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Dodd Frank Update Monthly Edition
Dodd Frank Update March 2018
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Trades eye CFPB, Dodd-Frank with advocacy agendas
Posted Date: Friday, February 23, 2018
The nation’s major financial trade associations agree that the tone has changed at the Consumer Financial Protection Bureau (CFPB), as many said they hoped would be the case once the CFPB came under different leadership.
Dodd Frank Update spoke with industry experts from the Consumer Bankers Association, the Credit Union National Association and the Independent Community Bankers of America who said that the bureau’s shift toward a less aggressive, more pro-business approach is a sign that it is a better time than ever to push for real change affecting the industry.
Find out what types of changes the trades will be pushing for throughout 2018.
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Trades see prime opportunities for policy changes in 2018
Posted Date: Thursday, March 1, 2018
With the major shift in the regulatory environment since President Donald Trump took office, financial trade advocates are hoping to make the most of any opportunity to get Congress to advance legislative policies for which they long have advocated.
Representatives from the Consumer Bankers Association, the Credit Union National Association and the Independent Community Bankers of America spoke with Dodd Frank Update about opportunities they see for change that could help banks and credit unions by alleviating burdens and building a regulatory environment for the modern age of financial services.
Read on to learn more details.
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CFPB Strategic Plan Analysis: What’s changing?
Posted Date: Friday, February 16, 2018
The differences between the Consumer Financial Protection Bureau’s (CFPB) philosophies under acting director Mick Mulvaney compared with those under Richard Cordray’s leadership are evident in the CFPB’s recently finalized Strategic Plan for 2018-2022.
The final plan differs from a draft published in October 2017 in several ways, including its description of the bureau’s mission and vision, its approach to enforcement and supervision and its stated view that the bureau is responsible for ensuring that financial service providers are treated fairly, as well as consumers.
Find a detailed analysis of how significantly the revisions will alter the bureau’s approach over the next five years.
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Senators double down pressing Mulvaney on payday rule, lawsuits
Posted Date: Thursday, March 1, 2018
Responding to a letter questioning his motives in re-evaluating the Consumer Financial Protection Bureau’s payday lending rule and withdrawing lawsuits against payday lenders, acting director Mick Mulvaney pushed back against insinuations levied by six Democratic senators, including Sens. Elizabeth Warren (D-Mass.) and Maxine Waters (D-Calif.). Three of the senators then followed up by reiterating questions Mulvaney failed to address from their initial letter.
Mulvaney has exchanged multiple letters with Warren regarding the legitimacy of his status as the bureau’s interim leader and his actions in that capacity.
Find out more about what was said by both parties in this latest war of words.
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Will the Supreme Court hear PHH v. CFPB?
Posted Date: Friday, February 9, 2018
Looming behind the U.S. Court of Appeals’ decision in favor of the CFPB constitutionally and against former director Richard Cordray’s interpretation of the RESPA is the possibility that the ruling could be appealed to the Supreme Court.
Three legal experts offered their takes on the likelihood of an appeal in this case, while speaking with Dodd Frank Update.
Find out details about what why the case may or may not reach the highest court in the country.
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Mortgage Choice Act hailed by industry, panned by critics
Posted Date: Tuesday, February 13, 2018
The House passed a bipartisan bill that would amend the Truth in Lending Act (TILA) to allow borrowers to consider more financing options when applying for a mortgage. The bill has support from multiple financial trade organizations but faces opposition from some consumer and civil rights groups.
If enacted, H.R. 1153, known as the “Mortgage Choice Act,” would adjust certain TILA definitions to enable more loans to meet Ability to Repay/Qualified Mortgage standards.
Find out more about why the legislation has gained strong support within the financial industry but equally strong opposition from various other organizations.
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Trades urge CFPB to repeal mortgage servicing rule
Posted Date: Tuesday, February 20, 2018
Asserting conflicts with current law, six financial trade associations detailed their argument for repealing or delaying amendments to the Consumer Financial Protection Bureau’s 2013 mortgage servicing rule in a letter to acting director Mick Mulvaney.
The trades also included a list of concerns for the bureau to consider if the rule is not repealed.
