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    Texas man stuck in A.T.M. for 3 hours... & other bizarre banking news

    Man Trapped Inside Texas A.T.M. for 3 Hours Is Rescued by Police, The New York Times

    A man who got stuck inside an A.T.M. room slipped notes through the machine’s receipt slot until a user took one seriously. CreditKRIS 6 News - Corpus Christi, Tx

    Just after 2 p.m. Wednesday, the 12th of July, a person in Corpus Christi, Tex., had just completed a transaction at a Bank of America A.T.M. when a surprise slid through the receipt slot.

    “Please help,” read a handwritten note on a thin strip of paper. “I’m stuck in here, and I don’t have my phone.”

    The person, whose age and gender the authorities did not provide, did not know quite what to do. But it so happened that a Corpus Christi police officer was driving by, so the person went a step beyond what other A.T.M. users had been willing to do and flagged down the officer.

    The officer, like previous bank patrons, initially thought the note was a joke — some sort of “Candid Camera”-type prank that no one wanted to fall for.

    But then the officer approached the A.T.M., and when he listened closely, he could hear a faint sound. 

    This was how the police came to discover a man who had been trapped for hours inside an A.T.M., said Gena Pena, a spokeswoman for the Corpus Christi Police Department.


    A worker arrived on Wednesday to repair the “locking mechanism” of the room behind this A.T.M. in Corpus Christi, Tex. CreditKRIS 6 News - Corpus Christi, Tx

    “Honestly we can’t say it’s never happened,” Ms. Pena said in an interview on Thursday. “But 95 percent of people will have their phone on them,” she added, and for about three hours, she said, this man did not.

    How does one become stuck inside an A.T.M. in the first place? Ms. Pena said it happened this way:

    The A.T.M. was affixed to a bank, which was under construction, so no employees were inside. The A.T.M., though, was operational. And somewhere on the site, a door led into what Ms. Pena called an “A.T.M. vault” — a room from which a person can service a teller machine from the inside.

    A worker arrived on Wednesday to repair the “locking mechanism” of the room, Ms. Pena said. The door shut behind the worker, and somehow, she said, the man locked himself in.

    The worker, whom the police did not identify, had left his phone inside a vehicle. But once he realized that people were using the A.T.M., the man began slipping notes out the receipt slot, a solution Ms. Pena thought was “pretty ingenious.”

    Unfortunately for the man, several A.T.M. users who got a note thought they were being pranked and apparently did nothing.

    “He was kind of upset,” Ms. Pena said of the contract worker.

    Indeed, the man would later tell the police that he had been screaming for help. Something about the room, though, must have muffled the sound, Ms. Pena said. Read More


    CFPB Warns Against “Tricking Consumers” with Pay-by-Phone Fees

    From JD Supra: Regulated entities should be prepared to defend their policies and practices surrounding fee-based pay-by-phone options in light of new guidance issued by the Consumer Financial Protection Bureau (CFPB).

    The CFPB released a compliance bulletin on July 31 to provide guidance on charging pay-by-phone fees. In a press release, the CFPB touts the bulletin as a warning against “tricking consumers into expensive pay-by-phone fees,” which is also a succinct way to describe the CFPB’s take on the conduct it identifies in the bulletin. The bulletin highlights the risks of potential violations of Dodd-Frank’s UDAAP prohibition or the FDCPA posed by charging pay-by-phone fees. Read More

    From According to the CFPB, most financial service companies give consumers several options to make payments, some consumers may choose to pay bills by phone using an automated system or speaking with a customer service representative. Companies may charge different pay-by-phone fees depending on what method of payment the consumer uses, such as payment by electronic check, debit card or credit card. Consumers may also be charged an additional fee to expedite phone payments, though many companies offer consumers no-fee or lower-fee pay-by-phone options that post after a delay, the CFPB said.  The government agency noted a recent bureau enforcement action in which it alleged  a company and its service provider misled consumers into paying a $14.95 pay-by-phone fee by deceptively calling it a “processing” charge. According to the CFPB, the fee was actually for posting payment to the account the same day.  

    In another example, the CFPB said some companies do not disclose their fees in writing up front to consumers. Instead, they may depend solely on phone representatives to disclose the relevant fees to consumers before the charge is imposed. These representatives may then fail to inform consumers about significant price differences between available pay-by-phone options. This may substantially harm consumers who wind up using much more expensive options because they are not informed that significantly cheaper options are available, the CFPB said. Read More

    CFPB Corrects, Clarifies Final Mortgage Servicing Rule Amendments, The M Report

    The Consumer Financial Protection Bureau has taken two big steps in clarifying its amendments to the 2013 mortgage servicing rules, which were issued in August 2016. On Tuesday, the Bureau released direct-to-final technical corrections to the amendments, as well as policy guidance on the three-day early compliance period spelled out in the 2016 final rule.

