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10 storylines that will shape financial reform in 2015 (Pt.1)
Posted Date: Friday, November 21, 2014
If some were unconvinced before, 2014 proved that, for better or worse, Dodd-Frank is here to stay. However, it also proved that financial reform is fluid and can change course in important ways for any number of reasons. With that in mind, Dodd Frank Update begins a series exploring 10 storylines that promise to shape financial reform in the New Year. Read on to learn about important developments involving the CFPB’s Title XIV mortgage rules, the CFTC’s derivatives rules and the debate over whether the government has done enough to end “too-big-to-fail.”
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Lender to pay $730K for alleged violations of Fed’s LO Comp rule
Posted Date: Friday, November 14, 2014
California-based Franklin Loan Corp. will pay $730,000 to settle Consumer Financial Protection Bureau claims that the company violated Federal Reserve loan originator compensation rules that went into effect in April 2011. The bureau said Franklin gave its employees illegal bonuses for steering consumers into loans with higher interest rates. Read on to learn about the issues the bureau had with Franklin’s compensation system.
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CFPB aligns prepaid oversight with credit card industry
Posted Date: Friday, November 14, 2014
Two years after saying it would initiate oversight of the prepaid card industry, the Consumer Financial Protection Bureau announced a proposed rule that would provide consumer protections for account users, including required new disclosures, access to account information, and fraud/theft protections. But the most notable decision was the bureau’s move to align overdraft and credit services for the industry with credit card issuing standards. Read on to find out why the bureau chose to push the prepaid industry toward credit cards and not toward traditional checking deposit protections.
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CFPB proposes servicing rule amendments, expansion
Posted Date: Friday, November 21, 2014
The Consumer Financial Protection Bureau proposed several important amendments to its servicing rules. The amendments, unveiled Nov. 20, seek to enhance protections for successors in interest and also focus on issues pertaining to early intervention, loss mitigation, servicing transfers, the small servicer definition and other areas. Read on for an overview of the proposal.
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HUD declines to adopt QM points and fees cure
Posted Date: Tuesday, November 4, 2014
The Department of Housing and Urban Development altered its qualified mortgage definition in response to final Consumer Financial Protection Bureau amendments unveiled Oct. 22. Although HUD adopted the CFPB’s changes to an exemption for non-profit transactions, it did not adopt the bureau’s new QM points and fees cure provisions. Read on to find out why.
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Fed finalizes rule implementing Section 622
Posted Date: Tuesday, November 11, 2014
The Federal Reserve Board issued a final rule implementing Section 622 of the Dodd-Frank Act, which generally prohibits a financial company from combining with another company if the ratio of the resulting company’s liabilities exceeds 10 percent of the aggregate consolidated liabilities of all financial companies. Read on to find out when the rule takes effect and how the final rule differed from the proposed rule posted in May.
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OTC group updates cross-border progress before Summit
Posted Date: Tuesday, November 18, 2014
In preparation for the G20 Leaders Summit in November, the Over-the-Counter Derivatives Regulators Group (ODRG) issued a new report on the ODRG’s progress to resolve over-the-counter (OTC) derivatives cross-border implementation issues, citing moves made in Australia, Singapore and Canada among its recent highlights. Read on for the details.
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Mortgage servicing: The promise and the pitfalls
Posted Date: Friday, November 7, 2014
The mortgage servicing market has experienced a pronounced shift in recent years driven by new compliance requirements and changes in the regulatory treatment of servicing assets. What do these changes mean for industry stakeholders? That was the topic of a session at the recent Mortgage Bankers Association Annual Convention in Las Vegas. Read on for the details.
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CFPB calls out servicing issues in latest supervision report
Posted Date: Friday, October 31, 2014
The Consumer Financial Protection Bureau highlighted student loan servicing and mortgage servicing issues in its latest Supervisory Highlights report. The report also discussed problems examiners found in the debt collection, deposits and consumer reporting markets. Read on to learn about issues that are top of mind for CFPB examiners.
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Lenders sound off on CFPB HMDA proposal (Pt. 1)
Posted Date: Tuesday, November 4, 2014
Groups representing mortgage lenders of all sizes urged the Consumer Financial Protection Bureau to make numerous substantive changes to a sweeping proposal that would expand the Home Mortgage Disclosure Act data set. Comments on the bureau’s 573-page proposal were due at the end of October, and industry commenters voiced concern regarding a range of issues including consumer privacy, regulatory burden and the scope of HMDA coverage.