Find out what aspects of the rule the trades characterized as particularly troublesome.
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FHA mortgage relief option helps borrowers in disaster areas
Posted Date: Friday, February 23, 2018
The Federal Housing Administration (FHA) has introduced a new loss mitigation option for FHA-insured borrowers who live or work in areas impacted by Hurricanes Harvey, Irma and Maria, as well as California wildfires and subsequent flooding and mudslides.
The new option allows affected borrowers to remain in their homes while reducing losses that would otherwise adversely affect the FHA’s Mutual Mortgage Insurance Fund.
Read on to find out more about the agency’s new offering.
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Ruling in CashCall case highlights tribal laws, penalty tiers
Posted Date: Tuesday, February 20, 2018
A federal court granted the Consumer Financial Protection Bureau’s (CFPB) request for partial summary judgment regarding its claims against an online loan servicer and affiliated parties for allegedly attempting to evade consumer protection laws.
The Central California District Court ordered the company to pay significantly less than what the CFPB requested, asserting that the bureau failed to establish certain evidence that would warrant a larger penalty sum.
Find out more about what factors led the bureau to file suit and to the court’s decision.
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U.S. Bank pays $613 million over BSA/AML deficiencies
Posted Date: Friday, February 23, 2018
Bancorp, the parent company of U.S. Bank, recently announced that will pay $613 million in penalties for failing to comply with the Bank Secrecy Act (BSA) and anti-money laundering (AML) requirements.
The company’s BSA/AML compliance program was deemed faulty by the U.S. Attorney’s Office for the Southern District of New York, the Office of the Comptroller of the Currency, the Federal Reserve and the Financial Crimes Enforcement Network.
Find out what deficiencies led to compliance issues for the bank.
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CFPB seeks input about external engagement strategies
Posted Date: Tuesday, February 27, 2018
The Consumer Financial Protection Bureau recently issued a Request for Information (RFI) seeking feedback about the bureau’s external engagements as part of acting director Mick Mulvaney’s ongoing call for evidence examining the agency’s operations.
Through this RFI, the bureau is seeking feedback on its methods of obtaining information from external stakeholders.
Read on to find out what areas of interest the bureau is asking commenters to address in their responses.
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MBA challenges ‘flawed’ fair lending analysis
Posted Date: Tuesday, February 27, 2018
Challenging assertions about discriminatory lending practices in the mortgage industry, the Mortgage Bankers Association (MBA) refuted a recent article published by the Center for Investigative Reporting under its “Reveal” brand name.
MBA said the news organization’s analysis is “flawed” because it does not account for multiple considerations that go into lending decisions, none of which involve race or ethnicity.
Find out what factors were missing from the analysis.
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Roostify closes $25 million Series B to fund expansion
Posted Date: Friday, February 23, 2018
Roostify, a digital lending platform provider, recently announced the completion of a $25 million Series B round of financing. The round included new investments from Cota Capital, Point72 Ventures and Santander Innoventures, the venture capital arm of Banco Santander, as well as money from previous investors.
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Report highlights alternative appraisal risks
Posted Date: Friday, February 23, 2018
New appraisal alternatives could pose new risks that could affect loans that are later sold and securitized, according to a recent report by Moody’s Investors Service.
The report highlights potential risks lenders should be cognizant of relating to the use of hybrid appraisals, broker price opinions and automated valuation models.
Read on to learn what lenders should know about the risks related to each method.
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NFHA investigates discrimination among auto dealers
Posted Date: Friday, February 23, 2018
The National Fair Housing Alliance (NFHA) recently published a report detailing discrimination in the auto lending industry.
The report, titled “Discrimination When Buying a Car: How The Color of Your Skin Can Affect Your Car-Shopping Experience,” highlights scenarios during which racial discrimination occurs at dealerships pertaining to car sales and financing, based on an investigation the conducted by the NFHA.
Find out what went into the methodology behind the investigation and what results the organization uncovered.
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Lenders advocate ‘guarantor-based’ GSE reform
Posted Date: Tuesday, February 20, 2018
The push for reforming the housing finance system to include multiple government-backed guarantors received a vote of confidence from nearly 130 lenders from 40 states who recently wrote to Congress to explain why they think implementing such a model is the best option.
