Dodd-Frank News Center

CFPB issues report on elder financial exploitation

This story appeared in Bank Digest.                                   

The Consumer Financial Protection Bureau's Office of Financial Protection for Older Americans has issued a report regarding financial exploitation of older adults. The report is based on Suspicious Activity Reports filed with the federal government by financial institutions such as banks and money services businesses.

The report presents the first public analysis of elder financial exploitation SAR filings since the Financial Crimes Enforcement Network introduced electronic SAR filing with a designated category for "elder financial exploitation" in 2013. Among other findings, the report said that SAR filings on elder financial exploitation quadrupled from 2013 to 2017.

FTC provides CFPB with summary of ECOA enforcement activities

This story appeared in Bank Digest.                                     

Federal Trade Commission staff has provided the Consumer Financial Protection Bureau with an annual summary of the Commission's activities enforcing the Equal Credit Opportunity Act during 2018. The FTC is responsible for ECOA enforcement and education regarding most nonbank financial service providers.

According to a press release, the FTC's document describes the Commission's work on ECOA-related policy issues, including activities addressed in research and policy development, and also outlines its business and consumer education efforts on fair lending issues.

Advisory council meetings announced

This story appeared in Bank Digest.

The Consumer Financial Protection Bureau’s Community Bank Advisory Council, Consumer Advisory Board, and Credit Union Advisory Council will each hold public meetings on March 14, 2019, from approximately 9:30 a.m. to 5:15 p.m. eastern daylight time in Washington, D.C., to discuss policy issues related to financial technology and other trends and themes in consumer finance. Those wishing to attend the meetings must RSVP by noon EDT on March 13, 2019.

A specific agenda for the meetings will be made available to the public on Feb. 27, 2019, via consumerfinance.gov.

CFPB issues guide for payment-related requirements of Payday Lending Rule

This story appeared in Bank Digest.                                   

The Consumer Financial Protection Bureau has issued a new Small Entity Compliance Guide for its Payday, Vehicle Title, and High-Cost Installment Lending Rule (Payday Lending Rule), specifically discussing payment-related requirements. The Bureau notes that its Feb. 6, 2019, notice of proposed rulemaking to reconsider the mandatory underwriting provisions of the Payday Lending Rule does not impact the payment-related requirements of the rule. The purpose of the guide is to provide information that may be helpful when implementing the payment-related requirements of the Payday Lending Rule.

The guide summarizes the rule's general provisions as well as its record retention and compliance program requirements as they relate to the payment provisions. In addition, examples are provided to help illustrate certain aspect of the rule.

 

FHFA issues fourth quarter 2018 Prepayment Monitoring Report

This story appeared in Bank Digest.                                   

The Federal Housing Finance Agency has issued its fourth quarter 2018 "Prepayment Monitoring Report," which provides insight into how the FHFA monitors the consistency of prepayment rates across cohorts of the To-Be-Announced-eligible mortgage-backed securities of Fannie Mae and Freddie Mac (the Enterprises). A prepayment on a mortgage loan is the amount of principal paid in advance of the loan's scheduled payments, and the "To-Be-Announced" market is a forward market for certain mortgage-backed securities, including those issued by the Enterprises.

The FHFA's "2014 Strategic Plan for the Conservatorships of Fannie Mae and Freddie Mac" includes the goal of improving the overall liquidity of the Enterprises' securities through the development of a single, common mortgage-backed security. The new security will be called the Uniform Mortgage-Backed Security (or UMBS) and is designed to trade in the TBA market without regard to which Enterprise is the issuer.

According to the FHFA, consistency of prepayment rates is important to the success of UMBS and to the efficiency and liquidity of the secondary mortgage market.

OIG finds ‘medium’ risk level in CFPB's travel card program

This story appeared in Bank Digest.  

The Office of Inspector General for the Consumer Financial Protection Bureau and the Federal Reserve Board has conducted a risk assessment of the Bureau's travel card program for fiscal year 2018 to determine the necessary frequency and scope of travel card audits.

The specific objective of the report was to analyze the risks of illegal, improper, or erroneous purchases and payments associated with the Bureau's travel card program in order to determine an overall risk level for the program. The scope of the report included travel card purchases from Oct. 1, 2017, through Sept. 30, 2018.

The OIG said the results of the risk assessment show that the risk of illegal, improper, or erroneous use in the Bureau's travel card program is "medium," which means that while illegal, improper, or erroneous use is likely to occur, such an occurrence would be expected to have a limited effect on current operations and long-term objectives.

FHFA adopts regulations on capital requirements for FHLBanks

This story appeared in Bank Digest.                                   

The Federal Housing Finance Agency is issuing a final rule to adopt as its own portions of the regulations of the Federal Housing Finance Board pertaining to the capital requirements for the Federal Home Loan Banks. The final rule carries over most of the existing Federal Housing Finance Board regulations without material change but substantively revises the credit risk component of the risk-based capital requirement, as well as the limitations on extensions of unsecured credit. The rule takes effect Jan. 1, 2020.

OCC issues revised dataset for use in 2019 stress tests

This story appeared in Bank Digest.

The Office of the Comptroller of the Currency has released a revised dataset for use by covered institutions in the upcoming 2019 stress tests. According to the agency's release, the previously released dataset contained an incorrect value for the mortgage rate in the fourth quarter of 2018. The updated dataset contains the corrected data point of 4.8 percent rather than the previously published 4.6 percent mortgage rate for that quarter.

Democrats write to CFPB opposing changes to payday loan rule

This story appeared in Bank Digest.                                   

Senators Jeff Merkley (D-Ore), Dick Durbin (D-Ill), and Sherrod Brown (D-Ohio) have led a group of 47 senators in writing to Consumer Financial Protection Bureau Director Kathleen Kraninger to oppose the CFPB's proposal to revise its payday loan rule to eliminate underwriting requirements.

In their letter, the senators said, "Currently under the Payday Rule, lenders will be required to verify a borrower's income, debts, and other spending in order to assess a borrower's ability to remain current and repay credit, and provide an affordable repayment plan for borrowers who take out more than three loans in succession."

They went on to say, "Repealing this rule provides a green light to the payday lending industry to prey on vulnerable American consumers. In drafting these devastating changes to the Payday Rule, the CFPB is ignoring one of the most fundamental principles of consumer finance--an individual should not be offered a predatory loan that they cannot pay back." The senators asked for answers to several questions regarding the effect of the proposed changes.

OFR establishes data collection for centrally cleared funding transactions

This story appeared in Bank Digest.                                   

The Office of Financial Research has adopted a final rule to establish a data collection covering centrally cleared funding transactions in the United States repurchase agreement (repo) market. The rule will become effective 60 days after publication in the Federal Register.

According to the OFR's press release, the daily collection will enhance the ability of the FSOC to identify and monitor potential risks to U.S. financial stability by closing the data gap related to centrally cleared repo transactions. The collection will also support the calculation of certain reference rates, particularly alternatives to the U.S. dollar London Interbank Offered Rate (LIBOR).