This is the latest update from Washington, designed to keep NACBA members informed about significant and relevant activity on the part of Congress, regulatory agencies and interest groups/think tanks. Feedback should be directed to Krista.DAmelio@NACBA.com
On The Hill Senators Elizabeth Warren (D-MA) and Al Franken (D-MN) sat down to discuss CFPB’s arbitration rule in a Facebook video published on Senator Warren’s page. View the video to hear the advice they provide on what viewers can do to stop Congress from “selling out to the big banks”.
In The Agencies The Consumer Financial Protection Bureau (CFPB) has filed an amicus brief in support of the Department of Education’s (ED) appeal asking the U.S. Court of Appeals for the Federal Circuit to vacate a preliminary injunction entered by the Court of Federal Claims that bars the ED from assigning defaulted student loans to certain small business private collection agency contractors and other contractors. The injunction was issued in a lawsuit filed by companies challenging ED decisions not to award or continue contracts with such companies to collect student loans. The CFPB argues that by preventing the ED from assigning debt collectors to defaulted loans, the preliminary injunction impedes or prevents borrowers from managing their federal student loan debt.
More on CFPB. On August 25, 2017 CFPB issued the 2017 HMDA Final Rule that amends Regulation C to implement amendments to the Home Mortgage Disclosure Act made by section 1094 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act). CFPB added several new reporting requirements, clarified existing requirements and modified institutional and transactional coverage of Regulation C. The final rule also provides extensive guidance regarding compliance with both the existing and new requirements.
The Trump administration has selected Julian Schmoke Jr. to serve as the Department of Education’s new chief enforcement officer. Schmoke is a former for-profit college official who previously directed campus operations at West Georgia Technical College and served as a dean at DeVry University. He will lead the Department’s unit that polices fraud in higher education. Specifically, Schmoke will lead the Student Aid Enforcement Unit established by the Obama administration to more aggressively combat fraud and deceptive practices at colleges and universities. Sens. Sherrod Brown (D-OH), Patty Murray (D-WA), Dick Durbin (D-Il) and Elizabeth Warren (D-MA) wrote a letter to Secretary DeVos urging that the person selected must “have relevant experience in consumer protection or litigation, managing attorneys, and conducting investigations with the highest ethical standards.” The unit Schmoke will oversee is also responsible for processing debt relief claims filed by federal student loan borrowers who say they’ve been defrauded by their college.
OTHER It is being reported that in the wake of Hurricane Harvey, about 80% of homeowners in the areas devastated by the hurricane lack flood insurance. This leaves many who escaped the storm with little financial help to rebuild their homes and lives. The Washington Post reports that only 17 percent of homeowners in the eight counties most directly affected by Harvey have flood insurance policies that cover up to $250,000 in rebuilding costs and $100,000 to replace personal belongings such as TVs and furniture. Losing a home without insurance compensation is financially devastating. A total loss could delay retirement or force people into bankruptcy.
Wells Fargo is now revealing it has found a total of up to 3.5 million potentially fake bank and credit card accounts, up from its earlier tally of approximately 2.1 million. The additional fake accounts were discovered by a previously-announced analysis that went back to January 2009 and that reviewed the original May 2011 to mid-2015 period. Moreover, Wells Fargo also revealed that thousands of customers were enrolled in online bill pay without their authorization. The review found 528,000 potentially unauthorized online bill pay enrollments.