Dodd-Frank News Center

Democratic Congress members file amicus brief in support of CFPB

This story appeared in Bank Digest.

House Financial Services Committee Ranking Member Maxine Waters (D-Calif) and 20 other Democratic current and former members of Congress have filed an amicus brief with the U.S. Court of Appeals for the District of Columbia Circuit in support of the Consumer Financial Protection Bureau's petition to have the entire court revisit an earlier decision by a three-judge panel that struck down the bureau's structure. The earlier ruling was made in October in the case of PHH Corporation, et al. v. Consumer Financial Protection Bureau.

The brief highlights the reasons Congress decided to structure the CFPB with a single director removable for cause under the Dodd-Frank Act and details the reasons the current and former members of Congress believe the October decision is at odds with the text of the Constitution and Supreme Court precedent.

Treasury Department releases FY 2016 ‘Citizens’ Report’

This story appeared in Bank Digest.

The Treasury Department's Office of Financial Stability has issued its "Citizens' Report for Fiscal Year 2016," which describes financial and performance results for the eighth year of the Troubled Asset Relief Program. The report contains the comparative fiscal years 2016 and 2015 financial statements for TARP, the Government Accountability Office's auditor's report with the audit opinion on these financial statements, an opinion from the GAO on the OFS's internal control over financial reporting for TARP, and the results of the GAO's tests of the OFS's compliance with selected provisions of laws, regulations, contracts, and grant agreements applicable to the OFS.

The report also includes information on the status of TARP programs and on the structure and operational goals of the OFS, which was created to help implement TARP.

According to an introductory message from the Deputy Assistant Secretary for Financial Stability, the OFS has made significant progress towards winding down TARP investments and is preparing to retire the largest TARP housing program, Making Home Affordable. He also said that more than 2.7 million homeowner assistance actions have taken place through the MHA program and that the Hardest Hit Fund has assisted approximately a quarter of a million American homeowners in preventing avoidable foreclosures. But in spite of these accomplishments and recent improvements in the economy, he said the recovery of the housing market remains uneven.

TILA threshold for exempt consumer credit transactions unchanged for 2017

This story appeared in Bank Digest.

The Consumer Financial Protection Bureau and Federal Reserve Board are finalizing amendments to the official interpretations and commentary for the agencies' regulations that implement the Truth in Lending Act to reflect the dollar threshold for exempt consumer credit transactions for 2017.

The Dodd-Frank Act amended TILA by requiring that this threshold be adjusted annually by the annual percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). If there is no annual percentage increase in the CPI-W, the bureau and the Fed will not adjust this exemption threshold from the prior year. The final rule memorializes this as well as the agencies' calculation method for determining the adjustment in years following a year in which there is no annual percentage increase in the CPI-W.

The agencies said that based on the CPI-W in effect as of June 1, 2016, the exemption threshold will remain at $54,600 through 2017. The final rule is effective Jan. 1, 2017.

CFPB seeks approval of complaint survey information collection

This story appeared in Bank Digest.

The Consumer Financial Protection Bureau is proposing a new information collection entitled "Consumer Response Customer Response Survey." According to the bureau, the purpose of this information collection is to incorporate a short survey into the complaint closing process through which consumers will have the option to provide feedback on a company's response to and handling of their complaint via all channels, including online, phone, fax, and mail.

The bureau said the information collection reflects comments received in response to a Notice and Request for Information published on March 24, 2015, in 80 Federal Register 15583, as well as comments received during the 60-day comment period and user testing conducted concurrent with the 60-day comment period. The CFPB issued a 60-day notice requesting comments in 81 Federal Register 50484 on Aug. 1, 2016. Written comments on the current notice must be received by Dec. 29, 2016, and will be summarized and/or included in the request for Office of Management and Budget approval.

CFPB alleges company deceived consumers into signing away future settlement payments

This story appeared in Bank Digest.

The CFPB has filed a complaint in federal district court against Access Funding, LLC, for a scheme in which victims of lead-paint poisoning and others allegedly were deceived into signing away future settlement payments in exchange for a significantly lower lump-sum payout.

The CFPB alleged that Access Funding steered victims to receive “independent advice” from a sham advisor—an attorney who was actually paid directly by the company and provided virtually no advice—indicating to consumers that the transactions required little scrutiny. In its lawsuit, the CFPB seeks to put an end to the company’s allegedly unlawful practices, obtain relief for the harmed consumers, and impose penalties.

