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News By Edition
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Dodd Frank Update Monthly Edition
Dodd Frank Update June 2016
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Will CFPB unintentionally limit consumers’ abilities to resolve disputes?
Posted Date: Tuesday, May 24, 2016
The Consumer Financial Protection Bureau released its official proposed rulemaking on pre-dispute arbitration. As the name implies, a pre-dispute arbitration agreement is created when the contracting parties agree to use arbitration to resolve a dispute before a dispute has even risen. Concerns were discussed at a House Financial Services Committee hearing about the possibility that proposed class-action waiver bans may harm consumers’ choice in dispute resolution. Read on to learn more.
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CFPB publishes annotated LE, CD with TILA citations
Posted Date: Friday, May 13, 2016
Pay attention to the Consumer Financial Protection Bureau’s recent annotated Loan Estimates and Closing Disclosures, which contain citations to disclosure provisions in the Truth in Lending Act. The citations suggest that the bureau may intend to expand the statutory authority for the form to increase the potential civil liability under the TILA-RESPA Integrated Disclosure rule (TRID, or Know Before You Owe), according to Attorney Richard Horn, who led the final rulemaking while a senior counsel and special advisor at the bureau.
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NCUA to review its examination process
Posted Date: Friday, May 13, 2016
National Credit Union Administration Board Chairman Rick Metsger is initiating a review of the agency’s examination process that will consider the frequency of exams as well as moving more of the examination process offsite. “We need to see how we meet our statutory responsibility to examine credit unions for safety and soundness with as small a footprint as possible,” Metsger told the Idaho Credit Union League. Read on to learn more.
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CFPB releases Payback Playbook for student borrowers
Posted Date: Friday, April 29, 2016
The Consumer Financial Protection Bureau, U.S. Treasury and Department of Education announced several new initiatives to assist borrowers with paying back their student loans and improve servicing practices. Chief among these initiatives is the bureau’s proposed Payback Playbook, a set of prototype disclosures that presents a new way for loan services to communicate repayment options with borrowers. The bureau is seeking feedback on the Playbook, which the Department of Education plans to implement later this year. Read on to learn more.
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CFPB takes aim at cash checking, payday lenders
Posted Date: Friday, May 13, 2016
The Consumer Financial Protection Bureau filed a complaint against cash checkers and payday lenders All American Check Cashing, Inc. and Mid-State Finance, Inc. for alleged unfair, deceptive and abusive acts or practices (UDAAP). This isn’t a case of a company lacking sufficient written policies and procedures but, in fact, allegedly using training guides that say, “NEVER TELL THE CUSTOMER THE FEE.” Read on for more details.
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FTC investigates PayPal for potential UDAP violations
Posted Date: Friday, May 6, 2016
One of PayPal’s “hottest properties” is under investigation by the Federal Trade Commission for potential unfair and deceptive acts or practices, according to a recent filing with the Securities and Exchange Commission. The Consumer Financial Protection Bureau brought its own enforcement action against the mobile and online payment last year. Read on to learn more.
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CFPB halts debt collection practices by lawsuit mill, debt buyer
Posted Date: Friday, April 29, 2016
The Consumer Financial Protection Bureau filed two consent orders April 25, ordering the debt collection law firm Pressler & Pressler, LLP; its two principal partners; and New Century Financial Services, Inc., a debt buyer, to halt certain conduct that the bureau said violated the Fair Debt Collection Practices Act and the Consumer Financial Protection Act. Read on for the details.
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TRID, MLA among OCC’s supervisory priorities
Posted Date: Friday, May 13, 2016
The Office of the Comptroller of the Currency’s Committee on Bank Supervision has released a mid-cycle status report on its operating plan, which sets forth the agency’s broad supervision priorities and objectives. Supervision’s focus will center on compliance, operational resiliency, credit risk management, stress testing, strategic planning and execution, corporate governance and interest rate risk. Read on to learn more.
