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New York Financial Regulator Uses Dodd-Frank to Sue Auto Lender
Last edited Sun Apr 27, 2014, 11:46 AM - Edit history (1)
New York Financial Regulator Uses Dodd-Frank to Sue Auto Lender
By RACHEL ABRAMS
Updated, 7:22 p.m. | By his own admission, even New York’s top financial regulator did not know he could use the Dodd-Frank law to enforce consumer protections until very recently.
Once he did, however, Benjamin M. Lawsky, the state’s superintendent of financial services, put the power to use...Lawsky’s office filed a lawsuit against a subprime auto lender in New York, accusing it of violating certain provisions of the Dodd-Frank...The move appears to make Mr. Lawsky the first state financial regulator and the second state regulator to take advantage of a weapon many of his peers may not have even known was in their arsenal. And as officials across the country seek to appear tough on wrongdoers after the financial crisis, the action could encourage other state regulators to follow suit.
<...>
Dodd-Frank, which was put into place after the financial crisis, contains provisions that prohibit deceptive, abusive or unfair practices by financial companies. It also allows state regulators to enforce those provisions and grants them broader authority than they would have under state law.
Mr. Lawsky’s complaint, filed in Federal District Court in Manhattan, contends that the Condor Capital Corporation, a subprime auto lender based on Long Island, siphoned millions of dollars away from the accounts of unwitting borrowers. To do this, the company would shut down borrowers’ access to online accounts after a loan had been repaid, leaving them unable to see whether an insurance payoff, overpayment or other transaction had left excess money behind, according to the suit.
- more -
http://dealbook.nytimes.com/2014/04/23/new-yorks-top-regulator-sues-subprime-auto-lender/
By RACHEL ABRAMS
Updated, 7:22 p.m. | By his own admission, even New York’s top financial regulator did not know he could use the Dodd-Frank law to enforce consumer protections until very recently.
Once he did, however, Benjamin M. Lawsky, the state’s superintendent of financial services, put the power to use...Lawsky’s office filed a lawsuit against a subprime auto lender in New York, accusing it of violating certain provisions of the Dodd-Frank...The move appears to make Mr. Lawsky the first state financial regulator and the second state regulator to take advantage of a weapon many of his peers may not have even known was in their arsenal. And as officials across the country seek to appear tough on wrongdoers after the financial crisis, the action could encourage other state regulators to follow suit.
<...>
Dodd-Frank, which was put into place after the financial crisis, contains provisions that prohibit deceptive, abusive or unfair practices by financial companies. It also allows state regulators to enforce those provisions and grants them broader authority than they would have under state law.
Mr. Lawsky’s complaint, filed in Federal District Court in Manhattan, contends that the Condor Capital Corporation, a subprime auto lender based on Long Island, siphoned millions of dollars away from the accounts of unwitting borrowers. To do this, the company would shut down borrowers’ access to online accounts after a loan had been repaid, leaving them unable to see whether an insurance payoff, overpayment or other transaction had left excess money behind, according to the suit.
- more -
http://dealbook.nytimes.com/2014/04/23/new-yorks-top-regulator-sues-subprime-auto-lender/
To quote Elizabeth Warren:
There is no question that Dodd-Frank was a strong bill—the strongest in three generations. I didn’t have a chance to vote for it because I wasn’t yet in the Senate, but if I could have, I would have voted for it twice.
http://www.warren.senate.gov/files/documents/AFR%20Roosevelt%20Institute%20Speech%202013-11-12.pdf
http://www.warren.senate.gov/files/documents/AFR%20Roosevelt%20Institute%20Speech%202013-11-12.pdf
http://www.democraticunderground.com/10024815727
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