Groups Highly Oppose OCC Proposal that Would Avoid State Rate Caps to permit High-Cost Predatory Loans
Washington, D.C. – The Center for Responsible Lending, nationwide customer Law Center, Leadership Conference on Civil and Human Rights, NAACP, National Association for Latino Community Asset Builders, People in the us for Financial Reform, Consumer Federation of America, Public Citizen, and U.S. PIRG, delivered a message that is strong yesterday up to a federal bank regulator, any office of this Comptroller and Currency (OCC), opposing a proposed guideline that could encourage rent-a-bank schemes that permit loans of 100% APR or maybe more in states that prohibit high-cost loans and even mortgages as much as 138% that drive small company owners into 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 beneath the nationwide Bank Act to authorize non-banks to charge usurious prices, and therefore the OCC has did not proceed with the demands of this 2010 Dodd-Frank Act before preempting state legislation. The remark additionally criticizes the agency for failing woefully to think about the dangers the proposition poses to customers and businesses that are small specially those who find themselves financially susceptible. Furthermore, the OCC is neglecting to stop a rent-a-bank scheme by an OCC-supervised federal cost savings relationship, Axos Bank, that will be allowing predatory loans by World company management. The remark states in part:
“The proposed guideline would allow non-bank that is predatory to launder their loans through banking institutions to evade state interest caps. Continue reading