    Regarding the corrections, the Bureau called them “non-substantive” and will publish the final rule with the Federal Register.

    “The corrections address two typographical errors, the authority citation for Regulation Z, and several amendatory instructions relating to certain official commentary to apply the correct effective date," the CFPB reported.

    The issued final rule, with completed corrections, can be found at

    The second release today was what the CFPB dubbed “Policy Guidance on Supervisory and Enforcement Priorities Regarding Early Compliance with the 2016 Amendments to the 2013 Mortgage Rules Under the Real Estate Settlement Procedures Act (Regulation X) and the Truth in Lending Act (Regulation Z).” The issue is non-binding and relates to a three-day period of early compliance on the final 2016 rule.

    “Some provisions in the 2016 final rule will take effect on Oct. 19, 2017; the remainder will take effect on April 19, 2018,” the CFPB reported. “This non-binding policy guidance addresses early compliance for up to three days preceding each effective date.”

    The guidance stems from what the CFPB calls “concerns” about the effective dates—which fall in the middle of the work week—of each provision. Read More

    • Attend our Webinar to learn everything you need to know about the Final Mortgaging Servicing Rules Amendments  ​​​​​- Tuesday, October 10 at 2PM ET. 

      • Hurry! The Early Bird-dog Special of $199 (Live +1-Year OnDemand) expires this Thursday, August 10. 

    CFPB Unveils Prototypes of "Know Before You Owe" Overdraft Disclosure Designed to Make Costs and Risks Easier to Understand, ConsumerFinance.Gov

    WASHINGTON, D.C. – The Consumer Financial Protection Bureau (CFPB) today unveiled new Know Before You Owe overdraft disclosure prototypes designed to improve the model form that banks and credit unions already provide to consumers weighing overdraft coverage. The Bureau is currently testing four prototypes that each have a simple, one-page design aimed at making the costs and risks of opting in to overdraft coverage easier to understand and evaluate. People who frequently attempt to overdraw their checking accounts typically pay almost $450 more in fees if they opted in to debit card and ATM overdraft coverage, according to a new CFPB study published today. The study found that most of these frequent overdrafters are financially vulnerable, with lower daily balances and lower credit scores than people who do not overdraft as often.

    "Our study shows that financially vulnerable consumers who opt in to overdraft risk incurring a rash of fees when using their debit card or an ATM," said CFPB Director Richard Cordray. "Our new Know Before You Owe overdraft disclosure prototypes are designed to help consumers better understand the consequences of the opt-in decision." 

    An overdraft occurs when consumers lack the funds in their account to cover a transaction, but the bank or credit union pays anyway. Financial institutions may charge a fee for this service, typically around $34 per transaction, and require that the account deficit be repaid with subsequent deposits. In 2010, federal regulations began requiring financial institutions to obtain a consumer’s consent in advance before charging overdraft fees on most debit card transactions and ATM withdrawals. Consumers who do not opt in to overdraft coverage will generally have debit card purchases and ATM withdrawals declined with no charge if their account doesn’t have enough funds to cover the transaction at the time they attempt it.

    In addition to debit card transactions and ATM withdrawals, consumers can overdraw their account through checks, online bill payments, or direct debits from lenders or other billers. Banks and credit unions can charge overdraft fees on checks or electronic payments made through the Automated Clearing House system, and on debit card payments set up on a recurring basis. Charging these fees does not require the consumer to opt in, because those fees are not covered by the 2010 rule. Read More

    Hensarling wants CFPB’s Cordray investigated for potential election law violations, Housing Wire

    Rumor has it that Consumer Financial Protection Bureau Director Richard Cordray plans to leave his position and run for Ohio governor at some point soon, but according to one of the top Republicans on Capitol Hill, Cordray is already making moves to prepare for his run in Ohio – some of which include violating federal election law by mixing his current job with the job he supposedly wants next.

    House Financial Services Committee Chairman Rep. Jeb Hensarling, R-Texas is calling for an investigation of Cordray for allegedly violating the Hatch Act, which prohibits federal employees and cabinet members from using their official position to influence an election.

    At issue is whether Cordray was involved in a recent call between Ohio Supreme Court Justice Bill O'Neill and a “mutual friend” who said that Cordray plans to run in Ohio and asked the state’s top elected Democrat to not stand in Cordray’s way.

    In a letter sent last week to the Office of Special Counsel, Hensarling accuses Cordray of potentially consenting to the call between O'Neill and the “mutual friend,” which could be a violation of the Hatch Act.

