In letters to the heads of the Department of Veterans Affairs, the Social Security Administration and Comerica Bank, Sen. Elizabeth Warren, D-Mass., says she wants to know more about a security breach reported in August that affected Direct Express, a program that issues prepaid debit cards to federal benefit recipients. Comerica has administered the program since 2008.
Former Federal Reserve chief Janet Yellen says she doesn't see any financial imbalances in the economy, which she predicts could remain strong through 2019. But a continued tight labor market with low unemployment and accelerated wages could cause unhealthy inflation growth, she notes.
What constitutes an abusive act by a financial-services firm is not well-defined in law, and the Consumer Financial Protection Bureau plans to establish a rule to clarify that definition, acting Director Mick Mulvaney says. Companies have long said the language in the Dodd-Frank Act is overly broad, but consumer advocates say making it more specific will limit the CFPB's power and therefore mean fewer enforcement actions.
Banks and the public should participate in a request for comment on the Community Reinvestment Act from the Office of the Comptroller of the Currency, Federal Reserve Governor Lael Brainard says. The Fed is not part of the advance notice of proposed rulemaking, but Fed officials will read comments and likely will work with the OCC and the Federal Deposit Insurance Corp. on a joint proposal, Brainard says.
The Hoover, Ala., City Council has issued a moratorium on businesses including small-dollar lenders and title-loan shops. These businesses can deter redevelopment, says Councilman Casey Middlebrooks, who proposed the resolution.
Three major US banks have shrugged off fears that rising interest rates, a trade spat with China and political uncertainty will decrease consumer spending. Citigroup, JPMorgan Chase and Wells Fargo have reported double-digit third-quarter earnings growth, thanks to increased income from consumer lending.
Federal Reserve regulatory chief Randal Quarles has signaled to the Senate banking committee that foreign banking organizations will be held to the same Dodd-Frank Act requirements as comparable US banks. "We are not including any changes to the FBO regulatory scheme for FBOs with more than $250 billion in global assets as part of our implementation of tailoring mandated by the Act," according to written testimony from Quarles.
Increasing Pell Grants, changing the name of award letters and clarifying what they include, and simplifying the loan repayment system would improve higher education financing, write Brad Conner, a vice chairman at Citizens Financial Group and former chairman of the Consumer Bankers Association, and William Hoagland, senior vice president of the Bipartisan Policy Center and a former staff director of the Senate Budget Committee. Roughly 90% of student loans are made by the federal government, which reports a delinquency and default rate in the double digits.
Enforcement actions taken by US state securities regulators in 2017 led to 1,985 years of prison time and probation, 47% higher than in 2016, according to a North American Securities Administrators Association report. More than $486 million in restitution was ordered to be given back to investors, and fines reached $79 million, the report said.
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