At a glanceFriday, April 17, 2020

Collection Industry News At A Glance - April 17, 2020
Friday April 17, 2020
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Attorney General James and Governor Cuomo Renew Suspension of State Debt Collection in Response to Coronavirus, Protecting New Yorkers’ Wallets

EW YORK – New York Attorney General Letitia James and New York Governor Andrew M. Cuomo today announced that the state has renewed a previous order from March 17, 2020 that halted the collection of medical and student debt owed to the State of New York and that was specifically referred to the Office of the Attorney General (OAG) for collection for an additional 30-day period, in response to growing financial impairments resulting from the spread of coronavirus disease 2019 (COVID-19). The new order took effect this morning and will run for an additional 30-day period, until May 17th.

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NAFCU grassroots advocacy rallies Hill support for MBL relief

NAFCU and its member credit unions' grassroots advocacy efforts have led to more than 60 members of Congress calling for the next coronavirus relief package to include specific relief for credit unions under the member business lending (MBL) cap.

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Former CFPB director: The CFPB is dropping the ball on the coronavirus crisis

Former Consumer Financial Protection Bureau (CFPB) Director Rich Cordray warned that the agency is not doing enough to protect consumers amid the coronavirus pandemic.   “The CFPB has been misreading the current crisis,” Cordray said during a virtual panel hosted by U.S. PIRG on Wednesday. “This is not a time to see this as businesses need help, we need to ease off on businesses and let them have a lot of leeway … if those businesses are consumer finance companies — if the bank, if they are mortgage lenders, mortgage servicers, if there are debt collectors and credit reporting companies — if you ease off of them and don't make them do their jobs, consumers will bear the brunt of that.”

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‘Congress has to finish its job’: Richard Hunt on PPP program

Congressional leaders work to replenish the stimulus relief program after the bank's small business loans have completely exhausted their funding capacity. Consumer Bankers Association CEO & President Richard Hunt joins Yahoo Finance’s On The Move to discuss.

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HB 1553 Debt settlement services providers; licensure and regulation by State Corporation Commission.

Debt settlement services providers; penalties. Provides for the licensure and regulation of debt settlement services providers by the State Corporation Commission. The measure defines "debt settlement services" as any action or negotiation initiated or taken by or on behalf of any consumer with any creditor of the consumer for the purpose of obtaining debt forgiveness of a portion of the credit extended by the creditor to the consumer or reduction of payments, charges, or fees payable by the consumer. The measure prohibits licensees from accepting a fee from consumers prior to providing the consumers' requested debt settlement services. The requirements imposed by this measure on licensed providers of debt settlement services are similar to those applicable to agencies providing debt management plans. The measure provides for civil penalties against licensees that violate these requirements, grants consumers a private right of action against licensees, and makes a violation a prohibited practice under the Virginia Consumer Protection Act

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The $349 billion coronavirus loan program for small businesses is out of money after 13 days

Less than two weeks after launching on April 3, the Trump administration’s Paycheck Protection Program (PPP) for small businesses slammed by coronavirus has run out of funds, hitting the $349 billion initial allotment on Thursday morning, according to the Small Business Administration (SBA).

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Chairwoman Waters, Ranking Member Brown Call on Administration to Stabilize the Housing Market During the Coronavirus Pandemic

Today, Congresswoman Maxine Waters (D-CA), Chairwoman of the House Financial Services Committee, and Senator Sherrod Brown (D-OH), Ranking Member of the Senate Banking, Housing and Urban Affairs Committee, sent a letter to Federal Reserve Chairman Jerome Powell and Treasury Secretary Steven Mnuchin urging them to ensure the stability of the housing market in the face of the Coronavirus pandemic. The lawmakers called on the Federal Reserve and Treasury to use the authority provided to them by Congress to prepare to ensure the stability of nonbank mortgage servicers in the event of increased liquidity need. Servicers may have greater liquidity needs as millions of homeowners and renters lose jobs, are furloughed, or see reduced hours, which will keep them from making timely mortgage and rent payments.

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Coronavirus economic threat — A mortgage industry calamity is looming

The coronavirus pandemic is perhaps the single biggest crisis to hit the U.S. economy since the 1930s. Large swaths of the U.S. economy have been idled and particularly the services sector is being decimated in a way that harkens back to the Great Depression. Double-digit unemployment seems inevitable by June, with all of the attendant economic and financial consequences.Amidst this chaos and dislocation, the U.S. housing industry should be a bulwark upon which the economy may find support. After all, virtually all residential mortgages and many multi-family commercial loans in the U.S. are government-guaranteed, right?

