A top CFPB official in charge of protecting student borrowers stepped down from the agency in late August, blaming the leadership of Acting Director Mick Mulvaney. Seth Frotman, who was the student loan ombudsman at the agency, said in his letter of resignation the current leadership of the bureau has “turned its back on young people and their financial futures.” He added: “The bureau is now content doing the bare minimum for [consumers] while simultaneously ...
The CFPB announced that it will hold a day-long symposium, “Building a Bridge to Credit Visibility,” to explore challenges many consumers face in getting credit. This event will take place on Sept. 17 in the CFPB’s Washington, DC, headquarters, and will be streamed live. The CFPB said the symposium “will convene a diverse set of stakeholders to explore challenges in overcoming barriers to expand fair, equitable, and non-discriminatory access to credit [Includes three briefs] ...
It has been more than three years since FHA introduced a new streamlined process of identifying loan defects and their severity to minimize or avoid enforcement action and hefty penalties under the False Claims Act. Despite calls by the mortgage industry to improve and clarify the process – the Single-Family Loan Quality Assessment methodology or “defect taxonomy” – the FHA has yet to make a move to meet industry demands for more detailed defect taxonomy. Contacted for an update on the defect taxonomy, a Housing and Urban Development spokesperson said simply, “Nothing to report on this.” An outgrowth of lender concern over the government’s indiscriminate use of the FCA to prosecute mortgage fraud and recover FHA losses, the defect taxonomy establishes nine categories of loan defects in loans it endorses. The nine defect categories replaced the 99 loan defect codes that were ...
All 49 Democratic senators last week signed a letter to Acting CFPB Director Mick Mulvaney, urging him to continue protecting servicemembers and their families under the Military Lending Act. The letter follows reports that Mulvaney plans to suspend examining lenders for MLA compliance. The senators called on Mulvaney not to halt military lending checks or take steps that would potentially harm servicemembers and their families. “The CFPB should not be abandoning ...
A federal court in Texas recently refused for the second time to delay the compliance date of the CFPB’s payday lending rule, which generally leaves the agency only one option to delay the date: through notice-and-comment rulemaking procedures. “There is a significant likelihood that the bureau might extend the compliance deadline” through rulemaking, said Quyen Truong, a partner at Stroock & Stroock & Lavan. Two payday lending trade groups earlier this year ...
The CFPB recently imposed a $69 million judgement against two individuals and a group of payday lending entities controlled by them for cash-grab scams, although most of it will be waived. This is the seventh enforcement action brought by the CFPB so far this year, and also the third involving payday lenders. The U.S. District Court for the Western District of Missouri Western Division recently entered an order effectuating a settlement between the CFPB ...
There are fewer structural protections in today’s speculative-grade securities backed by subprime auto loans compared to below-investment grade issuances in the 1990s, according to an S&P Global analysis of the subprime auto loan ABS sector.
Kathy Kraninger, President Trump’s nominee to be the next CFPB director, last week responded to questions sent by Democrat members of the Senate Committee on Banking, Housing, and Urban Affairs. The questions followed on the heels of a confirmation hearing earlier in July where Democrats accused the nominee of stonewalling. The Democratic lawmakers sent three lists of questions, over 10 pages, covering issues ranging from the nominee’s day-to-day job ...
The U.S. Treasury Department in a recent report urged the CFPB to rescind its payday lending rule because the states already have regulatory structures in place for the industry. “Treasury recognizes and supports the broad authority of states that have established comprehensive product restrictions and licensing requirements on nonbank short-term, small-dollar installment lenders and their products,” said the agency’s long-awaited report on fintech that was ...
Two public interest groups recently asked the CFPB’s inspector general to open an investigation into Acting Director Mick Mulvaney’s relationship with the payday lending industry. Americans for Financial Reform and Change to Win requested the IG, Mark Bialek, investigate whether Mulvaney has violated ethics regulations governing the conduct of executive branch employees by giving preferential treatment to the payday lending industry. Americans for Financial Reform ...