Dodd-Frank News Center

Brown issues statement on CFPB's proposed debt collection rules

This story appeared in Bank Digest.

Senator Sherrod Brown (D-Ohio), ranking member of the Senate Banking Committee, has issued a statement on the Consumer Financial Protection Bureau's initial outline of proposed rules to overhaul the debt collection market. According to Brown's press release, the CFPB's proposal would affect a broad range of industries and would require collection companies to verify debts before contacting consumers, improve the dispute process, and limit the number of times a collector can call or email consumers.

In his statement, Brown said, "Families who are struggling to make ends meet shouldn't be harassed to make payments on debts they've already paid off or never owed in the first place." He also called the CFPB's proposal "an important first step to protecting consumers from predatory debt collectors and making sure this industry operates with clear rules of the road and strong oversight."

CFPB outlines regulation of debt collection industry

This story appeared in Bank Digest.

The Consumer Financial Protection Bureau has released an outline of proposals under consideration that would overhaul the debt collection market. The bureau released the outline in advance of a field hearing on debt collection held July 28 in Sacramento, Calif. Among other things, the proposals under consideration would require debt collectors to have more and better information about debts before they attempt collection, and while collecting debts, they would be required to limit communications, clearly disclose debt details, and make it easier to dispute debts.

In preparing the proposals, the bureau conducted a survey of debt collection firms and vendors to the debt collection industry to better understand the operational costs of debt collection firms. A report released by the CFPB describes the survey and summarizes survey responses.

In prepared remarks at the field hearing on debt collection, CFPB Director Richard Cordray said the proposals "would apply to third-party debt collectors and to others covered by the Fair Debt Collection Practices Act, including many debt buyers." According to Cordray, "Both consumers and responsible businesses stand to benefit by improved standards for debt collection. Consumers deserve to be treated with dignity and respect, and businesses should be able to operate fairly and reasonably to collect the debts they are legitimately owed."

OCC seeks to extend information collection on swap entity exemptions

This story appeared in Bank Digest.

The Office of the Comptroller of the Currency is requesting comment on the proposed three-year extension of an existing information collection entitled "Margin and Capital Requirements for Covered Swap Entities: Exemptions." The agency has sent the collection to the Office of Management and Budget for review.

According to the OCC's notice, Section 302 of the Terrorism Risk Insurance Program Reauthorization Act of 2015 amends Sections 731 and 764 of the Dodd-Frank Act to provide that the initial and variation margin requirements for non-cleared swaps and non-cleared security-based swaps do not apply to certain transactions with specified counterparties that qualify for an exemption or exception from clearing.

On April 19, 2016, the OCC issued a notice at 81 Federal Register 23082 for 60 days of comment concerning the collection, but no comments were received. Comments on the current notice must be submitted by Aug. 29, 2016.

Fed proposes revision of 'Capital Assessments and Stress Testing' information collection

This story appeared in Bank Digest.

The Federal Reserve Board is requesting comment on a proposal to extend for three years, with revision, the "Capital Assessments and Stress Testing" information collection applicable to bank holding companies with total consolidated assets of $50 billion or more and U.S. intermediate holding companies established by foreign banking organizations under 12 CFR 252.153.

According to the Fed's notice, this information collection provides the agency with the additional information and perspective needed to help ensure that large BHCs and IHCs have strong, firm-wide risk measurement and management processes supporting their internal assessments of capital adequacy and that their capital resources are sufficient.

The Fed is proposing to revise general report requirements and several schedules of the reports. The proposed revisions would be effective with the reports as of Dec. 31, 2016, or Dec. 31, 2017. Comments on the proposal must be submitted by Sept. 26, 2016.

Fed extends comment period for its insurance company capital proposal

This story appeared in Bank Digest.

The Federal Reserve Board has extended until Sept. 16, 2016, the comment period for the advanced notice of proposed rulemaking detailing conceptual frameworks for capital standards that could apply to systemically important insurance companies and to insurance companies that own a bank or thrift. Comments had previously been due by Aug. 17, 2016.

The ANPR, which was approved by the Fed at its June 3, 2016, meeting, and published in the June 14, 2016, Federal Register, seeks comments on the Building Block Approach and the Consolidated Approach that would be used to establish regulatory capital requirements for supervised insurance institutions.

In its notice extending the comment period, the Fed said that given "the range and complexity of the issues addressed in the ANPR," an extended comment period "allow[s] interested persons additional time to analyze the proposal and prepare their comments."

Agencies propose new method of calculating threshold exemptions under TILA, CLA

This story appeared in Bank Digest.

The Federal Reserve Board and Consumer Financial Protection Bureau have issued proposed rules detailing the method that will be used to make annual inflation adjustments to the thresholds for exempting certain consumer credit and lease transactions from the Truth in Lending Act and Consumer Leasing Act.

