Customer and Civil Rights Groups Urge Federal Banking Regulator to end Rent-a-Bank Cash Advance Schemes
Groups Highly Oppose OCC Proposal that Would Avoid State Speed Caps allowing High-Cost Predatory Loans
Washington, D.C. – The Center for Responsible Lending, nationwide customer Law Center, Leadership Conference on Civil and Human Rights, NAACP, nationwide Association for Latino Community Asset Builders, People in america for Financial Reform, customer Federation of America, Public Citizen, and U.S. PIRG, delivered a message that is strong yesterday to a federal bank regulator, any office regarding the Comptroller and Currency (OCC), opposing a proposed guideline that will encourage rent-a-bank schemes that help loans of 100% APR or more in states that prohibit high-cost loans and even mortgages as much as 138per cent that drive small company owners into property foreclosure. The teams argued that it could be made by the proposal easier for non-bank lenders to launder cash through banking institutions and unleash a flood of predatory loans.
The 55-page comment states that the OCC does not have authority underneath the nationwide Bank Act to authorize non-banks to charge usurious prices, and therefore the OCC has did not stick to the needs for the 2010 Dodd-Frank Act before preempting state legislation. The remark additionally criticizes the agency for failing continually to think about the dangers the proposition poses to customers and businesses that are small specially those people who are economically susceptible. Furthermore, the OCC has already been failing woefully to stop a rent-a-bank scheme by an OCC-supervised federal savings relationship, Axos Bank, that is enabling predatory loans by World company management.