In their letter, the lenders detailed the principles on which they believe such a system should be based, including some that have seen growing support in Congress, and how such a change could build on and improve the existing, two-guarantor structure.
Find out more details about those principles and why these lenders believe they would lead to the best system for taxpayers and the U.S. mortgage markets.
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CFPB issues RFI to assess supervision processes
Posted Date: Tuesday, February 20, 2018
The Consumer Financial Protection Bureau’s (CFPB) fourth Request for Information in acting director Mick Mulvaney’s call for evidence pertains to the agency’s supervision processes.
To help the bureau assess the overall efficiency and effectiveness of its supervision program, it is asking interested parties for feedback about the supervision program that could shed light on whether changes would be appropriate to enable the CFPB to better fulfill its consumer protection mission.
Find out what specific topics the bureau is asking commenters to address in their responses.
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CFTC issues nearly $47 million in penalties over spoofing charges
Posted Date: Tuesday, February 20, 2018
Alleging charges of commodities fraud and spoofing, the Commodity Futures Trading Commission recently issued criminal and civil enforcement actions against three banks and six individuals, in conjunction with the Department of Justice and Federal Bureau of Investigation’s Criminal Investigative Division.
Consent orders issued to Deutsche Bank, UBS and HSBC direct the companies to pay a total of nearly $47 million in civil monetary penalties.
Find out more about what practices were deemed illegal under federal laws prohibiting spoofing.
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VA senior advisor to the secretary joins PenFed
Posted Date: Monday, February 19, 2018
PenFed Credit Union, the nation’s second largest federal credit union, recently hired Matthew S. Collier as its new vice president for business development. Collier joins PenFed from the U.S. Department of Veterans Affairs (VA) where he served as senior advisor to the secretary.
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New home mortgage applications surged year-over-year
Posted Date: Friday, February 16, 2018
The mortgage industry has seen a surge in applications for new home purchases in the past year, according to the Mortgage Bankers Association’s Builder Application Survey (BAS) for January 2018.
The BAS tracks application volume from mortgage subsidiaries of home builders throughout the country.
Read on to learn more about what insight the survey revealed.
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Fannie Mae fourth-quarter loss fuels GSE debate
Posted Date: Friday, February 16, 2018
The revelation that Fannie Mae is requesting to draw from the Treasury to make up for a $3.7 billion deficit after a $6.5 billion loss in the fourth quarter of 2017 has reinvigorated the debate over whether the government-sponsored enterprises should be reformed or allowed to establish capital buffers.
Fannie Mae CEO Tim Mayopoulos said that the loss is an isolated incident, while some argue that it has much broader implications for how the secondary market should be structured.
Find out what an industry trade leader and a high-level legislator are saying about the company’s funding request.
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House passes bill including TRID fix, SAFE Act amendment
Posted Date: Friday, February 16, 2018
Encompassing five measures and garnering support from the financial services industry, the House passed H.R. 3978, also known as the “TRID Improvement Act,” by a 271-145 margin. The package is named after a free-standing measure to amend the Real Estate Settlement Procedures Act, and includes a provision pertaining to loan officers who relocate or go to work for different types of entities.
Language incorporated from two bills comprising the package drew attention from Mortgage Bankers Association, which previously expressed support for both measures.
Find out more about all of the measures included in the legislative package.
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Bill codifying ‘valid when made’ doctrine passes House
Posted Date: Friday, February 16, 2018
The House recently passed legislation that would codify the “valid when made” doctrine, stipulating that the interest rate of loan must not change after the loan is transferred to another person or entity, including when being sold from a depository institution to a non-bank, third party.
The bill is touted as a means of clarifying confusion created by the Second Circuit Court’s 2015 Madden v. Midland decision, however many national and state consumer groups have argued that it would open doors for predatory lenders.
Find out more about what the bill proposes and what arguments are being made for and against its enactment.
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Republican committee chairs to retire
Posted Date: Friday, February 16, 2018
Since the start of 2018, three Republican committee chairs have announced plans to retire from Congress at the conclusion of their terms.
