On Heels of Crypto Legislative Activity, NYDFS Follows up With Crypto Stablecoin Guidance

On June 8, 2022, the New York State Department of Financial Services (“NYDFS”) released regulatory guidance applicable only to payment stablecoins that are backed by the U.S. Dollar and issued by entities regulated by NYDFS.

Prepared Remarks of Director Chopra on Credit Card Late Fees ANPR Press Call

Good morning. Today the Consumer Financial Protection Bureau is taking a critical step to address the billions of dollars that Americans pay in penalties to credit card companies. We are publishing an Advance Notice of Proposed Rulemaking to review provisions originally developed by the Federal Reserve Board that allow credit card companies to sidestep Congressional mandates on reasonable penalty fees. Our effort is particularly timely, given that the rule currently allows credit card companies to hike late fees by the rate of inflation.

CFPB Initiates Review of Credit Card Company Penalty Policies Costing Consumers $12 Billion Each Year

The Consumer Financial Protection Bureau (CFPB) is taking the first step toward addressing credit card company penalty policies costing consumers $12 billion each year, starting by looking at excessive late fees. In an Advance Notice of Proposed Rulemaking published today, the CFPB asks for information on the Federal Reserve Board of Governors’ 2010 immunity provision for excessive late fees that allows credit card companies to escape enforcement scrutiny.

Federal Trade Commission Sends More than $2 Million to Students Harmed by Debt Relief Scam

The Federal Trade Commission is sending 22,817 checks totaling more than $2 million to borrowers who lost money to a student loan debt-relief scam that operated under the names Student Debt Doctor.

Flagstar Bank Announces Data Breach Impacting Over 1.5 Million Names and Social Security Numbers

Recently, Flagstar Bank confirmed that the company experienced a data breach after someone gained unauthorized access to the company’s computer network. According to Flagstar, the breach resulted in the names and Social Security numbers of certain customers being compromised. On June 17, 2022, Flagstar filed an official notice of the breach and sent out data breach letters to all affected parties.

North Carolina considers new laws to ‘de-weaponize’ medical debt and protect patients

RALEIGH, N.C. — When Erin Williams-Reavis faced a $3,500 surgery bill, the hospital offered to let her pay in $300 monthly installments. It was too much, said Williams-Reavis, 44, who lives in Greensboro, about an hour west of the state capital. Her hours as a personal assistant had been cut, and she and her husband were behind on bills, even requesting a forbearance on their mortgage.

CFPB to review QM rule

The agency, in a blog post, said it would conduct a review of its Qualified Mortgage (QM) rule. The rule, under the federal Truth In Lending Act, sets standards mortgages must meet in order to have a safe harbor from improper underwriting counterclaims during a foreclosure. The move by the CFPB is part of a larger review of rules the agency says warrant scrutiny because they were inherited from other agencies, published in the first decade of the agency, or have been tested in the market for several years.

Tell us your stories about employer-driven debt

The Consumer Financial Protection Bureau (CFPB) wants to hear your stories about practices and financial products that leave you financially worse off as a result of being indebted to your employer or an affiliated third party.

DFPI Seeks Public Comment on Oversight of Crypto Asset-Related Financial Products and Services

Governor Gavin Newsom issued Executive Order N-9-22 (Executive Order) on May 4, 2022, to foster responsible innovation, bolster California’s innovation economy, and protect consumers. In his announcement, Governor Newsom outlined his aim to create a transparent regulatory and business environment for web3 companies which harmonizes federal and California approaches, balances the benefits and risks to consumers, and incorporates California values such as equity, inclusivity, and environmental protection.

CFPB outlines BNPL expectations

The CFPB’s new blog post titled “Buy Now, Pay Later and Credit Reporting” appears intended to send a message about the CFPB’s expectations to industry. 

CFPB continues focus on overdraft practices

In a blog post published last week, the CFPB reported that since the beginning of 2022, it has been collecting data from supervised institutions on their overdraft and non-sufficient fund (NSF) practices and intends to use the information to identify institutions for further examination and review.

