At a glanceWednesday, April 22, 2020

Collection Industry News At A Glance - April 22, 2020
Wednesday April 22, 2020
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3 million Americans are skipping mortgage payments, but Fannie Mae and Freddie Mac will cut mortgage servicers a break

As the number of Americans requesting forbearance on their home loans rises, Fannie Mae FNMA, 2.57% and Freddie Mac FMCC, 4.51% are relaxing rules for mortgage servicers.   As of April 12, nearly 6% of all mortgages nationwide were in forbearance, according to data released late Monday by the Mortgage Bankers Association. That equates to roughly 3 million homeowners, MBA chief economist Mike Fratantoni said. In a forbearance agreement, a borrower may skip or make reduced payments for the duration of the agreement.

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Attorney General Becerra Calls on the Federal Communications Commission and Telecom Industry to Further Protect Consumers During the COVID-19 Pandemic

SACRAMENTO – California Attorney General Xavier Becerra today, as part of a coalition of 27 attorneys general, sent a letter to the Federal Communications Commission (FCC) asking them to join the coalition in urging the telecommunications industry to make further commitments to protect consumers during the COVID-19 public health emergency. As a result of COVID-19 and public health measures, Californians are relying heavily on the internet and their phones for a multitude of essential activities, such as work and school. In March, the FCC announced that many telecom companies had pledged to three commitments aimed at protecting consumers’ access to essential telecommunication services for 60 days.

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SBA reports data breach in disaster loan application website

NEW YORK (AP) — Thousands of small business owners reeling from the aggressive measures taken to halt the spread of the coronavirus may have had their personal information exposed last month on a government website that handles disaster loan applications. The Small Business Administration said Tuesday that the personal information of more than 7,000 business owners applying for economic injury disaster loans was potentially seen by other applicants on the SBA website on March 25.

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FTC Safeguards Workshop Postponed Until July 13, 2020, Will be Held Online

The Federal Trade Commission announced that it has postponed its workshop seeking input on proposed changes to the Safeguards Rule under the Gramm-Leach-Bliley Act until July 13, 2020 and that the event will be held online.   The virtual workshop, originally scheduled to take place on May 13, 2020, will continue to focus on some of the issues raised in response to amendments the FTC has proposed making to the Safeguards Rule, which requires financial institutions to develop, implement, and maintain a comprehensive information security program. In 2019, the FTC sought comments on the proposed amendments to the Safeguards Rule.

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Home sales down 8.5 percent in March, before worst effects of pandemic

U.S. home sales dropped in March even before the brunt of the coronavirus pandemic struck, according to the National Association of Realtors (NAR). CNBC reported Tuesday that NAR's seasonally adjusted index pointed to an 8.5 percent fall, with the drop-off largely occurring in the second half of the month. Many of those sales represent contracts closed earlier in the year, before the coronavirus outbreak caused local governments to shutter nonessential businesses and order Americans to stay at home.

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Fashion Nova Will Pay $9.3 Million for Consumer Refunds To Settle FTC Charges It Violated Rules On Shipping, Refunds

Online fashion retailer Fashion Nova will pay $9.3 million to settle Federal Trade Commission charges that it didn’t properly notify consumers and give them the chance to cancel their orders when it failed to ship merchandise in a timely manner, and that it illegally used gift cards to compensate consumers for unshipped merchandise instead of providing refunds.

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Media Advisory: Consumer Financial Protection Bureau Releases Video for Non-Filers on Economic Impact Payments

WASHINGTON, D.C. – The Consumer Financial Protection Bureau (Bureau) has released a video outlining the steps that non-filers need to take in order to receive their economic impact payments authorized by the CARES Act.  Additionally, the Bureau published a blog with FAQs for consumers with details on the economic impact payments (stimulus payments). Under the statute, eligible Americans will qualify for stimulus payments if:

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10 markers of a great cybersecurity program

CISOs have multiple ways of quantifying the work they do, from counting the number of threats thwarted to the number of patches performed. Some of those metrics speak to the volume of work being performed, while others – such as mean time to detect and mean time to respond – offer insights into the effectiveness of the department’s people, processes and technology.

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Fannie-Freddie not buying problem loans has U.S. seeking fix

Fannie Mae and Freddie Mac's regulator is confronting a fresh crisis for the U.S. housing market: The companies won't buy recently issued loans that were made to borrowers who already can't afford their monthly payments because of coronavirus. Industry executives have told Fannie and Freddie's watchdog, the Federal Housing Finance Agency, that the issue is causing severe disruptions for the real estate sector because it's preventing the mortgage giants from guaranteeing new loans in forbearance.

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Banks warn that new small-business funding could evaporate in 2 days

Lawmakers are nearing a deal to restart an emergency small-business loan program that exhausted its funding last week — but it may buy only a few days before the program screeches to a halt once again. Lenders are warning their customers they might not be able to secure loans even if Congress provides an additional $300 billion as soon as this week. Banking industry representatives say the program has a burn rate of $50 billion per day and needs closer to $1 trillion to meet demand, with hundreds of thousands of applications pending.

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Consumer Financial Protection Bureau Advisory Committees to Meet on May 1, 2020

The Consumer Financial Protection Bureau announced that the Consumer Advisory Board (CAB), Community Bank Advisory Council (CBAC), the Credit Union Advisory Council (CUAC), and the Academic Research Council (ARC) will meet jointly on May 1st from 2:00 to 4:15 pm ET via conference call.

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Incident Of The Week: How Hackers Are Taking Advantage of Coronavirus

The coronavirus has upended almost every aspect of daily life. Stress and panic levels of individuals all over the globe have spiked. People are on edge, and hackers use these heightened emotions to their advantage. Now, cyber threats are increasing as COVID-19 continues to cause global panic.

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Coronavirus pandemic causes US banks to issue Internet fraud alerts

In an email sent out earlier this week, Bank of America advised its customers not to respond to unsolicited requests for their account or personal information such as access codes, PINs or Federal Student Aid (FSA) IDs. The Charlotte, N.C.-based bank offered advice that all cybersecurity analysts give: validate a suspicious email request by finding the official phone number of the organization and calling that number.

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Big banks built a $35 billion fortress to protect against coronavirus bankruptcies and defaults

New York (CNN Business)Officials in Washington are trying hard to minimize the amount of bankruptcies, defaults and foreclosures caused by the coronavirus pandemic. America's big banks are planning for the worst anyway. Bank of America, (BAC) JPMorgan Chase, Citigroup, Wells Fargo and US Bancorp (USB)have set aside an additional $35 billion during the first quarter to cushion against loans that go bust, according to a tally by Edward Jones.

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Small-business loan program ran out of money within minutes, some banks say

Much of the $350 billion in the Small Business Administration's emergency coronavirus relief fund was effectively spoken for within the first minutes of launch, according to senior banking executives. "We didn't even get through the first five minutes of applications," a JPMorgan Chase senior banking executive said. The bank received over 60,000 applicants for the Paycheck Protection Program within those first five minutes, a senior executive at Chase said. When funds ran dry after less than two weeks, only 27,000 loans had ultimately been approved, Chase said.

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FTC Takes Action to Stop Company Posing as SBA Lender and Preying on Small Businesses

The Federal Trade Commission has charged a Rhode Island-based company and its owner with falsely claiming to be an approved lender for a federal coronavirus relief lending program and asked a federal court to immediately halt their misrepresentations.

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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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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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Portfolios For Sale

$486,058 Credit Cards
Capital Asset Management, Inc.

(317) 633-6633

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$2,790,011 Auto Deficiencies
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$9,923,438 Medical
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$11,918,112 Medical
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(317) 633-6633

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