WASHINGTON–NCUA is among six federal agencies that have been contacted by a consumer group and five military advocacy organizations about what they have been doing to protect members of the military and their families from predatory lenders.
The organizations have asked for complaints the agencies have filed in federal court or through administrative proceedings alleging violations of the Military Lending Act, according to the Air Force Times. The organizations asked the agencies to respond by Dec. 21.
Enacted in 2006, the Military Lending Act does not give the Defense Department enforcement authority over lenders, but a 2013 law clarified which agencies are charged with that enforcement: NCUA, the Federal Trade Commission, Consumer Financial Protection Bureau, Federal Reserve Board of Governors, Office of the Comptroller of the Currency, and the FDIC, the Times reported.
“We write to request information about your agencies’ commitment to enforcing this law and protecting military families from illegal conduct,” states the letter, which is signed by the Consumer Federation of America; National Military Family Association; Air Force Sergeants Association; Chief Warrant & Warrant Officers Association, U.S. Coast Guard; Commissioned Officers Association of the U.S. Public Health Service; and The Retired Enlisted Association.
The letter also asked for the number of supervisory examinations the agencies have conducted that have required lenders to take corrective action, along with and details on those findings and corrective actions, Air Force Times added.
“The 2006 law gave DoD broad authority to define the types of loans covered, but exempted mortgages or purchase-money loans such as vehicle loans. In its initial implementation of the law in 2007, DoD placed narrow limits on the types of credit covered: payday loans, vehicle title loans and refund anticipation loans,” reported Air Force Times. “Consumer advocates criticized those narrow limits and complained that some lenders had “morphed” their products so that they fell outside DoD regulations, which would allow them to continue charging triple-digit interest rates.”