Posts tagged ‘Mulvaney’

In Albany, The More Things Change The More They Stay The Same

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By winning two special elections last night for vacant State Senate seats combined with the recent dissolution of the Democratic Independent Caucus, the Democrats now have a numeric majority in the New York State Senate. This is a big deal. With the exception of short stints in 2008 and 1965, the Republicans have controlled the State Senate since World War II.

In addition, the fact that the Republicans lost decisively in the special election in Westchester where Democrat Shelley Mayer will now serve out the remainder of that Senate term, is a sure sign that State Senate Republicans may very well pay a hefty price for the Trump Presidency. When I started working in the State Senate in 1989, the general rule of thumb was that national politics didn’t really have too much of an impact on the State Senate. Clearly this is no longer true.

Now for the good news if you’re a Republican. Despite this historic election, not all that much has changed this morning. That’s because Simcha Felder who runs on the Democratic and Republican line has indicated that he is going to continue to support the Republicans at least until the end of session. Stay tuned, this is a story that will be playing out at least through November and one that which will have a huge impact on the shapes and prospects for the credit union legislative agenda for years to come.

By the way, a special thanks to all of you who took the time to show up in Albany for our annual State GAC event. It’s always great to see all of you who make the extra effort to help out with the cause.

Mulvaney To Shut Down Public Complaint Portal

Since its inception in 2014, yours truly has been a vocal critic of CFPB’s public complaint portal under which complaints lodged against financial institutions are available for public review. Talk about guilty until proven innocent.

In the latest example of his efforts to fundamentally reform the Bureau of which he is head, Acting Director Mick Mulvaney indicated in a speech before the American Bankers Association yesterday that he whole-heartedly agrees with me. The American Banker quotes him as saying, “I don’t see anything in here that says I have to make all of this public. We are going to maintain the consumer database. It is mandated by law,” but “I don’t see anything in here that I have to run a Yelp for financial services sponsored by the federal government.” His comments come as the CFPB has made a request for the public to comment on CFPB’s existing public complaint process.

Enjoy your day.

April 25, 2018 at 8:58 am Leave a comment

New Director Reconsiders Pending Legal Actions

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Although much of the early talk about a Trump appointed Director of the CFPB has centered on the potential for regulatory relief, the place where we will see the quickest and most dramatic shift is in the use of enforcement actions. Let’s not forget that the CFPB has aggressively used its UDAP powers and enforcement authority to take legal actions against alleged wrong-doers. Acting Director Mulvaney is already decisively changing the Bureau’s use of these powers.

Exhibit 1 is Nationwide Biweekly Administration, an Ohio-based company that transmits funds from consumers to their mortgage servicers. They have been sued by the Bureau over claims that it misrepresented the terms of its product, which enables consumers to make biweekly mortgage payments. The Bureau has now announced that it was no longer opposing a company’s request that the CFPB not be allowed to collect a $9 million judgment against it. The Bureau’s decision comes just days after it had filed a motion in opposition to the company’s request for a stay.

Then there is the granddaddy of them all. As readers of this blog know, in PHH Corporation, et. al. v. CFPB, the issue being litigated is the very constitutionality of the Bureau. Specifically, the Court of Appeals for the D.C. Circuit has already ruled that the Bureau’s single director structure is unconstitutional and that the President must be able to fire the Director at will. This case is being appealed but if the CFPB decides not to contest this ruling, it would effectively concede that it is, as structured by Congress, unconstitutional.

While there are many of us who feel that this is precisely the conclusion that the Court should come to, any decision along these lines will create an uproar bigger than the Giants’ decision to bench Eli Manning. Trust me, it was a big deal.

The bottom line is this: the CFPB has not only been an incredibly aggressive regulator but is also an aggressive enforcer of consumer protection laws as it feels they should be interpreted. Again, for those of us who can’t stand regulation through litigation, pulling back on the CFPB’s reigns is a welcomed development. But the number of important enforcement actions and cases in which the CFPB is currently involved underscores why the battle for the temporary leadership of the CFPB is so important.