The January retirement announcements are just some of the most recent among several members of the House and Senate, disproportionately coming from the Republican side of the political aisle.
Find out more about some of the most noteworthy congressional leaders who are set to step down once their respective terms are up.
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Radian aligns sales team to provide enterprise-wide solutions
Posted Date: Wednesday, February 14, 2018
Radian Group Inc., a leading provider of mortgage insurance, risk management products and mortgage and real estate services to financial institutions, recently announced that it has reconfigured its sales team to create a unified focus on selling all Radian products and services across the mortgage continuum.
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CFPB to ‘refocus’ efforts with five-year Strategic Plan
Posted Date: Tuesday, February 13, 2018
The Consumer Financial Protection Bureau (CFPB) released its Strategic Plan for 2018-2022, stating that the bureau intends to go no further than its statutory duties outlined by the Dodd-Frank Act in fulfilling its mission.
The Strategic Plan establishes the CFPB’s mission, strategic goals and strategic objectives for the next five years, and includes multiple revisions from a draft version released in October 2017.
Find out how CFPB acting director Mick Mulvaney summarized the intention behind the new plan.
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Black Knight pushing eMortgages to volume
Posted Date: Tuesday, February 13, 2018
The company that brought the mortgage industry’s first collaborative solution for TRID transactions is ready to take eMortgage collaboration to another level.
Black Knight Lending Solutions Senior Vice President/Managing Director Andy Crisenbery recently sat down for an in-depth conversation about the company’s latest project, Expedite Close, which launches in the first quarter this year to bring eMortgage adoption to volume.
Read on to learn more.
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House passes bill proposing ‘relief’ for bank holding companies
Posted Date: Tuesday, February 13, 2018
Trade associations representing small and mid-sized banks are pleased with the House’s recent decision to pass H.R. 4771, also known as the “Small Bank Holding Company Relief Act.”
The bipartisan legislation would amend the Dodd-Frank Act to raise the asset threshold for coverage under the Federal Reserve’s Small Bank Holding Company Policy Statement, which also is proposed in the Senate’s regulatory relief bill, S. 2155.
Find out why the industry supports the legislation and what those opposed to its enactment are saying.
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Pawlenty to leave FSR, industry reacts
Posted Date: Tuesday, February 13, 2018
After more than five years at the helm for the Financial Services Roundtable (FSR), Tim Pawlenty recently announced that he will step down from his post in March.
As he leaves, there is some speculation that the former Minnesota governor will return to politics.
Find out what the financial industry has to say about his decision, and what he accomplished during his time leading the FSR.
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MBA supports FHLB memberships for captive insurers
Posted Date: Tuesday, February 13, 2018
The Mortgage Bankers Association wrote to Congress in support of S. 2361, the Housing Opportunity Mortgage Expansion Act. The bipartisan bill proposes to amend the Federal Home Loan Bank (FHLB) Act to allow certain captive insurance companies to have their FHLB memberships continued or restored.
Captive insurance companies lost FHLB membership eligibility in February 2017 upon the effectiveness of a Federal Housing Finance Agency final rule, stipulating that such entities should be excluded from the definition of “insurance company” under the FHLB Act.
Read on to learn more about the legislation and why it has gained industry support.
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Fed restricts Wells Fargo’s growth, orders board changes
Posted Date: Friday, February 9, 2018
Citing the company’s multiple violations of consumer protection laws, the Federal Reserve Board recently announced that it would restrict Wells Fargo’s growth until it can sufficiently improve its corporate governance and risk management processes.
The Fed also ordered Wells Fargo to replace three of its board members by April and a fourth by the end of the year.
Find out what the sanctions against the company entail, as well as what reactions they have elicited from the company and the industry.
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CFPB requests feedback on enforcement
Posted Date: Friday, February 9, 2018
The Consumer Financial Protection Bureau’s (CFPB) enforcement process is the subject of the agency’s third Request for Information (RFI) issued as part of acting director Mick Mulvaney’s on-going call for evidence to assess the overall efficiency and effectiveness of its functions.
