Hands Off the Consumer Finance Bureau

Hands Off the Consumer Finance Bureau

 The consumer bureau is the only federal agency with the sole mission of looking out for the interests of ordinary Americans in their dealings with banks and other lenders.  Some congressional Republicans are calling on President Trump to summarily fire Richard Cordray, the director of the Consumer Financial Protection Bureau. Their push to remove Mr. Cordray, whose term runs until July 2018, is the latest of many attempts to weaken the bureau, which date back to its creation in 2010 under the Dodd-Frank financial reform law. This time around, however, Republican foes of the bureau are assuming they have a willing ally in the White House. While Mr. Trump has not fully disabused them of that notion, he has sent them a “not so fast” signal: Last week, his press secretary, Sean Spicer, told reporters that “no decision has been made at this time” about Mr. Cordray’s position. Mr. Trump would be smart to go against lawmakers and let Mr. Cordray serve out his term. That would be the right thing to do and consistent with his campaign promises to defend Americans against a system he says has “robbed our working class.” The consumer bureau is the only federal agency with the sole mission of looking out for the interests of ordinary Americans in their dealings with banks and other lenders. The consumer bureau is the only federal agency with the sole mission of looking out for the interests of ordinary Americans in their dealings with banks and other lenders. Its investigations and enforcement actions have yielded fines and settlements that have returned nearly $12 billion to millions of Americans in the past...
LETTER TO CONGRESS: The CFPB Solves Student Debt Problems

LETTER TO CONGRESS: The CFPB Solves Student Debt Problems

The Honorable Mitch McConnell Majority Leader 317 Russell Senate Office Building Washington, DC 20510 The Honorable Paul Ryan Office of the Speaker H-232 The Capitol Washington, DC 20515   The Honorable Charles Schumer Minority Leader 322 Hart Senate Office Building Washington, DC 20510 The Honorable Nancy Pelosi Democratic Leader H-204 The Capitol Washington, DC 20515 February 13, 2017 Re: The CFPB Solves Student Debt Problems Dear Majority Leader McConnell, Minority Leader Schumer, Speaker Ryan, and Leader Pelosi: On behalf of the undersigned national, state and local organizations, we are writing to express our strong support for the crucial work the Consumer Financial Protection Bureau (CFPB) does on behalf of student loan borrowers. We also urge you to ensure the agency remains well-positioned to solve borrowers’ problems, which includes protecting the Bureau’s single-Director structure and its independent funding, and maintaining Director Richard Cordray until his term ends. Student loan borrowers suffer more problems in the campus marketplace than should be tolerated. Taxpayers invest billions in federal aid and state funding each year for students to go to college and get ahead. Despite this investment, students who borrow graduate from college with an average of $30,000 in debt. That debt drags on the individual borrower in the form of lifetime wealth loss, but it also drags on our economy, as some borrowers may now delay purchasing a home and starting families. Even after graduation, student borrowers are still behind. The problems that cause student debt are many, but they are made worse when students encounter tricky financial products on campus or predatory loans by bad actors that cause them to lose...
Consumer Financial Protection Bureau sues student loan debt relief company for collecting illegal fees

Consumer Financial Protection Bureau sues student loan debt relief company for collecting illegal fees

FOR IMMEDIATE RELEASE: January 30, 2017 CONTACT: Office of Communications Tel: (202) 435-7170 Lawyers Revived an Illegal Debt Relief Scheme that the CFPB Previously Shut Down Washington, D.C. – The Consumer Financial Protection Bureau today took action against a ring of law firms and attorneys who collaborated to charge illegal fees to consumers seeking debt relief. In a complaint filed in federal court, the CFPB alleges that Howard Law, P.C., the Williamson Law Firm, LLC, and Williamson & Howard, LLP, as well as attorneys Vincent Howard and Lawrence Williamson, ran this debt relief operation along with Morgan Drexen, Inc., which shut down in 2015 following the CFPB’s lawsuit against that company. The CFPB seeks to stop the defendants’ unlawful scheme, obtain relief for harmed consumers, and impose penalties. “The defendants exploited consumers who were already suffering financial difficulties by tricking them into paying steep, illegal fees,” said CFPB Director Richard Cordray. “We put a stop to this scam once already, and we intend to do it again.” Howard Law and Williamson & Howard are law firms based in Orange County, Calif. The Williamson Law Firm is registered in Kansas. Vincent Howard is the president of Howard Law, and Lawrence Williamson heads the Williamson Law Firm. Both are part owners of Williamson & Howard. These firms and lawyers offer debt relief services to consumers nationwide. The Telemarketing Sales Rule generally prohibits debt relief providers from charging a fee until they have actually settled, reduced, or changed the terms of at least one of the consumer’s debts. It also limits the types of fees a debt relief provider can charge for...
Under Trump, Student Lenders Expect Big Profits

Under Trump, Student Lenders Expect Big Profits

Less regulation, sure. But the big prize is reducing the feds’ role. The student loan business got a lot tougher during President Barack Obama’s time in the White House. The victory of Donald Trump and congressional Republicans promises to turn that around dramatically. In 2010, Obama and a Democratic-controlled Congress ended a program wherein banks and private lenders made government­-backed student loans. The banks earned fees and interest payments while the feds bore the cost of defaults. Under a new law, the government alone would make those loans directly. Next, in 2013, the government cut interest rates on new federal student loans to levels often half of those offered by banks on private loans. Throughout his administration, Obama continually made loan repayment plans more generous to student debtors, further undercutting the case for borrowing from lenders such as SLM Corp., better known as Sallie Mae. Michael Tarkan, director of research at Washington-based Compass Point Research & Trading, says that’s made student loan companies’ stock unattractive for some investors he talks to. “When I first bring up Sallie Mae, they throw their hands up and say, ‘I can’t touch that. It’s student debt,’ ” he says. Things were probably going to get worse for the industry had Hillary Clinton won the election. She advocated free tuition at public colleges, which, though tough to get through Congress, likely would’ve reduced demand for new loans. A Clinton victory would also have emboldened the Consumer Financial Protection Bureau, which has been documenting complaints of misbehavior and shoddy customer service by companies that service student debt. Last year, the CFPB told Navient Corp., the nation’s biggest...
Millennials struggling with student debt, uncertain economy

Millennials struggling with student debt, uncertain economy

The average student loan debt has more than tripled in the last 20 years. Living with his parents in Verona, New Jersey is not what 23 year-old Anthony DeCandia envisioned after graduating from college last year. “Obviously I love my family, I love the free food and I love my dog. But I’m just ready to move on and live on my own and it’s just tough because with these loans and all these debts that us millennials have, we can’t,” DeCandia said. DeCandia’s story is one of more than 75 million other millennials juggling debt and economic uncertainty, reports CBS News business analyst Jill Schlesinger. “Millennials are disproportionately more likely to start their economic life in debt and also carry higher amount of debt than [the] previous generation,” said Annamaria Lusardi, a professor of economics with the Global Financial Literacy Excellence Center at the George Washington University School of Business . The average student loan debt has more than tripled in the last 20 years. For the first time, more millennials are living with parents than with spouses or partners. And since the recession, young adults have been slower to buy homes. Continue Reading at CBS...