February 1, 2018

Mulvaney Saving, Not 'Dismantling,' Consumer Financial Protection Bureau.
by Daniel Press

Mick Mulvaney has caused quite a stir around Washington with his (temporary) takeover of the Consumer Financial Protection Bureau. Last week, the Acting Director penned an all-staff email outlining the new focus for the Bureau under his watch.

As American Banker reported, reactions to the 'Mulvaney memo' range from elation to disgust. Catherine Rampell of the Washington Post, for example, wrote that Mulvaney is "dismantling" the CFPB, while Sen. Elizabeth Warren (D-MA)-the intellectual founder of the Bureau-said that he is "trying hard to make the consumer agency work for the people who want to cheat consumers."

Hyperbole aside, there is nothing that Mulvaney has said or done as head of the CFPB to suggest that he is intent on killing the agency. In his own words, Mulvaney made clear that he has "no intention of shutting down the bureau" and that the "law mandates that we enforce consumer-protection laws, and we will continue to do so under my watch."

It is also no small issue that Mulvaney has no legal authority whatsoever to change the underlying structure of the Bureau or its statutory obligations. That would require new legislation from Congress. To say that he is somehow doing otherwise is sorely mistaken.

Quite simply, Mulvaney has outlined that the CFPB will no longer "push the envelope," in that the Bureau will faithfully enforce the consumer protection laws as written, but not go beyond that mandate. Read more at Competitive Enterprise Institute
FLORIDA: 'Installment' payday loan bill backed in Senate

A proposal that would allow payday loans for longer periods of time and larger amounts of money cleared its second Senate committee Monday.

The Senate Commerce and Tourism Committee approved the bill (SB 920), filed by Appropriations Chairman Rob Bradley, R-Fleming Island.

The bill would allow "installment" loans up to $1,000, with repayment over 60 to 90 days.

Current law limits the high-interest loans to $500 for periods of seven to 31 days.

Backers of the bill say it is needed because of federal regulations slated to take effect in August 2019 on the types of smaller-dollar, shorter-term loans made by payday lenders in Florida.

Also, supporters say the industry plays an important financial role for many low-income people who do not have access to other sources to borrow money.

"I think these loans provide a valuable service to individuals on a short-term basis, which is the way they were intended," Sen. Kelli Stargel, R-Lakeland, said. Read more for NEWS4JAX
Dreher Tomkies LLP
Court upholds constitutionality of CFPB

A federal appeals court has upheld the constitutionality of the Consumer Financial Protection Bureau's structure in the face of challenges from business interests and conservatives.

The D.C. Circuit Court of Appeals ruled, 7-3, that a provision in the 2010 Dodd-Frank law that limits the president's ability to remove the CFPB director during his or her 5-year term does not violate the president's authority to appoint and remove executive branch officers.

The ruling was largely along ideological lines, with one George W. Bush appointee joining all the Democratic-appointed judges in upholding the consumer bureau's structure. The three dissenting judges were all Republican appointees.

In November, Richard Cordray, who was appointed CFPB director by then-President Barack Obama, resigned and designated his deputy, Leandra English, as acting head of the agency. The same day, President Donald Trump named his budget chief, Mick Mulvaney, as the CFPB's acting head. English and others have filed lawsuits challenging Mulvaney's appointment, but no court has stepped in to block Trump's move.

The same court that ruled in today's decision will hear English's appeal to halt any further action by Mulvaney as acting director of the bureau. Mulvaney has taken a number of steps to rein in the bureau since he took over, including requesting no additional funding from the Federal Reserve for the CFPB for the second quarter of fiscal year 2018. Read more at POLITICO
Why 2018 Is Shaping Up to Be a Good Year for Banks

The U.S. banking industry is in an upbeat mood as it looks ahead in 2018, following a year of policy and regulatory uncertainty under the Trump administration, including an announced changing of the guard at the Federal Reserve. Overall, the banking and finance sector performed well in 2017 - stocks have appreciated in the last 12 months - but the sector also suffered setbacks with reports of misdeeds by companies like Wells Fargo, while others, such as UBS and Deutsche Bank, received waivers on restrictions imposed on them after they pled guilty to currency manipulation in the LIBOR scandal of a few years ago.

In the year ahead, the banking sector will be bolstered by the fact that the Trump administration is favorably disposed towards Wall Street, and it will benefit from the latest tax reforms as U.S. corporations bring back profits held overseas. In addition, the new Fed chair, Jerome Powell, who takes over on February 3, is expected to continue raising rates and maintain the steady pace of his predecessor, Janet Yellen.

At the same time, lingering consumer distrust - a fallout from the recent scandals - and more competition from fintechs are potential hurdles for banks this year, according to Wharton legal studies and business ethics professors Peter Conti-Brown and David Zaring. Conti-Brown and Zaring discussed the outlook for the banking industry in 2018 on the Knowledge@Wharton show on Wharton Business Radio on SiriusXM channel 111. (Listen to the podcast at the top of this page.)                                     Read more at WHARTON at UPENN
CFSA Conference
U.S. Houses passes Tipton bill to make rural banking more accessible

The House of Representatives overwhelming passed legislation introduced by Rep. Scott Tipton (R-Colo.) that extends mobile banking access to rural Coloradans Monday evening.

The Making Online Banking Initiation Legal and Easy (MOBILE) Act of 2017 (H.R. 1457) passed with high bipartisan support on a 397-8 vote.

The MOBILE Act increases access to mobile banking services by requiring states to allow consumers to use electronic scans of their driver's license or other personal identification to set up bank accounts on a mobile devices.