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Frontier files for bankruptcy, says its broadband service won’t get any worse

Frontier Communications filed for Chapter 11 bankruptcy yesterday, but the struggling telecom said its service to customers won't be affected by the financial restructuring. "Frontier expects to continue providing quality service to its customers without interruption and work with its business partners as usual throughout the court-supervised process. The Company has sufficient liquidity to meet its ongoing obligations," Frontier said in last night's bankruptcy announcement. Frontier filed in the US Bankruptcy Court for the Southern District of New York.

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Consumer Financial Protection Bureau Issues Final Rule Raising Data Reporting Thresholds Under the Home Mortgage Disclosure Act

WASHINGTON, D.C. – The Consumer Financial Protection Bureau (Bureau) issued a final rule raising the loan-volume coverage thresholds for financial institutions reporting data under the Home Mortgage Reporting Act (HMDA).    The final rule, amending Regulation C, increases the permanent threshold for collecting and reporting data about closed-end mortgage loans from 25 to 100 loans effective July 1, 2020. The final rule will also amend Regulation C to increase the permanent threshold for collecting and reporting data about open-end lines of credit from 100 to 200, effective January 1, 2022.

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Attorney General James Takes Action to Protect Small Businesses Impacted by Coronavirus

NEW YORK – New York Attorney General Letitia James today took action to protect and support small businesses that have been impacted by coronavirus disease 2019 (COVID-19) and are in need of financial aid. Attorney General James issued guidance to help small businesses obtain loans through the federal government’s Paycheck Protection Program (PPP) and also provided warnings and tips to protect small businesses from lenders and agents fraudulently and deceptively marketing these loans. The Attorney General’s Office also announced the issuance of a cease and desist order to one such company, “” for deceptive marketing and business practices related to the issuance of PPP loans.

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Nessel and Coalition of Attorneys General Call On CFPB To Protect Consumers’ Credit During COVID-19 PandemicNessel and Coalition of Attorneys General Call On CFPB To Protect Consumers’ Credit During COVID-19 Pandemic

LANSING ― Michigan Attorney General Dana Nessel and 21 other attorneys general urged the Consumer Financial Protection Bureau (CFPB) to enforce the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) and require credit reporting agencies to follow the Fair Credit Reporting Act (FCRA) during the COVID-19 crisis. The CFPB’s recent announcement that they would not enforce the law would leave consumers at the mercy of unresponsive credit agencies at a critical time.

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Popular small business rescue program poised to run out of money soon

The roughly $350 billion Paycheck Protection Program (PPP), which experienced a very rough rollout, is designed to cover eight weeks of a business' payroll expenses, so the company can retain its workers or hire back those it may have already furloughed, and the loans are forgivable provided that 75% of the total amount borrowed is used for payroll expenses.

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CFPB and FHFA Announce Borrower Protection Program

WASHINGTON, D.C. – Today, the Consumer Financial Protection Bureau (CFPB) and the Federal Housing Finance Agency (FHFA) announced the Borrower Protection Program (the Program), a new joint initiative that enables CFPB and FHFA to share servicing information to protect borrowers during the coronavirus national emergency.

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Inslee issues new proclamations on criminal statutes, CDLs and garnishments

Gov. Jay Inslee signed three new proclamations today in response to the COVID-19 outbreak. The orders impact criminal statute of limitations, make it easier to renew commercial driver licenses and learner permits, and protect consumer assets, including federal stimulus checks, from consumer debt collections.  “As the COVID-19 situation develops, we must constantly evolve our state systems to ensure that our communities are supported and set up to get through this outbreak,” Inslee said.

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Illinois Issues New COVID-19 Collections Guidance

On April 14, 2020, the state of Illinois Department of Financial and Professional Regulation issued new guidance to state licensed consumer credit companies that they are referring to as “best practices” that they are “recommending” should be put into practice to help persons during the coronavirus pandemic. Much like Massachusetts, Texas and the district of Colombia, this guidance suggests the suspension of all collection activity, waiver of most fees and the copious offering of payment forbearances.

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Remitter USA Inc today announced its partnership with M&G Solutions. Remitter is a market leading white-labelled SMS and email communications platform, powered by AI and used by providers in the financial services industry to improve collection and recoveries performance.  The Partnership between M&G Solutions and Remitter will further add to Remitter’s expertise in the accounts receivables space within the Unites States.  The M&G Solutions – Remitter partnership brings together M&G’s expertise in the collections and operations space with the leading non voice solution to help clients implement a best in class non voice collections experience for the consumer.

