InfoBytes Blog
Filter
Subscribe to our InfoBytes Blog weekly newsletter and other publications for news affecting the financial services industry.
Senator Warren invites student loan servicer to testify before Congress
On March 18, Senator Elizabeth Warren (D-MA) sent a letter to a large student loan servicer, inviting its executives to testify at an upcoming hearing hosted by the Banking, Housing, and Urban Affairs Subcommittee on Economic Policy on April 10. The hearing will focus on the servicer’s performance, student loan borrowers’ experience with return to repayment, and the Public Service Loan Forgiveness (PSLF) program. The letter alleged the servicer “mishandl[ed]” borrowers return to repayment after the pandemic by impeding public servants’ access to PSLF relief, among other things. Senator Warren also alleged the servicer failed to perform “basic servicing functions” for PSLF borrowers which led to a backlog of public service workers’ forms eligible towards receiving credit on their student debts. The letter further alleged the servicer implemented a “call deflection scheme” to redirect borrowers' calls from customer service representatives. Testifying would give the servicer the chance to provide context to the allegations, Warren said.
OCC Acting Deputy Comptroller Murphy testifies on OCC’s Office of Financial Technology
On December 5, the Acting Deputy Comptroller of the OCC’s Office of Financial Technology, Donna Murphy, testified before the U.S. House Subcommittee on Digital Assets, Financial Technology and Inclusion. Her testimony focused on the OCC’s supervision and regulation of new and emerging fintech products.
Created in October 2022, the Office of Financial Technology regulates and supervises all aspects of fintech innovation in the federal banking system, including bank-fintech partnerships, artificial intelligence, and digital assets. Murphy testified that a strong risk management plan against third parties is essential. She referenced the joint guidance issued earlier this year by the OCC, Federal Reserve, and FDIC (previously covered by InfoBytes, here).
Murphy also discussed the use of artificial intelligence and algorithms in banking, highlighting the many ways they can strengthen safety and soundness, enhance consumer protection, improve compliance, address financial crime, and increase fairness and access to the banking system. However, Murphy highlighted the need for banks to focus on software design, testing, security, and data management when implementing artificial intelligence. Lastly, Murphy iterated the OCC’s commitment to reducing inequality in banking and increasing access to financial services for all.