FederalDaily - September 6, 2007
Group Says Pentagon Adopted Inadequate Credit Rules
New lending rules just adopted by the Pentagon were too narrowly drawn and will allow predatory lenders
to tweak loan terms to get around the 36 percent interest rate cap that is supposed to protect military
families, a consumer group said on Sept. 4. According to the National Consumer Law Center (NCLC), by
narrowly defining problem loans, the Pentagon’s final rules of implementation actually weaken
the federal law that was intended to stop the abusive financial practices. The Military Lending Act
passed by Congress last year caps rates at 36 percent for consumer loans to military families. During
the rulemaking process, the banking industry lobbied the Pentagon strongly, asking that they be exempted
from the rules. Instead of the exemptions, the Pentagon narrowly defined the categories of loans, excluding
credit cards, overdraft loans and all forms of open-end credit. “Perhaps unintentionally, the
Pentagon has provided predatory lenders with a set of very specific instructions: ‘How to avoid
the cap and keep charging 400 percent interest,’” said Lauren Saunders, NCLC managing attorney.
To see more, go to: www.responsiblelending.org/pdfs/DoD-Comments-final-6-11-07.pdf.
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TAP Renews Call to Abolish IRS Private Debt Collections
The Taxpayer Advocacy Panel (TAP) renewed its call for the IRS to abolish the agency’s program
that uses private-sector debt collectors to pursue tax deadbeats. The panel made its recommendation
in a recently released annual report that reiterates the suggestion it made a year ago—dismantle
the private collections effort. “The IRS should abandon all plans to outsource any tax collection
work and restrict collection activities to properly-trained and proficient IRS personnel,” TAP
said in its report, which contains 58 recommendations. The panel—which has about 100 volunteer
members appointed by the Secretary of the Treasury—was established as a way of providing direct
taxpayer input to the IRS. National Treasury Employees Union (NTEU) President Colleen Kelley, who has
been sharply critical of the private debt collections, applauded TAP’s position. “Multiple
knowledgeable voices, including those from bipartisan members of Congress and from both within and
outside the IRS, have reached the same conclusion as TAP,” Kelley said. To see more, go to: www.nteu.org.
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Hispanic Publication Ranks USPS Among Top Entities for Diversity
Hispanic Business magazine has named the U.S. Postal Service (USPS) to its annual Diversity Elite
60 List, making the USPS the only federal entity to make this year’s ranking, USPS said Wednesday.
The list, which is included in the business magazine’s September issue, cited the agency as one
of the best companies for Hispanics determined by about 30 variables, such as a firm’s commitment
to Hispanic hiring, promotion and philanthropy. “The Postal Service is committed to fostering
a business culture that provides an inclusive work environment for all employees,” USPS said
in a Sept. 5 statement. To see more, go to: www.usps.com/news
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