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Collection Industry Organizations Support Protecting Stimulus Payments from Garnishment

Three collection industry organizations, the Commercial Law League of America, International Association of Commercial Collectors, and the Commercial Collection Agencies of America, all support any action to protect the Coronavirus Aid, Relief, and Economic Security (CARES) Act (“CARES Act”) stimulus payments to individuals from garnishment. Leadership of all three organizations recognize the extent of the economic crisis and the impact the pandemic has had on our whole economy, but most particularly on small businesses and individual consumers.

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Millions of Americans may not be able to pay bills. These banks are offering coronavirus relief

In the face of the global pandemic, millions of Americans may not be able to pay their bills this month. To that end, a growing number of financial institutions, including Ally Financial, Bank of America, Citi and Fifth Third Bank, have taken steps to offer some assistance for customers affected by Covid-19. The coronavirus aid relief bill also offers some credit protections. For example, lenders and financial institutions need to report accounts as “current” (as opposed to delinquent) — but it doesn’t happen automatically; borrowers must first apply for help. 

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Assessing liquidity for a new abnormal

Despite the old adage that the next financial crisis won’t look like the last one, for the past decade, financial practitioners have been fixated on building their own ‘Lehman scenarios’. Over the years, that scenario has become increasingly obsolete, and the recent disruption caused by the global COVID-19 outbreak provides a real-world example of why that is the case. As expected, the current stress is unlike anything we have seen before, and this is why it is important to shift the focus from historical scenarios to those based on changing market conditions.

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Aspects of cybersecurity not to overlook when working from home

Due to the novel coronavirus situation, billions of people are currently working remotely, many for the first time in their lives. It could be out of personal fears of infection, in obedience of local social distancing regulations, or in accordance with company-wide policies, but the end result is an unexpected shift from the norm of working in the office to working from home (WFH).

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PPP’s supplemental rule clarifies some CU questions

The interim final rule from the Small Business Administration (SBA) to implement its paycheck protection program (PPP) published today in the Federal Register. In addition to the rule's text that was previously releaThe interim final rule from the Small Business Administration (SBA) to implement its paycheck protection program (PPP) published today in the Federal Register. In addition to the rule's text that was previously released, a supplemental version was also published that clarifies some questions credit unions have had related to documents needed for self-employed individuals' income and eligible businesses.sed, a supplemental version was also published that clarifies some questions credit unions have had related to documents needed for self-employed individuals' income and eligible businesses.

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Consumer Alert: Prevent Data Breaches by Updating your Router’s Firmware

Amid the COVID-19 crisis, more North Carolinians are working and learning remotely using their home internet. That makes now a great time to ensure that your systems are as secure as possible. Hackers and scammers are working overtime to steal your money and personal information, but taking simple security steps like updating your internet router’s firmware can help keep you safe. Router manufacturers release firmware updates to repair vulnerabilities exploited by hackers. Almost all of your personal information passes through your router, so keeping its security up to date is critical to protecting your personal financial data.

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Attorney General James Leads Coalition Urging Federal Government to Ensure Emergency Stimulus Payments Go to Families, Not Debt Collectors

NEW YORK – New York Attorney General Letitia James today sent two letters to the federal government in an effort to help Americans deal with the ensuing economic fallout of the coronavirus disease 2019 (COVID-19) public health crisis. First, Attorney General James led a bipartisan coalition of 25 attorneys general in sending a letter to Treasury Secretary Steven Mnuchin, calling on the U.S. Department of the Treasury to take immediate action to ensure billions of dollars in emergency stimulus payments authorized by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) go to American families and not debt collectors.

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Consumer Financial Protection Bureau Paves Way for Consumers to Receive Economic Impact Payments Quicker

WASHINGTON, D.C. – Today the Consumer Financial Protection Bureau (Bureau) took steps to make it easier for consumers to receive pandemic-relief payments, including the economic impact payments authorized in the CARES Act, through prepaid accounts. Federal, State, and local governments are considering a variety of approaches to providing consumers relief from the economic impacts of the COVID-19 pandemic.

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NAFCU discusses mortgage lending, forbearances with CFPB

Members of NAFCU's Regulatory Affairs team Monday shared credit union concerns and issues related to mortgage servicing, forbearances, and periodic statements with the CFPB. NAFCU previously spoke with CFPB Director Kathy Kraninger to reiterate credit unions' need for regulatory relief amid the coronavirus.

