New Maine law to protect abuse survivors’ finances is illegal, credit agencies say in lawsuit

The nation’s largest credit reporting agencies are suing Maine over the state’s first-of-its-kind law to protect survivors of domestic violence from poor credit reports as a result of economic abuse by their estranged partners.   In the lawsuit filed in U.S. District Court in Bangor, the Data Industry Association contends that Maine’s new law is pre-empted by the federal Fair Credit Reporting Act of 1996, and that Congress prohibited states from interfering in credit reporting. The association represents the nation’s large credit reporting agencies, including Experian, TransUnion and Equifax, and other smaller agencies.

United States: CFPB And The Fifth Circuit Agree That Independent Agency Directors Should Be Removable At Will

A recent decision from the United States Court of Appeals for the Fifth Circuit and statements by the Director of the Consumer Financial Protection Bureau (CFPB) may prompt the Supreme Court to consider the constitutionality of the CFPB's single director structure. Sitting en banc, the Fifth Circuit ruled earlier this month that the directorship structure of the Federal Housing Finance Agency (FHFA) is unconstitutional. The FHFA—an independent agency created under the Housing and Economic Recovery Act of 2008 (HERA)—serves as regulator and conservator of government sponsored enterprises such as Fannie Mae and Freddie Mac. Like the CFPB, the FHFA's sole director is only removable by the President "for cause." In Collins v. Mnuchin, the Fifth Circuit ruled that this "for cause" language should be struck from HERA, deeming it an unconstitutional limitation on the President's removal power under Article II. Notably, however, the Court of Appeals found only that severing the provision would be warranted, and did not rule that invalidating the FHFA outright was an appropriate remedy.

FBI Issues ‘High-Impact’ Cyber Attack Warning—What You Need To Know

Be it the prohibition-era gangsters of the 1920s or the global war on terrorism, the Federal Bureau of Investigation (FBI) has been the primary U.S. investigative agency of the federal government with a responsibility to protect the nation. As part of what the FBI describes as being "a unique dual responsibility, to prevent harm to national security as the nation’s domestic intelligence agency and to enforce federal laws as the nation’s principal law enforcement agency," it has increasingly had to deal with the cyber threat. One "high impact" and ongoing cyber threat has become such a critical concern that on October 2, the FBI issued a warning to U.S businesses and organizations.

Important compliance deadlines CUs should know

NAFCU this week sent Final Regulation alerts to member credit unions to notify them of important effective dates for rules that will impact the industry. The rules covered include the CFPB's innovation policies, NCUA's payday alternative loans (PALs), and the Department of Labor's (DOL) overtime rule.

Consumer Bankers Association comments on CFPB’s proposed debt collection rule

The Consumer Bankers Association (CBA) has filed a letter commenting on the CFPB’s proposed debt collection rule.  Ballard Spahr served as counsel to the CBA in preparing the comment letter. In the letter, the CBA urges the Bureau to make various revisions and clarifications to the proposal, including the following:

CFPB structure challenged in Supreme Court petition filed by payday lender

Payday lender, All American Check Cashing, is asking the Supreme Court to decide whether the structure of the Consumer Financial Protection Bureau, Massachusetts Sen. Elizabeth Warren’s brainchild, is unconstitutional and how the alleged separation-of-powers violation should be judicially redressed. All American is arguing that the agency’s structure is unconstitutional, based on how its director can be removed, as well as “other anomalous features of the agency.” All American, of Mississippi, asked the U.S. Supreme Court to take up the case even though an appeals court has yet to review it.

Commercial, multifamily debt rises in 2019

Commercial and multifamily debt keeps rising, increasing by $51.9 billion in the second quarter of 2019. The level of mortgage debt rose 1.5% in the second quarter, according to the Mortgage Bankers Association’s latest Commercial/Multifamily Mortgage Debt Outstanding quarterly report. At the end of the first half of 2019, total commercial and multifamily debt outstanding stood at $3.5 trillion. But multifamily mortgage debt alone increased by 1.7% or $24.4 billion in the first quarter to $1.5 trillion.

CFPB Announces Advisory Committee Members

WASHINGTON, D.C. – Consumer Financial Protection Bureau Director Kathleen L. Kraninger today announced the appointment of members to the Consumer Advisory Board (CAB), Community Bank Advisory Council (CBAC), Credit Union Advisory Council (CUAC), and Academic Research Council (ARC). These experts advise Bureau leadership on a broad range of consumer financial issues and emerging market trends.  

Why the federal government has expanded exposure to risky mortgages

Banking, Tech Communities Are ‘Breathless’ About Fintech, But Is It All Hype?

Bankers and tech experts keep speculating that Big Tech and financial technology (fintech) companies will dramatically disrupt the traditional banking industry, but some economists say such talk is overhyped. Deutsche Bank just released a report describing how the expanding financial ecosystem now includes Big Tech companies like Amazon, Apple, Google and Facebook, which host services from fintech companies like mobile payments (CashApp, Paypal, Venmo), renter’s insurance (Lemonade) and student loan refinancing (SoFi).

