July 30, 2019

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Debt collectors will pay $60M to settle consumer bureau charges

A New York debt collection network will pay more than $60 million in fines and exit the industry under settlements announced Thursday by the state's attorney general and the Consumer Financial Protection Bureau (CFPB).

Debt collectors Douglas MacKinnon and Mark Gray - along with their companies, Northern Resolution Group, Enhanced Acquisitions and Delray Capital - agreed to settle 2016 charges of violating federal and New York state consumer protection laws.

The CFPB and New York attorney general charged MacKinnon, Gray and their companies in 2016 with using deceptive and abusive practices to collect millions of dollars in debt purchased by their network of collection firms.

The network of 60 debt collection companies allegedly violated federal and state regulations for debt collection by using "illegal tactics to extract as much money as possible from consumers for their debts," according to the CFPB. Read more at THE HILL

  Accept payments and fund loans anytime, anywhere with REPAY's intelligent and integrated payment technology.

Financial Services for Everyone

Our friends at the Cato Institute recently hosted an excellent discussion on financial opportunity and inclusion titled "How Credit Is Reaching Underserved Communities," featuring an impressive panel of experts, including CEI board member Todd Zywicki of George Mason University.

The Cato summary of the event:

New financial tools are bringing more people into the modern financial world-changing how households save, borrow, invest in their futures, and pay for everyday needs, while helping serve the unbanked and underbanked in society. What innovations are making access to financial services easier, more affordable, and safer? How are regulators adapting to such rapid change? Is our regulatory framework helping or hindering progress toward more inclusion?

Unfortunately, over the last several years federal regulation in the U.S. has been hindering progress toward a more inclusive financial system in several ways. The Consumer Financial Protection Bureau, for example, pursued a policy that would eliminate most payday loans, despite the fact that most short-term borrowers would thus be left with fewer options and worse off financially without them. Fortunately, under Director Kathy Kraninger, the CFPB has moved to reconsider the Payday, Vehicle Title, and High-Cost Installment Loans rule. Competitive Enterprise Institute President Kent Lassman signed a coalition letter earlier this year emphasizing the deficiencies of the original rule:
Read more at Competitive Enterprise Institute


The Community Financial Services Association of America was formed in 1999 to promote laws and regulations that protect consumers while preserving access to credit options and to support and encourage responsible practices within the short-term loan industry.

Why Postal Banking Would Help Neither the Poor Nor the Postal Service

If a company lost $66 billion in 10 years and was on track to lose another $10 billion this year, would that company make a good banker?

Some in Washington think so. They are urging that the United States Postal Service start providing banking services ranging from checking accounts to short-term loans.

That would be a mistake, not only for the Postal Service, but for the U.S. taxpayer, who ultimately would foot the bill for a failed venture.

The idea of postal banking is not new. From 1910 to 1967, post offices offered savings accounts at a modest interest rate of 2%. These savings accounts offered a safe place for consumers unfamiliar with banks or distrustful of banks to safely deposit their money. (It also issued "postal notes," which allowed customers to send money safely).

With the advent of federal deposit insurance, money orders became less popular. The Post Office discontinued its financial services by 1967.

Redefining how financial service businesses measure risk and process payments.

You can now submit a claim for the $700 million Equifax data breach settlement-here's how

If your information was compromised during the massive 2017 Equifax data breach, you could be entitled to up to $20,000.

On Monday, Equifax agreed to pay nearly $700 million to settle federal and state investigations into how it handled a massive data breach that affected nearly 150 million people.

The settlement includes $425 million to directly help consumers affected by the breach. The restitution fund will start with $300 million dedicated to consumer compensation, with an additional $125 million at the ready if the initial funds run out.

The Federal Trade Commission opened up the online claims process on Wednesday, where affected consumers can file a digital form (or print one out and send it in) to claim some of that settlement. The deadline to submit a claim is January 22, 2020.

The settlement provides a cash payment of up to $20,000. "Go into this with your eyes open," Charity Lacey, VP of communications at Identity Theft Resource Center, tells CNBC Make It. "Part of this claims process really puts the onus on the consumer to justify that they deserve that."
Read more at CNBC

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Auto Lenders Can Decrease Delinquencies by Offering Multiple Ways to Pay.
by Kristen Hoyman

Auto lenders are facing a big problem: credit quality is deteriorating. Private lenders and buy here pay here lenders are getting hit the hardest. If you haven't suffered yet, higher than average delinquencies are probably coming your way.

Auto loan originations have hit an all-time high of $584 billion. At the same time, the Motley Fool reports that 7 million Americans are more than 90 days late on their auto loans, which accounts for almost 6.5% of all auto loans across all credit grades. Bloomberg describes the problem as the highest auto delinquency levels since 2012. More people are now behind on their auto loan payments than during the Great Recession.