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Attorney General Xavier Becerra Joins Coalition Urging the Department of the Treasury to Immediately Exempt COVID-19 Emergency Monetary Relief from Garnishment

SACRAMENTO – California Attorney General Xavier Becerra today joined a coalition of 25 attorneys general in urging the U.S. Department of the Treasury (Treasury) to take immediate action to ensure that emergency monetary relief authorized by the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act) will not be subject to garnishment by creditors or debt collectors. The CARES Act was enacted last month by Congress to provide emergency assistance and healthcare response for individuals, families, and businesses affected by the COVID-19 public health emergency. Today’s letter urges Treasury Secretary Steven Mnuchin to use his authority to designate CARES Act payments as exempt from garnishment.

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CFPB Tapped To Help Distribute COVID-19 Payments

The Consumer Financial Protection Bureau (CFPB) has made it easier for people to access stimulus CARES Act funds by removing some of the legal barriers barring banks from issuing the payments through prepaid accounts, according to a press release. Banks or other government agencies are usually unable to get direct deposits right to consumers if the banks are not in possession of the consumer’s account information. In some of those cases, the faster option might be a fresh prepaid account through which the intended funds can be disbursed.

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AG Healey to Debt Collectors: COVID-19 Stimulus Payments Are Off Limits

Boston — Attorney General Maura Healey today issued guidance to protect consumers who will receive a payment as a result of the federal government’s Coronavirus Aid, Relief, and Economic Security (CARES) Act from unfair debt collection practices and called on the Trump Administration to take immediate action to ensure these payments go to American families and not debt collectors.

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WI AG joins 22 others demanding enforcement of CARES Act

MADISON, Wis. (RELEASE FROM ATTORNEY GENERAL'S OFFICE)- Attorney General Josh Kaul and a coalition of 22 other attorneys general are demanding the Consumer Financial Protection Bureau (CFPB) enforce the CARES Act and require credit reporting agencies to follow the Fair Credit Reporting Act (FCRA) during the COVID-19 crisis. The CFPB’s recent announcement that they would not enforce the law would leave consumers at the mercy of unresponsive credit agencies at a critical time.

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US banking regulator lacks agency-wide crisis readiness or training plan, audit finds

The US Federal Deposit Insurance Corporation, which insures deposits at banks and oversees their safety and soundness, had failed as of a year ago to develop an agency-wide readiness or personnel-training plan for economic crises, an internal audit said this week. FDIC management said in a March 2020 response attached to the Inspector General report that it agreed with some conclusions and disputed others. “The FDIC has a strong and recognized track record of effectively responding to crises,” said Arleas Upton Kea, deputy to chairman Jelena McWilliams. “The FDIC agrees that additional training could be used” in some instances.

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Fairfield, NJ – Vertican Technologies, a global leader in the debt collection software industry, announced today the retirement of founder and chief executive officer, Stevan H. Goldman and promotion of Isaac Goldman. Stevan has been a pioneer of the Accounts Receivable Management (ARM) industry for more than four decades, revolutionizing the way data collection and ethical recoveries are performed. His imprint in the receivables’ world has set the standard by which future advances in technological solutions will follow.

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Over 500,000 Zoom accounts sold on hacker forums, the dark web

Over 500,000 Zoom accounts are being sold on the dark web and hacker forums for less than a penny each, and in some cases, given away for free. These credentials are gathered through credential stuffing attacks where threat actors attempt to login to Zoom using accounts leaked in older data breaches. The successful logins are then compiled into lists that are sold to other hackers. Some of these Zoom accounts are offered for free on hacker forums so that hackers can use them in zoom-bombing pranks and malicious activities. Others are sold for less than a penny each.

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Coronavirus mortgage relief poses risk to housing industry

 A sixth-month pause on certain mortgage payments mandated by the coronavirus economic rescue bill is causing confusion and risking financial peril across the housing industry. The $2.2-trillion coronavirus response and stimulus bill signed by President Trump in March gave any homeowner with a mortgage backstopped by the federal government the ability to receive forbearance or delay payments for up to 180 days.

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Exclusive: JPMorgan Chase to raise mortgage borrowing standards as economic outlook darkens

NEW YORK (Reuters) - JPMorgan Chase & Co (JPM.N), the country’s largest lender by assets, is raising borrowing standards this week for most new home loans as the bank moves to mitigate lending risk stemming from the novel coronavirus disruption.

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Fintech Firms Intuit and PayPal Approved by SBA to Distribute Funds as Part of US Emergency Lending Program, Following Coronavirus Outbreak

Fintech firms Intuit and PayPal have been approved by the Small Business Administration (SBA) to distribute funds, which are part of the US organization’s emergency lending and relief program.

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