Research & Policy

For years, predatory lenders have sought ways to avoid state interest rate limits. One scheme has been the “rent-a-bank” scheme. Under this scheme, a non-bank lender finds a bank willing to be the nominal originator of the non-bank lender’s high-cost loan, because banks are generally exempted from complying with state interest rate laws. State regulators, state attorneys general, and consumers...

The undersigned consumer and civil rights organizations appreciate the opportunity to submit comments on the Consumer Financial Protection Bureau’s (CFPB or Bureau) 2020 Supplemental Notice of Proposed Rulemaking (supplemental proposed rule) on debt collection. As organizations dedicated to eliminating abusive financial practices – particularly focused on communities of color and low- to moderate-income consumers – we are deeply concerned about...

From the amicus brief: This case concerns the authority of the Office of the Comptroller of the Currency (OCC) to extend the privileges of national banks to entities that do not accept deposits and are not banks in any traditional or legal sense. The foremost reason why non-banks will seek out a “special purpose national bank” is to take advantage...

We support the CFPB’s decision to conduct additional testing of the validation notice it has proposed and agree that such research is a necessary part of the Bureau’s debt collection rulemaking. As discussed below, we believe that the utility of the research will depend upon: the criteria used to select individuals to participate in the research; and the scope of...

Download the sign-on letter from the 101 undersigned community, civil rights, consumer, and student advocacy organizations insisting on student debt cancellation for all borrowers during negotiations over the next coronavirus relief package.

Download the full letter from Wells Fargo's Michael DeVito, EVP of Head of Home Lending, to the U.S. Department of Housing and Urban Development regarding the Fair Housing Act Disparate Impact Rule.

Industrial loan companies (ILCs) or industrial banks (IBs) (together, “ ILCs”) typically enjoy the privileges of traditional banks but pose two significant risk factors unique to ILCs: They are not subject to the Federal Reserve’s supervision, which occurs at the consolidated level (i.e., the ILC’s parent company, the ILC, and their affiliates); and They permit the intermingling of commercial and...

The Center for Responsible Lending (CRL) joined with a coalition of civil rights, community, consumer, and faith organizations in two public comment letters warning the Federal Deposit Insurance Corporation (FDIC) that its proposed rule for chartering additional underregulated Industrial Loan Companies (ILCs) would expand predatory, high-interest lending. The plan would grant the predominantly online non-bank companies that are approved for...

On May 20, 2020, the Office of the Comptroller of the Currency (OCC) acted alone in issuing a structurally flawed final rule on the Community Reinvestment Act (CRA) that weakens the CRA and will harm low- and moderate-income (LMI) communities and communities of color. Rather than postpone rulemaking to focus on the devastating economic crisis caused by the COVID-19 health...

On June 17, 2020, Ashley Harrington testified before the House Small Business Committee. This written testimony focuses on: Presenting an overview of the disproportionate economic impacts of the COVID-19 health crisis. Discussing issues with the structure and implementation of the PPP and how they served to limit access for the smallest businesses and businesses owned by people of color. Highlighting...

The Center for Responsible Lending (CRL), Self-Help Federal Credit Union, Self-Help Credit Union, and the National Consumer Law Center (on behalf of its low income clients) (NCLC) write to share concerns with the Interim Final Rule on Overdraft Policy that was considered and tabled at NCUA’s May Board meeting. Unfortunately, the proposal fails to offer members relief from overdraft fees...

A review of 2019 data shows that big banks continue to collect over $11 billion in overdraft related fees each year. Banks engage in a number of abusive practices that combine to drain massive sums from their customers’ checking accounts. The large majority of these fees are shouldered by banks’ most vulnerable customers, often driving them out of the banking...

This comment includes examples that are intended to be illustrative of the kinds of issues confronting low-to-middle-income households and communities of color attempting to navigate the consumer finance system.

CRL joined with more than 400 organizations to call on Congress to pass meaningful police reform legislation: Abusive police practices coupled with devastating state-sanctioned violence have exacted systemic brutality and fatality upon Black people since our nation’s founding. The current protests across our country are not new. They are in response to a long cycle of lawlessness against Black people...

The Paycheck Protection Program (PPP) is a revenue replacement program designed to sustain small business jobs during the ongoing public health and economic crisis. The effect of the crisis on small businesses has been profound—over half of small businesses said the crisis has had a large negative effect on their businesses and 74% of small businesses said they have had...

Nearly forty consumer and civil rights organizations call on the Trump Administration and the Congress to work together and take the following steps to ensure access to the Paycheck Protection Program for underserved businesses and sole proprietors. Set aside $10 billion for use ONLY by Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs), to make this funding available...

CRL is working to monitor the unfolding developments of the COVID-19 pandemic and its financial and economic effects on LMI communities and communities of color. As the response to the crisis continues, CRL is advocating for strong consumer protections and financial relief for the consumers, workers and small businesses that are always among the hardest hit by any national emergency...

CRL's comment to the Small Business Administration on the April 15 Interim Final Rule implementing the Paycheck Protection Program focuses on two key challenges with the PPP to date: The Paycheck Protection Program continues to be disadvantageous to smaller businesses, and businesses without employees. PPP loans can be forgiven if the business is able to use the funds for eligible...

From the letter to Speaker Pelosi, Chairman Scott, and Chairman McGovern: As Congress works to better protect Americans from the economic fallout of COVID-19, the financial difficulties of 44 million student loan borrowers and the effect of this debt on the economy cannot be forgotten. The relief in HEROES, especially the $10,000 of cancellation per borrower, will have a significant...

A joint statement on the choice to narrow student loan debt cancellation in the HEROES Act from Action Center on Race and the Economy, American Federation of Teachers, Americans for Financial Reform, Center for Responsible Lending, Demos, Generation Progress, National Consumer Law Center (on behalf of its low-income clients), Student Borrower Protection Center, Student Debt Crisis.

A majority of Americans across all regions of the US support permanently reducing student loan debt by $20,000 for all borrowers, according to a new bipartisan poll by Lake Research Partners and Chesapeake Beach Consulting. Download the poll results Download the top lines

Americans of all partisan identities,and across all regions of the United States,strongly support enacting new consumer protections on high-interest lending during the coronavirus crisis. Americans are highly supportive of prohibiting all high-interest loans during the crisis and of capping interest rates for consumer loans, according to a new bipartisan poll from Lake Research Partners and Chesapeake Beach Consulting. Download the...

The Small Business Administration Paycheck Protection Program (PPP) has failed to fairly serve businesses owned by people of color, causing spill-over harms throughout communities of color, states, and regions. Businesses owned by people color are a substantial source of income and employment—accounting for more than 8.7 million jobs at total annual payroll of $280 billion, and $1.3 trillion in revenue-yet...

H.R. 748, the Coronavirus Aid, Relief and Economic Security Act (CARES Act)—signed into law on March 27, 2020—offers important benefits for the public health crisis caused by COVID-19. However, the bill fails to provide substantive, comprehensive financial relief for vulnerable families who now face economic challenges, such as unemployment and reduced work hours, as a result of the crisis. It...

From the full comment letter: As more borrowers than ever migrate to online platforms, the Department’s role in ensuring program integrity is even more vital. The consensus language in the NPRM represents the best compromise between industry, innovators, and borrowers. If it is changed at all, it should be strengthened, not weakened. The final rule should include the consensus definitions...