Leading consumer groups call on FTC and CFPB to update study on accuracy of consumer data

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July 23, 2021

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 and Linda Sherry, (202) 544-3088, linda.sherry@consumer-action.org

Washington, DC—Leading consumer groups are calling on the Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB) to update a key 2012 study on the accuracy of consumer data at the credit bureaus in a letter sent to both agencies.

The National Consumers League and Consumer Action, two leading consumer advocacy organizations working to promote pro-consumer policies on the federal level, noted in their letter to FTC Chairwoman Khan and Acting CFPB Dirctor Ueijo that policy leaders in Congress and the White House had been citing the 2012 study in recent hearings and events and they were concerned that the data policymakers were using was almost 10 years old.

“Much has happened since 2012 that impacts the accuracy of consumer data, starting with the rise of technology, increased data breaches by bad actors, the NCAP settlement and of course a pandemic and economic crisis. It is critical that we re- examine the accuracy of the credit bureau data in light of these developments…” the Consumer Action and National Consumers League letter reads. “…We worry about the unintended consequences if policymakers fashion new laws based on old facts.”

A full copy of the letter can be found here.

About the National Consumers League

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

National Consumers League applauds House repeal of national banking regulator’s Predatory Lending Rule; Urging Congress to act soon on interest rate cap

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June 29, 2021

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242

Washington, DC—The National Consumers League (NCL) applauds the House for voting for the Congressional Review Act resolution to overturn the OCC’s “fake lender” rule, which allowed predatory lenders to evade state interest rate laws by putting a bank’s name on the paperwork. In a 218-208 bipartisan vote, The U.S. House of Representatives voted to approve SJ Res 15, a resolution under the Congressional Review Act (CRA), which was introduced by Senators Chris Van Hollen (D-MD) and Sherrod Brown (D-OH). A companion resolution was introduced by Rep. “Chuy” García (D-IL). Now that both chambers of Congress have approved this resolution, we look forward to President Biden signing the bill into law.

“We applaud the House’s bipartisan vote to repeal this harmful rule which facilitates rent-a-bank schemes,” said NCL’s Public Policy Manager Sarah Robinson. “This is an important step in preventing predatory lenders from targeting vulnerable communities. We urge President Biden to quickly sign this bill into law to protect consumers.”

NCL was part of a broad coalition of more than 400 organizations representing all 50 states and the District of Columbia calling on Congress to overturn the “fake lender” rule, which threatens to “unleash predatory lending in all fifty states.”

The rushed “fake lender” rule took effect in December and was issued by the Office of the Comptroller of the Currency (OCC). The rule protected “rent-a-bank” schemes whereby predatory lenders (the true lender) launder their loans through a few rogue banks (the fake lender), which are exempt from state interest rate caps. The rule had overridden 200 years’ worth of case law allowing courts to see through usury law evasions to the truth, and replaced it with a pro-evasion rule that looked only at the fine print on the loan agreement.

A broad, bipartisan cross-section of experts and officials have called on Congress to repeal the fake lender rule. They include a bipartisan group of 25 state attorneys general, concerned the rule would effectively gut their state usury laws. The Conference of State Bank Supervisors, National Association of Consumer Credit Administrators, National Association of Federally-Insured Credit Unions, Credit Union National Association, Military Officers Association of America, Faith for Just Lending, and many other groups also support Congress overturning the rule.

According to national polling, two-thirds of voters (66%) are concerned about the ability of high-cost lenders to arrange loans through banks at rates higher than the state laws allow.

This victory will stop predatory lenders from charging 100% to 200% APR and make all lenders adhere to state laws.

NCL now urges the Congress to take up the Veterans and Consumers Fair Credit Actand cap interest rates nationally on all consumer loans, including payday and car title loans. It is crucial that the Congress take up this bill that was introduced by Rep. Garcíaand Rep. Glenn Grothman in the last Congress. This is a critical piece of legislation that will protect all consumers from predatory lending. We look forward to working with Congress and our state delegation to pass this important piece of legislation.

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About the National Consumers League

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

Finally, Juneteenth is declared federal holiday

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By Sally Greenberg, NCL Executive Director

Juneteenth, or June 19, is now a federal holiday, thanks to an overwhelming Congressional vote and President Biden’s signing it into law in the past two weeks. And it’s a long time coming. The day marks the emancipation of the last enslaved people in America in Galveston, Texas in 1865, over two years after the Emancipation Proclamation was signed by President Abraham Lincoln.