December 7, 2017 at 9:43 am Leave a comment

New York On Verge of Historic Power Shift…Again

Image result for senator jeff kleinThis headline might be a tad premature but it appears that the State Senate Democratic Caucus headed by Andrea Stewart-Cousins and the 8 member Independent Democratic Caucus by Senator Jeff Klein have reached a preliminary agreement to unify, potentially paving the way for cutting Republicans out of holding any power in the state legislature.

How big of a deal is this? Since the end of WWII, Democrats have held power without Republican help only briefly in 1964, 2008, and 2010. In the latter two cases, Republicans maintained control by entering into power sharing agreements with a group of breakaway Democrats.

Yesterday, Senator Jeff Klein issued a statement in which he indicated that the Democratic factions had come to an agreement about how to work together. In a statement released yesterday evening, “The State Party’s assurance that our progressive legislative agenda will be advanced is a victory for the people of New York,” Klein said. “I look forward to implementing the terms that have been outlined in yesterday’s letter.”

Still this appears to be an agreement to agree. The new power sharing arrangement is reportedly scheduled to take effect only after the state budget is negotiated. Currently there are 23 Democrats in the traditional Senate Democratic Caucus and 8 Democrats in the breakaway IDC. Simcha Felder is a Democrat who currently caucuses with the Republicans but has indicated in the past that he is willing to work with whatever party can most help his constituents. With special elections taking place next year, a unified Democratic conference should be able to take control without needing Republican help, but then again we have been here before.

NY Credit Union Fined By DFS

New York’s Department of Financial Services announced that The United Nations Federal Credit Union and Lloyds of London were fined $1.47 million for marketing and offering life insurance tied to the credit union’s credit and debit card program without being appropriately licensed. Here is some additional information.

Round One Goes To Mulvaney

Also yesterday evening, a Federal District Court Judge refused to block Mick Mulvaney from taking over as the interim head of the CFPB while continuing to serve as the Director of the Office of Management and Budget. I haven’t seen a transcript of the proceedings yet but according to this article, the Judge explained “Nothing in the statutes prevents Mr. Mulvaney from holding both of these positions.” Hopefully this silliness can end soon and we can start concentrating on working with Mr. Mulvaney to bring much needed mandate relief to credit unions.

November 29, 2017 at 9:11 am Leave a comment

Five Things You Need To Know On Tuesday Morning

Here is a roundup of some of the other news that happened over the last week when I wasn’t doing the blog and the CFPB had only one Director:

Uber Data Breach

Most importantly, ride sharing app Uber disclosed, all be it belatedly, that it had been victimized by a data breach about a year ago. The breach affected at least 57 million accounts and compromised the phone numbers and emails of 600,000 US driver licenses. It ended up paying more than $100,000 in ransom money to hackers. Uber’s announcement, conveniently made as people prepared for the Thanksgiving holiday, is the latest and most blatant example of companies failing to give adequate notice of data breaches in a timely fashion. This is why it is also the latest example of why we need national data breach standards.

High Noon For Tax Reform

The push for the Republican Tax Cut Proposal is nearing another critical stage with the Senate talking about voting on the bill by the end of the week. Today the Senate Budget Committee meets to consider the bill. What’s so interesting about that is that one of the Republicans most outwardly skeptical about the plan, Senator Corker of Tennessee sits on that committee. He has indicated the he plans to vote against the bill unless changes are made. If Republicans hope to pass a tax bill without Democrat support, they can only afford two Republican no votes. Remember, that even if the legislation gets through the Senate, then the House and the Senate will have to agree to and pass a single bill.

CUNA and NAFCU Recognize Mulvaney As CFPB Director

All of this would be comical if it didn’t have real world consequences and involve adults.

