Mick Mulvaney guts 3 CFPB advisory boards

The shark strikes again…

Acting Director of the Consumer Financial Protection Bureau Mick Mulvaney gutted three CFPB Advisory Boards today. The Consumer Advisory BoardCommunity Bank Advisory Council, and the Credit Union Advisory Council were all disbanded today.

“Today, in a move that signals the continuing attempts by acting director Mulvaney to destroy the Consumer Financial Protection Bureau from within, leadership at the Bureau informed me, along with other Consumer Advisory Board members and members of two other CFPB Advisory Boards, that we were fired,” California Reinvestment Coalition Executive Director Paulina Gonzalez said in a statement regarding the firings.

“The actions by Mulvaney today speak to the direction of the Bureau, which under his leadership have been entirely focused on industry interests, such as dismantling consumer protections, weakening fair lending enforcement, dismantling auto discriminatory lending guidance, and not implementing hard-won payday lending rules. By firing the CAB, Mulvaney is taking away an important voice of working-class Californians who have never fully recovered from the Wall Street financial crisis, and who are still struggling to stay in their homes and access safe, affordable credit and financial products,” she added.

Read on.


Bank of America destroyed documents as borrowers tried to save their homes, lawsuit says

A new lawsuit says Bank of America misled borrowers trying to hang onto their homes, pushing them into foreclosure while it enriched itself off a federal mortgage-modification program.

The suit, filed this month in federal court in Charlotte, is the latest to allege the Charlotte-based company abused homeowners seeking to reduce their mortgage payments through the Home Affordable Modification Program, or HAMP. The U.S. Treasury Department launched the program in 2009 following the financial crisis to help struggling homeowners avoid foreclosure.

Brought by 11 borrowers across the U.S., including one in North Carolina’s New Hanover County, the suit was initially filed last month in Mecklenburg County Superior Court before being moved to federal court. The suit says it involves individual borrowers after a federal judge in Massachusetts in 2013 denied a request to grant class-action certification for a case against Bank of America involving HAMP applicants from across the U.S.

Read on.


THE LEADERSHIP OF the Consumer Financial Protection Bureau is required by law to hold in-person meetings with its consumer advisory board, yet according to more than a dozen of its members, they are refusing to do so.

“It appears the bureau does not want to engage with us,” said Ann Baddour of the consumer organization Texas Appleseed and chair of the current Consumer Advisory Board, or CAB, who joined a conference call Monday with other board members who have decided to speak publicly. “Staying silent would violate our ethical responsibility to the bureau and the American people.”

The CFPB, under Acting Director Mick Mulvaney, has canceled two in-person meetings with the CAB, as well as numerous conference calls. Contact has been limited to one phone call in March that was supposed to last one hour but ended after 20 minutes. The most recent cancellation was for a scheduled meeting this week; members only found out about it when they coordinated with CFPB to make travel arrangements.

Section 1014 of Dodd-Frank mandates the creation of a consumer advisory board of experts to consult with the CFPB about emerging practices and concerns within the lending industry and across the country. The board, whose 25 members are drawn from academia, consumer groups, and the financial services industry, “at a minimum, shall meet at least twice in each year,” per the statute.

Under previous CFPB Director Richard Cordray, the CAB met in two-day sessions three times a year, with Cordray or senior staff present for the entire period. The CAB would discuss rule-making, enforcement issues, financial education materials, and more. “Since the change in leadership we’ve seen a change in the lines of communication,” Baddour said.

CAB members released two letters to Mulvaney, one from May 18 from Baddour, and another from 15 members on May 25, after they learned of the most recent cancellation. “The undersigned members of the CAB are extremely concerned that that our collective input is not valued,” the members wrote.

Read on.

Citing the wrong obstruction law in letter to Mueller by Trump’s attorneys?

Law and Crime:
This weekend, the New York Times published a January 2018 letterdrafted by the Trump legal team and sent to Robert Mueller in an attempt to preempt any subpoena that Mueller might have been planning to send Trump’s way. Kudos to John Dowd and Jay Sekulow (Trump’s lawyers at the time) for their efforts, but it might’ve impressed the special counsel a bit more if they’d actually done their research.

For starters, they argued about the wrong obstruction statute.  No, I’m not kidding.  Here’s what the letter said:

“… § 1505 of Title 18, United States Code…forbids anyone from corruptly, or by threats of force or by any threatening communication, influencing, obstructing, or impeding any pending proceeding before a department or agency of the United States, or Congress…No court has ever held than an FBI investigation constitutes a § 1505 proceeding… As a matter of law, then, the FBI’s investigation of Lt. Gen. Flynn was not, at the time of the President’s comments as recalled by Mr. Comey, within the scope of § 1505.”

Okay, got it. The statute only forbids interference with “pending proceedings” and an FBI investigation isn’t a “pending proceeding.”   That would be a fantastic legal argument, but for one little problem. 18 USC §1505 isn’t the statute under which Trump would be prosecuted for obstruction of justice – 18 USC §1512 is. That statute was enacted in 2002, it criminalizes corrupt interference with investigations even before proceedings have actually begun. 18 USC §1512 would probably be the one under which Trump were indicted (assuming it came to that) for the Comey situation.

18 U.S. Code § 1505 – Obstruction of proceedings before departments, agencies, and committees:

Whoever, with intent to avoid, evade, prevent, or obstruct compliance, in whole or in part, with any civil investigative demand duly and properly made under the Antitrust Civil Process Act, willfully withholds, misrepresents, removes from any place, conceals, covers up, destroys, mutilates, alters, or by other means falsifies any documentary material, answers to written interrogatories, or oral testimony, which is the subject of such demand; or attempts to do so or solicits another to do so; or

Whoever corruptly, or by threats or force, or by any threatening letter or communication influences, obstructs, or impedes or endeavors to influence, obstruct, or impede the due and proper administration of the law under which any pending proceeding is being had before any department or agency of the United States, or the due and proper exercise of the power of inquiry under which any inquiry or investigation is being had by either House, or any committee of either House or any joint committee of the Congress—

And here is 18 U.S. Code § 1512 – Tampering with a witness, victim, or an informant. Click here.


Happy Memorial Day!


Bank Of America Accused Of Discrimination Against Iranian Americans

Bank of America is discriminating against a troubling number of customers of Iranian descent by wrongfully freezing or closing their accounts, according to the National Iranian American Council (NIAC).

U.S. sanctions against Iran “do not justify or excuse discriminatory conduct by U.S. banks and corporations,” declared the NIAC, which sent a letter on May 8 to Bank of America CEO Brian Moynihan calling for an immediate end to the bank account closures.

The bank’s actions have stunned and alarmed customers of Iranian descent, according to Jamal Abdi, executive director of NIAC Action.

“To be honest, it feels like a personal attack on all of us,” Abdi said. “We understand that fundamentally the issue is with the labyrinth of U.S. sanctions in place that are supposedly aimed at Iran’s government, but that’s no excuse for Bank of America to err on the side of discrimination and punish ordinary people. There’s a profound sense of insecurity that – because of your heritage or geopolitical disputes among governments — you may suddenly find out you’ve been blocked from accessing your own money. You may not be able to pay for groceries or rent.”

Read on.

Another new scandal: Wells Fargo employees altered documents about business clients

Height Capital Markets senior banking analyst Ed Groshans discusses whether investors should still keep Wells Fargo in their portfolios, despite the recent report that the bank’s employees altered documents about business clients.