NEWS: September 5

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Rep. Hensarling seeks answers from CFPB's Cordray on payday loan rule

Responding to reports that the Consumer Financial Protection Bureau's (CFPB) final payday loan rule will be narrower in its coverage than originally proposed, Rep. Jeb Hensarling (R-TX) is questioning CFPB Director Richard Cordray on the reported change.
The CFPB's original proposal established limitations for a "covered loan" which could be either a short-term consumer loan with a term of 45 days or less or a loan with a term of more than 45 days where the total cost of credit exceeds an annual rate of 36 percent along with other qualifications.

According to reports, the final rule, which is in review by other agencies, will only cover short-terms loans with a term of less than 45 days. The review is expected to be finalized in early September, according to reports.

Hensarling wrote to Cordray asking about his motives behind the reported rush to finalize the CFPB's payday lending rule. He also asked about his future at the bureau, amidst speculation that he is going to resign and run for governor in Ohio.

The Texas congressman asked Cordray to deny that political considerations have informed any decisions, orders and communications relating to the payday lending rule; assure him that all records relating to the rulemaking will be preserved; and confirm that Cordray will serve his full term as CFPB director, or otherwise provide the date on which he will resign from office. Hensarling asked for a reply to those statements in writing this week.
Dreher Tomkies LLP
Hurricane Harvey: Six Positive Steps Employers Can Take to Help Their Employees

Hurricane Harvey has caused massive damage and displacement of individuals in southeast Texas. For employees who have been unable to work during the past week, and for those who may not be able to return to work in the near future, there is an obvious financial and emotional toll.

Here are six positive steps that businesses may want to consider in an effort to help employees who have been directly impacted by Harvey. If the employer's affected employees are covered by a collective bargaining agreement, the employer should reach an agreement with the union representing those employees before making any changes to the terms and conditions of employment.

1. Pay Your Employees for the Time They Would Have Worked - Salaried, exempt employees are entitled to their full salaries for any workweek in which they perform any work, subject to limited exceptions. However, neither federal law nor Texas state law requires employers to pay nonexempt employees for time that they do not spend working. Thus, employers that were closed for only part of a workweek could find themselves in a situation where their exempt employees are getting paid their full weekly salaries but their nonexempt employees are taking an economic hit. To help lessen the blow, and to be more equitable, employers with the financial ability to pay their nonexempt employees for the hours they would have worked if Hurricane Harvey had not hit the region may want to do so.

2. Provide Your Employees With No Interest Loans or Pay Advances - Many employers may not be able to afford paying employees for not working. However, ... Read more at JD SUPRA
Alternative Credit Data Facilitates Lending Options for Consumers

ATLANTA-FactorTrust®, the Alternative Credit Bureau™, today announced a partnership with leading predictive analytics and digital decisioning company, Enova Decisions™, to integrate FactorTrust's proprietary data into its Colossus™ digital decisioning platform. The integration will strengthen Enova Decisions' platform with additional proprietary data that will result in improved automated, real-time operational decisions for its customers.

Chicago-based Enova Decisions supports numerous industries, including financial services, telecommunications and higher education. The company's data-driven solutions help clients in the financial services industry specifically improve their operational decisions instantly and at scale.

"FactorTrust is proud to assist industry leaders like Enova Decisions with their data needs," said FactorTrust CEO Greg Rable. "Our alternative credit data enables their clients to gather the full picture on likely consumers, thereby extending appropriate credit options to consumers that may otherwise not receive it-a shared goal of FactorTrust and Enova Decisions."

In its 14-year history, Enova, parent company to Enova Decisions, has extended more than $19 billion in credit to nearly five million customers around the world using Enova Decision's advanced analytics and decisioning technology. Read more at FACTORTRUST
Community Involvement
Advance Financial
It gives us great joy to help support students as they head back to school. With the help 
of  some of our team members the Advance Financial Foundation was able to 
supply  $3,000 worth of school supplies to 3 schools in the Knoxville area

Department of Education Killing Obama-Era CFPB Policy

The Department of Education (DOE) sent a letter to Consumer Financial Protection Bureau (CFPB) Director Richard Cordray Friday afternoon announcing its intent to terminate a data-sharing policy enacted under the Obama administration, according to documents released to The Daily Caller News Foundation.

The DOE and the CFPB entered into an agreement to share data to increase the efficiency of identifying and processing claims of fraud on student loans, specifically for-profit colleges. The goal of the policy was to "collaborate to ensure coordination in providing assistance to and serving borrowers seeking to resolve complaints," related to either their private education loans or Federal Student Aid.

How the relationship was supposed to work was rather simple. The DOE would provide data to the CFPB, which would in turn source through the various complaints. If the agency found a claim or if a student presented them one, the CFPB was supposed to report it to the DOE, which is subject to congressional oversight. The agreement required that the CFPB report "all complaints related to Title IV federal student loans" to the DOE "within 10 days" of its discovery.