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Banking associations say Basel III ‘unduly harsh’ on MSAs
Posted Date: Friday, November 14, 2014
Three banking associations have told federal regulators that upcoming requirements regarding mortgage servicing assets are too restrictive for the marketplace. Read on to find out the association’s views.
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OIG notes 5 major challenges for CFPB
Posted Date: Friday, November 7, 2014
A new report from the Office of Inspector General cites five major management challenges for the Consumer Financial Protection Bureau. Read on to see where the bureau’s focus should be.
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Whistleblower tips still on the rise, SEC says
Posted Date: Friday, November 21, 2014
The leader of the Securities and Exchange Commission’s whistleblower office says the agency continues to receive an increasing number of tips. Sean McKessy, chief of the Office of the Whistleblower, said the SEC received 3,620 whistleblower tips in FY 2014, a more than 20 percent increase in just two years. Read on to learn what McKessy says likely is spurring more would-be whistleblowers to bring their concerns to the SEC.
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Curry warns of third-party security risks
Posted Date: Tuesday, November 18, 2014
A week after the Federal Financial Institutions Examination Council announced observations from a cybersecurity assessment conducted over the summer, Comptroller of the Currency Thomas Curry spoke on some of the findings to the 10th annual Community Bankers Symposium in Chicago. In particular, Curry addressed third-party relationships and the vital need for community banks to protect their data.
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CFPB fines auto dealer for alleged credit reporting violations
Posted Date: Friday, November 21, 2014
An Arizona-based “buy-here, pay-here” used car dealer agreed to pay an $8 million civil penalty to resolve Consumer Financial Protection Bureau claims that its collections activities violated Dodd-Frank’s unfair acts and practices ban. The CFPB also said the company, DriveTime Automotive Group Inc., violated the Fair Credit Reporting Act and the furnisher rule by furnishing information to credit bureaus that it had reasonable cause to believe was inaccurate. Read on to learn about the CFPB’s enforcement action.
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FDIC releases video on ATR/QM rule
Posted Date: Friday, November 21, 2014
The Federal Deposit Insurance Corp. released the first in a series of three new technical assistance videos aimed at helping bank employees meet regulatory requirements under the Consumer Financial Protection Bureau’s mortgage rules. The first video addresses the ability-to-repay/qualified mortgage rule.
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Constitutionality of CFPB, Cordray’s appointment back in court
Posted Date: Tuesday, November 18, 2014
Two cases challenging the authority of the Consumer Financial Protection Bureau, the recess appointment of Director Richard Cordray, and other parts of the Dodd-Frank Act are back in court Wednesday morning for oral arguments. Read on to find out where these cases stand.
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Realtors urge FHFA to stay the course
Posted Date: Tuesday, November 18, 2014
As the Federal Housing Finance Agency proposed housing goals for Fannie Mae and Freddie Mac that could change the way the government-sponsored enterprises measure progress, at least one industry association urged the FHFA to stay the course. Read on to find out why.
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CFPB report shows older Americans troubled by debt collection
Posted Date: Tuesday, November 18, 2014
Consistent with the trend of overall complaints, the Consumer Financial Protection Bureau found that older Americans cite debt collection as a top complaint, a report released Nov. 4 showed. Since September 2013, older Americans have submitted more complaints to the CFPB about debt collection than any other financial product or service, the report found. Read on to find more details of the findings.
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For mortgage brokers, no good deed goes unpunished
Posted Date: Friday, November 14, 2014
The role of the mortgage broker in today’s home loan market is significantly diminished as a result of rules implemented during the past few years. In this article, Howard Lax, a member of Michigan-based Bodman PLC, discusses how rules intended to prevent underwriting abuses cut both ways by limiting the flexibility brokers traditionally have relied upon to rescue otherwise doomed loan applications.
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Whistleblower split deepens
Posted Date: Friday, November 14, 2014
The debate over whether one must report to the Securities and Exchange Commission to be considered a whistleblower entitled to Dodd-Frank’s anti-relation protections deepened when two district courts, ruling just days apart, came down on different sides of the issue. Read on for the details.