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Agencies propose net stable funding ratio rule
Posted Date: Tuesday, May 10, 2016
To reduce the likelihood that disruptions to a banking organization’s regular sources of funding will compromise its liquidity position, the Federal Reserve Board, Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency have proposed a rule that would implement a stable funding requirement: the net stable funding ratio to complement the Liquidity Coverage Ratio. Read on to learn more.
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Industry eager for more clarity from CFPB on TRID
Posted Date: Monday, May 2, 2016
Industry participants will have another bite at the apple. The Consumer Financial Protection Bureau announced that it will be revisiting the text and commentary of the TILA-RESPA Integrated Disclosure (TRID, or Know Before You Owe) rulemaking, with a proposed rulemaking to be released later this year. Representatives from Independent Community Bankers of America and Consumer Bankers Association spoke with Dodd Frank Update.
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Small banks to pay less as FDIC finalizes DIF rule
Posted Date: Friday, April 29, 2016
The Federal Deposit Insurance Corp. Board of Directors approved a final rule amending the way small banks will be assessed for deposit insurance. It has been projected that, with including the overall decline in rates approved by the FDIC Board in 2011 that will occur once the reserve ratio for the Deposit Insurance Fund (DIF) reaches 1.15 percent, more than 93 percent of small banks will pay lower assessment rates. Read on to learn more about the finalized rule and the latest revisions to the Financial Institution Employee’s Guide to Deposit Insurance.
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Fannie: Larger lenders say TRID gave them competitive advantage
Posted Date: Friday, May 13, 2016
In its quarterly Mortgage Lender Sentiment Survey, Fannie Mae’s Economic & Strategic Research Group found that 44 percent of respondents, particularly larger lenders, said that the TILA-RESPA Integrated Disclosure (TRID) rule gave them a competitive advantage. Read on to find out what the biggest challenges remain to be, what is making the mortgage market more or less competitive and more.
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Fitch: Borrower claims nonexistent 2 years after ATR rule
Posted Date: Friday, April 29, 2016
Fitch Ratings has found that since the Consumer Financial Protection Bureau’s ability-to-repay and qualified mortgage rules became effective Jan. 10, 2014, there has not been a single borrower legal claim. However, as more non-qualified mortgages become more common, this trend can change. Read on to learn more.
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Treasury whitepaper examines online marketplace lending
Posted Date: Tuesday, May 10, 2016
The U.S. Treasury Department has issued a whitepaper titled, “Opportunities and Challenges in Online Marketplace Lending,” that gives an overview of the evolving market landscape, reviews stakeholder opinions and provides policy recommendations. Read on to learn more.
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Will Congress remove the ‘A’ in UDAAP?
Posted Date: Friday, May 6, 2016
Rep. Blaine Luetkemeyer (R-Mo.) introduced the Unfair or Deceptive Acts or Practices Uniformity Act (H.R. 5112), a bill that would amend Title X of the Dodd-Frank Act (also known as the Consumer Financial Protection Act) so that the Consumer Financial Protection Bureau’s “unfair, deceptive or abusive acts or practices” (UDAAP) authority will resemble the Federal Trade Commission’s similar authority. Read on to learn more.
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CFPB releases report on single-payment auto title loans
Posted Date: Wednesday, May 18, 2016
The Consumer Financial Protection Bureau released its fourth report May 18 detailing findings on single-payment vehicle loans, concluding that one in five borrowers who take out such loans end up having their vehicle seized. The bureau is considering a possible rulemaking on small-dollar, high-cost loans such as vehicle title, installments loans and payday loans. Read on to learn more.
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A small victory: SCOTUS looks at injury in fact in Spokeo
Posted Date: Tuesday, May 17, 2016
In a 6-2 vote, the U.S. Supreme Court reversed the Ninth Circuit’s opinion in Spokeo, Inc. v. Robins, determining that a plaintiff cannot satisfy the Constitution’s Article III standing requirements by alleging a bare procedural violation but that a plaintiff must satisfy the injury-in-fact requirements by demonstrating both particularity and concreteness, even under the Fair Credit Reporting Act. Read on to learn more.
