ALTERNATIVE FINANCIAL SERVICE PROVIDERS ASSOCIATION

             ALTERNATIVE FINANCIAL SERVICE PROVIDERS ASSOCIATION

NEWS: November 10, 2015

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ZERO PARALLEL
Sen. Cruz Demands Answers from Associate AG Nominee on Operation Choke Point
The DOJ has acted as a partisan arm of the White House
WASHINGTON, D.C. - Today in a full Senate Judiciary Committee hearing, U.S. Sen. Ted Cruz (R-Texas) questioned the Hon. Stuart Delery, nominee for U.S. Associate Attorney General. Mr. Delery approved Operation Choke Point, a Department of Justice (DOJ) initiative that unconstitutionally sought to choke off access to banking services for gun dealers and other lawful business enterprises.
"The DOJ has a long and bipartisan tradition of staying out of politics, of defending the law and the Constitution, and not acting simply as a partisan arm of whatever president happens to be in the White House. I believe the DOJ has violated that tradition of staying out of politics. The DOJ has an obligation to defend the Constitution, and instead, this Administration's DOJ has consistently violated the constitutional rights of American citizens and has treated the Bill of Rights with contempt," Sen. Cruz said. "By cutting off financial resources to lawful small businesses, Operation Choke Point is an abuse of power that undermines the integrity of the DOJ."        Watch the full exchange here.
DM Metrics

CFSA Supports FTC's Actions to Target Abusive Debt Collectors

Wednesday, November 4, 2015 * CFSA
Dennis Shaul, CEO of the Community Financial Services Association of America (CFSA), released the following statement regarding the Federal Trade Commission's announcement of new actions to target abusive debt collectors: "We are pleased to see the FTC and its partners in law enforcement crack down on these deceptive, unscrupulous and abusive debt collection practices. These fraudsters made up debts that people do not have and in some cases attributed them to payday lenders. This harms the reputations of regulated, licensed payday lenders, including CFSA members, which uphold the highest lending standards in the industry." "CFSA member companies are licensed lenders that comply with all state and federal laws and adhere to a strict set of mandatory Best Practices that ensure their loans are safe, reliable and provide important consumer protections. These standards explicitly prohibit using unlawful threats, intimidation or harassment to collect past due accounts and encourage members to adhere to the Fair Debt Collection Practices Act." - See more at Community Financial Services Association of America 

FactorTrust

How Hundreds Of Lawmakers Ended Up Voting To Give Banks $17 Billion
The Highway Bill largesse is basically to thank them for being banks.
So, that happened. On Thursday, 354 members of the House of Representatives voted to give banks $17 billion, basically just to thank them for being banks.
All but two Republicans voted for the measure, including all but one member of the hyper-conservative Freedom Caucus, which frequently lambasts the grip of "crony capitalism" in Washington. Only 70 Democrats voted against the measure, mostly members of the Progressive Caucus.
So how did so many lawmakers end up voting to just hand $17 billion to banks?
Congressional negotiators have been scrambling for months to find potential spending cuts that could offset new funding to fix roads and bridges. Republicans have refused to consider any tax increases to support the infrastructure spending, making any potential source of frivolous spending a target.
Enter the Progressive Caucus. Every year, the coalition of dozens of Democrats releases an annual budget proposal. With Republicans in control of the House, it's a largely symbolic measure that essentially lays out the priorities of liberal lawmakers. But the budget released last year included an item that most members of Congress had never heard of: "Ending Excessive Fed Dividends For Wall Street." 

