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Strengthening Price Gouging Statute | Illegal Fees for Mortgage Payments | AGs Contest Reprieve for Robocallers

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Cozen in the News

Cozen O’Connor’s State Attorneys General Practice Co-Chairs Quoted in Article About HHS Secretary Nominee

  • Bernie Nash and Lori Kalani, Co-Chairs of Cozen O’Connor’s State Attorneys General Practice, are quoted in a Healthcare Dive article discussing the expectations for California AG Xavier Becerra’s tenure if confirmed as the Secretary of the U.S. Department of Health and Human Services in the Biden administration.
  • Nash, noting that as a U.S. Congressman, Becerra sat on the Health Subcommittee of the House Ways and Means Committee, said, “[h]e’s very experienced and knowledgeable in the healthcare field.” Kalani discussed a conversation she had with AG Becerra just prior to the 2020 presidential election in which he stressed antitrust work as a top healthcare priority. Kalani added that Becerra would be likely to coordinate with the U.S. Attorney General on a more national scale, but such coordination will likely be fairly discreet.

Consumer Protection

Connecticut Attorney General Seeks to Beef Up Price Gouging Statute

  • Connecticut AG William Tong is seeking new legislation to strengthen Connecticut’s price gouging statute and has testified in favor of the proposed legislation before the General Law Committee of the Connecticut General Assembly.
  • According to the AG’s office, even though it received over 750 COVID-19-related price gouging complaints in 2020, it was unable to address some of the worst allegations of bad actors seeking to take advantage of severe shortages in protective equipment and essential goods because they did not fall under the current statute.
  • The proposed legislation aims to address three shortcomings in the current statute. First, it expands the price gouging statute beyond retail sales to include wholesale and the entire supply chain. Second, it more clearly defines price gouging behavior and prohibits the sale of certain goods and services at an “unconsciously excessive price.” Third, the new legislation will apply to rentals and leases of products and services, making it unlawful to rent or lease products and services at an unconscionable price.

Bipartisan Group of Attorneys General Fight District Court’s Reprieve for Robocallers

  • A bipartisan group of 35 AGs, led by Indiana AG Todd Rokita and North Carolina AG Josh Stein, filed an amicus brief in the U.S. Court of Appeals for the Sixth Circuit in Lindenbaum v. Realgy, LLC, arguing that the district court erred in finding that the Telephone Consumer Protection Act’s (“TCPA”) ban on robocalls was unenforceable from 2015 to 2020.
  • According to the brief, in 2015, the TCPA was amended to include a “government-debt exception” that allowed calls and texts to consumers for the purpose of collecting on debts owed to or guaranteed by the federal government, but this amendment was struck down by the U.S. Supreme Court in 2020 in Barr v. American Ass’n of Political Consultants, Inc. The district court held that the struck-down exception contaminated the TCPA in its entirety while it was in force, and that therefore, the TCPA could not be enforced against robocallers for their actions between 2015 and 2020.
  • The brief argues, among other things, that the district court’s ruling is contrary to the U.S. Supreme Court’s decision in Barr because the Supreme Court severed the struck-down exception from the rest of the Act, finding that the exception functioned independently and that the remaining provisions of the TCPA would be fully-operative without it, and further noting that the TCPA was fully operative for more than 20 years prior to the enactment of the exception. The brief also argues that the district court erred as a matter of statutory interpretation in not applying the severability decision retroactively.

Company Allegedly Promised Funding but Opened Credit Card Accounts for Consumers Instead

  • The Federal Trade Commission (“FTC”) reached a settlement with funding company Seed Consulting, LLC and a related company and individuals (collectively “Seed Consulting”) to resolve allegations that it used deceptive and unfair practices to charge consumers thousands of dollars to open credit card accounts for them in violation of the FTC Act, the Telemarketing Sales Rule, the Credit Repair Organization Act, and the Consumer Review Fairness Act.
  • The complaint alleged that Seed Consulting’s services were pitched to consumers by companies promising to teach how to make money by investing in real estate or operating an online business as a way to obtain funding for such undertakings. In reality, Seed Consulting allegedly did not provide its own funding and instead charged consumers thousands of dollars to open multiple credit card accounts, then notified the companies of the consumer’s new cards and credit limits. The complaint further alleged that Seed Consulting often inflated consumers’ income on the credit card applications.
  • Under the terms of the proposed stipulated order, among other things, Seed Consulting agreed to pay $2.1 million to the FTC to be used for consumer redress. It is also banned from selling or promoting consumer credit services and from misrepresenting or helping to misrepresent consumers’ financial information to financial institutions. Additionally, it must submit compliance reporting to the FTC.

