News By Edition

Mortgage rates are strongly linked to the health of the U.S. economy. So, who better to consult about where both are headed than an economist who works in the housing industry? First American Chief Economist Mark Fleming spoke with Dodd Frank Update about his perspective on what the foreseeable future holds for the housing market in the wake of the presidential election.

Predatory lending is now a criminal offense punishable with jail time in California following the enactment of California Assembly Bill 3108 in September. The legislation expanded the legal definition of “mortgage fraud” to include any mortgage broker or person who originates a loan with the intent to defraud someone.

A level playing field and clear rules of the road are appealing ideals to mortgage professionals. However, these concepts sometimes feel purely aspirational with respect to rates, regulation, and real estate. These “Three R’s” provided a jumping off point for an insightful panel discussion about the unique challenges faced by independent mortgage banks and other players in the lending space.

Minutes released from the Federal Open Market Committee’s Nov. 6-7 meeting shed light on the agency’s decision to lower the federal funds rate by 25 basis points to a range of 4.5 to 4.75 percent. The minutes offer insight into the committee’s outlook on inflation, interest rates and housing, among other takeaways.

Rumblings that Congress may be considering excluding language banning the use of “trigger leads” by creditors in the National Defense Authorization Act (NDAA) is causing some concern among industry advocates. The Community Home Lenders of America released a statement urging policymakers to address trigger leads in the NDAA.

Old National Bancorp sought to bolster its footprint in the Twin Cities and expand into other Midwestern markets by acquiring Bremer Financial Corp. (BFC), the bank holding company for Bremer Bank. Upon completion of the definitive merger agreement between the two institutions, Old National will become the third-largest bank in the Twin Cities with more than $70 billion in total assets, according to a joint press release announcing the deal.

With the holiday season upon us, financial professionals are mindful of the heightened risk of cybersecurity issues, as well as the end-of-year activities by their prudential regulators as they finalize their budgets and last-minute rulemakings. Read about these matters and more in this roundup.

The Consumer Financial Protection Bureau is being sued by Comerica Bank over the bureau’s multi-year investigation into the bank’s management of the Direct Express program, an offering sponsored by the U.S. Treasury Department. Comerica argued that since the bureau began its investigation in 2021, the bank has suffered substantial harm and the court should deem the probe unlawful.

The Federal Trade Commission issued its “click-to-cancel” final rule, requiring entities operating subscription-based services to make the cancellation process as easy as enrollment for consumers. Consumer Financial Protection Bureau Director Rohit Chopra subsequently issued a statement noting the rule is enforceable by the bureau, as well as the commission.

The Consumer Financial Protection Bureau ordered Global Tel Link Corp. to pay $3 million in penalties and restitution for freezing and draining hundreds of thousands of incarcerated people’s accounts and charging undisclosed fees. Operating under the name of ViaPath Technologies, the company’s actions harmed not only the people being detained, but also their families.

In the waning weeks of the year, federal agencies are working to finalize budgetary reports and reviewing key metrics that will inform their strategic moves in the year ahead. Learn about some of the latest developments on these matters in this roundup.

The adjusted fee schedule for payment services provided by the Federal Reserve Banks is set to take effect Jan. 1, 2025. These services include the clearing of checks, automated clearing house transactions, instant payments, and wholesale payment and settlement services.

President-elect Donald Trump announced his intended nominations to lead the U.S. Treasury Department and the Department of Housing and Urban Development this past week, along with several others.

Four prudential regulators testified before the House Financial Services Committee on Nov. 20 during which there were roughly as many questions about pending regulatory matters as there were about allegations of sexual harassment and other gross misconduct levied against government officials.

The Consumer Financial Protection Bureau issued a final rule intended to hold digital payment app providers to the same standards of accountability as traditional banks, credit unions, and other financial institutions supervised by the bureau.

Speculation as to whether the Securities and Exchange Commission will see new leadership after Donald Trump begins his second term as president was put to rest when the agency announced Gary Gensler’s intention to leave his position as chair on Jan. 20 at noon. His exit will coincide with the inauguration of Trump’s second term in office, at which point he will be able to immediately nominate Gensler’s successor.

As the year enters the final stretch, banking advocates are voicing their concerns and hopes for future policy positions they argue will benefit both the financial marketplace and consumers. These priorities include opposition to certain proposed regulations and recommended changes to regulatory approaches. Learn more in this roundup.

The U.S. Department of the Treasury’s Community Development Financial Institutions Fund allocated $76.32 million in Technical Assistance Awards spread across 256 organizations to enhance their capacity to offer financial products and services to low-income and underserved people and communities throughout the country.

