Law and regulation

An ad running in the Capitol Hill newspaper Roll Call is attacking credit unions in a manner reminiscent of an ad run years ago by credit unions’ main nemesis – the bankers – except this time bankers are on the same side, and in fact are partners with credit unions in the fight to block the interchange amendment to the bank bill.

The chief sponsor of the Senate’s interchange amendment creating price controls agreed yesterday to exempt all government programs from his provision, eliminating an argument being used by credit unions and banks lobbying against the measure.

Green Dot Corp., which plans to go public, disclosed in a filing with the Securities and Exchange Commission earlier this month that it issued 2,208,552 shares of Class A common stock to Wal-Mart Stores Inc., sparking speculation the retailer is indirectly trying to gain a toehold in banking following failed attempts to do so three years ago.

Rhode Island Attorney General Patrick C. Lynch today warned consumers about a collection scam involving individuals impersonating law enforcement officials, including claiming an affiliation with the Bureau of Criminal Identification (BCI) Unit.

In the biggest independent lobby against the interchange amendment Navy FCU, one of three credit unions on the wrong side of the exemption from the amendment price-control provision, is calling on its 3.5 million members to urge Congress for defeat of the measure.

A Virginia couple accused of forging the wife’s grandfather’s signature on more than a dozen bogus student loan applications worth nearly a quarter million dollars were sentenced in federal court for their crime.

Credit card issuers were somewhat spared in the Federal Reserve Board’s final rules issued June 15 regarding card penalty fees, which analysts say were not as severe as some had feared.

Reps. Debbie Wasserman Schultz, D-Fla., and Kenny Marchant, R-Tex. released a letter Monday with the signatures of more than 100 lawmakers urging conferees to drop the interchange provision from the final reform bill.

U.S. Sen. Richard Durbin, D-Ill., on June 14 announced plans for a hearing this week examining the interchange fees the federal government pays on credit and debit card transactions and how to reduce them.

A flurry of last-minute lobbying surrounding debit-interchange regulation begins this week as lawmakers negotiating the final version of the financial-services reform bill stake out their positions on interchange.

WASHINGTON – Credit union lobbyists were undeterred last week after the congressional conference to set the final bank reform bill opened with key lawmakers pledging to retain the controversial provision that would establish federal price controls over debit card interchange.

Industry consensus is mounting to suggest that some form of the debit-interchange amendment crafted by U.S. Sen. Richard Durbin, D-Ill., will be included in the reconciled financial-reform bill. But top payments-consulting firms continue to parse the amendment’s potential effects.

Editor's Note: The following is a release from attorney Sergei Lemberg. Collections & Credit Risk wants your reaction to his statements about the industry. Your responses will be published, upon your approval. Contact Darren Waggoner at darren.waggoner@sourcemedia.com or 815.463.9008.

In urging Congress to delete the interchange amendment from the pending bank reform bill credit union executives were put in an unusual position of arguing that an exemption – a so-called carve-out – from the amendment that they have sought in other bills is unworkable and impracticable.

Millions of dollars in ads are being printed and carried over the airwaves by credit unions and banks and their nemeses in the interchange amendment to the bank bill, the nation’s retailing groups, in the biggest credit union lobbying effort in more than a decade.

Hundreds of credit union executives criss-crossed the halls of Congress Wednesday in an effort to convince lawmakers to scrap the provision of the bank reform bill that would establish price controls over debit card interchange, but their efforts face great odds.

Industry groups continued their full-court press Wednesday to keep an interchange provision out of the final regulatory reform bill, but whether they could succeed was an open question.

U.S. Sen. Dick Durbin, D-Ill., on June 9 made a brief appearance before the Senate Judiciary Committee Subcommittee on Antitrust, Competition Policy and Consumer Rights, warning lawmakers of the need to investigate possible collusion between Visa Inc. and MasterCard Worldwide in the setting credit and debit card interchange rates.

Representatives from credit unions and community banks during a June 9 press conference in Washington, D.C., exhorted lawmakers to exclude the debit-interchange amendment from the final financial-reform bill, claiming that altering debit-interchange rules likely would force them to raise overall banking fees charged to consumers.

National Enterprise Systems (NES) Inc., a collection agency in Solon, Ohio, will pay $75,000 to settle illegal and abusive collection charges brought in a lawsuit by West Virginia's Attorney General's office.