Environment

Ignoring Stormwater Control Requirements Costs Solar Panel Company $1.14 Million

  • Massachusetts AG Maura Healey reached a settlement with solar energy development company Dynamic Energy Solutions, LLC (“Dynamic”) to resolve allegations that it polluted wetlands and waterways in violation of the federal Clean Water Act, the Massachusetts Wetlands Protection Act, and the Massachusetts Clean Waters Act.
  • The complaint alleged, among other things, that Dynamic constructed a solar panel array without designing and implementing legally-required stormwater controls, thereby causing sediment-laden stormwater to be discharged in sufficient quantities to uproot trees, destroy streambeds, fill wetlands with sediment and destroy wildlife habitats, and pollute a river that is a cold-water fishery, and failed to comply with an enforcement order.
  • Under the terms of the consent decree, Dynamic will pay a $100,000 civil money penalty, $215,000 to a land trust to be used for land conservation and preservation efforts, and $80,000 in attorney’s fees and costs. In addition, Dynamic will undertake restoration and compensatory mitigation projects at an estimated cost of $740,000.

False Claims Act

Adult Day Health Centers Settle Allegations of Medicaid Program Overbilling

  • Massachusetts AG Maura Healey reached a settlement with adult day health centers Fun Life Adult Day Care and Monarch Care (collectively “Fun Life and Monarch”), to resolve allegations that the day care centers improperly billed Massachusetts’s Medicaid Program (“MassHealth”) for adult day health programs.
  • According to the AG’s office, Fun Life and Monarch allegedly billed MassHealth for more hours than the hours members actually attended adult day health programs, and improperly submitted claims in excess of MassHealth’s per diem billing requirements.
  • Under the terms of the settlement, Fun Life and Monarch will pay over $1 million and will implement a three-year compliance program that will include updated billing policies and procedures, staff training, and third-party monitoring and auditing, among other things.
  • As previously reported, AG Healey settled allegations with adult day health company Quality Life Adult Day Services to resolve allegations that it improperly billed MassHealth for full-day services for members who did not attend the facility for the entire day.

Financial Industry

Bipartisan Group of Attorneys General Objects to Settlement Regarding Mortgage Payment Processing Fees

  • A bipartisan group of 33 AGs, led by Minnesota AG Keith Ellison and New York AG Letitia James, filed an amicus brief in the U.S. District Court for the Southern District of Florida in Morris et al. v. PHH Mortgage Corp. et al., opposing a proposed class action settlement relating to mortgage payment processing fees.
  • According to the brief, PHH Mortgage Corporation and its predecessor corporation, Ocwen Loan Servicing, LLC (collectively “PHH”), allegedly charged close to one million homeowners nationwide a fee for each monthly mortgage payment made by phone or through an online account, without disclosing or seeking authorization for such fees in the mortgage contract. The proposed settlement, opposed by the AGs, would permit PHH to continue charging such fees for the remaining life of the loan in exchange for a one-time payment or credit to affected homeowners.
  • The brief argues, among other things, that the transaction fees are illegal under the laws of many states, and that the proposed settlement is in effect an attempt to authorize the unlawful fees through an unwritten amendment of the mortgages, which would violate most states’ statutes of fraud. The brief also notes that the proposed settlement would only provide account credits to homeowners with a current mortgage serviced by PHH and that that credit would be applied to the unpaid principal of the mortgage only after all late fees are paid, resulting in PHH essentially paying itself through the credit in many cases.

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Are Sallie Mae Student Loans Federal or Private?

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When you hear the name Sallie Mae, you probably think of student loans. There’s a good reason for that; Sallie Mae has a long history, during which time it has provided both federal and private student loans.

However, as of 2014, all of Sallie Mae’s student loans are private, and its federal loans have been sold to another servicer. Here’s what to know if you have a Sallie Mae loan or are considering taking one out.

What is Sallie Mae?

Sallie Mae is a company that currently offers private student loans. But it has taken a few forms over the years.

In 1972, Congress first created the Student Loan Marketing Association (SLMA) as a private, for-profit corporation. Congress gave SLMA, commonly called “Sallie Mae,” the status of a government-sponsored enterprise (GSE) to support the company in its mission to provide stability and liquidity to the student loan market as a warehouse for student loans.

However, in 2004, the structure and purpose of the company began to change. SLMA dissolved in late December of that year, and the SLM Corporation, or “Sallie Mae,” was formed in its place as a fully private-sector company without GSE status.

In 2014, the company underwent another big adjustment when Sallie Mae split to form Navient and Sallie Mae. Navient is a federal student loan servicer that manages existing student loan accounts. Meanwhile, Sallie Mae continues to offer private student loans and other financial products to consumers. If you took out a student loan with Sallie Mae prior to 2014, there’s a chance that it was a federal student loan under the now-defunct Federal Family Education Loan Program (FFELP).

At present, Sallie Mae owns 1.4 percent of student loans in the United States. In addition to private student loans, the bank also offers credit cards, personal loans and savings accounts to its customers, many of whom are college students.

What is the difference between private and federal student loans?

When you’re seeking financing to pay for college, you’ll have a big choice to make: federal versus private student loans. Both types of loans offer some benefits and drawbacks.