I’ve heard Juneteenth called Emancipation Day, Freedom Day, and the country’s second Independence Day. It surely is one of the most important anniversaries in our nation’s history.

As a Jew who has observed Passover my whole life, the holiday based on the Book of Exodus celebrating the liberation of Jews from Egypt after 400 years of enslavement, I also celebrate Juneteenth.

As I listened to the radio during a road trip, I heard stories about the newly declared federal holiday. I think most importantly, it’s gotten people talking about a conversation America has never really had: truth and reconciliation about the despicable institution of slavery in the United States and its vestiges: a century and a half of Jim Crow segregation, violence, and rampant, entrenched discrimination against African Americans.

Sadly, this is a conversation too many Americans don’t want to have. Oklahoma passed a law outlawing the teaching of “Critical Race Theory” in state schools. In 2020, President Donald Trump issued an executive order excluding from federal contracts any diversity and inclusion training interpreted as containing “Divisive Concepts,” “Race or Sex Stereotyping,” and “Race or Sex Scapegoating.”

What even is Critical Race Theory? The textbook definition is that CRT acknowledges that the legacy of slavery, segregation, and the imposition of second-class citizenship on Black Americans and other people of color continue to permeate the social fabric of this nation.

Half a dozen other states are considering bills similar to Oklahoma’s. Fox News and other right wing media outlets have tried to use phony scare tactics to discourage discussion of slavery and its generations-long aftermath. The problem is that unless we have those discussions, we will never reckon with the reality that so much of our nation was built on the backs of enslaved people, including the White House. Refusing to discuss this our history of enslavement has a term too: “White Fragility,” defined as white Americans feeling discomfort and defensiveness when confronted with information about racial inequality and injustice. So despite Oklahoma’s law, Biden’s declaring Juneteenth as a federal holiday got people talking—and that’s a good thing.

I liked hearing about Civil Rights Activist Opal Lee, who long advocated for the celebration that started in Galveston to be made a federal holiday.

It was also interesting to learn that there’s a growing discontent within the African American community with symbolic gestures like declaring a federal holiday marking the end of slavery.

On that theme, NCL has endorsed HR 40, a U.S. House bill to set up a commission to study the history of enslavement and reparations to families whose relatives were enslaved. Consider these facts about the legacy of slavery:

We thank President Biden for recognizing that Juneteenth needs to be a federal holiday and was long overdue. Equally important is HR 40, which will provide a way forward for this country akin to the Truth and Reconciliation Commission body established by the South Africa in 1995 to help heal the country and bring about a reconciliation of its people by uncovering the truth in the aftermath of Apartheid.

Slavery is a legacy that all Americans, no matter your racial or ethnic background or when your family arrived in the United States, need to confront. We must not let anger, fragility, backlash, or denial prevent us as Americans from taking the time to really learn about and understand slavery, the Jim Crow laws that followed it, and practices, including lynching, that were used as a tool of terror and white supremacy, and the many lasting repercussions of that terrible history.

The boom in e-commerce has been a boon for fraudsters

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The COVID-19 pandemic has greatly accelerated the growth of e-commerce…

Read more

A step forward on privacy legislation

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By Sarah Robinson, Public Policy Manager

Earlier this month, NCL joined other consumer advocates and industry stakeholders in an event to highlight our consensus that Congress must act to create strong federal consumer privacy rights urgently. We joined colleagues at the 21st Century Privacy Coalition, the Business Software Alliance, and Common Sense Media in calling on Congress to commit to passing comprehensive privacy legislation by the end of the 117th Congress. In a virtual press conference, the groups, along with Rep. Jan Schakowsky (D-IL), Rep. Gus Bilirakis (R-FL), and Sen. Richard Blumenthal (D-CT) agreed that Congressional action to strengthen consumers’ privacy rights is long overdue.   

The Washington Post Editorial Board highlighted our event stating, “the surprising degree of consensus around not only the general necessity of nationwide data protections but also the particulars” makes taking action a “no-brainer.” A recent poll from Morning Consult revealed 80 percent of both Democrats and Republicans said Congress should make privacy a “top” or “important” priority in 2021.

