March 1, 2018

CFPB Announces Subdued Enforcement in 2018-22 Strategic Plan. by Troutman Sanders LLP

On February 12, 2018, the Consumer Financial Protection Bureau ("CFPB") released its strategic plan for 2018 through 2022. The plan, which will take two years to implement, calls for placing new restrictions on the CFPB's enforcement authority. "The proposed reforms would impose financial discipline, reduce wasteful spending, and ensure appropriate congressional oversight," according to a statement also released on that date. Mick Mulvaney, acting interim director of the CFPB, stated that the Bureau's new direction will provide "clarity and certainty to market participants."

Under the proposal, which also is included in President Trump's 2019 budget plan, the CFPB would be funded by Congress rather than the Federal Reserve. This change would arguably give lawmakers more oversight and influence over the agency's priorities - a common complaint from critics of the CFPB. The CFPB's 2019 budget also would be capped at its 2015 level - $485 million - compared to a projected $630 million this year.

In its strategic plan, the CFPB lays out revised mission and vision statements:

Mission: To regulate the offering and provision of consumer financial products or services under the Federal consumer financial laws and to educate and empower consumers to make better informed financial decisions. Read more at LEXOLOGY

COLORADO: Payday loans have average interest rates of 129% in Colorado. A ballot measure proposes capping them.

The initiative would piggyback off Colorado's last major reform effort on payday lending in 2010, which was held up as a national model

With a growing body of research showing that a prior round of reforms did not eliminate abuses in the payday-lending business in Colorado, reform supporters are now looking to ask voters to limit interest rates on the short-term loans.

A ballot initiative filed this month with the Colorado secretary of state's office would cap the annual interest rates for payday loans at 36 percent - a dramatic reduction from the 129 percent such lenders charge on average now.

Payday lending has long been viewed by opponents as a predatory practice that disproportionately targets low-income minorities with promises of quick cash. But the early payday comes at a significant cost that can trap such borrowers - who already were scraping by financially - in a cycle of debt.

A new report issued Wednesday by the Center for Responsible Lending, one of the groups pushing the ballot initiative, found that in 2016, payday borrowers paid on average $119 in interest and fees for loans worth $392. Some took out two or more simultaneously, spending an average of $238 to borrow $392. Read more at THE DENVER POST

CFSA Conference and Expo

CFPB Report Finds Removal Of Public Record Data Has Small Effect On Credit Scores

Today we released the latest quarterly consumer credit trends report , this time focusing on the removal of civil public records from consumer credit reports.

The three nationwide credit reporting companies-Equifax, Experian, and TransUnion-entered into a settlement with over 30 state attorneys general. This settlement, called the National Consumer Assistance Plan (NCAP), required the companies to increase the accuracy of credit reports and to make it easier for consumers to correct errors on their reports. Part of this settlement required the three nationwide credit reporting companies to create minimum standards for personally identifiable information and reporting frequency for civil public records, including bankruptcies, civil judgments, and tax liens.

Starting July 1, 2017, this aspect of the settlement required all civil public records to have a name, address, and a Social Security number or date of birth before appearing on credit records from the three nationwide credit reporting companies. The settlement also required this information to be refreshed by the credit reporting companies at least every 90 days.

In this report, we explore how the reduction in public records affected consumers' credit records and their credit scores. However, we cannot assess scoring-model accuracy because we need two years of data following the implementation of the new standards to perform that analysis.

INDIANA: Committee chairman kills divisive payday lending bill

An Indiana Senate committee chairman has killed a payday lending bill that critics charge would have allowed predatory lending practices.

A spokesman for Republican Sen. Mark Messmer said Tuesday that the Jasper Republican ruled out giving the bill a hearing in his Commerce and Technology committee. That effectively killed the bill, which was previously approved by the House.

Messmer's decision comes after the Senate leader David Long of Fort Wayne said that he is "not of big fan" of the bill. It was also opposed by faith-based groups.

It's a felony under state law to offer loans with an annual percentage rate over 72 percent. But the bill would create a new type of payday loan that would have allowed for annual percentage rates of up to 222 percent. Read more at THE CHARLOTTE OBSERVER


The #1 U.S. company for pay and benefits

Most companies offer employees a compensation and benefits package, but how do you know if it's competitive?