For Coloradans in rural areas, this bill removes a burdensome trip to a physical bank, which might be miles away.

"In communities where access to a physical bank is limited, mobile banking has become a critical tool for Americans to save money securely, pay their bills on time, and better plan for their future financial needs," Tipton said in a news release.

The legislation addresses banking issues faced by rural Americans in unbanked or underbanked communities. A 2016 Federal Reserve study found that 31 percent of Americans were unbanked or underbanked, but widely used mobile phones. Read more at THE JOURNAL
Cordray rips 'zealots and toadies' axing payday loan rules

WASHINGTON - The former head of a consumer watchdog agency Wednesday lambasted his replacement in a series of tweets for deciding to reconsider a rule aimed at protecting consumers from abusive payday lending practices.

Richard Cordray, a former Ohio attorney general who resigned in late November to seek the Democratic gubernatorial nomination, blasted the Consumer Financial Protection Bureau's decision to reconsider payday lending rules that he had helped to craft as head of the agency. The bureau confirmed it would reconsider the rules in a statement Tuesday.

"Truly shameful action by the interim pseudo-leaders of the CFPB, announcing their plans to reconsider the payday lending rule just adopted in November," Cordray tweeted. "Never mind many thousands of people stuck in debt traps all over the country. Consumers be damned!"

Dennis Shaul, CEO of the Community Financial Services Association of America, a trade association that represents payday lenders, said the organization was "pleased" that the agency would take a new look at the payday lending rule.

"The bureau's rule was crafted on a pre-determined, partisan agenda that failed to demonstrate consumer harm from small-dollar loans, ignored unbiased research and data, and relied on flawed information to support its rulemaking," he said.
A_S Management
Warren, Waters ask Mulvaney about CFPB change of heart on payday

WASHINGTON - Top Democrats in the House and Senate sent a letter to Mick Mulvaney on Wednesday questioning his decision to delay the implementation of the Consumer Financial Protection Bureau's payday loan rule.

"We have a number of questions about the sudden reversal of the CFPB's positions" including the payday rule, a case against four installment lenders and an investigation into a payday lender, said the letter, which was led by Sen. Elizabeth Warren of Massachusetts and the top Democrat on the House Financial Services Committee, Rep. Maxine Waters of California, and signed by four other Democrats.

Under Mulvaney's leadership, the CFPB announced on Jan. 16 that it was reconsidering the payday loan rule. Two days later, it dismissed a case against the installment lenders and on Jan. 22 dropped an investigation into World Acceptance Corp.

"The agency barely explained its payday rule reversal," said the letter, which was also addressed to Leandra English, who was former CPFB Director Richard Cordray's chief of staff and tapped to be the acting director before the position was given to Mulvaney. A case challenging Mulvaney's status as head of the agency is still pending. Read more at CREDIT UNION JOURNAL
Mulvaney Outlines "New Mission" for the CFPB in Email to Bureau Staff

Yesterday afternoon, Acting Director Mulvaney sent an email to the entire CFPB staff in which he drew a sharp contrast with the views of his predecessor, Director Richard Cordray, and outlined a new direction for the Bureau.

In explaining how "things would be different" at the Bureau, Acting Director Mulvaney criticized the agency's aggressive approach under former CFPB Director Richard Cordray, citing a statement Mulvaney attributed to the former Director that "[p]ushing the envelope is a loaded phrase, but that's absolutely what we did." Acting Director Mulvaney explained, "that entire governing philosophy of pushing the envelope frightens me a little." Instead, he stated that the Bureau must work for everyone, including both consumers and providers of financial services.
O_Keefe _ O_Malley
What Richard Cordray built, President Trump is remodeling drastically

WASHINGTON - Things have gotten personal.

President Donald Trump has been reversing Obama White House policies since the moment the former real estate tycoon took office last year. But rarely was there personal criticism directed from this White House to the former department heads and agency directors.

But from the lips of Trump to the computer keyboard of his budget director, Mick Mulvaney, leading Republicans have now personally blamed one Obama appointee - Richard Cordray - for representing so much of what they are trying to change.

Technically speaking, Mulvaney did not use Cordray's name in an "all hands" memo last week to the staff of the Consumer Financial Protection Bureau, or CFPB, which the budget chief has been running on an interim basis since Cordray's November resignation. (See the full memo at the bottom of this article.)

But by pointedly stating his philosophical and enforcement differences from those of "my predecessor," by paraphrasing and attempting to quote that predecessor, and by spelling out dramatic change, Mulvaney made it clear. Read more at CLEVELAND.COM
Secure Check Cashing Systems
Net neutrality: What it is and what its repeal means to consumers. by Philip Burgess

With roughly 80 percent of adults in America having broadband access, according to recent polling data from the Pew Research Center, the internet has become almost as ubiquitous in the typical home as the television. The online world reaches more people today than ever before in its history, a trend that's only expected to continue in the coming years.

Wide availability has helped keep subscription costs affordable for internet users. Prices vary, but on a monthly basis, the typical bill runs between $35 and $42, based on estimates from the Open Technology Institute, assuming connection speeds averaging 11.4 megabytes per second. But with net neutrality no longer the law of the land due to its tabling by the Federal Communications Commission, some consumers are worried that their internet bills will cost more, a potential point of concern for the unbanked and underbanked, whose creditworthiness is - in part - determined by their timeliness of paying off these kinds of bills. Will internet rates rise with the rule's repeal? To determine this, it's instructive to examine what net neutrality is all about and what its removal could mean for consumers.

What is net neutrality? Read more at MICROBILT NEWS

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