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Stevens: Let’s rewrite QM rule sooner rather than later
Posted Date: Tuesday, May 17, 2016
At the Mortgage Bankers Association’s National Secondary Market Conference and Expo, President and CEO David Stevens told attendees that the qualified mortgage (QM) rule falls short of being the long-term solution and should be re-written. Read on to find out what he thinks specifically needs changed.
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NS3 Preview: Embracing change, developing models can drive sales
Posted Date: Tuesday, May 17, 2016
Since the implementation of the TILA-RESPA Integrated Disclosure (TRID) rule in October, it’s safe to say that business has been anything but usual for the title and settlement services industries. In a panel discussion at the National Settlement Services Summit in Charlotte, N.C., Orange Leaf Consulting CEO Cynthia McGovern and Florida Agency Network CEO Aaron Davis will discuss the opportunities to increase and enhance your business during this period of change. Read on for the details.
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Whistleblowers do not need to tip off investigations
Posted Date: Tuesday, May 17, 2016
The Securities and Exchange Commission (SEC) announced that it has awarded more than $3.5 million to a whistleblower whose tip bolstered an ongoing investigation with additional evidence that had strengthened the SEC’s case. “Whistleblowers can receive an award not only when their tip initiates an investigation, but also when they provide new information or documentation that advances an existing inquiry,” the SEC Division of Enforcement Director said. Read on to learn more about this case and for an update on the Whistleblower Augmented Reward and Non-Retaliation Act of 2016 (WARN Act).
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Bill introduced to add to CFPB’s operations
Posted Date: Tuesday, May 17, 2016
Rep. Tom Emmer (R-Minn.) introduced the “CFPB Dual Mandate and Economic Analysis Act” (H.R. 5211) on May 12, a bill that would amend the competitiveness language in Section 1021 of the Consumer Financial Protection Act and require the Consumer Financial Protection Bureau to establish the Office of Economic Analysis. Read on to learn more.
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Google to pull payday lending ads, industry criticizes ‘censorship’
Posted Date: Friday, May 13, 2016
Google has announced that, starting July 13, it no longer will have ads for payday loans and some related products. The announcement is a “culmination of a lengthy collaboration” between Google and a coalition led by The Leadership Conference on Civil and Human Rights. The announcement has been met with both praise and criticism. Read on to learn more.
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Recent developments in mobile financial services industry
Posted Date: Tuesday, May 10, 2016
The Federal Deposit Insurance Corp. is seeking feedback on the use of mobile financial services as a means to reaching underserved consumers; the Federal Trade Commission has issued orders to eight mobile device manufactures to provide information about how they issue security updates and the Federal Financial Institutions Examination Council (FFIEC) revised its Retail Payment Systems booklet to include a new appendix on mobile financial services. Find out what you need to know about these developments.
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NS3 Preview: Creating meeting of the minds between creditors, settlement agents
Posted Date: Tuesday, May 10, 2016
At this year’s National Settlement Services Summit (NS3), October Research, LLC will be hosting “TRID Tails,” where a panel of experts will review the TILA-RESPA Integrated Disclosure (TRID) rule’s various conflicts and problems that they have seen arise out of the normal workflow between creditors and settlement agents. Clayton Holdings Director of Regulatory Compliance John Levonick offered a look into some of the areas which the panel will discuss. Read on for more details.
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MBA: Availability of mortgage credit decreased in April
Posted Date: Tuesday, May 10, 2016
Mortgage credit availability decreased in April, according to a report from the Mortgage Bankers Association (MBA) that analyzes data from Ellie Mae’s AllRegs Market Clarity business information tool. The index decreased 0.89 percent in April. Read on to learn more.
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How Treasury plans to counter money laundering, tax evasion
Posted Date: Tuesday, May 10, 2016
The U.S. Treasury Department and Financial Crimes Enforcement Network (FinCEN) have taken actions to combat money laundering and tax evasion by requiring financial institutions to know who actually owns the companies that make use of their services, and by urging Congress to pass legislation that would require U.S. financial institutions to provide the same information that foreign financial institutions must provide the IRS to the country’s partners under the Foreign Account Tax Compliance Act. Read on to learn more.