 

The Dodd-Frank Act requires that the exemption thresholds for consumer credit transactions and consumer leases in the TILA and CLA be adjusted annually based on the percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). According to the agencies, the calculation method proposed would allow the thresholds to keep pace with the CPI-W. Among other clarifications, the proposals detail that if there is no annual percentage increase in the CPI-W, the agencies will not adjust the exemption thresholds from the prior year. and Consumer Financial Protection Bureau have issued proposed rules detailing the method that will be used to make annual inflation adjustments to the thresholds for exempting certain consumer credit and lease transactions from the Truth in Lending Act and Consumer Leasing Act.

Comments on the proposed rules are due 30 days after they are published in the Federal Register.

Agencies propose new method of calculating threshold exemptions for small loans

This story appeared in Bank Digest.

The Federal Reserve Board, Consumer Financial Protection Bureau, and Office of the Comptroller of the Currency have issued a proposed rule detailing the method that will be used to make annual inflation adjustments to the thresholds for exempting small loans from higher-priced mortgage loan appraisal requirements.

The Dodd-Frank Act amended the Truth in Lending Act to add special appraisal requirements for higher-priced mortgage loans. The rules implementing these requirements exempted transactions of $25,000 or less and required that the exemption threshold be adjusted annually to reflect increases in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).

            According to the agencies, the proposed calculation method would allow the thresholds to keep pace with the CPI-W. In addition, among other clarifications, the proposal details that if there is no annual percentage increase in the CPI-W, the agencies will not adjust the exemption threshold from the prior year. Comments on the proposed rule must be received within 30 days after the date it is published in the Federal Register.

Statements mark anniversaries of Dodd-Frank Act, CFPB

This story appeared in Bank Digest.

July 21, 2016, marked six years since the Dodd-Frank Act became law and five years since the Consumer Financial Protection Bureau began operating, and a number of Congress members, as well as Treasury Secretary Jacob Lew, issued statements relating to one or both of these anniversaries. Senator Sherrod Brown (D-Ohio), Senate Banking Committee Ranking Member, issued a statement on the CFPB's fifth anniversary, saying: "Time and again, the bureau has exposed unfair and abusive behavior by financial companies that previously had no federal watchdog focused on consumer protections." He went on to say that the bureau "has made consumer financial products safer and better for consumers--but its work is not finished."

House Financial Services Committee Chairman Jeb Hensarling (R-Texas) referred to the Dodd-Frank Act as "a grave mistake" and said it "includes a taxpayer-funded bailout scheme for banks designated 'too big to fail.' “He also said the Act "gives big banks an advantage over small ones that can't keep up with the size, cost and complexity of all its regulations." In contrast, House Financial Services Committee Ranking Member Maxine Waters (D-Calif) said that since Dodd-Frank became law, "we have seen a financial system that works better for consumers and an economy that is stronger because of it." She also said the CFPB "has been remarkably successful."

House Democratic Leader Nancy Pelosi (D-Calif) said the enactment of the Dodd-Frank Act "ushered in a new era of financial security and consumer protection for hard-working Americans." Similarly, Treasury Secretary Jacob Lew said that after six years, "we can say without question that Wall Street Reform has made our financial system safer and sounder." A Treasury Notes blog post also discussed progress the author said had been made since Dodd-Frank was signed into law, and the Treasury Department released a document entitled "Dodd-Frank at Six Years: Reforming Wall Street and Protecting Main Street" that was also devoted to describing progress made since the Act became law.

CFPB blog details consumer complaints handled

A Consumer Financial Protection Bureau blog post states that the bureau has handled nearly one million consumer complaints in the five years of its existence, and the post goes on to provide statistics on the total number of complaints handled each year, as well as the numbers and percentages of the most complained about products and services over the last five years.

The post says that the bureau has handled more debt collection complaints than complaints in any other category--approximately 248,300 complaints, or 27 percent of the total over five years. This is followed by mortgages (about 235,800 complaints), credit reporting (about 153,400 complaints), credit cards (about 97,100 complaints), and bank accounts and services (about 91,800 complaints).

CFPB announces leadership changes

This story appeared in Bank Digest.

The Consumer Financial Protection Bureau has announced changes to three senior leadership positions at the bureau. Specifically, Chris D’Angelo, currently the bureau’s chief of staff, will serve as the CFPB’s Associate Director for Supervi­sion, Enforcement and Fair Lending. In a second leadership change, Richard Lepley will serve as the CFPB’s Principal Deputy General Counsel in the Office of the General Counsel in the Legal Division. According to the bureau, Lepley has worked as the deputy general counsel for general law, ethics, and oversight at the CFPB for the past five years.

Finally, Nellisha Ramdass will serve as the CFPB’s Deputy Chief Operating Officer. She previously was in charge of team operations in the Office of Tech­nology and Innovation, including serving as the act­ing deputy chief information officer.