Hackers stole Social Security numbers in Flagstar data breach affecting 1.5 million customers

Flagstar Bank, one of the largest financial service providers in the United States, has notified more than 1.5 million customers of a data breach in which Social Security numbers were stolen — its second incident in two years.

Federal Trade Commission Returns More Than $9.7 Million To Small Businesses Harmed by Yellowstone Capital’s Merchant Cash Advance Operation

The Federal Trade Commission is sending 7,731 checks totaling more than $9.7 million to small businesses who were harmed by Yellowstone Capital, a merchant cash advance company that withdrew money from their bank accounts without permission.

CUNA education campaign directly reaches state legislators and staff

CUNA has undertaken a robust campaign to target and educate lawmakers in state capitols across the country on the credit union difference. Using opportunities like Financial Literacy Month to capture lawmaker attention, CUNA has focused on driving lawmakers and staff working inside all 50 state capitals to CUNA’s Advancing Communities page to learn how credit unions in their state are improving consumers’ financial well-being.

Congressman Kim Introduces Dental Care for Our Troops Act and Military Family Protection from Debt Act

WASHINGTON D.C. – Yesterday, Congressman Andy Kim (NJ-03) introduced two bills, the Dental Care for Our Troops Act and the Military Family Protection from Debt Act, to put servicemembers and their families first. These policies are two of Congressman Kim’s top priorities for the Fiscal Year 2023 National Defense Authorization Act (NDAA) that is being considered by the House Armed Services Committee next week.

MACY’S CREDIT SUED FOR PRERECORDED CALLS: Retailers Back in the TCPA Crosshairs?

Retailers have had a rough few years as Amazon and COVID have more or less crushed the idea that people want to go to the store for stuff.

CFPB report: Many borrowers still behind on mortgage payments after COVID-19 forbearance

The report was sourced from data by 16 large mortgage servicers between May and December 2021, and revealed that homeowners continue to face significant risks and challenges when it comes to paying their mortgages. The servicers used for the data collection service many types of loans including VA, FHA, GSE, PLS or portfolio, across many locations in the U.S. to give the CFPB a better understanding of how servicers are handling all areas.

‘Don’t Annoy Me’: A Cardinal Rule for Banks to Keep Consumers’ Trust

Consumers are sending a crystal-clear message to the banks and credit unions that have been trusted partners in their everyday financial lives, according to Doug Brown, president of NCR. That message is just three simple words: “Don’t annoy me.”

Rethinking the approach to regulations

Markets work best when rules are simple, easy to understand, and easy to enforce. The CFPB is seeking to move away from highly complicated rules that have long been a staple of consumer financial regulation and towards simpler and clearer rules. In addition, the CFPB is dramatically increasing the amount of guidance it is providing to the marketplace, in accordance with the same principles.

FTC Weighs In On Data Breach Notification

The FTC recently reminded companies that principles of fairness and the likelihood of harm may in some cases prompt breach notification. This requirement might exist even if state breach notice laws have not been triggered. The FTC emphasized at the same time the need for breach disclosures to be accurate. These comments appeared in the FTC blog, and underscore the agency’s continuing trend to exercise its enforcement authority under the FTC Act in the data security and data breach context.

California DFPI issues final regulations implementing 2018 law requiring consumer-like disclosures for commercial financing

The California Department of Financial Protection and Innovation (DFPI) has issued final regulations to implement SB 1235, the bill signed into law on September 30, 2018 that requires consumer-like disclosures to be made for certain commercial financing products, including small business loans and merchant cash advances. 

Measuring the impact of financial institution overdraft programs on consumers

In December 2021, the CFPB released two research reports on checking account overdraft fees, detailing how banks continue to rely on these fees as a major source of revenue and how they do not compete on transparent, upfront pricing. At that time, CFPB Director Rohit Chopra announced that financial institutions with a higher share of frequent overdrafters or a higher average fee burden for overdrafts should expect the Bureau to be paying them close supervisory attention. These often exploitative and hidden fees can have a significant impact on a family’s bank account, and as a result, we have been closely monitoring those institutions.