There is bipartisan consensus and agreement from organizations across the spectrum that Congress must act. NCL’s message at the event is that it is now time to craft legislation that gives consumers back control over their personal data. At the event, Rep. Schakowsky, the chairwoman of the House Subcommittee on Consumer Protection and Commerce, announced her intention to hold a series of bipartisan roundtable discussions to examine ways to pass comprehensive privacy legislation. NCL is ready and eager to participate in those conversations to help ensure that a comprehensive bill gives all consumers strong, enforceable privacy rights.  

While passing legislation this Congress is a priority, NCL made clear that we are not going to simply bargain away long held principles on data privacy. NCL believes that in order to protect the privacy and security of consumers’ personal data, the legislation must not preempt stronger state laws, must include strong enforcement provisions, including a private right of action and provide consumers with strong substantive privacy rights. The right legislation will include effective enforcement mechanisms that safeguard privacy rights for consumers and enshrine rules of the road for businesses.  

We applaud Reps. Schakowsky and Bilirakis, and Sen. Blumenthal for their leadership and their commitment to continue fighting for comprehensive privacy legislation. We hope to continue to cooperate with this esteemed group as we work to achieve our shared goal. 

NCL joins advocates in applauding Senate for repealing the national banking regulator’s predatory lending rule, urging the House to act soon

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Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—The National Consumers League (NCL) applauds the Senate for voting to overturn the OCC’s “fake lender” rule, which allows predatory lenders to evade state interest rate laws by putting a bank’s name on the paperwork. In a 52 – 47 bipartisan vote this week, the U.S. Senate voted to approve S.J. Res. 15, a resolution under the Congressional Review Act (CRA), which was introduced by Senators Chris Van Hollen (D-MD) and Sherrod Brown (D-OH). Rep. “Chuy” García introduced a parallel resolution, H.J. Res. 35, in the U.S. House of Representatives. Now that the Senate has approved the resolution, the House needs to take swift action to stop the ongoing harm.

“We applaud this bipartisan rejection of rent-a-bank schemes,” said Sarah Robinson, NCL’s Public Policy Manager. “As consumers and small businesses look to rebuild from the devastation of the coronavirus pandemic, they must be protected from predatory lending. We now urge the House to move with urgency to prevent this rule from continuing to do harm.”

NCL was part of a broad coalition of more than 375 organizations representing all 50 states and the District of Columbia calling on Congress to overturn the “fake lender” rule, which threatens to harm consumers nationwide.

The rushed “fake lender” rule took effect in December and was issued by the Office of the Comptroller of the Currency (OCC). The rule protects “rent-a-bank” schemes whereby predatory lenders (the true lender) launder their loans through a few rogue banks (the fake lender), which are exempt from state interest rate caps. The rule overrides 200 years’ worth of case law allowing courts to see through usury law evasions to the truth and replaces it with a pro-evasion rule that looks only at the fine print on the loan agreement. Predatory lenders charging 100 percent to 200 percent APR are already starting to push high-cost installment loans across the country that exceed the rates permitted under states’ laws.

A broad, bipartisan cross-section of experts and officials have called on Congress to repeal the fake lender rule. They include a bipartisan group of 25 state attorneys general, concerned the rule would effectively gut their state usury laws. The Conference of State Bank Supervisors, National Association of Consumer Credit Administrators, National Association of Federally-Insured Credit Unions, and many other groups also support Congress overturning the rule.

According to national polling, two-thirds of voters (66 percent) are concerned about the ability of high-cost lenders to arrange loans through banks at rates higher than the state laws allowed.

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About the National Consumers League

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

NCL supports Peloton treadmill recall

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Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—The National Consumers League (NCL) supports Peloton Interactive Inc’s decision to recall its Tread+ treadmill.

“The company has finally come to its senses and agreed to recall its treadmill, which has been caused deadly injuries to children,” said NCL Executive Director Sally Greenberg. “Use of Peloton’s Tread+ exercise machines resulted in at least 72 reports of injuries, including the death of a 6-year-old boy.”

There were also 29 reports of children suffering broken bones, cuts, and abrasions. The agency that regulates these products, the Consumer Product Safety Commission (CPSC), took the unusual step of issuing an administrative subpoena in April when the company refused to provide information about the fatal injury to a child.

