Higher One, Inc. promises to help students reach their goal of achieving a degree by providing money management and refund services. But federal regulators say the company misled these students into paying improper fees, opening unneeded accounts through deceptive marketing tactics, and now it must pay $55 million in fines and restitution to harmed consumers. [More]
In the short time since Navient – the nation’s largest student loan servicing company – spun off from Sallie Mae, the company has come under scrutiny for it allegedly unfair practices of overcharging and imposing excessive fees on consumers’ loans. While those practices resulted in a $97 million settlement with the Depts. of Education and Justice, and the Federal Deposit Insurance Corp, they could soon lead to a lawsuit from the Consumer Financial Protection Bureau. [More]
In early 2014, the four major banks still offering customers payday loan-like services announced they would discontinue their often under-fire programs by the end of the year. Apparently Fifth Third Bank has changed its mind, announcing plans to continue with a revised, supposedly less harmful version of the service for existing customers. But consumer groups say the revamped service doesn’t actually address the problems that led banks to discontinue programs in the first place. [More]
When discussing the topic of payday loans — or other high-cost, short-term financial products like auto-title loans and check-cashing — there can be a tendency to treat them like something that only a small percentage of Americans use. But a new report from the FDIC confirms that 25% of us have turned to one of these potentially predatory services in the past year, and that this rate has not been going down. [More]
While most major services you use like Facebook, Google, Yahoo, Twitter and others have likely (and hopefully) patched up any security holes at risk from the Heartbleed bug, U.S. regulators are warning banks to update their systems as well, and quickly. [More]
Washington, D.C., might as well be called Acronym City. It feels like there are a zillion different, discrete agencies, organizations, bureaus, boards, and commissions within the federal government, each with its own graceless three-, four-, or five-initial moniker, forming the tangled web of a bureaucracy that regulates… well, almost everything. So what are the key regulatory agencies, anyway? Who oversees what, and who do they report to, and how does it all work? [More]
If we were to play a word-association game with the nation’s largest banks, we’re sure that terms like “fair” and “equitable” would be right on the tip of peoples’ tongues. And because big banks always play fair with everyone else, they are asking that their checking-account fees not be put under the regulatory microscope if smaller banks’ fees aren’t going be subject to the same scrutiny. [More]
What Can A Regulator With A Sense Of Ethics Do After Leaving The Feds? Try Not To Become A Lobbyist.
After many years building your career, you’ve reached such a level of good reputation and success that you’ve been tapped to lead a major federal regulatory agency for a few years. Wow! That’s real power. Great job! But your term ends, or the administration changes, and your time in charge of the agency is done. You feel strongly that you’ve got another decade or two in you before retirement, though. So what’s your next move?
Now that marijuana for recreational use is doing booming business in Colorado where it’s legal (with Washington State to join it eventually) the federal government is getting around to answering some weighty questions. Namely, how will it deal with the revenue coming in from pot sales? [More]
While many payday lending operations are not directly tied to federally insured banks, some of the biggest names in banking — most notably Wells Fargo — offer what are effectively payday loans via “Direct Deposit Advance Loans.” But today the FDIC and the Office of the Comptroller of the Currency have given some guidance to the banks they regulate, basically saying “That’s enough of that, don’t ya think?” [More]
The next time you’re banging your head against the wall and moaning over what an idiot you’ve been to ignore late credit card payments, know this: You are not alone. Also you’re not an idiot, but if the woman who used to head up the Federal Deposit Insurance Corporation can get entangled in problems with retailer credit cards, it can happen to anybody. [More]
The shutdown of the federal government is now a week old, meaning a growing number of furloughed workers — and employees of businesses whose income depends on government contracts — are having trouble keeping up with their bills. In a joint statement today, five regulators have asked banks and other financial institutions to be mindful of customers who are directly impacted by the current staring contest. [More]
First, the good news: Our wiser, elder siblings at Consumer Reports have ranked the best and worst prepaid cards for the very first time, and it seems many cards have lower fees and act a lot like traditional bank accounts. But now for the bad news: Fee information can still be tricky to find and many cards don’t come with the guarantees you can get with a regular debit card. [More]
In her first hearing as a member of the Senate Banking Committee, Massachusetts Senator and longtime Consumerist favorite Elizabeth Warren grilled a panel of regulators on their tendency to settle with law-breaking banks rather than go to trial. [More]
Four of the nation’s largest banks — Wells Fargo, Fifth Third Bank, U.S. Bank and Regions Bank — are involved in high-interest, short-term loans that may not always be called “payday” loans but might as well be. Thus, a group of five U.S. senators have asked regulators to put a stop to the practice altogether. [More]
More than a few people are upset at large financial institutions for their apparent lack of accountability following the 2008 economic collapse, so the banks and their regulators have paid lip service to the idea of having tougher standards. As a result, one investment banker says he was fired from Bank of America for a minor breakfast-related misunderstanding from 1998. [More]
I used to know a guy who kept his money hidden in his home because he didn’t trust banks. Like, all of it. He would never tell me where, obviously, guess though I may (Freezer? Under the mattress? Behind the “secret” DVD collection?). He isn’t alone — there are 10 million American households that don’t have bank accounts, a number that is increasing every day.