Magazine article American Banker

CFPB Criticizes 10 Institutions for Lack of Transparency

Magazine article American Banker

CFPB Criticizes 10 Institutions for Lack of Transparency

Article excerpt

Byline: Rachel Witkowski

WASHINGTON -- The Consumer Financial Protection Bureau named 10 banks and credit unions on Wednesday that it claimed were not being transparent about their agreements with large universities to market financial products to students.

A Wednesday blog posting by Rohit Chopra, the CFPB's student loan ombudsman, said 10 out of 11 institutions that have partnerships with some of the largest universities have either not disclosed or partially disclosed their agreements online. Those banks included Capital One, Wells Fargo, U.S. Bank, Huntington Bank and PNC Bank.

In response, the CFPB sent alerts to university officials, urging them to get their partnering institution to make the agreement more easily accessible online.

"Based on a scan of your financial institution partner's website, it appears that" the partnering institution "has not disclosed this agreement. We wanted to alert you that this failure to be transparent may pose potential consumer protection risks," Chopra said in a sample letter posted to the blog.

The blog lists off 14 universities that are members of the Big Ten conference, only one of which lacks a known partnering financial institution. Of the 13 remaining schools, eight had a partnering institution that did not disclose any agreement online. Three other universities had partnerships with TCF Bank, which the CFPB said posted a partial portion of the agreement online.

The only institution deemed to have made the entire agreement easily available was Hills Bank & Trust Co. …

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