Category Archives: CFPB – Consumer Financial Protection Board

Red tape to ban short-term loans for people in need?

dollars and red tape(Article released by the Online Lenders Alliance. While critics label it as “predatory lending,” the short-term loan industry says they take financial risks to help people who need cash urgently. But the CFPB – Consumer Financial Protection Board – is proposing regulations that could dry up those loans.)

By Samantha Bentson, CEO, Cashland Holdings

I recently attended the CFPB’s Richmond hearing where the agency released its draft proposal governing short-term credit.  During the public comment period I heard many of the same stories from customers and employees that I hear every week in my own business in Oklahoma:  Consumers would have no other options without these loans and they value the relationships they have with their lenders.

That’s why, like many of the members of the public that day. I was stunned by the CFPB’s proposal.  As written, it could put me out of business, cost 45 employees their jobs, and eliminate credit options for thousands of people in the states I serve.

Our company owns 13 retail locations throughout Oklahoma and provides loans online in Oklahoma, Missouri, and New Mexico.  We offer revolving lines of credit and installment loan products. Our customers come from diverse backgrounds.  We serve individuals, single income families, and married families with children across all income brackets. 

Our business is often the only financial lifeline our customers have to manage the peaks and valleys of their household budgets resulting from unexpected car repairs, a medical emergency, or school expenses for children.

Surprisingly, the CFPB’s own analysis of its proposal predicts 60 to 80 percent of consumers would no longer have access to this form of credit, effectively eliminating an industry and an option for my customers and millions of consumers nationwide.

Congress recognized the need for a short-term credit when it passed the Dodd-Frank Act.  Yet, the CFPB appears to want to wipe out the industry administratively. Is Congress prepared to see 50 million consumers lose access to the only form of short-term credit available to them and eliminate a $46 billion industry if the CFPB’s proposal is implemented as written? 

Congress must step in and remind the CFPB of its original intent. Dodd-Frank also prohibited the CFPB from setting rates, yet the CFPB proposal appears to backdoor a 36% rate cap by creating its confusing rules only for products that exceed this arbitrary rate.  Congress should exercise its oversight authority and remind the CFPB not to overstep its legal boundaries.

Cashland has served the Oklahoma community for over twenty-five years.  I am often told by customers that I was the only “person” willing to help them when they so desperately needed to borrow money.  I am concerned as to where these customers will go if they do not have an option of short-term credit. 

I often read commentary in Washington, D.C., publications from consumer groups and industry representatives about how to treat consumers who need short-term credit.  I can tell you from personal experience that outside the Beltway there will be millions of Americans left lacking any credible options without honest community businesses like mine providing these loans. 

Congress must step in and ensure the CFPB’s final rules don’t hurt the very people they purport to help.

Bentson is the CEO of Cashland Holdings which operates several retail establishments in Oklahoma, Missouri, and New Mexico and has an online lending platform.  She is a member of the Online Lenders Alliance.

Source: CFPB proposal would hurt consumers it’s designed to help 

Privacy at-risk on HealthCare.gov website

Healthcare-dot-gov_risksOnce it met you, it won’t forget you. And you can forget your privacy.

All who shared information with healthcare.gov will be remembered forever. That Obamacare website stores information indefinitely about all who visited it, even if they did not buy their insurance through the website.

The data system is called MIDAS–Multidimensional Insurance Data Analytics System. Developing the website cost taxpayers over $2.1-billion, yet it still is not finished.

The practic is like what the Consumer Financial Protection Board does. Both government websites keep a mountain of personal data on millions of Americans. Goodbye, privacy! What will the feds eventually do with it? We have to guess.

And is either site more secure than the files of millions of federal workers, which got hacked through the Office of Personnel Management? Unlikely.

Experts told Congress that the longer the data is kept on government websites, the more likely it will be hacked and and privacy of millions will be breached.

The Associated Press writes up more details:  Government data warehouse stores personal information indefinitely for all HealthCare.gov users – Red Alert Politics

Family budgets wrecked by runaway regulations and red tape

Grocery shopperRunaway regulations are hurting everyday people and wrecking family budgets. It’s not big companies that suffer from the $1.88 trillion annual burden of red tape that the government imposes. They pass them along, adding the costs onto their price tags.

Unaffordable health care coverage, unaffordable electric bills, unaffordable rises in food costs, unaffordable college, and unaffordable appliances are parts of the skyrocketing burden of regulations, usually dictated from Washington.

Millions of Americans who no longer pay federal income tax nevertheless have a stake in controlling the size of government, because their family budgets are ruined by higher prices resulting from regulations. All costs of regulations are passed along by businesses to consumers.

The average is $15,000 per household per year, according to the Competitive Enterprise Institute’s new annual report “Ten Thousand Commandments”, with a collective cost of $1.88 trillion. Last year alone, President Obama’s hand-picked bureaucrats created $567 per person of new red tape by creating 75,000 pages of more regulations. That’s a one-year regulatory increase of over $2,000 for a household of four.

Because that overall $1.88 trillion number is too big to swallow, people need the details one bite at a time. Providing those digestible bites is the mission of Americans for Less Regulation. Many items also are posted on ALR’s Facebook site.

HOW does red tape hurt your family budget? Read more for details including:

  • Skyrocketing electric bills
  • Higher automobile prices
  • Phony claims of consumer savings
  • Appliance prices
  • Light bulbs
  • Window blinds
  • Federal snooping of your personal finances
  • Rising health care costs