Oversight

GAO: CFPB’s Civil Penalty Fund needs additional oversight

A recent report from the Government Accountability Office (GAO) on the CFPB’s Civil Penalty Fund found that while the agency has implemented a number of internal controls, more needs to be done to document transactions originated in the fund. Civil penalties levied by the CFPB are placed into the fund to compensate potential eligible victims... Read More...

FTC order prohibits collection of “phantom debts” by Georgia firm

A U.S. district court in Atlanta, Ga., recently issued an order that prohibits a firm based in the state from using threats and deceptive tactics to collect $3.5 million payday loan debts not owed by consumers. According to the FTC, Georgia resident John Williams and two companies he controls allegedly violated the FTC Act and Fair Debt... Read More...

RBS to pay $99.5 million in FHFA mortgage-backed securities settlement

The Federal Housing Finance Agency (FHFA) announced last week a $99.5 million settlement with RBS Securities over alleged federal and state securities violations related to residential mortgage-backed securities (MBS). In September 2011, the FHFA filed suit against Ally Financial and 16 other banking institutions and underwriters, including... Read More...

FHFA: Fannie Mae’s earnings unsustainable in coming years

The Federal Housing Finance Agency (FHFA) recently said in its annual report to Congress that Fannie Mae’s earnings—$84 billion last year, compared to $17.2 billion in 2012—are unsustainable. According to the report, which is part of the agency’s mission to ensure soundness and safety in Fannie Mae and Freddie Mac, the elevated earnings... Read More...

Consumer Portfolio Service to pay $5.5 million to settle FTC charges of illegal practices

Consumer Portfolio Services (CPS), a national subprime auto lender, agreed last week to pay more than $5.5 million to settle charges by the FTC that the company allegedly used illegal tactics to collect debts not owed by consumers. The California-headquartered company agreed to refund or adjust 128,000 accounts by more than $3.5 million and... Read More...

Witnesses testify before subcommittee on alleged discrimination at CFPB

A House subcommittee heard testimony on Wednesday from witnesses it subpoenaed late last month over allegations of racial and gender discrimination at the CFPB. At Wednesday’s hearing before the House Financial Subcommittee on Oversight and Investigations, Ben Konop, the executive vice president of the CFPB’s employee union, appeared before... Read More...

House to examine proposals to improve transparency at CFPB

The House Financial Services Subcommittee on Financial Institutions and Consumer Credit will hold a hearing at 2 p.m. on Wednesday to examine proposals aimed at improving transparency and accountability at the CFPB. The hearing will include discussion on legislation introduced by Rep. Shelley Moore Capito (R-W.Va.) that would eliminate the... Read More...

House to resume CFPB investigation on alleged discrimination

The House Financial Subcommittee on Oversight and Investigations will continue its examination of allegations of discrimination and retaliation at the CFPB with a second hearing later this week. The hearing, which will be held at 10 a.m. on Wednesday and will be chaired by Rep. Patrick McHenry (R-N.C.), will include testimony from two CFPB... Read More...

Sallie Mae settles over alleged violations of servicemember rights

The Department of Justice announced on Tuesday that it has taken enforcement actions against Sallie Mae for allegedly violating the rights of U.S. service members in servicing policies for student loans. Additionally, the FDIC also reached a settlement with Sallie Mae and its servicing unit over allegations of servicing misconduct. According... Read More...

FTC warns it will take action against lax security at companies

FTC Chairman Edith Ramirez said last week said the agency would take action against companies that fail to safeguard consumers’ sensitive personal information, pointing to the ongoing case against Wyndham Hotels. Over the past 18 months, the Wyndham hotel chain has suffered three security breaches—the result of, according to the FTC,... Read More...

Hensarling calls on Treasury’s FSOC to end “too big to fail” designations

House Financial Services Committee Chairman Jeb Hensarling (R-Texas) recently called on Treasury Secretary and Financial Stability Oversight Council Chairman (FSOC) Jacob Lew to stop designating financial institutions as “too big to fail” until Congress has greater oversight of the council. The FSOC was charged by the Dodd-Frank Act... Read More...

FSOC urges state regulators to coordinate standards to bolster nonbanks

The Financial Stability Oversight Council released a report earlier this week urging state regulators to coordinate their prudential and corporate governance standards to ensure the stability of nonbanks in the mortgage servicing industry. In its report, the council noted a substantial increase in 2013 in the transfer of mortgage servicing... Read More...

GAO report highlights financial reporting deficiencies at CFPB

The Government Accountability Office released a report last week that highlighted multiple deficiencies in the CFPB’s financial reporting controls. The audit report for fiscal years 2013 and 2012 found the consumer protection agency failed to develop and implement controls over the year-end accrual process to ensure accounts payable were... Read More...

House subcommittee votes to subpoena CFPB, employees’ union officials

The House Financial Services Subcommittee on Oversight and Investigations voted on Tuesday to subpoena CFPB officials and a union representative as part of the subcommittee’s investigation into allegations of discrimination and retaliation at the agency. According to a release by the subcommittee, the CFPB refused to allow witnesses to... Read More...

House subcommittee considers subpoena of CFPB employees

The House Financial Services Subcommittee on Oversight and Investigations will meet on Tuesday to discuss a resolution that would authorize subpoenas of CFPB personnel to require them to testify on allegations of discrimination at the agency. Earlier last month, reports surfaced that CFPB managers had allegedly ranked minority employees... Read More...

IRS ramps up efforts to combat identity, tax refund fraud

The IRS announced last week that it has initiated approximately 300 new investigations into identity theft and refund fraud ahead of the April 15 tax deadline. Since January, the IRS’ criminal investigation unit has launched 295 new investigations, pushing the number of active cases under investigation to more than 1,800. “Identity theft... Read More...

