Six Things You Need To Know To Start Your Credit Union Week

January 7, 2019 at 9:12 am Leave a comment

Good morning, people. Yours truly is in fine spirits even though it’s Monday. For one thing, there’s plenty to write about but more importantly, I’m happy to be a Giants fan this morning. I’d rather be a fan of a team with a losing record than watch my team win a Division only to lose in the firbecause its kicker is better at hitting goal posts than kicking through them.

Important Guidance on Loan Forbearance

With 800,000 federal workers not getting paid, chances are your credit union has received some questions from members finding it difficult to make loan payments. Late last week the Consumer Data Information Association issued guidance to companies that furnish data to consumer reporting agencies about how to properly record forbearances as a result of a consumer’s inability to make payments due to the government shutdown or for other reasons. Remember there are some nuanced reporting requirements that you should keep in mind. The guidance reminds businesses that forbearance is a period of time during loan repayment in which a borrower is permitted temporarily to postpone making regular payments. The loan is not forgiven. This is in contrast to a loan modification in which the terms of the loan are actually changed. If all goes according to plan, later this week I will highlight some court cases in which financial institutions were sued for allegedly misreporting forbearances to the credit reporting agencies.

It’s Official: Cuomo Nominates Linda Lacewell to Head DFS

The New York Law Journal reported on Friday afternoon that Governor Cuomo has formally nominated Linda Lacewell, his current Chief of Staff, to be the third head of the Department of Financial Services which was created in 2011 when the Governor combined New York’s Banking and Insurance Departments.

Lacewell’s background is similar to that of the Department’s first head, Benjamin Lawsky. She is a high-ranking aid to the Governor who also has extensive experience as a federal prosecutor, having been involved with high-profile criminal investigations involving organized crime and Enron Corporation. She replaces Maria Vullo.

Are You Handling Your Stop Payment Requests Properly?

That’s the question you should be asking yourself in the aftermath of the announcement that the CFPB has entered into a consent decree with USAA to settle claims that the bank had inadequate policies and procedures when responding to stop payment requests involving preauthorized transfers.

According to the consent order, “On numerous occasions prior to 2015, USAA failed to enter stop payment orders after account holders notified the Bank of their desire to stop payment on Preauthorized EFTs, including by refusing to enter stop payments or by requiring consumers to contact the merchants initiating the EFTs as a prerequisite to implementing stop payment orders. In some of these instances, USAA failed to enter stop payment orders because consumers requested to stop payments to payday loan lenders.”

This has long been a consumer pet peeve. I remember fielding consumer questions about this when I was working in the Assembly oh so long ago.

New Legislative Session Kicks Off This Week

Speaking of the Assembly, a new era begins in New York State politics this week. On Wednesday the Assembly and Senate will hold their first sessions of the year. The Senate will feature  a new Democratic Majority firmly in control and Andrea Stewart-Cousins officially taking the helm as the first female leader of either Chamber in New York history. The state-of-the State address is later this month.

New York City Is Booming

If you want to make it in New York City, now is a good time to be looking for that dream job. The New York Post is reporting this morning that job growth in the Big Apple is “tremendous” fueled by 7,000 new startups and the headquarters of leading finance, fashion, entertainment and technology employers. How much this benefits the rest of the state remains to be seen.

More on the Progressive, PenFed Merger

Here is an article in this morning’s CU Today in which former Progressive CEO Robert Farmilant and PenFed CEO James Schenck discuss the merger and look back at the rise and fall of the medallion lending industry.


Entry filed under: Compliance, Legal Watch, New York State. Tags: , , , , , , .

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Authored By:

Henry Meier, Esq., Senior Vice President, General Counsel, New York Credit Union Association.

The views Henry expresses are Henry’s alone and do not necessarily reflect the views of the Association. In addition, although Henry strives to give his readers useful and accurate information on a broad range of subjects, many of which involve legal disputes, his views are not a substitute for legal advise from retained counsel.

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