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Advocates spar on arbitration proposal to eliminate class action waivers
Posted Date: Friday, May 6, 2016
The Consumer Financial Protection Bureau has unveiled its long-awaited proposal on arbitration, seeking to eliminate the use of class action waivers to prevent consumers from joining class action lawsuits. The Small Business Regulatory Enforcement Fairness Act (SBREFA) panel has reported that some small business representatives indicated that class action exposure may reduce their compliance budgets. Read on to learn more.
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OFR: Mandated credit rating alternatives pose own challenges
Posted Date: Friday, May 6, 2016
The Office of Financial Research has issued a report detailing the actions regulators have taken to reduce reliance on credit ratings, the alternative rating methods currently in use and the challenges posed by these alternatives. Prior to the financial crisis, credit rating agencies had an incentive to inflate ratings to expand their businesses, a practice that contributed to an undercapitalized and fragile financial system. Read on to learn more about the three credit rating alternatives.
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NS3 Preview: How to build a better relationship with your partners
Posted Date: Friday, May 6, 2016
This year at the National Settlement Services Summit (NS3) New Homes Solutions Consulting founder Kimberly Mackey will be speaking at the “Title Agents, Realtors and Builders: Why Can’t We Just Get Along?” session 2:10 p.m. Tuesday, June 7. She will be talking about the importance of the maintaining the long-term relationship with Realtors and builders to drive sales and grow your business.
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Is mortgage outsourcing for you? Here are some considerations
Posted Date: Friday, May 6, 2016
At the Independent Community Bankers Association annual conference, representatives from Embrace Home Loans discussed the ways in which community and small banks can use mortgage outsourcing as a means of remaining in the business. President Kurt Noyce spoke with Dodd Frank Update about the benefits and drawbacks of mortgage outsourcing. Read on to learn more.
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How the CFPB may ban arbitration, and why you should care
Posted Date: Friday, April 29, 2016
The Consumer Financial Protection Bureau is hosting a third field hearing on arbitration, where it may reveal its proposed rule. Director Richard Cordray has said that the bureau does not intend to ban arbitration outright but may ban class-action waivers instead. Attorney Alan Kaplinsky, who is credited with pioneering pre-dispute arbitration, spoke with Dodd Frank Update about the differences between arbitration and class action, and why the latter isn’t necessarily the best choice for consumers.
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NS3 Preview: Attorneys to discuss RESPA, ethics, reverse vendor oversight
Posted Date: Friday, April 29, 2016
Title agents and attorneys are expected to adhere to the highest ethical standards, especially given Dodd Frank’s ban on unfair, deceptive or abusive acts or practices, which gave the CFPB broad authority to root out questionable activities. This will be the topic of a highly engaging ethical discussion at this year’s National Settlement Services Summit, led by Charles Cain and Marx Sterbcow. See more here.
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ABA: Demand for CRE lending on the rise
Posted Date: Tuesday, April 26, 2016
In its first Commercial Real Estate Lending survey, the American Bankers Association has found that 82 percent of banks plan to increase their capital concentration in commercial real estate, with strategic planning and demand cited as the most influential motivators. Surprisingly, regulatory burden was not the top challenge facing commercial real estate lending. Read on to learn more.
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CFPB’s foothold slips with CID dismissal
Posted Date: Tuesday, April 26, 2016
The U.S. District Court for the District of Columbia held that the Consumer Financial Protection Bureau does not have the statutory authority to generally investigate a for-profit school accreditor’s process simply because the bureau also is investigating the lending practices of for-profit schools. The court has set aside a civil investigation demand. Read on to find out why.
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Agencies issue revised proposal for incentive-based compensation
Posted Date: Tuesday, April 26, 2016
The Office of the Comptroller of the Currency, Federal Reserve Board, Federal Deposit Insurance Corp., Federal Housing Finance Agency, National Credit Union Administration and Securities and Exchange Commission have issued a notice of proposed rulemaking and request for comments on incentive-based compensation arrangements. Read on to learn more.