Using a database with more than 18 million employer reviews,, a job search site, has pinpointed the top 15 companies offering the best pay and benefits.

Topping the list is Costco Wholesale (COST), which is the largest retailer of organic foods, wine, and rotisserie chicken. With more than 10,000 employees, the Washington-based chain earned the No. 1 spot for a handful of reasons, including its generous wages. In 2016, Costco increased the minimum wage for workers from $13 to $13.50 (the minimum wage in Washington is $11 an hour; the federal minimum wage is $7.25 an hour). Additionally, the average full-time cashier has a starting salary of $27,906, which can rise to $54,000 within five years, depending on the location.

"They have a graduated wage program that's based purely on total hours worked. Show up, do your job, and your pay goes up on its own," said one employee review.

When it comes to benefits, full and part-time workers are eligible for healthcare, dental care, vision coverage, an employee stock purchase plan, and 401(k)s that receive a 50-cent match on every dollar for the first $1,000.

In the second spot is Kaiser Permanente, one of the country's largest providers of not-for-profit health plans. According to employee reviews on Indeed, the company has generous benefits and "pays more than other medical facility hands down." According to Glassdoor, registered nurses at the company make an average of $111,875 a year at the headquarters in Oakland, Calif. This figure includes profit sharing and a cash bonus.    Read more at YAHOO.COM

Udall, Heinrich Cosponsor SAFE Lending Act To Protect Consumers From Predatory Practices

Commentary: WASHINGTON, D.C. (Feb. 27, 2018) -U.S. Senators Tom Udall and Martin Heinrich cosponsored the Stopping Abuse and Fraud in Electronic (SAFE) Lending Act to crack down on some of the worst abuses of the payday lending industry, particularly in online payday lending, and protect consumers from deceptive and predatory practices that strip wealth from working families.

Under the Trump Administration's leadership, the Consumer Financial Protection Bureau (CFPB), which previously was set to institute national rules related to payday loans, has suddenly reversed course on consumer protections from payday predators. In 2015, before New Mexico enacted a new state law capping interest rates, New Mexicans took on hundreds of millions of dollars of hard-to-pay-back debt through more than 300,000 high interest loans. Without strong CFPB protections at the federal level, state laws protecting consumers will be all the more important.

"Too many working New Mexicans struggling to make ends meet can fall prey to predatory payday lending practices that trap them in a cycle of debt," said Senator Udall. "Under President Trump's direction, the Consumer Financial Protection Bureau has turned its back on working families across the country by gutting regulations that limit the payday lending industry's predatory and deceptive practices. The SAFE Act would help protect hardworking New Mexicans by cracking down on the worst abuses by payday loan predators."

"We need to build more economic opportunities for New Mexicans - and stopping predatory lenders from targeting families and pulling them into a cycle of debt is an important part of that work," said Senator Heinrich. "As the Trump Administration aims to weaken the Consumer Financial Protection Bureau, we need to take action and ensure states have the tools they need to combat deceptive online payday lending. I'm proud to cosponsor the SAFE Lending Act to empower consumers to better protect themselves against predatory lending practices." Read more at KRWG

A_S Management
Dreher Tomkies LLP

MISSOURI: New credit union will provide alternative to payday loans for residents in KC's urban core

It's been seven years in the making, but this spring, African American leaders will finally open the first credit union designed to serve low-income families in the urban core.

Many in the African American community have worked hard to establish an alternative to the high costs of payday lending.

Organizers said four out of 10 people in the central city either don't have a checking or savings account, or rely on financial services outside the banking system.

"I can't take cash here," said Tenesia Looney, an urban core realty broker. "It's just too risky to accept cash."

Looney knows firsthand that cash is king on Kansas City's east side. The supervising broker at Keys Realty Group collects rent from nearly 70 tenants in the inner city, and she said nearly all of them try to pay her in cash.

"I have so many clients that don't have bank accounts or are afraid of banks themselves," Looney said.