CFPB to ramp up oversight of nonbank auto lenders

CFPB Deputy Director Steven Antonkes said last week the agency will move ahead with a proposal to expand the regulator’s supervisory authority to cover nonbank auto lenders as part of an effort to address fair lending risks. “For some time now, we have expressed concern that discretionary pricing in auto finance, coupled with financial... Read More...

House hears testimony from witnesses on alleged discrimination at CFPB

The House Financial Services Subcommittee on Oversight and Investigations heard testimony from witnesses on Tuesday alleging that the CFPB has engaged in a culture of discrimination and retaliation against its employees. Last month, reports surfaced that CFPB managers had allegedly ranked employees of different races differently in performance... Read More...

Regulatory inconsistencies hinder Native American housing programs

A report released by the Government Accountability Office last week found regulatory inconsistencies in federal housing programs for Native Americans have made it difficult for native tribes and tribal housing entities to administer the Indiana Housing Block Grant program. The program, which was established under the 1996 Native American... Read More...

House to examine allegations of discrimination at CFPB

The House Financial Services Subcommittee on Oversight and Investigations will hold a hearing next week to examine allegations of discriminatory behavior by managers at the CFPB. The hearing will discuss reports that agency managers have allegedly shown favoritism towards white employees in performance reviews used to issue raises and bonuses.... Read More...

GAO report reveals lack of oversight in student loan rehabilitation program

A report released by the Government Accountability Office last week revealed “serious weaknesses” in the Department of Education’s oversight of a program intended to help financially troubled student loan borrowers. The student loan rehabilitation program allows student loan borrowers in default to “rehabilitate” their loans by making... Read More...

Hensarling calls on CFPB to be transparent, end closed-door meetings

House Financial Services Committee Chairman Jeb Hensarling (R-Texas) called on the CFPB to end its closed-door meeting policy for its four advisory councils in honor of “Sunshine Week,” a national media initiative aimed at promoting open government. “Instead of operating behind closed doors, it’s time for the CFPB to live up to its... Read More...

House committee threatens action against CFPB for delays

House Financial Services Committee Chairman Jeb Hensarling threatened last week to take measures against the CFPB—including issuing a subpoena—over its “delay” in providing the committee with information on the agency’s policies related to indirect auto lending. Democrats from the committee wrote to the CFPB in May requesting... Read More...

HUD-OIG testifes on alleged inappropriate lobbying by HUD officials

Housing and Urban Development Inspector General David Montoya told a House committee on Wednesday that the office’s report revealed that actions by senior HUD officials “display the appearance of impropriety and of ethical regressions.” According to the OIG’s report, senior HUD officials allegedly engaged in appropriations lobbying that... Read More...

House subcommittee to hold hearing on alleged HUD lobbying violations

The House Financial Services Subcommittee on Oversight and Investigations will hold a hearing on Feb. 26 regarding allegations of improper appropriations lobbying at the Department of Housing and Urban Development. HUD Inspector General David Montoya will testify before the subcommittee at the hearing, which is scheduled for 10 a.m. at the... Read More...

GAO: Treasury has not assessed servicer compliance with non-English speaker policies

A recent study released by the Government Accountability Office found that while the U.S. Treasury requires mortgage servicers to develop policies to increase housing program accessibility for non-English speakers, the Treasury has not assessed compliance with the requirement. The U.S. Treasury was directed in 2000 and 2011 to improve access to... Read More...

OFR Director Berner takes heat from House subcommittee for data collection

Office of Financial Research Director Richard Berner took heat from members of the House Financial Services Subcommittee on Oversight and Investigations on Wednesday due to the agency’s collection of financial data. Berner testified before the subcommittee on the agency’s annual report, which was released in December. The Dodd-Frank Act... Read More...

CFPB supervision report uncovers unfair, deceptive practices by mortgage servicers

A report released by the CFPB last week uncovered a number of issues in the mortgage servicing industry in 2013, including unfair and deceptive practices. “Problems in mortgage servicing have plagued consumers for years and helped contribute to the financial crisis,” CFPB Director Richard Cordray said. “Taking action against mortgage... Read More...

Sens. Warren, Coburn introduce bill to boost transparency in federal settlements

Sens. Elizabeth Warren (D-Mass.) and Tom Coburn (R-Okla.) introduced legislation on Tuesday that would require federal agencies to provide full disclosure related to settlements involving enforcement actions. "When government agencies reach settlements with companies that break the law, they should disclose the terms of those deals to the... Read More...

Coburn releases Wastebook 2013 report highlighting “questionable” spending

Sen. Tom Coburn (R-Okla.), the ranking member of the Senate Homeland Security and Governmental Affairs Committee, released his annual oversight report earlier this month highlighting examples of “questionable and lower-priority spending.” According to Coburn’s “Wastebook 2013,” the National Endowment of the Humanities’ Popular... Read More...

SEC report finds lack of review procedures at credit rating agency

The SEC released a report last week that showed improvements in compliance at credit rating agencies, though an examination of the agencies showed a lack of review procedures and oversight of the development of new rating methodologies. In its annual report—mandated by the Dodd-Frank Act—the SEC focused on activities of credit rating... Read More...

Review of OCC concludes agency should focus on safety, soundness

A peer review of the OCC’s supervisory approach for large and mid-sized institutions recommended that the regulator make safety and soundness its key objective. The OCC has been criticized for missing clues leading up to the financial crisis, and some lawmakers have called for increased scrutiny of financial regulators, Financial Times... Read More...

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