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Benjamin K. Olson quoted in American Banker article, “Pentagon, others baffled by CFPB plan to cease military lending exams”

American Banker

Benjamin K. Olson

Benjamin K. Olson was quoted on October 11, 2018 in an American Banker article, “Pentagon, others baffled by CFPB plan to cease military lending exams,” which discussed the Consumer Financial Protection Bureau’s decision to stop examining compliance with the Military Lending Act. The article stated, “Some industry insiders argue that the MLA, particularly after efforts to strengthen the law, in some cases set financial institutions up for failure. In general, banks and other financial institutions have gone to great lengths to ensure compliance with the MLA, in part since being perceived as harming service members could pose reputational problems. But running afoul of the law is relatively easy. For example, large lenders are required to check a Defense Department database of active-duty service members to determine which borrowers fall under the APR cap, but some say the database is difficult to navigate. Also, if a lender includes an arbitration agreement in a contract for a service member, which is prohibited by the statute, then the contract is void and the lender may have to swallow the borrower's entire debt.”

Olson noted, “Implementation of MLA has been a struggle for the industry and the penalties are really harsh.”

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