What the CFPB actually did was rather different. When a student made a complaint, the CFPB would start processing themselves. The CFPB "has handled such complaints itself."

"It is the Department's role to work with federal student borrowers to ensure that their issues are addressed within the rules applicable to its program. The CPB's intervention in this area adds confusion to borrowers and servicers who now hear conflicting guidance" for "student loan services for which the Department is responsible," the letter said. Read more at THE DAILY CALLER
Judge Tosses The CFPB's Case Against Global Payments

Noting that the CFPB had "blatantly" ignored his directions, a federal judge in Atlanta has officially dismissed the case against Atlanta-based payment processor Global Payments and three others for allegedly aiding fraudulent debt collectors.

The CFPB had alleged that Global Payments and three similar processing firms - Frontline Processing, Pathfinder Payment Solutions, and Electronic Merchant Systems - were liable for failing to prevent purported crooks from repeatedly using their automated payments systems to steal millions of dollars from victims.

That came as part of a civil suit filed in the U.S. District Court in Atlanta, wherein the federal watchdog agency went after about a dozen debt collectors, telemarketing firms and payments processors in metro Atlanta and Buffalo, N.Y. That suit alleges these firms scared consumers into paying debts they didn't actually owe via the mass use of robocalls inundating them with reports on "phantom" debts that didn't actually exist.

Global Payments and the other payments firms were also culpable, according to the CFPB, because the alleged fraud wouldn't have succeeded if the payment processors had properly screened and monitored the debt collectors. Moreover, the CFPB alleges that Global Payments and the others shouldn't have given these groups such wide access to customer accounts while there were clear signs of illegal activity. Read more at PYMNTS.COM
The world's 2 billion unbanked, in 6 charts

LONDON - Two billion people worldwide do not have a bank account or access to a financial institution via a mobile phone, or any other device.

But between 2011 and 2014, 700 million adults became account holders, and the unbanked population fell by 20%, down from 2.5 billion. That's according to the World Bank's Global Financial Inclusion database, based on information from more than 140 countries.

According to the World Bank's data, more than 20% of unbanked adults receive wages or government transfers in cash, and many people in developing countries pay bills and school fees in cash.

A 2015 working paper said governments and private companies have a "pivotal role" to play in reducing the number of people who are unbanked. Digitising payments, it said, would also help empower women and encourage their economic participation.

Financial inclusion has been seen as key for reducing poverty: bank accounts have an important part to play in the founding and expanding of businesses, making transactions more efficient, secure and transparent and managing savings. However, savings and accounts do not necessarily reduce inequality within a country, and some of the richest countries in the world have the widest gaps between the rich and the poor. Read more at BUSINESS INSIDER
A_S Management
Wells Fargo opened many more fake accounts than it first said

Wells Fargo's (WFC) banking scandal is growing even bigger.

The bank is now saying it has found 3.5 million fake accounts, a dramatic increase from the 2.1 million accounts it originally estimated.

In the weeks and months after the bank acknowledged in September 2016 that its employees opened 2.1 million accounts without getting customers' permission, the bank agreed to look for fake accounts going back an additional two years to 2009. This was because news reports showed that problems at Wells started before 2011, which is what Wells originally admitted.

"We apologize to everyone who was harmed by unacceptable sales practices that occurred in our retail bank," said Wells Fargo CEO Tim Sloan.

The disclosure prompted new calls from some lawmakers and consumers for additional changes at the bank, and one analyst said it's likely to keep a regulatory spotlight on the company. Senator Elizabeth Warren, D-Massachusetts, called for removal of the bank's board members who had served during the scandal. "Unbelievable," she wrote on Twitter about the revelation of the additional fraudulent accounts. Read more at CBS NEWS
Reps. Stivers, Walz sponsor bill to create Inspector General for CFPB

Legislation was introduced in the U.S. House of Representatives last week that would create the position of an independent Inspector General (IG) at the Consumer Financial Protection Bureau (CFPB).
The bill, called the Bureau of Consumer Financial Protection-Inspector General Act, would amend the Inspector General Act of 1978 to establish an independent Inspector General for the CFPB. The position would be appointed by the President and then confirmed with the advice and consent of the Senate.

The legislation is sponsored by U.S. Reps. Steve Stivers (R-OH) and Tim Walz (D-MN).

The CFPB currently does not have an independent, Senate-confirmed Inspector General. Instead, the bureau shares an Inspector General with the Federal Reserve, an unconfirmed position appointed by the Federal Reserve Chairman. The CFPB receives its funding from the Federal Reserve, rather than the appropriations process.

"Federal agencies must be held accountable to the American people," Stivers said. "This legislation will allow for increased oversight of an agency that has been given broad authority - and often overreaches that authority. It is important that we take the necessary steps to ensure the CFPB is able to fulfill its role in protecting consumers while being held accountable."

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