The bottom line: bringing the deals in is no problem, but making sure your portfolio stays current might be.

If you are an independent auto lender, you need to proactively manage your portfolio, or it could get away from you. REPAY has the tools to help you - you don't have to go at it alone.
Read more at REPAY

Introducing AI Lift, the AI-powered credit risk web service that leverages uncorrelated alternative data to identify the 20-30% of today's thin-file and no-file borrowers ready to be creditworthy customers.

Elizabeth Warren is siding with Google and Amazon when it comes to digital payments

Big Tech has a surprising ally in Elizabeth Warren, at least when it comes to digital payments. The US presidential candidate and three fellow democratic members of congress are proposing the Federal Reserve build a real-time payment system-something large tech companies have pushed for and big banks have tried to stop.

The US politicians are pushing for legislation that would require the central bank to build a real-time payment system that would speed up transactions. Such platforms are becoming de rigueur in Europe, leaving the US further behind, even as smartphones become commonplace and online commerce grows. The need to upgrade the country's creaky transaction system is becoming more urgent.

That leaves American policy makers at something of a crossroads. While pretty much everyone agrees that real-time payments would be better, officials have to decide whether something as universally vital as payments should be a utility, or whether it should be placed in private hands that might be more innovative, but could be less aligned with the interests of the broader public.

The Fed has been weighing how to speed up digital payments, but efforts to give consumers and businesses access to the money in their bank accounts in real time hasn't made much progress. This debate has played out online in recent months, following the Fed's request for comment.
Read more at QUARTZ

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Say "yes" to thin-file and no-hit borrowers with REAL alternative data and a fully compliant, AI-powered score, customized for your business.

House Of Representatives Cracking Down On Robocalls

Find robocalls a nuisance? Evidently, so does the House of Representatives, as it cracks down on the potentially illegal calls. With the new House bill, robocalling operations will face tougher penalties.

'Stopping Bad Robocalls Act'
In 2018 alone, 48 billion robocalls were made, which is 50 percent more than the robocalls in the previous year. In fact, Energy and Commerce Committee Chairman Frank Pallone Jr. says that what started as a nuisance is now threatening the way people use their phones.

As such, on Wednesday, the House passed a new bill cracking down on robocalls. Under the "Stopping Bad Robocalls Act," robocalling operations will face tougher penalties for offenses, allowing the FCC to fine them $10,000 per violation. This means that carriers have to make sure that calls are authentic, and that robocalling operations may face steep fines given the number of robocalls being made in a year.

The Act was passed in a 429-3 vote just a week after the Energy and Commerce Committee unanimously approved it last week, and the hope is that the White House signs it before 2020. The latest Act against robocalls is also similar to the "Telephone Robocall Abuse Criminal Enforcement and Deterrence Act" previously passed by the Senate.
Read more at TECH TIMES

Payliance: Powerful Payment Processing Technology

PENNSYLVANIA: State attorney general announces relief for 80,000 Pennsylvanians targeted by online payday loan scheme

HARRISBURG - Attorney General Josh Shapiro today announced a settlement with Think Finance, a national online payday lender, and an associated private equity firm for allegedly engineering a $133 million illegal online payday loan scheme that targeted as many as 80,000 Pennsylvania consumers.

The settlement will void all remaining balances on the illegal loans, Shapiro's announcement said. Pennsylvania is one of the leading creditors that negotiated this comprehensive settlement with Think Finance as part of its bankruptcy plan, which is pending approval before the Bankruptcy Court and subsequent approval by the U.S. Eastern District Court of Pennsylvania.

In late 2014, the Pennsylvania Office of Attorney General sued Think Finance, Inc. and Chicago-based private equity firm Victory Park Capital Advisors, LLC, and various affiliated entities. The suit alleged that between 2011-2014, three websites operated by Think Finance - Plain Green Loans, Great Plains Lending and Mobiloans -allowed borrowers to sign up for loans and lines of credit while charging effective interest rates as high as 448 percent.
Read more at FOX43

Alternative Credit Reporting

The $300B Employee Financial Stress Tax On Employers

Financial stress costs employers $300 billion in lost employee productivity. And in the case of one desperate employee, her job when not having the money to buy her daughters medicine drove her to steal money from the company. That story built a company, FinFit, and President David Kilby and Karen Webster use three other data points to explain how 100,000 employers are using financial wellness platforms - including short term loans - to help employees get financially fit.

Four hundred dollars.

That's the dollar amount that is out of reach for a significant number of employees in a world where financial stress is commonplace.

It's where an emergency, such as car repairs or a broken water heater, means choosing between fixing those items or paying the rent, perhaps.