A coalition of financial advocacy groups wrote to members of Congress expressing strong disapproval of the Credit Card Competition Act (S. 1838) or any other expansion of the Durbin amendment ahead of the Nov. 19 hearing of the Senate Judiciary Committee. The bipartisan bill, originally introduced last year by Sen. Richard Durbin (D-Ill), would prohibit certain credit card issuers with assets of over $100 billion from restricting the number of networks on which electronic credit card transactions may be processed.

Cornerstone Home Lending, a division of Cornerstone Capital Bank announced the promotion of Jay Crowell to the newly created role of president of its national retail division. Crowell will be tasked with driving strategy and continued growth of Cornerstone’s national retail and Realtor affiliate sales and operations.

The potential impact of the 2024 U.S. election cycle on housing policy and financial regulation could be enormous as Republicans seem poised to take control of the presidency, the Senate and the House in January. To get a sense of the magnitude of what changes could be looming ahead, Dodd Frank Update spoke with two experts from the CRE Finance Council, which released a 2024 Election Scenario Analysis pontificating on the numerous potential outcomes of the three concurrent elections.

The Consumer Financial Protection Bureau released a report indicating state and federal laws meant to safeguard consumers’ financial data lag behind those established in other economic sectors. The report highlights certain limits to consumer financial data protection laws at both levels, which the agency hopes to address through its recently finalized data privacy rule, as well as related actions.

The failure of a small community bank in rural Oklahoma due to fraudulent conduct signaled to Consumer Financial Protection Bureau Director Rohit Chopra the need for reforms to the nation’s federal deposit insurance regime to ensure customers of smaller banks have the same protections as those of much larger institutions.

The Federal Deposit Insurance Corp. released the latest semiannual update on the restoration plan for the agency’s Deposit Insurance Fund (DIF). FDIC staff projects that the reserve ratio remains on track to reach the statutory minimum of 1.35 percent ahead of the statutory deadline of Sept. 30, 2028.

The Federal Reserve offered a detailed recap of developments within the agency and in the financial sector in the latest edition of its standard monthly report on its supervisory and regulatory activities. Other agencies addressed new developments with respect to bank supervision and efforts to better educate the public about predatory pricing practices. Learn more about these developments in this roundup.

The Federal Housing Administration issued its annual report to Congress, offering insights about the financial health of the agency’s Mutual Mortgage Insurance Fund and other information about its policies and programs. Mortgage industry advocates responded, expressing optimism at the fund’s status while suggesting adjustments to make premiums more affordable.

Optimal Blue announced two key executive promotions the company believes will position it to deliver innovation faster across the company’s entire capital markets platform, and to further expand the company’s network of partners.

Republic First Bank, a financial institution closed by regulators earlier this year, was charged with unlawful mortgage redlining and discrimination by the New Jersey Office of the Attorney General in partnership with the state’s Division on Civil Rights.

NerdWallet announced it will be integrating mortgage brokerage services into its business offerings by acquiring Next Door Lending. The company detailed its plans to bring more hands-on guidance to the mortgage process in its third-quarter shareholder letter.

Federal and state regulators issued an enforcement action citing consumer compliance deficiencies with UniBank and its parent company, U&I Financial Corp., following a lawsuit revealing the bank’s involvement in a Ponzi scheme.

Two Minnesota-based debt settlement companies agreed to cease operations in the state after regulators determined they were collecting illegal fees from customers and misrepresenting service offerings. Minnesota Attorney General Keith Ellison announced a settlement between the companies and his office, requiring the companies to provide full refunds to consumers charged illegal upfront fees.

Federal financial regulators addressed the role of private entities in cultivating an effective landscape for innovative payment approaches, while also taking care to ensure consumers are protected in the event of one institution’s recent financial hardships. Learn about these matters and more in this regulatory roundup.

The Federal Reserve decided to lower the federal funds target rate by 1/4 percent to between 4-1/2 to 4-3/4 percent following the November meeting of the Federal Open Market Committee (FOMC). Dodd Frank Update spoke to a pair of experts about what implications this year’s election results could have on monetary policy.

The Consumer Financial Protection Bureau ordered Navy Federal Credit Union to pay $95 million for charging illegal overdraft fees through its “Optional Overdraft Protection Service,” known as “OOPS.” Navy Federal issued a statement denying the alleged wrongdoing but agreed to pay the amount, which is the largest total the bureau has ever collected from a credit union.

With the presidential election over, the financial sector is preparing to tailor advocacy strategies for a second Trump administration, which is expected to be more amenable to rolling back regulations than the current one. Several financial trade organizations issued official statements with their perspectives on what Donald Trump’s return to office will mean for financial services.

The Office of the Comptroller of the Currency bestowed upon three of its most tenured supervision officials the designation of “Senior National Bank Examiner,” in recognition of their years of high-quality performance and service in their field. It is the highest honor a national bank examiner can receive.

