Monthly Accounts Receivables Roundup for September 2021

Never Mind the Nation’s Credit Rating?

I think everyone in our industry winced when S&P downgraded the U.S. credit rating from AAA to AA+ ten years ago. As members of the House and Senate continue to play brinksmanship about the debt ceiling and the potential for another government shutdown before year’s end, it is painful to think of the potential for our credit rating taking another hit.

Perhaps if our Senators and Representatives worked a few months in our industry, they would get a greater appreciation for the need to balance budgets, and to protect that all-important credit rating.

Rohit Chopra Confirmed as CFPB Director

The Consumer Financial Protection Bureau finally has a director. Chopra appears to be well prepared for the post, having served as a Commissioner on the Federal Trade Commission, and before that serving as the CFPB’s Assistant Director and separately as the CFPB’s Student Loan Ombudsman. insideARM reports that while Student Loan Ombudsman, Chopra was critical of schools, banks, and servicers in their handling of loans and lack of transparency with borrowers.

The insideARM perspective is: “For the last several months (at least), while this confirmation has been pending, it has felt as though many decisions at the CFPB have been somewhat on hold. Hopefully, this confirmation will give the agency some permanent direction, providing clarity to the ARM industry (and many other industries) and consumers alike.”

CFPB Sues Software Company That Helps Credit-Repair Businesses Charge Illegal Fees

That report comes directly from the CFPB, which says the lawsuit seeks compensation for harmed consumers, injunction, and civil penalty for alleged violations of the Telemarking Sales Rule. The CFPB alleges that Credit Repair Cloud and CEO Daniel Rosen have violated the Telemarketing Sales Rule (TSR) and the Consumer Financial Protection Act of 2010 by providing substantial assistance or support to credit-repair businesses that use telemarketing and charge unlawful advance fees to consumers.

The CFPB writes: “They facilitated and encouraged credit-repair businesses to charge illegal advance fees, causing broader consumer harm in the marketplace. The CFPB will not tolerate companies facilitating and profiting from other companies’ violations of federal consumer protection laws.”

“The Feared Eviction ‘Tsunami’ Has Not Yet Happened. Experts are Conflicted on Why.”

That’s the headline from a recent Washington Post article on how eviction filings have fallen or remained flat in many areas after the eviction moratorium was struck down.

The article quotes Peter Hepburn, a research fellow at the Eviction Lab, which tracks cases of eviction filings in 31 cities and a half-dozen states all around the country, as saying: “I think it’s too early to declare decisively that this isn’t happening. This may not take the form of a sudden spike in eviction cases all at once. It may be something that’s much more delayed and diffuse.”

The article proposes another perspective: “One reason offered by tenant advocates and legal experts is that many people who fall behind on payments, particularly low income or immigrant renters who have no legal representation available, choose to ‘self evict.’ That means they leave when their landlord tells them to or once a notice is posted on their door, rather than try to fight the eviction in court.”

“Key Inflation Measure Soars to 30-Year High.”

That headline from the National Review adds to one of the great questions of the year: What’s happening with inflation? What makes this latest interesting is that the 30-year high was in, what the National Review describes as “The Federal Reserve’s preferred inflation gauge, the core personal consumption expenditures price index, which excludes food and energy costs.”

The article notes: “The measure increased 0.3 percent for the month and was up 3.6 percent from last year in its steepest climb since May 1991, a trend suggesting that the pandemic’s inflationary pressures, catalyzed by massive government spending, supply chain bottlenecks and surging demand, are not correcting as quickly as some economists anticipated.”

“Fed Predicts Inflation Rates Will Decline After Seeing Biggest Increase in 30 Years.”

From this headline in Newsweek, it appears Federal Reserve Chairman Jerome Powell is sticking with his message of inflation being transitory. The article says Powell told the House Financial Services Committee that current inflation “is a function of supply side bottlenecks over which we have no control. But I would say that we do expect in the first half of next year to see some relief, depending on the bottleneck in question, and inflation should move down.”

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Ray Peloso, Chief Customer Officer at Ontario Systems, brings 25 years of diverse consumer lending experience, having held executive leadership roles at Royal Bank of Scotland, Capital One, Citibank, MBNA and Katabat. Ray’s prior expertise in consumer credit and lending underpins a clear vision and understanding of the challenges faced by our clients in today’s rapidly evolving digital economy.

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