Welcome to the Thursday edition of OVERNIGHT REGULATION, your daily destination for today’s top regulatory news and tomorrow’s biggest storylines from Congress, the federal agencies and the courts. Click here to sign up for the newsletter.
THE BIG STORY:
Federal regulators are slapping the financial services arm of General Electric with the largest credit card discrimination settlement in history. http://j.mp/1l7AMvm
{mosads}The bank formerly known as GE Capital will pay customers $225 million to resolve claims of discrimination and deceptive marketing brought against it by the Consumer Financial Protection Bureau (CFPB) and the Justice Department. Now known as Synchrony Bank, it will also pay a $3.5 million fine to the CFPB.
“This kind of conduct has no place in the consumer financial marketplace,” CFPB Director Richard Cordray said Thursday. “People deserve to be given clear information and they deserve to be treated fairly.”
–Breaking it down:
1) “They didn’t know.” GE Capital will pay $169 million to reimburse about 108,000 Hispanic customers, who didn’t receive the same debt forgiveness promotions that other customers received, either because they lived in Puerto Rico or spoke Spanish, regulators say.
“These consumers never knew they were missing out on anything and thus had no way of recognizing that they were even being discriminated against – which is often the challenge in confronting discrimination,” Cordray said.
“At the Consumer Bureau, we are working diligently to right these kinds of wrongs,” he added. “No one should be excluded from credit opportunities simply because of where they live or the language they speak.”
2) Trick or treat? GE Capital will also pay $56 million to reimburse about 638,000 customers who were sold credit cards under false pretenses, regulators say. The bank used deceptive marketing practices to entice customers to sign up for credit cards that boasted debt cancellation if the borrower fell into hard times, but often times failed to deliver on that promise.
“In calls with telemarketers, many consumers mentioned that they were retired or disabled, which would mean that they were not eligible for key benefits of the products,” the CFPB wrote. “Even after hearing this, the telemarketers neglected to tell the consumers that they would not be eligible for key debt cancellation benefits.”
ON TAP FOR FRIDAY:
Following a week packed with regulatory news, members of Congress will scatter to their home states – but not before House committees get in their final licks. And, of course, federal agencies are open for business.
– The House Oversight Committee will hold the fourth in a series of hearings on the Obama administration’s evolving marijuana policy. Doug Throckmorton, M.D., deputy director for regulatory programs, at the FDA’s Center for Drug Evaluation and Research is among those slated to testify: http://j.mp/1oLQOyj
– House Judiciary will host FTC Commissioner Joshua D. Wright, among others, as the panel once again delves into net neutrality issues: http://j.mp/1m0HPGt
– The House Committee on Veterans Affairs will call into question bonuses received by executives at the Department of Veterans Affairs. A trio of officials from the scandal-rocked agency are scheduled to testify: http://j.mp/1nnpWzm
TOMORROW’S REGS TODAY:
The Obama administration plans to issue 162 new regulations, proposed rules, notices and other administrative actions in Friday’s edition of the Federal Register.
-The State Department will begin emailing debt collection notices to employees at least 30 days before they take the money out of their paychecks, as opposed to hand delivering the notices or sending them by first class mail like they do now.
Email is the best way of communicating with employees who owe the State Department money, the agency said.
“For example, for a debtor who is a current State employee and, therefore, has been assigned a State email account, the delivery of a notification via that email account will allow the debtor to receive the notice more quickly, reliably, and conveniently than if it were sent by first class mail,” the agency wrote. “This is especially true for employees serving overseas for whom it takes longer to receive first class mail.” http://j.mp/1ipbrO5
-The Department of Education will consider new rules intended to protect women on college campuses from dating violence, sexual assault and stalking. The rules come in response to the Violence Against Women Reauthorization Act of 2013. http://j.mp/1srsFid
-The Securities and Exchange Commission (SEC) will revise some of its electronic data collection rules in the Electronic Data Gathering, Analysis and Retrieval System’s (EDGAR) manual for agency employees effective immediately. http://j.mp/1kSQd5H
-The U.S. Postal Service (USPS) will raise some of its fees starting July 28. http://j.mp/1qjbX0c
-The Environmental Protection Agency (EPA) will exclude from its hazardous waste regulations certain oils and fluids that are used in metalworking to create parts for ships, bridges and engines. http://j.mp/1ypjFdR
-The Air Force will make changes to its environmental regulations that limit how much military planes pollute while flying at home and abroad. The changes include technical revisions to correct errors in the original rule. http://j.mp/SWGh4p
-The U.S. Department of Agriculture (USDA) will make small changes to a rule governing the national school breakfast program to correct an error. http://j.mp/1pNqKT2
NEWS RIGHT NOW:
MOVIN’ ON UP: House Majority Whip Kevin McCarthy (R-Calif.) bested Rep. Raul Labrador (R-Idaho) in the GOP’s intra-party race for the number two slot in the House Republican Conference. McCarthy will formally replace Rep. Eric Cantor (R-Va.) as majority leader on July 31: http://j.mp/URb2d9
A CHILLY RECEPTION awaited the EPA’s Janet McCabe, who testified before a subpanel of the House Energy and Commerce Committee Thursday, during the first congressional hearing on the agency’s controversial power plant emissions rule. Said subcommittee Chairman Ed Whitfield (R-Ky.): “Coal faces a devastating one-two punch from EPA. With this new proposed rule the agency can begin shuttering existing coal facilities.” http://j.mp/1nRwGr8
SAFER SKIES: Sen. Barbara Boxer (D-Calif.) is imploring FAA Administrator Michael Huerta to strengthen new pilot rest regulations to include cargo pilots, who can currently spend as long as 16 hours a day on duty: http://j.mp/1jBn67g
GROUNDED?: An amendment offered by Sen. Ed Markey (D-Mass.) would prohibit the FAA from approving the use of non-military drones unless the agency takes steps to protect U.S. residents’ privacy: http://j.mp/1lLgTpm
CAMPUS CRACKDOWN: The Education Department is floating new regulations meant to protect women on college campuses from sexual assaults and stalking, designating some rape scenarios as hate crimes: http://j.mp/1pNgslO
NEW DETAILS emerging from the investigation into the wreck that critically injured comedian Tracy Morgan indicate the man behind the wheel of a truck involved in the crash was going 20 miles an hour over the speed limit. The accident has rekindled debate over regulations governing big rig drivers: http://j.mp/1pjHq0X
BY THE NUMBERS:
$225 million: The total amount of money GE Capital will pay to resolve discrimination and deceptive marketing claims.
$169 million: The portion of the settlement GE Capital is paying to compensate Hispanic borrowers for the discrimination claims.
108,000: The number of Hispanic customers who GE Capital discriminated against who will be reimbursed.
$56 million: The portion of the settlement GE Capital is paying to compensate borrowers for deceptive marketing practices.
638,000: The number of consumers that GE Capital targeted with deceptive claims who will be reimbursed.
$3.5 million: The amount of the fine the CFPB levied against GE Capital for its deceptive marketing practices.
QUOTE OF THE DAY:
“The coal fleet is aging; half of the nation’s plants are in their 40s. There is a transition going on in the industry already.” – Acting assistant EPA administrator Janet McCabe, defending the agency’s contentions power plant emissions regulation during Thursday’s House hearing.
We’ll endeavor to stay on top of these and other stories throughout the week, so check The Hill’s Regulation page early and often for the latest. And send any comments, complaints or regulatory news tips our way, via bgoad@digital-staging.thehill.com or tdevaney@digital-staging.thehill.com. And follow us at @ben_goad and @timdevaney.