House Financial Services Committee Chairman Jeb Hensarling, R-Texas, is drafting revisions to the Financial CHOICE Act that would significantly alter the Consumer Financial Protection Bureau's functions. Hensarling recently referred to the structure of the CFPB as "a tyranny."
Pennsylvania Republican Sen. Pat Toomey, chairman of a key Senate banking subcommittee and co-founder of a Lehigh Valley community bank, is helping lead the charge for reform of financial industry regulations.
Some lenders are continuing predatory practices such as charging exorbitant rates and taking advantage of non-native English speakers by pushing them to sign loans without written agreements, although regulations have been tightened against them, Tom Kelly writes. The Mortgage Bankers Association and other groups are working to teach consumers skills to help prevent them from becoming victims of deceitful practices, he writes.
Wells Fargo wealth-management executives have apologized to retirement-plan officials and have taken responsibility for fraudulent accounts, according to meeting minutes from municipal and state pension boards. "We certainly understand the concerns about what happened in our community bank and have been in regular dialogue with our investor clients regarding the settlement," Wells Fargo said.
Financial firms are hoping minutes of the Federal Reserve's latest meeting, during which the target range of the federal funds rate was left at 0.25% to 0.5%, will reveal more about the central bank's view on inflation. "There was stronger language in the statement on inflation, so it will be interesting to see any color on their outlook," said Wells Fargo Securities Senior Economist Sam Bullard.
Tailored regulations and less red tape and overlap are three changes community banks need from any overhaul of Dodd-Frank, writes ConnectOne Bank CEO Frank Sorrentino. Community banks also need more decision making power at the local level, he writes.
Customers who have their information stolen in a bank fraud or cyberattack are more likely to switch banks after the fraud happens, a recent study by Carnegie Mellon University has found. That holds true even if the customer didn't lose any money, and instances of churn were more profound if the bank was unable to explain what happened, the study showed.
Two Lockport, New York, men have been indicted on federal bank fraud charges. Authorities say the pair, Michael Rosier and Cody Kross-Rosier, both 22, tried to bilk seven local financial institutions out of $123,000 during a three-month period.
Part of the problem with the fiduciary rule lies in the adjudication of complaints and the related costs being passed to consumers, says Francis Creighton, FSR's executive vice president of government affairs. "The problem with litigation is a court can essentially have unlimited damages," he said, adding, "We don't want things enforced by trial lawyers."
Rep. Jeb Hensarling, R-Texas, is expected to introduce a bill that would let the president fire the director of the Consumer Financial Protection Bureau. CBA and other industry groups have stated they prefer the stability of leadership by a bipartisan commission, which was proposed in an earlier version of the bill.
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