Read the story at HUFFINGTON POST 

VPCS
Treasury Department Starts Sifting Through Online-Lending Industry
The U.S. Treasury Department is beginning to analyze the growing alternative-lending industry, according to comments by Anjan Mukherjee, a Treasury official who advises the secretary of the Treasury.
The Treasury issued a request for information on the industry in July and has started analyzing more than a hundred responses that it received, Mr. Mukherjee said, speaking at the Marketplace Lending + Investing conference, hosted by SourceMedia Inc., in New York on Wednesday.
Alternative lenders, many operating online platforms and backed by venture capital, have been able to grow largely without regulatory oversight. Some thought that the interest from the Treasury might lead to new rules.
"Just because we put an RFI out doesn't mean we'll end up with a rule," Mr. Mukherjee said. He added, however, that the Treasury might formulate opinions and share them with lawmakers and that might affect regulations.
Alternative lenders have made numerous claims about the benefits of the emerging industry, such as providing access to loans for consumers and small businesses that otherwise couldn't get banked, as well as offering loans at a lower price and at a faster pace. The Treasury is trying to see whether that is true, as well as what regulation may be necessary to ensure "safe growth" of the industry, Mr. Mukherjee said.
"What's clear today," Mr. Mukherjee said about consumer lenders, is that reaching lower-income consumers isn't yet happening and that the new lenders are offering loans to consumers who can already get loans from traditional sources. The new small-business lenders, by contrast, have a real potential "to serve small businesses that didn't have access to...credit," he said.   Read the entire story at WALL STREET JOURNAL
Alternative Financial Solutions
Businesses may need to do more to dispel credit score myths by author Walt Wojciechowski
Over the last several years, the importance of having a good credit score has become apparent to far more people across the country. Prior to the financial downturn, many Americans likely didn't realize just how crucial a quality score could be, and likewise may have struggled financially as a result. However, this era of paying more attention to scores has done little to reduce the belief in a number of myths about the ways to build and maintain a good score that, in reality, simply aren't true. It may therefore be incumbent upon companies that use credit scores to evaluate potential clients or borrowers to do more to help people understand the ins and outs of good credit habits.
Perhaps the biggest financial or borrowing myth that ends up impacting people's credit scores in a negative manner is the idea that credit card lenders "want" people to owe some money. This is, in fact, not really true. What they want is borrowers who are able to pay their bills every month, and that comes with the understanding that if people owe more money, they're probably going to run into difficulties meeting that monthly payment requirement.  
When it comes to borrowing, lenders don't mind if consumers carry a balance, but they typically don't want to see all their balances exceed what they can afford to pay back. For this reason, consumers who want a good credit score should aim to borrow no more than 30 percent of the total combined credit limits of all their cards. This is known as their "credit utilization ratio," and makes up 30 percent of their overall credit scores. Therefore, the less they owe from one month to the next, the better off they will be when it comes to not only maintaining a strong score, but also avoiding significant interest charges.   
Sherman & Associates
It's expensive to be poor By Ren�e Loth Globe Columnist  November 09, 2015
That's what more than 16 million Americans learn every time they try to cash their paychecks, settle a bill, or swipe a debit card. They pay fees and fines for financial services most of us take for granted, and they submit to interest rates that keep them trapped in debt. They are "the unbanked" - Americans operating in an alternate economy without access to basic financial tools.
According to the FDIC, 9.6 million households have no account. Another 24.8 million households are "under-banked" - they may have a checking account, but they can't get a credit card or even a small loan, despite often holding steady jobs. They rely on a variety of poorly regulated alternative financial services, including payday lenders, prepaid debit cards, and check-cashing stores. Are you surprised to learn that the unbanked and under-banked are overwhelmingly black or Latino and living in the nation's poorest communities, including the rural South?
Shadowy ersatz banks prey on these individuals. The advocacy group United for a Fair Economy estimates that the average under-banked family spends $3,029 a year in alternative financial service fees and interest. Some states allow short-term payday lenders to charge interest rates as high as 400 percent. Even in Massachusetts, where short-term loan rates are strictly capped, check-cashing outlets can charge any fee so long as they clearly post the charges. A 2013 report by the Massachusetts Division of Banks estimated that a person earning $20,000 who cashes a weekly paycheck and buys eight money orders to pay bills each month would spend $450 in fees over the year, as opposed to an average of $36 in a traditional bank.
Then there are prepaid debit cards - the fastest-growing consumer financial product in the United States, with more than $65 billion in pre-loaded cash. These cards come in many forms but are usually marketed to minorities, lower-income customers, and millennials who haven't established credit. Some cardholders don't trust big banks, lack sufficient ID, or can'tqualify for an account. But many live miles from a traditional bank or are too poor to maintain the minimum balance most institutions require.  
CFSA
Industry veteran Carlos Rodriguez joins Prepay Nation to lead USA division
Berwyn, PA  - Prepay Nation, a leading provider of cross-border micro-value and prepaid mobile airtime transfers, has welcomed chief operations and business development executive Carlos Rodriguez to their team as President of Prepay Nation USA. Rodriguez will be responsible for overall company growth in the US market, helping to expand Prepay Nation's international airtime transfer and value transfer services nationwide.
With technical expertise and an entrepreneurial spirit, Rodriguez has over 27 years of delivering results through innovation, common sense management and a "Make it Your Own" approach. He has created customer loyalty by delivering excellence and providing leadership. He most recently served as Chief Operating Officer at Blackstone* where Rodriguez oversaw 275 employees throughout the US and Caribbean, that generated over $375 million in annual revenue.
"My goal is for Prepay Nation USA to become the industry leader," said Rodriguez, "and to take the business to the next level of growth." Rodriguez, part of the core team that brought international Top-up to the United States, said becoming President of Prepay Nation USA was the perfect match. "On the distribution side, I worked with Prepay Nation as a vendor. I am thrilled to move over to the vendor side, and work closely with Anurag Jain, CEO of Prepay Nation, who I have known for many years through the business."   PREPAY NATION
Dreher Tomkies LLP

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