It's an oft-quoted stat, illustrating how ill-prepared many individuals and families are to deal with shocks and unforeseen events. Thus: short-term lending, massive debt and a financial black hole that gets deeper and deeper.

In the latest Data Drivers, the question arose: Should employers care when their workers are in financial distress?

David Kilby, FinFit president, told Karen Webster that employers have - or should have - a vested interest in how their employees are coping with financial reality.
Read more at PYMNTS.COM

Lending as a Service

Dreher Tomkies LLP

At Dreher Tomkies LLP, we concentrate on the areas of banking and financial services, with an emphasis on financial services provided by creditors to consumers. Our Firm's partners have over 100 years of combined experience advising on banking and financial services matters.

Such counseling can include the rendering of advisory opinions, state law outlines and summaries, product design and development and the identification of appropriate product delivery vehicles, as well as program planning, implementation and maintenance.

Dreher Tomkies LLP also provides advice regarding all aspects of the purchase and sale of receivables, the negotiation of credit programs among financial institutions, retailers and others, securitizations and participations of receivables, litigation and amicus briefs in connection with credit issues, creditor representation in bankruptcy and legislative and regulatory solutions.

We frequently assist in long-term strategic planning, issue identification and the implementation of plans for financial institutions, other types of clients and their affiliates with respect to providing financial services on an interstate and nationwide basis.
Read more at Dreher Tomkies LLP

National Debt Holdings is a professional Receivables Management Company that partners with creditors to purchase and/or manage receivables at all stages of the account life cycle.

Defiance of Congress Melts Federal Reserve Credibility

In advance of his testimony yesterday before the House Financial Services Committee, Federal Reserve Chairman Jerome Powell was the subject of a front-page story in The Wall Street Journal that touted his supposedly good relations with lawmakers of both parties. "Powell's Support Inside Congress Is Deep," read the Journal headline in the print edition.

However, Powell may find his support eroding if the Fed under his tenure keeps defying the plain language of the laws that Congress writes. As I wrote recently here, the Fed has proposed its own system to process real-time electronic payments, despite the fact that Congress explicitly mandated in the Monetary Control Act that the Fed may only launch its own financial services if "the service is one that other providers alone cannot be expected to provide with reasonable effectiveness, scope, and equity." That legislative ban would seem to apply here, because as noted by a new coalition letter that the Competitive Enterprise Institute signed, "the Fed's proposal will directly compete with the private sector's established Real-Time Payments system and additional emerging technologies."

On top of this, hours before yesterday's hearing, the Fed released a final rule that blatantly ignores legislative language granting regulatory relief to Main Street banks from one of the most onerous provisions of Dodd-Frank. As a result, banks headquartered far away from Wall Street will still be subject to the arduous Volcker Rule.
Read more at Competitive Enterprise Institute

Alt Data is the key to compete effectively

Pushing for change for banks

For Richard Hunt, lobbying on behalf of the nation's banks isn't quite what it used to be.

As president and CEO of the Consumer Bankers Association (CBA) since 2009, Hunt has led the group's efforts to repair the industry's post-crisis reputation while working for changes to the rules imposed on banks after the 2008 recession.

Hunt, a former House chief of staff, has advocated for banks and the broader financial services industry since 2001, in the bullish days of the early 2000s economic expansion.

Hunt says that the tumultuous economic landscape - and the hypercharged political atmosphere it helped unleash - has drastically changed the way banks and their lobbyists operate in Washington.

Gone are the days when Thursday afternoon golf trips and bipartisan chumminess helped grease the wheels of the legislative machine, he said. Now, to move even moderate priorities, Hunt and his team contend with deep and rising skepticism of the banking industry and congressional critics with large social media followings.

"Our reputation took quite a hit," Hunt said during a recent interview at a Bobby Van's Steakhouse in downtown Washington. "In those days, we're taking one or two office visits to convince a lawmaker. Now sometimes it runs on three to four years. That may [still not] get done."
Read more at THE HILL

We are a revolutionary merchant service and technology firm servicing the debt repayment industry.
Advance Financial

We are proud to continue with our Pack-4-School Backpack Giveaway!
This time in one of our Knoxville stores. Starting at 11 am this Friday, we will be giving away 100 backpacks filled with school supplies on a first-come, first-served basis while supplies last, so come out and join in on the fun!

Dreher Tomkies LLP
Dreher Tomkies LLP is a law firm concentrating in the areas of Banking and Financial Services law.

Did you know that Amscot takes protecting the environment seriously?
In the last 12 months, we have recycled over 316 tons of paper!
Just another example of what a company can do in its everyday operations to be Green.


Alternative Financial Service Providers Association

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