Peterson releases statement setting out immediate steps needed to prevent home foreclosure, evictions, vehicle repossession, and credit reporting errors
Salt Lake City, Utah — Today gubernatorial candidate Chris Peterson issued a statement calling for expanded consumer protection measures to address the economic fallout from the COVID-19 pandemic.
Earlier this week Peterson joined other former federal officials in issuing a whitepaper recommending over a dozen steps banking regulators should take in response to the crisis. “There is much more that the state of Utah should do to protect the public,” said Peterson.
“We appreciate the steps our leaders are taking to address the pandemic,” said Peterson. “But, we still need practical solutions on pocketbook issues facing so many families who have lost their jobs or seen their wages reduced.”
Peterson, a former official with the federal Consumer Financial Protection Bureau, the Department of Defense, and a law professor, recommended detailed reforms on how to ensure the public sees some of the benefit from federal relief efforts.
“The federal government is spending trillions of dollars to assist businesses hit hard by this crisis. But, thousands of Utah families still need immediate action from the State government to make
sure their family budget stays on track,” explained Peterson. “These steps are needed to help Utah’s working people.”
Peterson’s recommendations include:
- Find Out from Utah Consumers What Is Happening and Share the News Widely. Right now, the Utah Governor’s Office should be directing the Utah Department of Financial Institutions, Division of Consumer Protection, and Division of Real Estate to assemble a detailed picture of what is going on in the consumer marketplace, and, above all, what people need in this time of crisis, using all the means at its disposal.
- Help People Avoid Foreclosure. The Governor’s Office should direct the Department of Financial Institutions to use its supervisory authority to ensure mortgage loan servicing companies are rapidly accommodating homeowners seeking to defer mortgage payments during the crisis. Under the federal Coronavirus Aid, Relief and Economic Security (CARES) Act, consumers are entitled to defer mortgage payments for three months. “Some banks are telling homeowners that postponed payments will be due in full once the three months are up,” explained Peterson. “The Governor and Utah regulators should insist that borrowers may tack suspended payments on the back end of the loan.”
- Help People Avoid Eviction. The Governor’s Office has taken a positive step by implementing a moratorium on eviction of affected residential tenants until May 15th. However, the order specifies that unpaid rent will be due after the order is lifted. The Governor’s office or the Legislature in special session should work with landlords to establish repayment plans for unpaid rent based on the tenants’ ability to repay. “Many tenants who have lost their job, had their wages reduced, or were infected with the virus will need time to get back on their feet,” said Peterson “The Governor’s office should do more to route emergency funding to these families and to ensure landlords work with their struggling tenants.”
- Help People Avoid Repossession of Vehicles. For many Utahns, their cars and trucks are a critical lifeline to get to work, secure food, or access emergency medical care. The Governor’s Office should impose a temporary moratorium on auto repossessions and establish clear and specific policies to facilitate consumers deferring their auto loan payments. The Utah Department of Financial Institutions should work with financial institutions, auto dealerships, and other businesses to ensure they have access to federal relief funds needed to accommodate these struggling consumers. “Our economic outlook will only be worse if tens of thousands of Utahns lose their car or truck at the same time they are losing their health or their job.” said Peterson. “The Governor’s office should lead an effort to ensure these Utahns can hold onto their vehicle and defer their loan or lease payments during the crisis.”
- Ensure Creditors Give Appropriate Latitude to Consumers in Reporting Credit Information. The standards for furnishing information to the credit reporting companies specify that accounts affected by a “natural or declared disaster” are reported with a special code that preserves people’s credit from being damaged. The Governor’s office should direct the Utah Department of Financial Institutions to immediately issue clear guidance that specifying that if payment on consumer loans is deferred in relation to the pandemic, it should be reported accurately. “Our leaders should use the law to help struggling Utahns to bolster their reputation and access to credit,” said Peterson.
- Provide Vigorous Oversight Over Debt Collectors. As more indebted Utahns begin to face delinquency and default, Utah leaders should develop a plan to stop harassment and abuses by some debt collectors. The Governor’s office should instruct the Utah Department of Financial Institutions and Division of Consumer Protection to issue joint guidance reminding debt collectors that the Fair Debt Collection Practices Act prohibits any conduct “the natural consequence of which is to harass, oppress or abuse any person in connection with the collection of a debt” or any conduct that is “unfair or unconscionable.” These protections are more important than ever during this time of crisis.
- Put a Stop to Scams, Frauds, and Other Deceptive Practices. Fraudsters and scam artists are proliferating with novel illegal schemes designed to take money out of people’s pockets just when they need it to get by. The Utah government must be aggressive in responding to fraudulent and predatory behavior. This kind of despicable conduct — taking advantage of the misfortunes of others — must be monitored closely and prosecuted harshly and publicly to deter imitators. The Governor’s office should establish a joint task force including the state Bureau of Investigation, the Utah Attorney General’s Office, the Department of Financial Institutions, and the Consumer Protection Division. These offices should coordinate with regional offices of federal law enforcement agencies including the U.S. Attorney, the Securities and Exchange Commission, the Federal Trade Commission, the Consumer Financial Protection Bureau, and the Federal Bureau of Investigation. “A consumer fraud task force should work in partnership with financial institutions and the business community to identify and put a stop to COVID-19 scams,” said Peterson.
Peterson concluded: “In Utah, I am grateful to see how we are coming together to support each other during this difficult time. I urge Utahns to remember our core values of compassion, integrity, and hard work as we move together toward practical solutions.”