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NS3 Preview: Industry leaders panel up to share insights
Posted Date: Tuesday, April 26, 2016
When the industry gathers in Charlotte, N.C., June 6-8 for the National Settlement Services Summit, it will have a chance to hear from a host of top underwriter and lender executives in three panels. Read on to find out who will be featured, and what to expect from some of the most dynamic sessions at the conference.
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CFPB enforcement action draws positive response from CUNA
Posted Date: Tuesday, April 26, 2016
The Consumer Financial Protection Bureau filed two complaints against the co-founders of T3Leads, for allegedly providing substantial assistance to the company as it bought and resold payday and installment loan applications containing sensitive personal data to lenders and data brokers without properly vetting the buyers and sellers – actions alleged to be unfair and abusive under the Dodd-Frank Act’s UDAAP standard. Read on to find out what Credit Union National Association President and CEO Jim Nussle had to say in response.
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Associations continue push for more CECL revisions
Posted Date: Tuesday, April 26, 2016
A pair of banking trade associations told the Financial Accounting Standards Board that its recent changes to its Current Expected Credit Loss standard have been meaningful, more work remains to ensure the standards do not become too complex for community institutions. Read on for details on what the associations would like to see from the board going forward.
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Why FSOC is turning its exams to asset management
Posted Date: Friday, April 22, 2016
Although the Financial Stability Oversight Council has been facing judicial pushback of its review process of potential financial risks, the council issued a statement on its examination work in the fast-growing asset management industry. Read on to learn more about the risks the council have detected and what Treasury Secretary Jacob J. Lew had to say about the council’s findings.
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Ninth Circuit COA: Cordray’s invalid appointment not a defense to enforcement actions
Posted Date: Friday, April 22, 2016
In CFPB v. Chance Edward Gordon, the Ninth Circuit Court of Appeals held that Consumer Financial Protection Bureau Director Richard Cordray’s recess appointment on Jan. 4, 2012, (although initially invalid) cannot be used as a defense against CFPB enforcement actions taken prior to Cordray’s official Senate confirmation. Read on to learn more.
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NS3 Preview: Lender Oversight PACE Lap sessions focus on liability, compliance
Posted Date: Friday, April 22, 2016
This year at the National Settlement Services Summit (NS3) June 6-8 October Research, LLC will be offering an all-new feature called the Lender Oversight PACE Lap. It will feature four high-impact sessions examining a range of third-party compliance issues. One of these speakers, Brent Laliberte gave a preview of the sessions. Keep reading to learn more.
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Proposal expected at CFPB’s third arbitration field hearing
Posted Date: Friday, April 22, 2016
The Consumer Financial Protection Bureau will host its third field hearing on arbitration May 5 in Albuquerque, N.M. The hearing likely will be accompanied by a release of the bureau’s official arbitration rulemaking proposal. Such a rule likely would not go into effect until at least 2017. What should you do in the meantime? Pre-dispute arbitration pioneer Alan Kaplinsky has some advice. Read on to learn more.
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Fed releases new off-site review procedures for small banks
Posted Date: Friday, April 22, 2016
Seeing the value in remote work, the Federal Reserve has implemented new procedures for examiners to conduct off-site loan reviews for community and small regional banks as part of its ongoing efforts to improve efficiency and reduce regulatory burdens while maintaining quality supervision. Read on to learn how to qualify for this exam option.
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Using financial transparency as a means to fighting corruption
Posted Date: Friday, April 22, 2016
Not long after the fallout of the leak known as the Panama Papers, Assistant Secretary Daniel Glaser spoke at the Atlantic Council and Thomson Reuters “Power of Transparency” Speaker Series about the U.S. Treasury’s efforts to ensure that the U.S. and global financial system becomes a hostile environment to corruption. What are the U.S. Treasury and global regulators doing to battle corruption? Read on to find out.
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