protection Bureau Director Kathy Kraninger emphasized the need for cost benefit analysis when it comes to solid policymaking Thursday ahead of a series of panel discussions focused on behavioral economics. In her opening remarks, she also emphasized the need to preserve consumer choice when developing policies and rulemakings.

VA concedes its debt collection systems leave veterans confused, frustrated

Robocall ‘hijacking’ is on the rise, report warns

Robocallers are alive and kicking as they constantly change tactics, a new report says. Americans are still flooded by 200 million unwanted robocalls a day, according to a report from Transaction Network Services (TNS), a telecommunications services company. High-risk calls grew at 28 percent from the third quarter of last year to the second quarter of this year, while nuisance calls jumped 38 percent, TNS said. A high-risk call typically involves an attempt of identity theft, which can cause “severe emotional distress,” while nuisance calls are typically not malicious but the result of careless, unintentional calling patterns, TNS said.

Fort Worth Considers Rules Governing Payday Lending

New rules from the U.S. Consumer Financial Protection Bureau regulating payday lenders were supposed to take effect on Aug. 19. The rules – laid out in 2017 – would have regulated lenders’ ability to withdraw funds directly from a person’s bank account. Those rules are on hold for now as the agency and a payday lender trade group challenge it in court. In Texas, nearly 70 cities have their own rules regulating payday and other high-interest loans. But there’s one notable holdout: Fort Worth is Texas’ largest city with no laws on the books that regulate payday and auto title lenders.

Attorney General Becerra to CFPB: Proposed Debt Collection Practices Rule Falls Far Shor

SACRAMENTO – California Attorney General Xavier Becerra today, as part of a coalition of 28 attorneys general, denounced the Consumer Financial Protection Bureau’s (CFPB) proposed Debt Collection Practices Rule, which falls far short of the regulation needed to protect consumers from abusive and unscrupulous debt collectors in the $11.5 billion industry. In the letter, the attorneys general recognize the importance of lawful debt collections and certain benefits of the proposed rule, but urge CFPB to fulfill its obligation to protect consumers in the financial marketplace rather than allow debt collectors to run rampant, putting customers at risk. 

Prevent SIM-Swapping Hackers From Stealing Your Phone Number—and the Rest of Your Identity

You know what’s worse than having your password stolen? Having your phone number stolen. SIM-swapping, a type of identity theft, is a means for scammers to get access to your phone number and all of the personal accounts secured through it. The attacker calls a phone provider, pretending to be a customer, and asks to port the number they’re trying to steal to a new SIM card, possibly on a new provider. With your phone number, the attacker can access any personal information secured with your phone, including any platforms that send two-factor Authentication codes via SMS. Since these “cyberattacks” involve good old fashioned cons over the phone, the usual digital security measures we recommend will not save you.

Apex Capital Group Internet Marketers Settle FTC Allegations They Deceived Consumers With False Claims of “Free Trial” Offers and Unauthorized Continuity Plans

The two principals of the Apex Capital Group Internet marketing operation and the 12 corporate defendants they controlled (the Apex Capital defendants) have agreed to court orders settling the Federal Trade Commission’s allegations related to their alleged operation of a multi-national scheme to defraud consumers via deceptive “free trial” offers and negative option continuity plans.

State AG, others, want proposed debt collection regs revised

New York Attorney General Letitia James and 28 of her counterparts from other states banded together to let a federal agency know they want a proposed debt collection rule revised. James and other attorney generals said the rule undermines protections and overwhelmingly take advantage consumers in a letter to Consumer Financial Protection Bureau. The rule, which was proposed by the bureau in May on behalf of President Donald Trump’s administration, has been met with mixed reviews.

GOVERNOR CUOMO ANNOUNCES SUCCESS OF NEW YORK’S LANDMARK OUT-OF-NETWORK LAW PROTECTING CONSUMERS FROM SURPRISE MEDICAL BILLS

Governor Andrew M. Cuomo today announced the Department of Financial Services has issued a new report detailing the successes of New York's first-in-the-nation out-of-network law, which protects consumers from emergency and surprise bills from out-of-network doctors and other healthcare providers, including an increasing number of dispute resolution requests. The law, which takes consumers out of the dispute process, has saved New Yorkers more than $400 million with respect to emergency services alone.

Over 200 Organizations Call for Protection From Debt Collection Industry

Washington, DC – Late yesterday, a coalition of 232 nonprofit organizations from all 50 states and the District of Columbia sent a letter to the Consumer Financial Protection Bureau (CFPB) in response to its proposal that protects abusive debt collectors more than consumers. Instead of giving the debt collection industry more weapons to harass and abuse consumers, the coalition urges the consumer bureau to limit the number of phone calls per week, require consent of the person before sending emails or text messages, allow people to opt-out of electronic messages, hold debt collection attorneys responsible for misrepresentations, and prohibit the collection of “zombie debt.”

Payday Lending Laws Drive Traffic To Pawn Shops

While short-term lending in general has a pretty rough reputation, the pawn loan is the most ill-regarded arena in an already unloved category of consumer lending. By definition, a pawnbroker offers loans on items that are not accepted as collateral by traditional banks or lenders. Items that typically show up in pawn shops include jewelry, electronics and collectible items. The loan amount a borrower can get from a pawnbroker is determined solely by the value of the item itself; as in most forms of short-term lending, there is no credit check. As a general rule, pawnbrokers are willing to lend 20 percent to 50 percent of what they assess an item to be worth, the borrower then has 30 days to pay the loan back, and the borrower can also opt to pay an additional fee (usually $100) to extend their loan for 30 days.