Zillow: Over half of renters blame student debt for delay in buying a home

In a paper released at the beginning of this year, the Federal Reserve estimated that about 20% of the decline in homeownership among young adults could be attributed to increased student loan debts since 2005. Based on the 2019 Zillow Group Report on Consumer Housing Trends released on Monday, that percentage may be a little low.  The report surveyed 13,000 U.S. household decision-makers about their homes, including how they search for them, pay for them and what challenges they encounter along the way. Among these findings, there was a recurrent topic of debt holding back potential buyers. From medical and credit card debt to student loans, an increasing amount of Americans are putting off buying a home.

AG James Sues Student Loan Servicer For Mismanaging Loan Forgiveness Program

NEW YORK – New York Attorney General Letitia James today sued the Pennsylvania Higher Education Assistance Agency (PHEAA) — one of the nation’s largest student loan servicers — for failing to properly administer the Public Service Loan Forgiveness (PSLF) program. The PSLF program is a federal program that forgives the student loans of borrowers who have made qualifying loan payments while working in public service for 10 years. PHEAA’s deceptive, unfair, and abusive practices in administering the federal program have contributed greatly to the large number of rejected PSLF applications, despite the fact that tens of thousands of New Yorkers are eligible for the program.

What is formjacking? New cyber security scam is on the rise

CHICAGO (WLS) -- Formjacking can make you a victim on any website, and even some of the most secure sites can be vulnerable. The worst part about this new scam is you don't even know you're a victim until it's too late. You could be shopping, or filling out a job application or a government form on what you think is a secure website. But it isn't. "The attacker figures out how to put malicious code on to their website and that malicious code will steal your information," said Andrew Hoog of Chicago-based cybersecurity company Now Secure.

Consumer Financial Protection Bureau and South Carolina File Suit against brokers of High-Interest Credit Offers

WASHINGTON, D.C. – The Consumer Financial Protection Bureau (Bureau) and the South Carolina Department of Consumer Affairs (South Carolina) today filed a lawsuit in federal district court in the District of South Carolina against Katharine Snyder, Performance Arbitrage Company, Inc., and Life Funding Options, Inc. The companies, owned and operated by Snyder, brokered contracts offering high-interest credit to veterans, many of whom are disabled, and to other consumers. The Bureau alleges that the companies and their owner violated the Consumer Financial Protection Act’s prohibition against deceptive acts or practices.

New SCOTUS petition: CFPB enforcement must be undone if agency is unconstitutional

(Reuters) - The drama over the constitutionality of the Consumer Financial Protection Bureau took another surprise turn on Monday, when a Mississippi payday lender, All American Check Cashing, filed a petition asking the U.S. Supreme Court to grant review of its constitutional challenge to the CFPB before the 5th U.S. Circuit Court of Appeals issues an opinion in the case.

Attorney General Becerra Secures Court Ruling Rejecting FCC’s Attempt to Preempt State Net Neutrality Laws

SACRAMENTO – California Attorney General Xavier Becerra today issued the following statement on a ruling by the United States Court of Appeals regarding the Federal Communications Commission’s (FCC) order repealing the FCC's prior neutrality rules. In January 2018, Attorney General Becerra, as part of a coalition of 22 attorneys general, challenged the FCC’s decision to repeal net neutrality. Today, the court issued an opinion vacating the FCC's Preemption Directive, which would have barred states from imposing their own net neutrality requirements. The Court also remanded the order to the FCC to address issues related to public safety, utility pole attachments, and impacts on the Lifeline Program, which protects low income consumers.

Bank of America, early adopter of Zelle, thrilled by huge increase in use of fund transfer app

Bank of America started using Zelle as a way to allow its customers to more easily make person-to-person fund transfers. It was a convenience its customers in the marketplace and in focus groups said they desired. Bank of America officials, however, have been surprised by its rapid rate of use. Since its introduction in 2016, the use of Zelle by Bank of America customers has grown every year. In fact, its use in 2019 topped its total use in 2018 in fewer than nine months, as the bank handled more than 160 million transactions through the end of August — and could break 200 million for the year

Smaller Banks, Credit Unions and Digital Lenders Hit Hardest by Business Lending Fraud Losses, According to LexisNexis Risk Solutions Study

ATLANTA, Oct. 2, 2019 /PRNewswire/ -- LexisNexis® Risk Solutions today released the results from its LexisNexis® Risk Solutions 2019 Small and Mid-Sized Business (SMB) Lending Fraud Survey. The study found that lending fraud financially impacts smaller banks, credit unions and digital lenders at twice the rate of larger competitors, with fraud monetary losses for smaller banks amounting to 4.5% and 5.8% of overall revenue, compared to 2.9% for larger institutions.

CFPB Investigating Loan Program at College Chain

The Consumer Financial Protection Bureau is looking into loans and other financing offered to students by the Center for Excellence in Higher Education, which operates the College America and the Stevens-Henager College chains. The agency notified CEHE in April that it was seeking information about whether it had misrepresented the loans to students or enrolled students in loan programs without their consent. The college chain objected in May to a civil investigative demand from CFPB -- essentially an information-gathering tool used by law enforcement agencies -- and asked that it be narrowed or set aside. CFPB director Kathleen Kraninger rejected that request in August.

