| Volume 125 Number 6 |
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The People’s Lawyer’s Tip of the Day
A bank may not charge an overdraft fee unless you “opt-in” to pay it. In my opinion, it is better to have your card rejected for your $4.00 latte than pay a $25-35.00 fee. If you don’t want to be charged a fee and would prefer your card be rejected, contact your bank. Click here for more.
New House Bill Places Restrictions on Consumer Agency
A recently passed House appropriations bill would place strict guidelines on the Consumer Financial Protection Bureau. First, the bill includes a condition barring the CFPB from using any of its funding “to regulate pre-dispute arbitration agreements.” Rather than have a single Director lead the Bureau, the appropriations bill seeks to replace that position with a 5-person board, any member of which can be removed by the President at any given time for “inefficiency, neglect of duty, or malfeasance in office.” Currently, the CFPB receives direct funding from the Federal Reserve. This new bill would require the Bureau to seek appropriations from Congress each year. The funding bill now goes to the Senate, where it is expected to face greater scrutiny from both lawmakers and consumer advocates. Click here for more.
Your Money
Being an authorized user on a credit card can boost the user's credit score. Authorized users typically receive a credit card that is linked to the credit card holder's account. FICO scores are calculated based on information in a consumer’s credit report. For FICO to calculate a score, a consumer must have one or more accounts open for at least six months. This includes accounts that a person is only authorized to use. By adding your children in college as authorized users you can help them build their credit score while also tracking their expenses. Click here for more.
For the Lawyers
Letter offering settlement on a time barred debt did not threaten litigation and, therefore, did not violate the Fair Debt Collection Practices Act. A district court in New Jersey recently held that a letter offering settlement on a time barred debt did not threaten litigation and therefore did not violate the FDCPA. The court found that the FDCPA permits the debt collector to seek voluntary repayment so long as it does not initiate or threaten legal action. The court was persuaded by the fact that the letter set forth a single lump sum payment option and used the word “settle.” The court concluded that under the Circuit’s “least sophisticated consumer” standard, the letter did not threaten litigation. Lugo v. Firstsource Advantage, C.A. No. 2:15-cv-06405-SDW-SCM, 2016 U.S. Dist. LEXIS 78636 (D.N.J. Jun. 16, 2016). Click here for more.