Debt collection

The CFPB wants a federal district court to enter a final judgment to shut down a student debt relief scheme that allegedly charged borrowers millions of dollars in illegal upfront fees for federal student loan services.

The Education Department could ban colleges from including mandatory arbitration clauses in student enrollment agreements. The proposal is part of ongoing rule-making talks focused on creating a new debt relief process for defrauded student loan borrowers.

The last individual defendant in a mortgage modification scam is banned from selling debt relief and mortgage-related products and services and from telemarketing under a court order obtained by the Federal Trade Commission.

Consumers' expectations about earnings, income and spending improved in February, according to the Federal Reserve Bank of New York’s latest Survey of Consumer Expectations.

China is testing a program that allows banks with bad loans to sell that debt to investors, The New York Times reported Saturday.

The Justice Department is notifying state and municipal court systems in a letter sent Monday that defendants who fail to pay fines or fees shouldn’t be jailed. The letter warns that such practices run afoul of the Constitution and harm trust within communities.

A top CFPB official said student loan companies are at risk of breaking the law if they place people in default when the co-signer of their loan dies or declares bankruptcy. The CFPB’s latest Supervisory Highlights report focuses on problems in the student loan industry.

There are more than 43 million student loan borrowers in the U.S., owing nearly $1.3 trillion dollars of debt. The National Foundation for Credit Counseling believes those numbers make it a hotbed for debt relief scams and NFCC officials are warning student borrowers about falling victim.

West York Borough, in York, Pa., is owed an estimated $500,000 as a result of delinquent residential sewer accounts, borough officials reported.

For financial institutions, there are scary parallels between the IRS' failure to protect sensitive personal information and their own such struggles.