FFIEC Announces Availability of 2021 Data on Mortgage Lending

Washington, D.C. – The Federal Financial Institutions Examination Council (FFIEC) today announced the availability of data on 2021 mortgage lending transactions reported under the Home Mortgage Disclosure Act (HMDA) by 4,338 U.S. financial institutions. Covered institutions include banks, savings associations, credit unions, and mortgage companies.

California lawmakers urge FDIC to rein in bank partnerships

Four Democratic members of the California state legislature recently sent a letter to the Federal Deposit Insurance Corporation (FDIC) urging the agency to take action against FDIC-supervised banks that partner with non-bank lenders to originate high-cost installment loans.

100 Million Americans Have Medical Debt: Poll

More than four in 10 American adults — or more than 100 million people in total — say they are carrying medical or dental debt, according to a new nationwide poll conducted by the Kaiser Family Foundation.

FTC Report Warns About Using Artificial Intelligence to Combat Online Problems

Today the Federal Trade Commission issued a report to Congress warning about using artificial intelligence (AI) to combat online problems and urging policymakers to exercise “great caution” about relying on it as a policy solution. The use of AI, particularly by big tech platforms and other companies, comes with limitations and problems of its own.

Firstmark Credit Union Named a 2022 ‘Best Places to Work’

Firstmark Credit Union is excited to announce that it has been voted a 2022 “Best Places to Work in San Antonio” by the San Antonio Business Journal for the third consecutive year. Firstmark was chosen among hundreds of leading companies for its commitment to fostering growth and employee well-being and cultivating an engaging workplace culture.

Mortgage loan critical defects reached high point in 2021

Last year was the worst ever for critical defects on mortgage applications, as pandemic-related stress on lender operations in the first half resulted in high rates of material misstatements slipping through, according to Aces Quality Management.

Fed interest rate hike will make credit card debt more expensive

The Federal Reserve on Wednesday raised its key interest rate by three-quarters of a point — its largest hike in nearly three decades — in an effort to tame inflation. Most credit card interest rates are tied to the Fed's benchmark rate. If you have a variable rate, it's headed higher.

Food stamps, credit card debt: Record high inflation forces some older Americans to make tough financial choices

For many older Americans, record high prices are jeopardizing their financial security just as they approach or live in retirement, according to a recent survey from The Senior Citizens League, a nonpartisan senior group.

CFPB issues order terminating Upstart no-action letter

The CFPB issued an order last week terminating the no-action letter issued to Upstart Network, Inc. on November 30, 2020 for a 36-month term (NAL).  The NAL was essentially a renewal of the no-action letter issued to Upstart in September 2017, which was the first no-action letter issued by the CFPB.

CFPB Wants Credit Reporting Standards in BNPL Sector

The Consumer Financial Protection Bureau (CFPB) published a blog post on Wednesday, June 15, indicating that Buy Now, Pay Later (BNPL) lenders and Nationwide Consumer Reporting Companies (NCRCs) may need to work more closely together to standardize BNPL payment data to ensure adequate credit reports. 

Buy Now, Pay Later and Credit Reporting

In December 2021, the Consumer Financial Protection Bureau (CFPB) launched a market monitoring inquiry into Buy Now, Pay Later (BNPL). Buy Now, Pay Later is a short-term, no-interest consumer credit product that has become nearly ubiquitous at the point of purchase online and, increasingly, in brick-and-mortar stores. Issued to five BNPL firms, the inquiry ordered information and data on several key areas of consumer impact, including data furnishing by BNPL firms to consumer reporting companies for inclusion in credit reports. We noted that BNPL credit is fast-growing and expressed concerns about the potential for people to accumulate debt by making multiple BNPL purchases with multiple companies.

RMAi Executive Summit 2022

RMAi

DCS2022 – Debt Connection Symposium and Expo 2022