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Lenders sound off on CFPB HMDA proposal (Pt. 2)
Posted Date: Tuesday, November 11, 2014
Industry groups urged the CFPB to make numerous substantive changes to a sweeping proposal that would expand the Home Mortgage Disclosure Act data set. Commenters voiced concern regarding a range of issues including data points, reporting tolerances and consumer privacy.
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Small Entity Compliance Guides get tweaks
Posted Date: Tuesday, November 11, 2014
After finalizing amendments to its ability-to-repay rules, the Consumer Financial Protection Bureau said it updated its Small Entity Compliance Guides to reflect the changes. Read on for the details.
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Agencies take EGRPRA review on the road
Posted Date: Tuesday, November 11, 2014
Federal agencies announced a series of outreach meetings to review regulations under the Economic Growth and Regulatory Paperwork Reduction Act of 1996. Read on for the details of the first meeting and what the agencies are looking for in terms of feedback.
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Unbanked households on decline
Posted Date: Friday, November 7, 2014
Improving economic conditions may be driving more Americans into the banking system, according to a report from the Federal Deposit Insurance Corp. Read on for highlights from the survey.
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CFPB set to propose prepaid card rules at hearing
Posted Date: Friday, November 7, 2014
After more than two years of preparations, the Consumer Financial Protection Bureau appears to be on the verge of announcing consumer protections for the prepaid card market at a field hearing Nov. 13. Among the announcements could be rulemaking on overdraft charges and disclosures. Read on for a preview.
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OCC updates guidance on MRAs
Posted Date: Friday, November 7, 2014
The Office of the Comptroller of the Currency has published revised policy and procedures for management of Matters Requiring Attention. Read on to find out the details.
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FFIEC discusses cybersecurity preparedness
Posted Date: Tuesday, November 4, 2014
Earlier this year, the Federal Financial Institutions Examination Council agencies piloted a cybersecurity assessment at more than 500 community institutions. Now, the FFIEC is releasing observations from that assessment. Regulators also suggested numerous questions that leaders of institutions may consider when assessing cybersecurity preparedness.
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Shadow banking industry growing, report finds
Posted Date: Tuesday, November 4, 2014
The world’s shadow banking system grew in 2013, according to a report from the Financial Stability Board, an international panel tasked with coordinating regulatory efforts to promote financial stability around the globe. Read on for findings from the FSB’s report.
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CFTC proposes more rule amendments
Posted Date: Tuesday, November 4, 2014
The Commodity Futures Trading Commission is proposing further tweaks to its Dodd-Frank rules. On Nov. 3, the commission voted to propose a rule on the residual interest deadline for futures commission merchants. It also plans to amend certain recordkeeping rules and requirements pertaining to forward contracts that have “embedded volumetric optionality.” Read on for the details.
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CFTC signals more ‘fine-tuning’ for Dodd-Frank rules
Posted Date: Friday, October 31, 2014
The Commodity Futures Trading Commission will meet Nov. 3 to consider what the agency’s leader indicated will be relatively small, yet significant, changes to some of its Dodd-Frank rules. Read on for the details.
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The CFPB channel: Takeaways from three recent enforcement actions (Pt. 2)
Posted Date: Friday, October 31, 2014
Deciphering the CFPB’s expectations is getting even harder as the agency increasingly makes use of consent orders and enforcement actions to convey its messages. Dodd Frank Update spoke with Richard Andreano, a partner at Ballard Spahr LLP, and Richard Horn, a partner at Dentons, to get their thoughts on some of the bureau’s recent consent orders. Read on to learn what they had to say about one enforcement action that has caused a great deal of concern, particularly among those in the real estate settlement services space.
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Bipartisan Policy Center weighs in on big bank breakup debate
Posted Date: Friday, October 31, 2014
Ending “too-big-to-fail” was one of the major goals of Dodd-Frank, but some policymakers have questioned whether more is necessary to ensure that mega financial institutions do not imperil U.S. financial stability. Should the government break up the biggest banks? Read on to learn what the Bipartisan Policy Center had to say about that issue in a recent report.
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Fed revises standards for systemic FMUs
Posted Date: Friday, October 31, 2014
The Federal Reserve finalized a rule amending risk management standards for financial market utilities that have been designated as systemically important. The Fed also announced final revisions to Part 1 of its Policy on Payment System Risk. The rule and policy amendments touch issues including establishing separate standards to address credit risk and liquidity risk, new requirements on recovery and orderly wind-down planning and others. Read on for the details.
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