    Hensarling has spoken about Cordray’s rumored interest in running for Ohio governor on many occasions, including passive-aggressively chiding Cordray for appearing before the House Financial Services Committee back in April.

    “Mr. Cordray, I know that you are here at our committee’s invitation for a statutory appearance, but I’m otherwise surprised to see you here in that, as you well know, there have been many press reports saying that you would have otherwise returned to Ohio to pursue a gubernatorial bid,” Hensarling said to Cordray’s face in April. “Perhaps the rumors of your political aspirations are greatly exaggerated.”

    But that was a few months ago, and the noise surrounding Cordray’s intentions has only gotten louder since then.

    And now, Hensarling wants Cordray to answer for his alleged actions.

    “It appears that as an employee of a federal agency, Director Cordray is subject of the Hatch Act,” Hensarling said in his letter of the Office of Special Counsel, a copy of which was obtained by HousingWire. Read More


    Revamped HMDA report: Know before you submit, Banking Exchange

    Remember your first time trying to ride a bike? The thought of taking flight without Mom or Dad’s help was terrifying. But with some encouragement and guidance going through the basic steps, before you knew it, you were off on your own.

    When it comes to data collection and reporting, we all know the basics. Institutions subject to the Home Mortgage Disclosure Act (HMDA) and Community Reinvestment Act (CRA) are required to collect, record, report, and disclose information about their mortgage and small business lending activity. Every year on March 1, institutions must submit their lending data from the previous year to the federal government. This data is then aggregated by the government and used for many purposes: in CRA exams, by institutions to analyze lending patterns of competitors, by community groups, and for fair-lending purposes.

    The new HMDA rule dramatically changes data collection in just about every way: institutions and transactions covered; required data points; collection and reporting of applicant information such as gender, race, and ethnicity; and the processes for reporting and disclosing the data. While most of these data changes apply on or after Jan. 1, 2018, some changes such as institutional coverage and submission/reporting requirements, apply to 2017 data. All changes apply to mortgages and do not impact submissions for small businesses/farms.

    For many institutions, gathering the essential data points and meeting regulatory and internal deadlines is a constant struggle under the existing rule. This process will only intensify with the regulatory changes. While it is important to focus on the data changes for 2018, it is critical to take some time to plan. The number of data requirements are expected to increase significantly. Just like riding a bike, you need to remember the basics, such as compiling the data, ensuring data accuracy, and filing the data to the government in a timely manner. Read More

    Prepare to meet these new HMDA requirements with our September Webinar: 

    New HMDA Data Collection Rules: Preparing for Extensive January 1, 2018 Changes - Tuesday, September 26 at 2PM ET 

    • A significant overhaul of the Home Mortgage Disclosure Act takes effect on the 1st of January 2018. It's later than you think: Is your Institution prepared to implement these sweeping changes on New Year's Day?
    • In this webinar, we will discuss various advertising and marketing rules, and  examine the types of advertisements that are considered Unfair, Deceptive or Abusive Acts (UDAAP). We will discuss the steps you should take now to ensure your Institution is ready to flip the switch on January 1. We will also review the non-discriminating advertising requirements under the Equal Credit Opportunity Act and Fair Housing Act. 

    Don’t miss this invaluable opportunity to prepare!​​​​​​ 

    Rep. Emmer introduces bill to exempt small banks, credit unions from HDMA reporting, Financial Regulation News

    U.S. Rep. Tom Emmer (R-MN) introduced legislation that would exempt certain small banks and credit unions from the updated reporting requirements under the Home Mortgage Disclosure Act (HMDA). 

    The Consumer Financial Protection Bureau (CFPB) revised Regulation C under the HMDA to require covered banks and credit unions to collect new data points on loan applications they receive and report this data to the CFPB. This rule goes into effect January 1, 2018.

    Emmer’s bill exempts small banks and credit unions from the updated reporting requirements of Regulation C if they are lenders that have originated 1,000 or fewer closed-end mortgages in each of the two preceding calendar years will be exempt from reporting on such loans.

    Lenders that have originated 2,000 or fewer open-end lines of credit (such as a typical home equity loan) in each of the two preceding calendar years would also be exempt.

    Additionally, the bill repeals the HMDA amendments included in Dodd-Frank and withdraws the CFPB’s rule to impose the new and modified HMDA data points. Read More


    Sen. Ron Wyden pushes for transparency in small business lending, Portland Business Journal

    Sen. Ron Wyden wants to make it easier for minority and female small business owners to get bank loans. Minority and female small business owners would like that, too.