“It’s critically important that the company work with the CPSC to recall 125,000 treadmills, at no cost to customers, and safely replace or repair the treadmills so they no longer pose a threat to children or pets,” Greenberg said.

The recall agreement was accepted Wednesday morning in a vote by the Commission. The agreement requires Peloton to halt sales of the Tread+ machine and fully refund consumers who wish to return their equipment.

Greenberg also pointed out how problematic CPSC’s rules are for launching a recall like this one and called on Congress to amend its statute. “We agree with Acting Chair Robert Adler’s assessment that the CPSC faces nearly insurmountable hurdles in protecting the public because, under its statute, the Commission is required to negotiate at length with companies before it is allowed to issue any safety warnings. No other federal safety agency is under such restrictions. That needs to change for the safety of the public.”

To read our previous statement concerning the Peloton Tread+ recall controversy, click here.

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About the National Consumers League

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

National consumer organization throwing support behind three major labor rights bills in Congress

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Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—The National Consumers League (NCL), America’s pioneering consumer and worker advocacy organization, founded in 1899 to advance the needs of consumers and workers, is backing three important federal bills aiming to even the playing field between workers and employers. The three pieces of legislation—the Protecting the Right to Organize Act (PRO Act), the Farm Workforce Modernization Act (FWMA), and the Public Service Freedom to Negotiate Act—would strengthen labor laws and give workers greater opportunities to organize and form unions, protecting the most vulnerable in our labor force.

“Decades of industry lobbying have made it increasingly difficult for workers to organize,” said NCL Executive Director Sally Greenberg. “Employers enjoy unprecedented and unfair advantages during union organizing drives, which has led to far fewer opportunities for workers to make their voices heard in the workplace. NCL is pleased to support several legislative initiatives that would help right the course for America’s workers.”

According to a recent Gallup Poll, roughly two-thirds of Americans approve of unions—a number trending upwards up from about half in 2009.

“Consumers are recognizing that they are harmed when workers do not have a strong voice,” said Greenberg. “Industry abuses are more likely to go unchecked, resulting in unsafe and dangerous products making it to the marketplace. And when workers are fairly compensated on the job, they can afford to buy the products they create, stimulating further demand that benefits the economy.”

About the bills

The Protecting the Right to Organize Act (PRO Act) would enhance collective bargaining rights, impose penalties on employers if they retaliate against workers who are trying to organize, and update labor laws to protect workers. The bill passed in the House of Representatives with bipartisan support this spring on a 225-206 vote. The bill currently awaits action in the Senate. Of 50 Democratic and independent Senators, 45 are currently committed to supporting the bill. If the Senate passes the bill, President Biden has pledged to sign it.

NCL strongly supports the PRO ACT and urges the Senate to swiftly pass this important measure.

The Farm Workforce Modernization Act (FWMA) passed the House October 30, 2019, and was the product of bipartisan negotiations between leading Democrats and Republicans to modernize laws and treat with dignity and fairness our 2.4 million farmworkers, half of whom are undocumented immigrants. On March 18, 2021, the Farm Workforce Modernization Act, H.R. 1603, passed the House again by a bipartisan vote of 247-174, with 30 Republicans joining Democrats in support. H.R. 1603, like the earlier version of the legislation.

“America’s farms and food systems depend on immigrants who pick our crops. But because so many don’t have legal status, they live in fear of deportation and cannot challenge illegal or unfair treatment in their jobs or in their communities,” said Greenberg. “FWMA provides a path to lawful permanent residency for these workers. Under the bill’s provisions, farmworkers would be able to improve their wages and working conditions and seek enforcement when their rights are violated. It also makes America more food-secure by ensuring that farmers have workers to harvest their perishable crops.”

The FMWA is a pro-consumer, pro-worker, and pro-agriculture bill that NCL strongly supports. NCL urges the Senate to pass this legislation and send it to President Biden’s desk for his signature.

The Public Service Freedom to Negotiate Act (PSFNA, HR 3463 and S 1970), would set a minimum nationwide standard of collective bargaining rights that all states would have to provide to state and local workers.

There are nearly 17.3 million public sector workers across the country. Unlike private-sector workers, there is no federal law protecting the freedom of public sector workers to join a union and collectively bargain for fair wages, benefits, and improved working conditions.

Currently, 20 states do not provide all state and local public sector workers the ability to collectively bargain for fair wages and benefits.

