The CFPB held its fourth webcast in its Military Educator Forum series last week, addressing various consumer issues affecting veterans. Holly Patraeus, head of the Office of Servicemember Affairs, summarized the consumer issues that her office is focusing on: overly aggressive marketing to veterans by certain institutions of higher education to take advantage of the GI bill, student loan debt incurred by veterans, deceptive advertising with respect to home loans for veterans, and pension advance schemes.
The CFPB, along with the VA and the Department of Justice, developed a new GI Bill Comparison Tool, which is aimed at providing a consolidated and simplified search tool. Before the Comparison Tool was developed, finding an answer to a very simple question, such as how much is covered by GI Bill benefits, would require going to anywhere between 17-22 websites from multiple federal agencies. The new Comparison Tool provides a direct link to the Department of Education’s College Navigator profile, and all information is available with “one click.” The Tool also provides demographic figures on how many other veterans are attending, and how those veterans are doing in terms of post-graduation employment. The primary purpose of the Tool is to show how the GI Bill benefit would work in real life. As we have previously reported, Director Cordray has maintained that protecting servicemembers is a priority for the CFPB. In particular, complaints relating to servicemember higher education are of particular concern, such that federal agencies, including the CFPB, FTC, and DOJ, have created a new online complaint submission system for this specific issue.
The webcast also discussed some of the various products that veterans are particularly susceptible to, including pension advance schemes, where military veterans or other eligible retirees are offered a lump sum payout in exchange for their pension payouts. Representatives from the CFPB also discussed the warnings the CFPB and FTC had sent to various mortgagees for potentially violating the law by implying they are VA-approved or promising special deals for veterans in a way that may mislead consumers about the product’s actual terms. The representatives also cautioned against the lure of “no payment” reverse mortgages, targeted at older Americans desperate to stay in their homes. According to the CFPB, warning signs include: official-looking logos implying that the advertisement comes from a government agency such as the VA or HUD; promise of “amazingly low rates,” promises that a reverse mortgage will let veterans stay in their homes for free, or offers of “pre-approval” and large amounts of cash or credit available to the veteran.
The CFPB has continued to maintain a high level of interest in consumer issues affecting servicemembers, and we will continue to report on any developments.