Debt settlement reviews

The CFPB Finalizes Amendments to the Ability-to-Repay RuleOn May 29, 2013, the CFPB issued its final amendments to the Ability-to-Repay Rule.1 The amended rule will go into effect on January 10, 2014.The new amendments provide certain exemptions to the Ability-to-Repay Rule for community development lenders and nonprofit lenders who make fewer than 200 home loans per year and loan to low and moderate income consumers.  They also provide the same exemption to certain housing agencies. The amendments also are intended to facilitate lending by smaller lenders who have less than $2 billion in assets and each year make 500 or fewer first-lien mortgages.  For example, the revised rule allows certain loans by these small lenders to still qualify as Qualified Mortgages even if a consumer’s debt-to-income ratio exceeds 43 percent.  Furthermore, these smaller lenders will be permitted to continue originating balloon loans to all customers for two more years, and in … [Read more...] about The Consumer Financial Protection Bureau, Week in Review: May 27 – 31, 2013

May 7, 2013Debt Relief Firm Becomes First CFPB Criminal ReferralThe CFPB targeted a debt relief company as its first criminal referral. Specifically, after a lengthy investigation conducted with the assistance of the U.S. Postal Inspection Service, the CFPB determined Mission Settlement Agency and its employees defrauded approximately 1,200 consumers seeking relief from credit card debt. Federal prosecutors for the Southern District of New York subsequently charged that Mission Settlement Agency “systematically exploited and defrauded” consumers by charging draconian fees while performing no work. The debt settlement company allegedly misrepresented to consumers that the fees would be utilized as part of a restructured payment plan with the creditor. The indictment claims that Mission Settlement Agency’s manager diverted the funds for his personal use, including operation of a nightclub and lease payments for multiple luxury automobiles.CFPB Mulls Delay in … [Read more...] about The Consumer Financial Protection Bureau, Week in Review: May 6-10, 2013

A Texas law firm has sued its former paralegal and her husband claiming they are responsible for a fake online review that resulted in lost business.The Bellaire law firm Weston & Associates and name partner Michael Weston are seeking $1.25 million for the review posted at Citysearch.com, Texas Lawyer reports. The defendants are the one-time paralegal, Amber Williams, and her husband, Jon, both Houston residents.The suit claims Amber Williams was fired for insubordination in November 2010 after less than a month on the job, according to the Texas Lawyer story. Citysearch.com has removed the negative review, which read:“I went to this attorney on the recommendation of a friend. He had used the father for a bankruptcy. I would be using the son to help with debt settlement. I found him to be condescending to my situation and cold in demeanor. If you are looking for a factory that turns out debt settlements then this attorney is for you. If you want someone to answer your … [Read more...] about Law Firm’s Defamation Suit Against Ex-Paralegal Claims Lost Business from Online Review

The United States Court of Appeals for the Second Circuit today vacated a closely-watched 2011 decision by U.S. District Court Judge Jed Rakoff rejecting a $285 million fraud settlement between Citigroup Inc. and the U.S. Securities and Exchange Commission (SEC), on the grounds that the District Court "abused its discretion by applying an incorrect legal standard in its review."  The Second Circuit decision indicates that parties who are seeking to resolve disputes with the SEC should feel more confident that settlement agreements that neither "admit nor deny" wrongdoing will be honored by District Courts.Judge Rakoff had rejected the settlement between the SEC and Citigroup because Citigroup neither admitted nor denied wrongdoing in settling allegations that the bank failed to disclose to investors that it had bet against a collateralized debt obligation (CDO) while simultaneously marketing the CDO to investors.  A panel of the Second Circuit disagreed with Judge … [Read more...] about Second Circuit Says District Court Erred In Blocking SEC/Citigroup Settlement

OFAC stated that an insurance company and its affiliates violated OFAC regulations by providing insurance support services for policies that were issued to, or provided coverage for, persons designated on the OFAC Specially Designated Nationals list.On October 29, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced a consent settlement that raises novel and important implications for support services providers in the securities, insurance, and financial industries. The respondents were an insurance company and its affiliates, which are Florida corporations that provide insurance support services, and the settlement was for an agreed upon civil penalty of $128,704. The settlement involved potential civil liability for 39 apparent violations of various OFAC regulations, for which the maximum fine could have been $9.75 million.The primary violation was that insurance provider issued health insurance policies or otherwise provided health insurance … [Read more...] about OFAC Settlement Extends Violations to “Support Service” Providers