Consumer advocates and academics criticized the policy, saying the agency was effectively tying its own hands. “It seems that the agency is trying to highly constrict the use of ‘abusive’ by using terms that do not fully capture the way lenders behave,” said Linda Jun, an attorney at the advocacy Americans for Financial Reform.
Americans for Financial Reform welcomes the passage of H.J. Res. 76 to roll back Education Secretary Betsy DeVos’ devastating attempt to make debt cancellation for scammed students nearly impossible. The resolution passed 231 to 180 with bipartisan support; 6 Republicans and all Democrats voted yes, with 19 members not voting.
The measure, which is scheduled for a vote at the company’s annual meeting next week, would block investors harmed by securities fraud or other corporate legal violations from bringing their claims as a class in a court of law, before a judge and jury. This would effectively end most shareholders’ ability to recover their losses in such cases, as they cannot affordably be brought individually in arbitration by any but the very largest institutional investors.
Today’s proposal that administrative authority be used to cancel student debt, and the affirmation of the legality of such a step by the Project on Predatory Student Lending at Harvard Law School are important positive possibilities for student borrowers and their families and communities. AFR has long called on the Department of Education to use its existing legal authority to cancel the federal debts of wronged students of for-profit colleges without individual application – as have former Corinthian students, advocates, lawmakers, and law enforcement officials.
“The CFPB is dropping the ball on enforcing and drafting federal rules to actually protect the public from rip offs and discrimination in lending,” said Linda Jun, senior policy counsel at Americans for Financial Reform Education Fund. “Creating and hiring a new task force stacked with industry representatives and ideological opponents of regulation is one more move that runs directly counter to the CFPB’s basic mission.”
If the proposed rule went into effect, HUD’s assessment of whether localities were meeting their AFFH obligations would not include consideration of race, religion, national origin, families with children, or other protected classes that the Fair Housing Act was intended to shield from discrimination. The proposed rule eliminates the community participation process, which was proven to be extremely effective in helping communities develop meaningful fair housing goals, and does not even have a requirement that state and local governments conduct a fair housing analysis for their communities at all.