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Better Markets Teams Up with Other Advocates, Nonprofits on Issues Impacting Main Street

Better Markets regularly joins with other public interest advocates and nonprofit organizations in support of regulatory action on a broad range of issues related to financial regulation and social justice—many of which disproportionately impact underserved communities, communities of color, and low-income communities.
 
Joining strong coalitions on critical issues that we support helps raise their visibility among key influencers, including regulators, legislators, interested members of the public, and others. Such joint advocacy also adds greater weight to the positions taken and increases the likelihood of positive action by policymakers.
 
Read below for details on some of our most recent joint advocacy efforts:
 
Strengthen Community Reinvestment Act Rules. The Federal Reserve issued an Advance Notice of Proposed Rulemaking seeking comment on its plan to modernize and strengthen rules implementing the Community Reinvestment Act (“CRA”). The CRA is a crucially important piece of legislation designed to ensure that historically underserved communities have access to credit and banking services. But for far too many Americans, the promises of the CRA have remained unfulfilled.
 
In addition to our own comment letter, in which we commended the agency for its plans to modernize the CRA and advocated for stronger measures, Better Markets joined two excellent sign-on letters led by the National Community Reinvestment Coalition and Americans for Financial Reform. More than 100 nonprofits and advocates participated in one or both of the letters. Read the NCRC letter and the AFR letter for more information. 
 
The bottom line is that the Federal Reserve must do everything in its power to ensure that the CRA’s provisions are implemented and enforced so that vulnerable American’s are not excluded from the many benefits that can come with full and fair access to the banking system, including equal opportunities to meet their basic needs, build wealth, and save for retirement.
 
Resist National Credit Union Administration’s Proposal that Would Allow More Overdraft Fees. The NCUA issued a proposed rule that would allow federal credit unions to keep members’ negative account balances open for longer than the current limit of 45 days, subjecting those members to additional overdraft fees. Better Markets, along with nearly 40 consumer, civil rights, faith, and community organizations, joined a sign-on letter to the NCUA led by the Center for Responsible Lending, the Self-Help Federal Credit Union, and the Self-Help Credit Union.
 
The joint comment letter persuasively demonstrates that the proposal fails to provide any of the claimed benefits to credit union members. It also shows that the NCUA failed to consider the significant risks it poses to members in the form of burdensome overdraft fees, which increase financial distress and run counter to other government measures designed to alleviate financial burdens during the COVID-19 crisis.
 
As noted in the comment letter: “Credit union overdraft practices, like those of banks, most heavily impact the financially vulnerable and leave them worse off. During the best of times, any NCUA action related to overdraft practices should provide a net benefit to FCU members. During a health and economic crisis, it’s only more important that the agency take a do-no-harm approach. Instead, this proposal undermines and contradicts federal relief efforts.”
 
Deny Rakuten’s Application for Deposit Insurance. Better Markets joined nearly 40 organizations, led by the National Community Reinvestment Coalition, to urge the FDIC to deny Rakuten’s application for deposit insurance as it seeks an industrial loan charter (“ILC”).
 
As explained in the comment letter, Rakuten’s application fails to address important concerns surrounding safety and soundness, privacy, and fair lending. For example, ILCs often include a parent institution that is not a financial institution and Federal prudential regulators therefore cannot comprehensively examine the parent nor other affiliates and subsidiaries for their safety and soundness. Moreover, serious doubts surround the ability of the FDIC to thoroughly monitor the relationship between the ILC and its parent and to monitor the risk the parent poses to the ILC. The application fails adequately to address these concerns.
 
The letter also explains that Rakuten has developed an incomplete strategic plan for its Community Reinvestment Act evaluation, which does not adequately serve the credit and deposit needs of the relevant communities, including low- and moderate-income areas. If the application is approved, it will set a precedent encouraging other huge companies across the country to set up poorly supervised banks of their own, driving loans to their own customers and ultimately creating systemic risks.
 
Establish Climate Hub in Treasury. Better Markets joined a coalition led by Public Citizen to encourage Treasury Secretary Janet Yellen to follow through on her commitment to create a hub at Treasury focused on the threat of climate change and to name a senior-level person to lead the department’s climate efforts. Nearly 150 environment, social justice, and consumer advocates signed the  letter.
 
In a statement related to the letter, President and CEO Dennis Kelleher noted that “There is no dispute that the climate crisis poses a material threat to many companies and an existential threat to the financial system, our economy, and the planet. Regrettably, the U.S. has fallen behind many other countries in taking the necessary actions to address these many and increasing risks. While this inaction impacts all Americans, those hardest hit will once again be low-income, minority, and other disenfranchised communities.”
 
“That’s why Treasury Secretary Yellen’s commitment to create a climate ’hub’ and appoint a ’very senior-level official to lead’ it was so important. More broadly, we are gratified that the Biden administration shares our view that we must all prioritize the critical issue of climate change along with racial justice and economic inequality, especially in the financial industry and at the financial regulatory agencies.”
 
Restore Court Access through FAIR Act. Better Markets has long fought against mandatory pre-dispute arbitration clauses in an effort to ensure that Main Street Americans always have the right to bring claims to court when they have been victimized by financial firms. That’s why we joined with nearly 85 organizations on a comment letter, led by Public Citizen and the National Association of Consumer Advocates, to urge Congress to quickly pass the Forced Arbitration Injustice Repeal Act (“FAIR Act”).
 
As explained in the comment letter, the FAIR Act would ensure that workers, consumers, ordinary investors, small businesses, and others harmed by bad actors will be able to bring valid claims in court and not be forced into biased, secretive, and corporate-controlled arbitration forums, as required by so many nonnegotiable consumer contracts. The FAIR Act would cover cases involving consumer, civil rights, employment, and antitrust violations and would ensure that harmed individuals in these cases can enforce related federal and state protections.
 
The Act would not ban arbitration but rather make it truly voluntary, allowing aggrieved individuals and businesses the opportunity to choose either arbitration or the courts after they have been harmed. With passage of the FAIR Act, Congress will restore full and fair access to our courts and reinvigorate important civil rights, employment rights, and consumer protections.
 
Ensure CFPB Promotes Racial Equity in Credit Markets. Promoting racial justice in our financial system is one important goal that Better Markets shares with a number of other prominent public interest groups. To that end, Better Markets, along with dozens of national, state, and local public interest organizations, joined a comment letter to the Consumer Financial Protection Bureau (“CFPB”). The letter was led by the National Consumer Law Center, the National Fair Housing Alliance, and the NAACP Legal Defense and Educational Fund, and it outlines numerous concrete steps that the CFPB can take to “address long-standing systemic discrimination in credit markets and the harsh economic fallout from the COVID-19 pandemic on communities of color.” 
 
The specific action items detailed in the letter fall under several headings, including protecting homeowners and renters impacted by the COVID-19 pandemic; supporting LEP populations with information in their language; enforcing fair lending laws; and promoting other racial justice measures, such as affording debt collection relief to those who are delinquent on auto loans and ensuring that student loan borrowers benefit from forbearance mandates. In sum, the comment letter urges the CFPB to “use its resources to protect individuals from discrimination in the credit markets and financial harm by addressing long-standing as well as emergent issues.”
 
 
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