CUNA and NAFCU sent letters to Mick Mulvaney congratulating him on being named the interim head of the CFPB. Meanwhile, the Justice Department was granted an extension to prepare a response to Leandra English’s lawsuit claiming that she is the rightful heir to the CFPB throne. Mulvaney also announced a freeze on CFPB rulemaking. Also yesterday, several high-profile Democratic Senators including New York Senator and majority leader Chuck Schumer and Massachusetts Senator Elizabeth Warren indicated that they would be submitting amicus briefs in support of English. All this took place as Mulvaney was passing out donuts to his new employees and English was emailing CFPB employees in between making visits to key Democrats on Capital Hill. And you thought your office was dysfunctional?

Powell To Testify At Confirmation Hearing

Gerome Powell will be testifying today before the Senate Banking Committee as he seeks to be confirmed as the next head of the Federal Reserve Board. Barring any unforeseen developments, he is expected to easily win Senate approval and take over the job when Janet Yellen’s term ends in February. Here is a link to his prepared testimony.

Is Inflation MIA?

When he takes the helm, one of the riddles he will continue to have to deal with is inflation and the lack thereof. As I’ve noted in previous blogs, there is an important debate going on among economists; in one camp are those who argue that inflation is just around the corner and that the Fed has to aggressively act now or it will act too late to control the inevitable spike; the other camp argues that the economy is changing and that the persistence of low inflation may be a permanent fixture of this new world. One of the most interesting articles I’ve read in recent weeks was this one from the WSJ in which Chairman Yellen said that the continued persistence of low inflation surprised her and that policy makers may have to consider that “there is something more endemic or long-lasting that we need to pay attention to.” Expect the Fed to raise rates again in December. But if inflation continues to be sluggish, more and more central bankers will question whether raising interest rates makes sense.

November 28, 2017 at 9:09 am Leave a comment

Two Things You Need To Know Before Thanksgiving

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I’m exaggerating a little with the headline but I’m going on hiatus until next Monday and there are a couple of things I thought you should know about before then.

Mulvaney To Be CFPB Director?

First, if CBS news is correct, former conservative Congressman and current Office of Management and Budget Director Mick Mulvaney will soon be named the interim director of the CFPB. This is big news. Mulvaney made a name for himself as one of the most fiscally conservative members of Congress. This morning, a lot of his quotes bashing the CPFB are getting attention. But for astute credit union junkies, or people paid to follow this stuff, Mulvaney’s name should ring a bell for another reason. He was one of the harshest critics of former NCUA Chairman Debbie Matz’s obstinate refusal to hold public budget hearings. She even suggested at one point that lobbyists pushing for these hearings were not really representing the interest of credit unions. Here is part of his response that I find most amusing: “Are you a CU member? I am,” continued Mulvaney. “And I think they are representing me when they ask for those things. As a member of the credit union, I like the fact the credit union is trying to guard my money and be conservative with that.”

Suffice it to say that if Mulvaney takes hold of the CFPB, we are in for some interesting times.

NY To Propose Work Scheduling Rules

With the caveat that I am not an employment law lawyer, after talking to a workmate who actually does know this stuff (aka Chris Pajak), I’ve decided to give you a head’s up about regulations to be posted by the Department of Labor on November 22, 2017. NY has a 45 day comment period.

This regulation is the accumulation of a series of hearings held by the New York State Department of Labor over the next several months. Employee groups complain that low wage employees are increasingly being given less than a week’s notice of their schedule, making it difficult to make arrangements for accommodations like childcare and these employees often show up for work only to be sent home. Generally speaking, under New York’s existing “Report To Pay” rules, there are circumstances when employers are required to pay employees for reporting to work even if the employer has no work for them. Specifically, a non-exempt employee is entitled to the lesser of four (4) hours of pay or the pay he/she would have received had he/she worked the shift.

On that note, I will be back on Monday. Enjoy your Thanksgiving and thanks for reading.

November 21, 2017 at 7:15 am Leave a comment

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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