A remark by Director Kathy Kraninger during a congressional hearing has renewed a fierce debate over how the agency uses academic studies to support rulemakings.
The restriction on how often a borrower’s account is debited was supposed to be relatively straightforward, but one lender is trying to fight that provision.
As part of the deal, the agency summarized its policy on account terminations and issued a letter acknowledging that some employees “acted in a manner inconsistent with FDIC policies with respect to payday lenders.”
Top executives at Advance America acknowledged that anti-money-laundering concerns at banks were likely the cause of account terminations, even as they publicly blamed a stealth regulatory campaign.
The agency's decision to lift a 2002 consent order against Ace Cash Express could lead to a revival of partnerships between national banks and payday lenders.
California officials had accused Advance America of wrongly assessing Department of Motor Vehicles fees on its payday loans to skirt the state's interest rate cap.
An industry-backed bill that is headed to the desk of Gov. Mary Fallin is seen by critics as an effort to minimize the impact of a potential CFPB crackdown.