Financial trade organizations are busy assessing how to best tailor their advocacy efforts based on the election results. Meanwhile, the mortgage industry is also looking at key indicators and research to determine what lies ahead for the housing market. Learn more about these topics in this roundup.

A pair of senators urged the Federal Reserve to not take their foot off the gas with respect to reducing the federal funds rate ahead of the November meeting of the Federal Open Market Committee, citing the progress in lowering the national inflation rate.

Dark Matter Technologies has tapped its chief revenue officer Sean Dugan to succeed Rich Gagliano as CEO effective April 2025. Gagliano, who launched Dark Matter in 2023 following more than a decade of leadership at its predecessor, Black Knight Origination Technologies, will continue with the company as executive chairman.

The Consumer Financial Protection Bureau took action against Navy Federal Credit Union for charging illegal overdraft fees through its “Optional Overdraft Protection Service,” known as “OOPS.” The bureau ordered Navy Federal to pay $95 million in redress and penalties as part of the largest total the bureau has ever obtained from a credit union.

VyStar Credit Union will pay $1.5 million to redress consumers harmed by the botched rollout of its online banking system. The charges stem from a coordinated supervisory effort between the Consumer Financial Protection Bureau and the National Credit Union Administration to uncover issues with the system and the consequences.

When Vanessa Montanez was hired as a senior vice president tasked with establishing a new community lending program at City National Bank in Los Angeles, she had her work cut out for her. The end result was an example of the profound impact community lending can have on lives and on a bank’s ability to meet its Community Reinvestment Act obligations.

New guidance issued by the Consumer Financial Protection Bureau seeks to hold employers accountable when using third-party consumer reports to monitor and evaluate workers, describing how some common practices fail to adhere to Fair Credit Reporting Act standards.

Noting the unique risks posed by certain artificial intelligence solutions, the New York State Department of Financial Services issued guidance urging financial services organizations to evaluate and address these types of issues when developing cybersecurity strategies.

There have been a handful of new appointments to key positions within federal agencies in recent weeks whom compliance officers at certain covered entities will want to familiarize themselves with. Regulators also have announced actions concerning illegal debt collection practices among medical providers, which could hold lessons for other firms bound by fair debt collection requirements.

The Federal Housing Finance Agency’s proposed updates and clarification on governance requirements for the Federal Home Loan Banks and the FHLBank system’s Office of Finance in a notice of proposed rulemaking.

A federal court in southern Ohio considered whether the debt settlement companies behind mailers sent as part of a marketing plan were creditors, and whether the practice violated the Fair Credit Reporting Act (FCRA) and the Equal Credit Opportunity Act (ECOA). The case is Jessica Stechenfinger v. Silverlake Fin., LLC, et al., No. 1:24-CV-47, 2024 WL 4266598, (S.D. Ohio Sept. 23, 2024).

Mortgage Bankers Association (MBA) President and CEO Bob Broeksmit sought to inspire attendees at MBA Annual 2024 in Denver, invoking the legacy and memory of the late former MBA President David Stevens in his opening remarks and calling for renewed industry commitment as the mortgage banking community navigates an unpredictable regulatory and political landscape.

The financial sector offered plenty of feedback indicating the widely-held belief that federal banking regulators should take on a bigger role in supervising third-party relationships between banks and fintechs. Attorneys at one trade group also were busy crafting court filings for multiple cases, two of which involved questions about preemption. Learn more about these matters and more in this roundup.

The Federal Reserve issued an enforcement action against a former employee of the Bank of Jackson Hole who illegally accessed and distributed thousands of confidential pieces of information without authorization.

The Federal Deposit Insurance Corp. Chair Martin Gruenberg is under more scrutiny from the House Financial Services Committee over his leadership of the agency. Committee leaders are demanding a briefing and documents related to proposed alterations to the agency’s asset manager passivity agreements outlined in a notice of proposed rulemaking.

Sourcepoint, a Firstsource company, announced its investment in building its own “domain-centric” Large Language Model (LLM) specific to the mortgage process. This investment leverages the company’s domain expertise to make sector-specific, AI-driven services and platform offerings.

Fay Servicing announced it has raised over $100,000 in donations for charity through its 2024 Corporate Challenge fundraising campaign, which engages companies across the mortgage and financial services industries. The Corporate Challenge encourages these companies to start employee giving programs or to use existing programs to make charitable contributions for non-profits and community organizations.

Floify, a point-of-sale (POS) solution for mortgage providers, announced its native electronic verification of income and employment (VOIE) service, Floify Verify, is available to the industry. Powered by Argyle, the service is designed to streamline the mortgage origination process.