Like many on the east side, Looney knows taking in cash would make her a tempting target for criminals. Her office is located near Linwood and Indiana avenues, a neighborhood plagued by violent crime and street gangs. Read more at FOX4KC

Why Reform Is Necessary At The CFPB

The opportunity for new leadership at the Consumer Financial Protection Bureau (CFPB) presents the agency with a chance to work with the Trump administration and Congress to reform how it meets its obligations to protect consumers while ensuring access to credit is not unnecessarily restricted.

The agency recently took a major step toward reform when it announced a series of Requests for Information in the coming months to allow public comment on nearly every aspect of the agency's operations, from enforcement to supervision and even rulemaking.

The CFPB has an important and worthy goal, but former Director Richard Cordray's tenure saw the agency create many rules and enforcement actions that appeared to be motivated by politics and internal bias. This included aggressive pursuits against the growing fintech industry, even when the agency's own consumer complaint database consistently ranks these firms as less of a concern than many traditional financial service providers.

For those working in and with the financial services sector, there is a recognition that appropriate regulations are needed to ensure consumer protection and maintain healthy competition in the industry. At the same time, financial service providers also desire a level playing field that allows for innovation and a business environment free from the constant fear of politically charged regulatory decisions. The evidence is mounting that the CFPB needs to reform how it operates.

Here are a series of reforms I believe the agency should consider in 2018. Read more at FORBES

CFSA Conference and Expo
CFSA Conference and Expo

Employee Financial Stress: How Employers Can Help and Improve Their Bottom Line

In a 2017 report by PricewaterhouseCoopers (PwC), a survey of 1,600 workers found that 53% are feeling financial stress, which results in negative impacts that impose costs in the form of less productive employees who may take more time off to deal with financial matters. Additionally, financially stressed employees tend to leave employers for higher pay and to cite health issues caused by financial stress.

According to the PwC study, employees reporting financial stress tend to be younger, with 35% of Millennials and 44% of Gen Xers saying they are financially stressed, versus only 21% of Baby Boomers. Women are more likely to feel financial stress, with 59% of females reporting financial stress versus 41% of men.

The survey also revealed that 54% of people feeling financial stress are twice as likely to postpone their retirement, and even 30% of those not feeling financial stress are planning to postpone retirement. Postponing retirement will, of course, cost the employer more in real budget dollars when long-term employees continue to work. Not only do long-term employees earn more in salary than newly hired employees, but an older work force also will tend to increase health care costs for the employer. Read more at American Society of Pension Professionals & Actuaries

U.S. Courts Jailing Thousands over Civil Debts 'Without Due Process,' ACLU Says

Thousands of people are being arrested and jailed each year because of outstanding civil debts, despite the United States banning debtors' prisons nearly 200 years ago, according to a new report from the American Civil Liberties Union.

An estimated 77 million Americans have debt that has been turned over to a private collection agency, the ACLU claims. The union has alleged that private debt collectors are partnering with local courts and prosecutors' offices to use the criminal justice system to punish debtors and to try to force repayments, even when debts are in dispute.

The ACLU said it found courts in 26 states and in Puerto Rico where judges has issued arrest warrants for alleged debtors at the request of private debt collectors.

Debtors' prisons were abolished by Congress in 1833, but the ACLU said courts have issued tens of thousands of arrest warrants every year for people who fail to show up in court to deal with unpaid civil debt judgments.

"The private debt collection industry uses prosecutors and judges as weapons against millions of Americans who can't afford to pay their bills," said Jennifer Turner, the principal human rights researcher at the ACLU and author of the "A Pound of Flesh: The Criminalization of Private Debt" report, which the union has touted as the first-ever glimpse into the impact of cooperation between courts and the private debt collection industry. Read more at NEWSWEEK

Community Involvement
Check City
A huge shout-out goes to Check City customers for donating through the 
Souper Bowl of Caring campaign.  They generously matched all customer 
donations,  bringing their total to over $14,198 -- the equivalent of nearly 
53,000 meals for  Utahns facing hunger!
AFSPA helps our members grow their Alternative Financial Services business by providing them with the best information, research, data, support, relationships and by vetting and presenting the best available product and service providers for the Alternative Financial Services Industry. 

Alternative Financial Service Providers Association

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