Federal student loans are educational loans that come from the U.S. government. Under the William D. Ford Federal Direct Loan Program, there are four types of federal student loans available to qualified borrowers.

With federal student loans, you typically do not need a co-signer or even a credit check. The loans also come with numerous benefits, such as the ability to adjust your repayment plan based on your income. You may also be able to pause payments with a forbearance or deferment and perhaps even qualify for some level of student loan forgiveness.

On the negative side, most federal student loans feature borrowing limits, so you might need to find supplemental funding or scholarships if your educational costs exceed federal loan maximums.

Private student loans are educational loans you can access from private lenders, such as banks, credit unions and online lenders. On the plus side, private student loans often feature higher loan amounts than you can access through federal funding. And if you or your co-signer has excellent credit, you may be able to secure a competitive interest rate as well.

As for drawbacks, private student loans don’t offer the valuable benefits that federal student borrowers can enjoy. You may also face higher interest rates or have a harder time qualifying for financing if you have bad credit.

Are Sallie Mae loans better than federal student loans?

In general, federal loans are the best first choice for student borrowers. Federal student loans offer numerous benefits that private loans do not. You’ll generally want to complete the Free Application for Federal Student Aid (FAFSA) and review federal funding options before applying for any type of private student loan — Sallie Mae loans included.

However, private student loans, like those offered by Sallie Mae, do have their place. In some cases, federal student aid, grants, scholarships, work-study programs and savings might not be enough to cover educational expenses. In these situations, private student loans may provide you with another way to pay for college.

If you do need to take out private student loans, Sallie Mae is a lender worth considering. It offers loans for a variety of needs, including undergrad, MBA school, medical school, dental school and law school. Its loans also feature 100 percent coverage, so you can find funding for all of your certified school expenses.

With that said, it’s always best to compare a few lenders before committing. All lenders evaluate income and credit score differently, so it’s possible that another lender could give you lower interest rates or more favorable terms.

The bottom line

Sallie Mae may be a good choice if you’re in the market for private student loans and other financial products. Just be sure to do your research upfront, as you should before you take out any form of financing. Comparing multiple offers always gives you the best chance of saving money.

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Tips to do some fall cleaning on your finances

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Wealth manager, Harry Abrahamsen, has five simple ways to stay on top of the big financial picture.

PORTLAND, Maine — Keeping track of our financial stability is something we can all do, whether we have IRAs or 401ks or just a checking account. Harry J. Abrahamsen is the Founder of Abrahamsen Financial Group. He works with clients to create and grow their own wealth. Abrahamsen shares five financial tips, starting with knowing what you have. 

1. Analyze Your Finances Quarterly or Biannually

You want to make sure that your long-term strategy is congruent with your short-term strategy. If the short-term is not working out, you may need to adjust what you are doing to make sure your outcome produces the desired results you are looking to accomplish. It is just like setting sail on a voyage across the Atlantic Ocean. You know where you want to go and plot your course, but there are many factors that need to be considered to actually get you across and across safely. Your finances behave the exact same way. Check your current situation and make sure you are taking into consideration all of the various wealth-eroding factors that can take you completely off course.

With interest rates very low, now might be a good time to consider refinancing student loans or mortgages, or consolidating credit card debt. However, do so only if you need to or if you can create a positive cash flow. To ensure that you are saving the most by doing so, you must look at current payments, excluding taxes and insurance costs. This way you can do an apples-to-apples comparison.

The most important things to look for when reviewing your credit report is accuracy. Make sure the reporting agencies are reporting things actuary. If it doesn’t appear to be reporting correct and accurate information, you should consult with a reputable credit repair company to help you fix the incorrect information.

4. Savings and Retirement Accounts

The most important thing to consider when reviewing your savings and retirement accounts is to make sure the strategies match your short-term and long-term investment objectives. All too often people end up making decisions one at a time, at different times in their lives, with different people, under different circumstances. Having a sound strategy in place will allow you to view your finances with a macro-economic lens vs a micro-economic view. Stay the course and adjust accordingly from a risk and tax standpoint.

RELATED: Financial lessons learned through the pandemic

A great tip for lowering utility bills or car insurance premiums: Simply ask! There may be things you are not aware of that could save you hundreds of dollars every month. You just need to call all of the companies that you do business with to find out about cost-cutting strategies. 

RELATED: Overcome your fear of finances

To learn more about Abrahamsen Financial, click here

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How to Get a Loan Even with Bad Credit

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Sana pwedeng mabura ang bad credit history as quickly and easily as paying off your utility bills, ‘no? Unfortunately, it takes time. And bago mo pa maayos ang bad credit mo, more often than not, kailangan mo na namang mag-avail ng panibagong loan. 

Good thing you can still get a loan even with bad credit, kahit na medyo limited ang options. How do you get a loan if you have bad credit? Alamin sa short guide na ito. 

For more finance tips, visit Moneymax.

 

 

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