With the RFI, the bureau is seeking feedback from the public regarding ways to improve outcomes for both consumers and covered entities pertaining to the CFPB’s enforcement of consumer protection laws.
Read on to learn what the bureau is hoping to accomplish.
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Mulvaney makes CFPB chief of staff hiring official
Posted Date: Friday, February 9, 2018
Consumer Financial Protection Bureau acting director Mick Mulvaney has hired Kirsten Sutton Mork to be the bureau’s chief of staff. Mork comes to the bureau from the House Financial Services Committee where she served as staff director under Chairman Jeb Hensarling (R-Texas).
Hensarling announced that Mork would be leaving the committee to join the CFPB as chief of staff on Jan. 5. Mulvaney made the hiring official on Feb. 6.
Read on to learn more about Mork and the credentials she brings to the bureau.
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Former Keller Williams CEO hired to run loanDepot’s mello Home
Posted Date: Friday, February 9, 2018
LD Holdings Group, LLC, parent company of loanDepot, has appointed Chris Heller as CEO of mello Home business, its new digital business designed to combine home-buying, financing and improvement services into a single consumer experience.
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Fed survey identifies fraud trends, mitigation strategies
Posted Date: Friday, February 9, 2018
Losses from payments fraud continue to plague the majority of financial institutions throughout the country, according to a survey by the Federal Reserve of Minneapolis.
The “2017 Financial Institution Payments Fraud Mitigation Survey” details which types of financial products are most susceptible to fraud and what strategies are most effective in mitigating fraud risk.
Read on to find out more about the survey results.
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MOBILE Act passes House, industry approves
Posted Date: Tuesday, February 6, 2018
Industry-supported legislation intended to streamline digital transactions recently passed the House with almost no opposition.
H.R. 1457, also known as the Making Online Banking Initiation Legal and Easy (MOBILE) Act, has had support from the financial sector since its introduction in March 2017, and has grown in popularity since.
Find out why this piece of legislation has found support from trade associations representing financial institutions of various sizes and business models.
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Judges vary on constitutionality question
Posted Date: Tuesday, February 6, 2018
The U.S. Court of Appeals’ majority ruling on PHH Corp. v. the Consumer Financial Protection Bureau (CFPB) was a mosaic of varying statutory interpretations with two main outcomes.
Akerman Partner Thomas Kearney and Buckley Sandler Partner Ben Olson dissected portions of the court’s ruling for Dodd Frank Update that the CFPB is constitutionally structured while simultaneously overturning former director Richard Cordray’s interpretation of the Real Estate Settlement Procedures Act.
Find out what differences in the judges’ interpretations could have significance if the ruling is appealed.
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CFPB publishes RFI about administrative adjudications
Posted Date: Tuesday, February 6, 2018
Seeking feedback about the agency’s use of administrative adjudications, the Consumer Financial Protection Bureau recently issued its second Request for Information since acting director Mick Mulvaney’s call for evidence to evaluate the efficiency and effectiveness of the bureau’s functions.
Financial professionals and interested members of the public are invited to comment on the benefits and impacts of administrative adjudications utilized by the bureau, as well as how the existing procedures can be improved.
Read on to learn what aspects of the process the bureau is asking commenters to focus on.
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House passes bills to increase charter flexibility, amend federal laws
Posted Date: Tuesday, February 6, 2018
The House recently passed five bipartisan bills, proposing to amend numerous federal statutes for the sake of increasing bank charter flexibility, adjusting “living will” standards and helping small businesses impacted by natural disasters, among other things.
The bills require amendments to the Dodd-Frank Act, the Truth in Lending Act, the Securities Exchange Act and the Home Owner’s Loan Act.
Find out which bills the industry is throwing its expressed support behind and details about what each one proposes to do if enacted.
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Mortgage applications dip, interest rate averages rise
Posted Date: Tuesday, February 6, 2018
After trending upward for three straight weeks, mortgage applications dipped 2.6 percent in the week ending Jan. 26, 2018, according to the Mortgage Bankers Association’s (MBA) latest Weekly Mortgage Applications Survey.
The survey also indicated that average mortgage contract interest rates increased across all loan types.
Read on to find out more details revealed in the survey.
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