Three financial regulation scholars told the U.S. Court of Appeals for the District of Columbia Circuit that the CFPB is a highly accountable agency when looked at in its entirety. Making that argument in a friend of the court brief in PHH Corp. v. CFPB were two law professors, Michael Barr at the University of Michigan Law School and Adam Levitin at Georgetown University Law Center, along with Deepak Gupta, founding principal of the Gupta Wessler law firm in Washington, DC. Gupta was senior litigation counsel and senior counsel for enforcement strategy at the CFPB back in the days when Elizabeth Warren was setting up the fledgling agency. “Viewed holistically, the CFPB is a highly accountable agency,” the trio said....

In another unusual, unexpected development in the legal wrangling between the CFPB and PHH Corp. over alleged violations of the Real Estate Settlement Procedures Act, the U.S. Department of Justice, now under the direction of the Trump administration, has asked permission of the court for a few minutes of its time to present its case. Oral arguments in the case, before the U.S. Court of Appeals for the District of Columbia Circuit, are scheduled for May 24, 2017. The court has allocated 30 minutes per side for arguments. In an unopposed brief filed earlier this month with the USCA, the DOJ asked for 10 minutes of argument time. “The United States agrees with petitioner PHH Corp. that the for-cause removal ...

More changes, or at least additional guidance, may be in the offing for the pending Home Mortgage Disclosure Act rule from the Consumer Financial Protection Bureau that is scheduled to take effect next year, agency Director Richard Cordray said last week during an appearance on Capitol Hill. During a hearing of the House Financial Services Committee, Rep. Brad Sherman, D-CA, pointed out, “Studies have shown that in some geographic areas, it is possible to determine the identity of nearly 100 percent of the borrowers using the data that lenders are required to collect and report by the Home Mortgage Disclosure Act. This is despite the fact that that act supposedly provides for anonymous data in its final form.” Sherman also ...

Community lending representatives met with Trump administration officials last week to push a package of pro-growth, regulatory relief proposals, including a number of changes to the mortgage rules promulgated by the CFPB. The meeting was held with Treasury Department officials under President Donald Trump’s executive order directing the Treasury to review existing laws, treaties, regulations, guidance, reporting and recordkeeping to determine if they promote or inhibit federal regulation of the U.S. financial system as per Trump’s core principles outlined in Executive Order 13772. Meeting with the Trump administration officials were a handful of CEOs of bank that are members of the Independent Community Bankers of America.Among the proposed changes the trade group advocated was a more expansive qualified mortgage ...

In a speech at a National Community Reinvestment Coalition conference in Washington, DC, recently, CFPB Director Richard Cordray spelled out the ways the bureau is working to end the practice of redlining, and not just in the provision of mortgage credit. “We are working to end discrimination in mortgage lending, help make sure that safe and reliable financial products are more readily available, and expand access to credit for those who are currently shut out,” Cordray told attendees. He cited two cases in which his agency worked with the U.S. Department of Justice, one involving Bancorp South and another involving Hudson City Savings Bank. In the Bancorp South case, the government asserted the lender denied some mortgage loans to African-Americans ...

Thanks in part to the recent consent order Wells Fargo reached with the CFPB, the Office of the Comptroller of the Currency recently gave the top mortgage lender in the U.S. a rare “needs to improve” rating under the Community Reinvestment Act – this despite citing Wells’ overall “outstanding” performance on the lender’s performance examination components, the lender noted. The rating is based on the most recent CRA performance evaluation, which covers the years 2009-2012. The agency referenced the lender’s recent $100 million consent order with the CFPB, and a related action brought by the city and county of Los Angeles that resulted in a $50 million fine, and numerous other enforcement actions. The OCC said the bank’s overall CRA performance ...

New York State Aligns State Law With TRID. New York Gov. Andrew Cuomo, D, recently signed into law Senate Bill S982, legislation that tweaks the existing state legal definition of the “consummation” of a mortgage loan to synchronize with the Truth in Lending Act/Real Estate Settlement Procedures Act Integrated Disclosure Rule promulgated by the CFPB.... Industry Need to Get TRID-Compliant Boosts DocMagic’s Bottom Line. Industry vendor DocMagic, based in Torrance, CA, late last week reported a 42 percent increase in revenue for 2016, due in large part to industry demand for products that enable compliance with the CFPB’s Truth in Lending Act/Real Estate Settlement Procedures Act Integrated Disclosure Rule, otherwise known as TRID....

There are multiple sides to the Treasury sweep debate but despite rumors to the contrary, the GSEs sent the bulk of their fourth-quarter earnings to the Treasury at the end of March, as scheduled. While some advocate for suspending the profit sweep, others question whether the timing of future payments could be altered to reduce the likelihood that either Fannie Mae or Freddie Mac might need another bailout. In early March, industry officials and lobbyists began voicing their belief that the FHFA, possibly with Treasury’s blessing, might alter or suspend the quarterly dividends. One possibility floated was changing the four quarterly payments to one annual one. Speculation may have been fueled...

While hopes were high for GSE reform with the incoming Trump administration, housing industry experts seem to agree that major changes at Fannie Mae and Freddie Mac may not happen anytime soon. Panelists at a housing finance conference sponsored by Moody’s agreed with the ratings agency’s sentiment and said that the policy environment is in flux and unpredictable with GSE reform unlikely in the near term. “The election of Donald J. Trump as president amid Republican control of Congress has created a new political landscape with potential implications for the U.S. housing and finance markets,” said Moody’s in a recap of the conference. “However, panelists at our conference saw targeted legislative or regulatory changes as...

The Treasury Department reneged on its support of the Federal Housing Finance Agency’s single- director structure last week. The issue stems from a recent PHH Mortgage-initiated lawsuit challenging the Consumer Financial Protection Bureau’s structure as unconstitutional, which led to questioning the similarly structured FHFA. Although the Treasury previously sided with the FHFA, the Trump administration decided to side with the mortgage lender. The Treasury Department is now making a similar argument that the FHFA’s structure is also unconstitutional. The CFPB and FHFA, the GSEs’ regulator, are independent agencies led by a single director whom the president can only fire for cause.