Appeals court upholds net neutrality repeal but rules FCC can’t block state laws

A federal appeals court on Tuesday delivered a mixed ruling for net neutrality supporters and opponents alike, allowing the Federal Communications Commission's (FCC) 2017 repeal to stand but striking down a provision blocking states from implementing their own open internet rules.  The D.C. Circuit Court of Appeals also ordered the FCC to revise the repeal order to take into consideration other issues, like the effect that it will have on public safety, broadband subsidies and the regulation of cable pole attachments.

CHAIRMAN PAI STATEMENT ON VICTORY IN D.C. CIRCUIT

WASHINGTON, October 1, 2019—Federal Communications Commission Chairman Ajit Pai released the following statement regarding the D.C. Circuit’s decision largely upholding the Restoring Internet Freedom Order:  “Today’s decision is a victory for consumers, broadband deployment, and the free and open Internet. The court affirmed the FCC’s decision to repeal 1930s utility-style regulation of the  Internet imposed by the prior Administration. The court also upheld our robust transparency rule so that consumers can be fully informed about their online options. Since we adopted  the Restoring Internet Freedom Order, consumers have seen 40% faster speeds and millions more Americans have gained access to the Internet. A free and open Internet is what we have today and what we’ll continue to have moving forward. We look forward to addressing on remand the narrow issues that the court identified.”

Millennials More likely to Report Losing Money to Fraud than Older Generations, New FTC Data Spotlight Reports

Millennials are 25 percent more likely to report that they have lost money to fraud than consumers aged 40 and over, according to a new Federal Trade Commission analysis of consumer complaint data.   The FTC’s latest Consumer Protection Data Spotlight shows that millennials—those ages 20-39—are twice as likely to report losing money to online shopping fraud than those 40 and over. Online shopping fraud reports include complaints about items that are never delivered or are not as they were advertised. Millennials reported losing $71 million to online shopping fraud—out of the nearly $450 million they reported losing to all types of fraud—in the last two years.

Banks get relief for residential real estate appraisals; NCUA rule planned

Three federal banking agencies issued a joint final rule to increase the threshold for residential real estate appraisals to $400,000. The NCUA is expected to propose a rule to increase the threshold for credit unions this year, which will likely provide parity with banks.

FTC Sends More Than $5.4 Million to People Who Paid for Worthless Student Loan Debt Relief

The Federal Trade Commission is sending more than $5.4 million to nearly 40,000 people who lost money to a student loan debt relief scam. The defendants behind the scam were required to turn over money under a 2018 settlement with the FTC.

Compliance: CFPB issues FAQs on SAFE Act amendments

The Consumer Financial Protection Bureau (CFPB) has published four frequently asked questions about the Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act) of 2008, and the amendments made by enactment of S. 2155. These amendments are effective Nov. 24, and details can be found in a recent CUNA CompBlog entry. S. 2155 permits state-licensed mortgage loan originators (MLOs) licensed in one state to temporarily work in another state while waiting for licensing approval in the new state, if certain conditions are met.

Citizens Bank CEO On The Rise Of A Super-Regional Bank

Earlier in his career, Bruce Van Saun got passed over for an opportunity to be the CEO of a major bank after it merged with another company. It was a disappointing development, but fate would be on his side. He went to Royal Bank of Scotland (RBS) as a CFO in the late 2000s as the company had taken a recent tumble and needed a new team to bring it back to health. As it turned out, RBS needed to offload some of its assets thanks to a European bailout rule and in 2013, the company decided to divest Citizens Bank, a super-regional bank it owned with a major presence in the northeast U.S.

What Charles Scharf’s Visa years say about his plan for payments at Wells

Wells Fargo has named Charles Scharf to be its next CEO, placing an experienced bank executive at the top of the troubled company.   In the payments world, Scharf is best known as the CEO of Visa Inc. from 2012 to 2016, where his strategies for faster payments, fintech partnerships and other key issues may shed light on what Scharf has planned for Wells Fargo.

NAFCU economist: Consumers key in fragile economy

NAFCU's Curt Long attributed the 2 percent economic growth during the second quarter to "a standout performance from U.S. consumers." However, he acknowledged that "there is an undeniable fragility in the economy, and any slippage from the consumer would almost certainly mean a recession is nigh."

‘They Are Coming For You’: Cyber Security Experts Warn Of Potential Threat

LARIMER COUNTY, Colo. (CBS4)– “They are coming for you,” that’s the message behind the Cyber Security Summit in Loveland. The FBI Internet Crime Complaint Center estimates the loss from internet theft, fraud, and exploitation in 2018 topped $2.7 billion. That’s part of the reason why the Larimer County Sheriff’s Office and the Fort Collins Area Chamber of Commerce gathered online security experts together to take part in the Cyber Security Summit. The goal was to educate small business operators how to protect their valuable information.

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