Among the bill’s provisions is a requirement that public sector employers recognize labor unions chosen by a majority of the employees voting, and that they bargain with the labor organization over wages, hours, and other terms and conditions of employment. If states fail to meet these standards, the bill gives the federal government the authority to intervene on behalf of public-service workers, ensuring their rights to form a union and negotiate with their employer.

NCL strongly supports the Public Service Freedom to Negotiate Act and urges swift Congressional action in both the House and the Senate so that President Biden can sign the bill into law.

“America would be unrecognizable without the gains made by working families and unions,” said Greenberg. “The movement needs an even playing field to do its job. These three bills are a good start, and NCL is proud to support each of them.”

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About the National Consumers League

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

NCL calls on Congress to protect consumers in wake of Supreme Court ruling in AMG Capital Management, LLC v. FTC

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April 23, 2021

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—The National Consumers League (NCL) is deeply disappointed with today’s Supreme Court ruling in AMG Capital Management, LLC v. Federal Trade Commission. For decades, the Federal Trade Commission (FTC) has relied on section 13(b) of the FTC Act to seek restitution for victims of fraud. The court’s decision in this case undermines that authority, making it significantly more difficult for the Commission to provide relief to consumers who are defrauded by scam artists and companies engaged in unfair or deceptive business practices.

The following statement is attributable to NCL Vice President of Public Policy, Telecommunications and Fraud John Breyault:

The Court today put the interests of a convicted scammer above the needs of fraud victims. We are incredibly disheartened at the decision to deprive the FTC of one of its most effective tools for clawing back criminals’ ill-gotten gains. This decision will embolden the criminals who annually defraud millions of consumers, costing them billions of dollars and untold emotional damage. We hear practically every day from victims of scams whose financial lives have been ruined by scammers. Consumer need and deserve a consumer protection agency empowered to make them whole. Congress should urgently pass legislation restoring the FTC’s 13(b) authority to obtain compensation on behalf of fraud victims.

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About the National Consumers League

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

Consumer group calls on Peloton to recall treadmills

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Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—The National Consumers League is advising consumers to stop using Peloton treadmills and is calling on Peloton to immediately recall its Peloton Tread+ treadmill exercise machine. According to recent reports, the product poses a danger to children and pets — including a child death — in what has been described by the Consumer Product Safety Commission (CPSC) as a “different hazard pattern than is typically seen.” The CPSC learned that there were dozens of such incidents and issued a safety warning over this past weekend, saying it “found that the public health and safety requires this notice to warn the public quickly of the hazard.” The CPSC also took the unusual step of issuing an administrative subpoena to require Peloton to disclose the name of the child who died.

“This pattern of injury and death is not acceptable, and it is wrong for Peloton to blame user error,” said NCL Executive Director Sally Greenberg. “The CPSC shouldn’t have to subpoena a company for information about a child who died using its product. The company should be working closely with the federal safety agency with jurisdiction over these products. Dozens of children getting dragged under a Peloton Treadmill and sustaining grave injuries or death requires immediate action by the company. Peloton should recall these Treadmills at no cost to customers and either redesign them to prevent hazards or stop selling the product altogether.”

Peloton is a $34 billion company predicted to double in value by 2024.

“The CPSC and the company must work together to expedite a recall and get these products out of people’s homes. These injuries are certainly foreseeable, and we thank Senator Richard Blumenthal (D-CT) and Congresswoman Jan Schakowsky (D-IL), both of whom chair consumer subcommittees in Congress,” said Greenberg. “We agree with Senator Blumenthal, who called on Peloton to ‘immediately cooperate with the CPSC to recall its dangerous and deadly treadmill. Amid dozens of incidents of hurt kids and pets — with broken limbs, brain injuries, and death after being pulled underneath the machine — it’s clear that the Peloton Tread+ must be recalled.’”

Earlier this month, Congresswoman Schakowsky asked the CPSC to investigate earlier in April, noting: “With families spending more time at home and together, home exercise equipment dangers are especially worrisome, and any potential risks to consumers and their families must be carefully scrutinized. The CPSC must be able to act nimbly in identifying and responding to emerging hazards. In addition to the absence of publicly available information about the child fatality, other publicly reported incidents involving the same treadmill model suggest potential obstacles preventing the Commission from taking swift action to protect the public.”

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About the National Consumers League

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.