    Wyden and two other Democrats this week said they are urging the Consumer Financial Protection Bureau to implement a rule that banks must collect and make available information about barriers facing women and minority entrepreneurs trying to get access to loans.

    Wyden's working on the effort with Cory Booker of New Jersey and Dick Durbinof Illinois.

    The senators want to bring transparency to small business lending and, ultimately, make it easier for women and minority entrepreneurs to get access to startup capital.

    In putting together our cover story this weekMatt Kish and I spoke with several small business owners in the Portland area who tried to get startup capital from banks and were turned away.

    Thanks to help from a local nonprofit that loans to small business owners turned away by banks (mostly minorities and women), these business owners were able to get their ventures off the ground. But federal data on small business lending nonetheless shows concerning trends.

    Small business lending in Portland declined significantly from 2007 to 2015 as the number of loans to black business owners plummeted. Lending to other ethnic groups also fell.

    If Wyden and the others succeed, the CFPB would implement a provision of the Dodd Frank Wall Street Reform Act not enacted along with the rest of the 2010 bill. Read More


    Wells Fargo pays $108 million on fraud claim by Atlanta whistleblowers, The Atlanta Journal-Constitution

    Wells Fargo & Co. has agreed to pay $108 million to the federal government to settle two metro Atlanta whistleblowers’ allegations that the bank charged fraudulent fees on veterans’ home refinancing loans.

    The settlement award, disclosed Friday by an Atlanta firm representing the whistleblowers, is the largest so far to result from the 11-year-old lawsuit. Two former metro Atlanta mortgage brokers sued eight banks or mortgage lenders on behalf of the government. The lawsuit was filed in federal district court in Atlanta.

    “We’re glad its over, at least as to Wells Fargo,” said one of the two whistleblowers, Victor Bibby. The second is Brian Donnelly.

    In 2012, SunTrust Banks, JP Morgan Chase, Countrywide Home Loans and three other major lenders agreed to pay $162 million to settle similar allegations by the whistleblowers.

    Another lawsuit is pending against a St. Petersburg, Fla., lender, Mortgage Investors Corp. In 2013, the lender laid off hundreds of employees and stopped making new home loans, blaming tougher regulations under the federal Dodd-Frank Act.

    A Wells Fargo spokeswoman said the bank changed its methods for handling Veterans Administration refinancing loans several years ago to fix the alleged problems and settled the lawsuit to “put the matter behind us.”

    The San Francisco bank, which is metro Atlanta’s second largest bank in terms of total deposits, has been bruised lately in a number of legal skirmishes over its practices.

    Last year, the federal Consumer Financial Protection Bureau and other agencies alleged that the bank’s employees broke the law by opening more than 2 million credit card, checking and savings accounts without customers’ knowledge, in order to meet sales quotas and win bonuses.

    Last month, Wells Fargo said it would refund customers after admitting that about 570,000 borrowers may have been wrongly pushed into auto insurance policies that they didn’t need.

    In the Atlanta whistleblower case, which affected veteran homeowners across the nation, Bibby and Donnelly alleged that Wells Fargo illegally collected lawyers’ fees and closing costs from borrowers who refinanced their mortgages, even though such charges were barred under the VA’s refinancing program.

    The bank hid the fees by mislabeling them, according to Atlanta law firm Butler Wooten & Peak, one of three firms that represented the whistleblowers.

    The law firm said taxpayers also lost money due to the alleged fraud. Under the VA loan guarantee program, the agency paid Wells Fargo a portion of any loans on which the borrowers defaulted, even though the fraudulent fees would have negated the government loan guarantees.

    Friday, Wells Fargo spokeswoman Crystal Drake said, “Today, we are settling this longstanding lawsuit, which did not seek any refunds for individual veterans, in order to put the matter behind us, and to focus on restoring trust in Wells Fargo.” Read More

    Wells Fargo Eyes Mortgage Fees and Identity Theft Insurance in Scandal, Fortune

    Wells Fargo & Co is examining whether it caused unnecessary financial harm to customers through residential mortgage fees, frozen deposit accounts or "add-on" products like identity theft protection, the bank said in a U.S. regulatory filing on Friday.

    The disclosures signal that the bank's problematic sales practices go further than investors and analysts had expected after Wells Fargo reached a settlement with regulators in September over unauthorized customer accounts. Wells Fargo's (WFC, -1.05%) shares dropped 1% to $52.87 in afternoon trading. 

    "We were surprised that this wasn’t disclosed when the original sales practices were disclosed," said Kevin Barker, analyst at Piper Jaffray. "Given the scope of the issues out there, it seems like this is a bigger deal than we had originally thought." Read More