NAFCU-sought fix for SBA fees in short-term funding bill

In a win for credit unions, the short-term funding bill passed by the House Thursday includes a NAFCU-sought appropriation for the Small Business Administration (SBA) that would avert a potential shutdown of the 7(a) program and eliminate the need to raise fees. NAFCU witness Gail Jansen raised concerns about the increased fees during congressional testimony earlier this year.

Student Debt Levels Rise, but More Slowly

Student loan borrowers who earned bachelor's degrees in 2018 had an average debt of $29,200, up 2 percent from their peers in the Class of 2017, the Institute for College Access & Success said in its annual student debt report Thursday. That represents a slight slowing in the rate of borrowing, as the average debt level for borrowers rose at a steady average of 4 percent a year between 1996 and 2012 and slowed after that between 2012 and 2016 before reaching the 2 percent it rests at now.

AG James Leads Bipartisan Coalition Urging CFPB To Place Consumers’ Interests Over Debt Collectors’

NEW YORK – New York Attorney General Letitia James today announced she has led a bipartisan coalition of 28 attorneys general from around the nation in sending a letter to the Consumer Financial Protection Bureau (CFPB) urging the agency to revise its proposed debt collection rule and place the interests of consumers over those of debt collectors.

In a blow to financial-services industry, the CFPB will keep consumer complaints database public

The Consumer Financial Protection Bureau is keeping its consumer complaints database public, in a surprising move that may assuage advocates’ concerns. The agency said Wednesday that it will continue to publish consumer complaints publicly, but that it was also make significant changes to the database. The move comes after the agency put out a call for public input on its consumer inquiry and complaint database in 2018 while it was under the direction of Mick Mulvaney, who now serves as the acting White House chief of staff. The move was seen as a sign that the agency would make the database private, a change that would be welcomed by many in the financial-services industry.

Feds investigating Bank of America for possible unauthorized accounts

CHARLOTTE, N.C. - Charlotte-based Bank of America Corp. is under investigation to determine whether it opened unauthorized customer accounts, according to information released on Tuesday by the Consumer Financial Protection Bureau. The CFPB issued a CID, or civil investigative demand, in March requesting documents from BofA in regards to potentially "unlawful acts or practices in connection with unauthorized consumer bank, credit card, and other accounts." The accounts in question go back to at least 2014.

CFPB and FTC to Host December Workshop on Accuracy in Consumer Reporting

The Consumer Financial Protection Bureau (CFPB) and the Federal Trade Commission (FTC). will host a public workshop on December 10, 2019 to discuss issues affecting the accuracy of both traditional credit reports and employment and tenant background screening reports.  

Director Kraninger’s Speech at CFPB Symposium on Behavioral Economics

Good morning. I am excited to welcome everyone to today’s symposium on “Behavioral Economics and Consumer Financial Services Policy.”  I’d like to take a brief moment to thank all of our panelists for participating today. They will be further introduced at the start of each panel so I won’t go into details now except to say they are experts. I also want to thank our moderators, Melissa and Jason, as well as the members of the working group for all of their work developing today’s program.

FTC Staff Submits Comment to CFPB on Proposed Debt Collection Rules

In a comment to the Consumer Financial Protection Bureau (CFPB), staff of the Federal Trade Commission provided feedback on a number of proposed rules that implement the Fair Debt Collection Practices Act (FDCPA).   In the comment, FTC staff notes that the Commission has long advocated for amendments and clarifications to existing laws to account for changes both in the debt collection marketplace and consumer technology since the FDCPA was passed in 1977. The comment also describes the Commission’s law enforcement, policy, and education efforts to protect consumers from unlawful debt collection practices.

Brownstein Attorneys Advise on Updates to 40-Year-Old FDCPA

On Tuesday evening, Sept. 17, ACA International filed a 155-page comment to the Consumer Financial Protection Bureau’s (“Bureau”) proposed debt collection rule. The comment advocates for consumers, creditors and a stable U.S. credit economy—as well as its 2,500 members of the accounts receivables management industry. A copy of the full comment is available here. Brownstein’s consumer finance attorneys worked alongside ACA to craft the comment based on several months of research, conversations with consumers and industry, and legal analysis. The proposed “Regulation F” will implement and interpret the Fair Debt Collection Practices Act (FDCPA), which became law in 1977 and has not been modified since.

AG James: Pennsylvania Addition To T-Mobile/sprint Lawsuit Keeps States’ Momentum Moving Forward

NEW YORK – New York Attorney General Letitia James today announced that the Commonwealth of Pennsylvania is joining the multistate lawsuit blocking the anticompetitive megamerger of telecommunications giants T-Mobile and Sprint, becoming the 18^th plaintiff to join the lawsuit and add to the states’ momentum.   “Pennsylvania’s addition to our lawsuit adds to the states’ momentum against this megamerger that continues to be bad for consumers, bad for workers, and bad for innovation,” said Attorney General James. “We welcome Pennsylvania and Attorney General Shapiro to our multistate coalition that continues to build strength, and now includes every region of the nation.”

Consumer Financial Protection Bureau to Enhance Consumer Complaint Database

WASHINGTON, D.C. – Today the Consumer Financial Protection Bureau (CFPB) announced that it will continue the publication of consumer complaints, data fields and narrative descriptions through the Bureau’s Consumer Complaint Database while making several enhancements to the information available to users of the database. The enhancements include: modified disclaimers to provide better context to the published data; integrating financial information and resources into the complaint process to help address questions and better inform consumers before they submit a complaint; and information to assist consumers who wish to contact the financial company to get answers to their specific questions. Additionally, the Bureau will work to provide enhanced features for the database that include dynamic visualization tools on recent complaint data.

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