Commenting on the lawsuit, Rep. Elijah E. Cummings (D-Md), Ranking Member of the House Committee on Oversight and Government Reform, said the lawsuit was “proof of the critical work the CFPB is doing, and evidence that any effort to undermine its legitimacy serves only to harm consumers.” Asserting that Access Funding and its advisors “deserve to face the full force of law,” Cummings went on to say he was “proud of the CFPB, and will fight to ensure it can continue to protect Americans from financial predators.”

Waters and Brown oppose rolling back Wall Street reform through policy rider

This story appeared in Bank Digest.

House Financial Services Committee Ranking Member Maxine Waters (D-Calif) and Senate Banking Committee Ranking Member Sherrod Brown (D-Ohio) have sent a letter to Senate and House leaders opposing ideological policy riders to year-end funding legislation aimed at rolling back protections of Wall Street reform. Noting that the Senate Banking Committee has not held a single legislative markup during the second session of the current Congress, Waters and Brown said that "it would be irresponsible for you to use the appropriations process as a replacement for Committee consideration of legislation through regular order."

The two also said that Wall Street Reform had strengthened the nation's financial stability and that given the recent Wells Fargo scandal, "it's clear that our financial markets need stronger rules and oversight, not less."

Senators request expedited review process for Wells Fargo whistleblowers

This story appeared in Bank Digest.

Senators Sherrod Brown (D-Ohio), Bob Casey (D-Pa), Bob Menendez (D-NJ), and Elizabeth Warren (D-Mass) have sent a letter to the Financial Industry Regulatory Authority requesting that the agency establish an expedited review process for Wells Fargo whistleblowers and other unfairly terminated employees to clear their termination notices, which the senators said "may contain negative comments as a result of their attempts to report or resist fraud at Wells Fargo." The letter referred to news reports that many employees who raised concerns about improper and abusive practices at Wells Fargo branches were fired.

The fraud the senators referred to involved a Consent Order Wells Fargo entered into in September regarding "improper and abusive practices" that resulted in "the unauthorized opening of 2 million customer accounts." The senators said it had been reported that many whistleblowers are now unable to find work at other banks due to negative information in their termination notices.

FDIC finalizes recordkeeping rule for large depository institutions

This story appeared in Bank Digest.

At its Nov. 15, 2016, meeting, the Federal Deposit Insurance Corporation adopted a final rule that is intended to facilitate the rapid payment of insured deposits to customers if an FDIC-insured institution with a large number of deposit accounts were to fail. The final rule requires that insured depository institutions with more than two million deposit accounts maintain complete and accurate data on each depositor and ensure that their information technology systems are capable of calculating the amount of insured money for most depositors within 24 hours of a failure. The FDIC anticipates the final rule will take effect on April 1, 2017.

According to the FDIC, the rule would currently apply to 38 institutions. The institutions would have three years to develop the recordkeeping and IT systems required for compliance.

OCC proposes revisions to stress test information collection

This story appeared in Bank Digest.

The Office of the Comptroller of the Currency is proposing to revise a currently approved information collection entitled "Company-Run Annual Stress Test Reporting Template and Documentation for Covered Institutions with Total Consolidated Assets of $50 Billion or More under the Dodd-Frank Wall Street Reform and Consumer Protection Act." This information collection is related to the annual stress tests that the Dodd-Frank Act requires certain financial companies, including national banks and federal savings associations, to conduct.

The OCC is proposing to revise its reporting requirements to mirror the Federal Reserve Board's proposed changes to its form FR Y-14A, which many covered institutions with total consolidated assets of $50 billion or more are required to submit. The OCC is also proposing to implement a new supplemental schedule to collect certain items not included in the Fed's FR Y-14A. Comments must be received by Jan. 17, 2017.

CFPB Servicemember Complaint Snapshot focuses on mortgage refinancing

This story appeared in Bank Digest.

The Consumer Financial Protection Bureau has issued its third semiannual Servicemember Complaint Snapshot—this one focusing on servicemember complaints related to refinancing of mortgages guaranteed by the Department of Veterans Affairs. According to the report, veterans complain about aggressive solicitations from lenders to refinance, misleading advertisements, and failure of lenders to fulfill promises of lower rates than the consumers' existing mortgages.

Military borrowers also complain about lack of clarity regarding underwriting requirements and poor communication from lenders during the refinance process. In addition, the report and a CFPB blog post list several tips for servicemembers to remember if they are thinking about refinancing their mortgages--telling them that they don't have to respond to marketing offering a home refinance and also to be savvy consumers, understand the risks involved, shop around, and know the process.