Consumer Law & Policy Blog

Regulatory matters in progress at CFPB and FTC

Federal agencies recently published their agendas of regulatory matters on which they expect to work from May 2013 through May 2014. (The July 3 publication is actually a delayed "spring" regulatory agenda.)

The agenda of the Consumer Financial Protection Bureau is available here. It lists 8 regulations that the agency expects to finalize during the year, 5 that expects to propose, and 4 on which it is beginning work. The latter category includes regulations to address home mortgage disclosure, payday loans, and debt collection.

The Federal Trade Commission's regulatory agenda is available here. It includes 1 rule that the FTC expects to finalize, 9 that it expects to propose, and 10 on which it is beginning work. The latter category includes regulations to address standards for safeguarding consumer information, fair packaging and labeling regulations, retail food store advertising, and the holder-in-due-course rule.

FTC Testifies Before Senate about Unlawful Debt Collection

From today's FTC press release:

The Federal Trade Commission told a U.S. Senate subcommittee that it continues to crack down on unlawful debt collection practices through an active program of vigorous law enforcement, education and public outreach, and research and policy initiatives.

Testifying on behalf of the FTC before the Senate Committee on Banking, Housing, and Urban Affairs, Subcommittee on Financial Institutions and Consumer Protection, James Reilly Dolan, Acting Associate Director for the FTC’s Division of Financial Practices, said that challenging unlawful debt collection practices continues to be one of the FTC’s highest priorities. Dolan noted that the FTC receives more complaints about debt collection than any other single industry, and that while lawful debt collection helps keep credit more readily available and affordable, unlawful debt collection victimizes consumers and places law-abiding collectors at an unfair competitive disadvantage.

The testimony highlighted some of the FTC’s recent work to ensure that debt collectors comply with the Fair Debt Collection Practices Act (“FDCPA”) and FTC Act.

 

Under Affordable Care Act (that is, Obamacare), individual insurance rates in New York to fall by 50% or more

As explained in this article by Roni Rabin and Reed Abelson, New York

[s]tate insurance regulators say they have approved rates for 2014 that are at least 50 percent lower on average than those currently available in New York. Beginning in October, individuals in New York City who now pay $1,000 a month or more for coverage will be able to shop for health insurance for as little as $308 monthly. With federal subsidies [mandated for some people under the Affordable Care Act], the cost will be even lower.

More on Senate approval of Richard Cordray

A nice overwiew by Danielle Douglas. Among other things, the article makes the point that, with the the CFPB's basic authority to act unquestionably in place, the agency can operate from a position of strength, both in taking unaliteral action and in negotiations with regulated parties. Of course, individual actions and regs will be subject to challenge, but with the basic power clear, the balance of power has likely changed.

Consumer Financial Protection Bureau posts five sample letters consumers can use to deal with debt collectors

The Consumer Financial Protection Bureau has published five sample "action letters" that consumers may want to use to reply to debt collectors. The agency says that these letters can "help consumers get valuable information about claims being made against them or protect themselves from inappropriate or unwanted collection activities."

1 - There's the "more information" letter, used when the consumer just doesn't have enough information about the alleged debt.

2 - A consumer may want to use the "dispute it and prove it" letter if she doesn't think she owes the alleged debt.

3 - A consumer who wants to work with a debt collector to resolve the debt may want to use the "contact restriction" letter, which tells the debt collector when and where it may contact the consumer.

4 - The "I've hired a lawyer" letter tells the debt collector just that and to contact the consumer only through her lawyer.

5 - And, in the "stop contact" letter, the consumer instructs the debt collector to cease all personal contact. (Note that this letter does not cut off all other debt collection efforts, such as a lawsuit.)

Cordray Confirmed (66-34)!

The confirmation was inevitable after this morning's deal and the vote just before noon, but it's official -- Richard Cordray is the Senate-confirmed Director of the Consumer Financial Protection Bureau. 

The Senate has voted to confirm Richard Cordray as director of the Consumer Financial Protection Bureau, as senators approved the first of a batch of President Barack Obama’s nominations freed for votes by a bipartisan agreement.

The 66-34 vote Tuesday came hours after Senate leaders worked out a deal freeing up seven stalled appointments for the consumer bureau and other agencies for simple majority votes by the chamber. In exchange, Democrats agreed to abandon for now an effort to change Senate rules to weaken the minority party’s ability to block nominations, and Obama agreed to submit two different nominees for two labor posts.

Senator Elizabeth Warren announced the final vote tally with a big smile.  Here's her statement:

After more than 700 days of waiting, Rich Cordray will finally get the confirmation vote he deserves from the U.S. Senate. Director Cordray has won praise from consumer and industry groups, and from Republicans and Democrats, for his fair and effective approach. With Director Cordray's confirmation, we will be able to say loudly, clearly, and with confidence: the consumer agency is the law of the land and is here to stay. We fought hard for the agency, and we proved that big change is still possible in Washington. Now we have the watchdog that the American people deserve - a watchdog looking out for middle class families, getting rid of tricks, traps, and fine print, and holding financial institutions accountable when they break the law.

Once I get done with an appellate brief tomorrow, I hope to be able to post some thoughts on what this all means. For now, let me just say that I'm very glad to learn that Section 1066 of the Dodd-Frank Act will be of only academic interest going forward. 

Cordray Clears Fillibuster

It's actually happened. Via Bloomberg:

The U.S. Senate advanced Richard Cordray's nomination to lead the Consumer Financial Protection Bureau under a compromise announced by Majority Leader Harry Reid, who said officials were working on final details.

U.S. Senate Majority Leader Harry Reid, a Democrat from Nevada, said he thinks "everyone will be happy" with the compromise on confirmation votes for the seven presidential nominees.

The vote today was 71-29, with 60 needed to advance the nomination. Senators will debate the matter for as many as eight hours and hold a final confirmation vote.

Cordray to get a Senate vote

Senators have apparently reached a deal to allow a vote -- today -- on the nomination of Richard Cordray to had the CFPB. Majority Leader Harry Reid had threatened to change Senate rules to end filibusters on executive branch nominees if Republican Senators did not allow votes on Cordray and other executive branch nominees. Under the deal, the two pending nominees to the National Labor Relations Board would be withdrawn and replaced with other individuals. And votes on five other nominees would be allowed to go forward, including Cordray, Gina McCarthy as EPA Administrator, and Thomas Perez as Labor Secretary. Politico has the story.

(BREAKING) Potential deal to avert "nuclear option" in Senate would lead to Cordray vote

NBC news reports here.

Terry Gross is shocked by contracts of adhesion

Check out this Fresh Air interview with NYT Supreme Court correspondent Adam Liptak. Starting at 14:40, it gives more air time and more detail about economic justice issues and corporate power than most coverage of the Court. Liptak mentions Italian Colors by name, explains why class actions are important, and describes contracts of adhesion. As Liptak rightly notes, this is the most pro-corporate Court since World War II (I'd say since the '30s). It's good to see coverage of the Supreme Court's recent Term not skip over the Court's steady stream of troubling pro-corporate decisions. Of course, most interviewers aren't as astute as Terry Gross and don't have 40 minutes to work with. Still, if anyone needs a primer on economic issues and class actions before the Supreme Court, this is a good one. It's about 4 minutes long.