NCUA needs 'immediate moratorium' on medallion loan sales: Congresswoman
As the National Credit Union Administration seeks to unload its portfolio of taxi medallion loans, one lawmaker is calling on the agency to immediately stop all sales and foreclosures of those loans.
In a letter addressed to NCUA Chairman Rodney Hood, U.S. Rep. Carolyn Maloney (D-N.Y.) called for an immediate moratorium on further sales so that the New York City Medallion Task Force could finalize and implement its debt relief plan. The plan proposes a $500 million bailout to assist the thousands of cabbies affected by the exploitative loans.
“I believe any foreclosures on, or sales of, taxi medallion loans owned by the NCUA would be both premature and harmful to the many borrowers who were innocent victims of fraudulent lending practices,” Maloney wrote.
That proposal coincides with a bill from concerned New York lawmakers that would alleviate the burden cabbies face by reducing tax obligations for those who receive debt relief. These efforts are in response to the medallion lending bubble that saw prices skyrocket from roughly $200,000 to over $1 million, only to burst and leave New York City cabdrivers unable to pay their debts.
If the NCUA were to either sell or foreclose loans within its taxi medallion portfolio to private lenders before the proposal could go into effect, Malony said that most of the victims will never find relief.
Maloney requested that the NCUA respond to her correspondence by Wednesday, Jan. 29.
NCUA previously said it was unable to comment on specific aspects of its resolution straegy since the loans in question involve personal, confidential finacnail information.
In a statement emailed to Credit Union Journal on Monday, the agency reiterated, "Because any disposition of these assets involves sensitive, personal financial information, the agency is unable to comment on any specifics regarding its resolution strategy. NCUA remains committed to finding a solution that is sensitive to the needs of medallion holders and their families and that meets its statutory obligations to minimize potential losses to the [National Credit Union] Share Insurance Fund."
This story was updated at 4:06 P.M. on Jan. 21, 2020.