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Thursday, September 19, 2019

Del. AG urges banks to comply with laws protecting military personnel

By Bryan Cohen | Oct 4, 2013

WILMINGTON, Del. (Legal Newsline) -- Delaware Attorney General Beau Biden sent letters to about 30 leading lending institutions Thursday requesting information about their compliance with the Servicemembers Civil Relief Act.

The letters to credit card banks, mortgage servicers and student loan servicers came after recent settlements between the federal government and large banks over violations of SCRA, which is meant to offer financial protections to military personnel.

SCRA caps interest rates on most loans at 6 percent and postpones civil proceedings during a deployment.

"Our military servicemembers who risk their lives and fight to defend us overseas should not have to worry about additional financial pressures at home," Biden said. "Their sole focus should be on the mission and returning home safely. I personally witnessed the sacrifices that our military makes every day for our country.

"The need for full compliance with the SCRA has never been more essential. A soldier in Afghanistan should be lining up for the satellite phone to call a loved one back home, not to call a debt collector who is not following the law."

The letters demand information about what the lenders are doing to determine if they violated SCRA in the past and what they are doing to make sure they are in compliance with the law going forward.

Biden also sent letters to the chairmen of the U.S. House and Senate's veterans affairs committees, urging lawmakers to let state attorney generals prosecute violations of the law.

"Our troops have been engaged in overseas combat for more than a decade, making strict compliance with the SCRA all the more essential," the attorney general said. "In these times a single violation of the SCRA is one too many. Those men and women should not be distracted from their mission by having to deal with unnecessary (and illegal) financial conflict at home...

"As the chief consumer protectors in our respective states, and the 'boots on the ground,' state attorneys general are often the first to hear about abuses in the arena of consumer debt, including abuses of servicemembers."

In July, Capital One agreed with the U.S. Department of Justice to pay $12 million to resolve allegations of SCRA violations.

In September, JPMorgan Chase reached a federal settlement calling for the bank to compensate service members for past violations. The agreement required the bank to set up internal procedures to increase SCRA compliance.

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