LOS ANGELES (Reuters) - Two changes to the US consumer bankruptcy process could help some of the most trapped student loan borrowers free themselves from a modern-day debtors prison.
President Barack Obama last week directed three US government agencies - the Department of the Treasury and Education as well as the Consumer Financial Protection Bureau - to report by Oct. 1 whether bankruptcy or other laws and regulations should be revised for student loans.
One change that is long overdue, and suggested by a group of Democratic senators who introduced a bill last Friday, would be to make private student loans erasable in bankruptcy court.
Led by Senator Dick Durban of Illinois, the lawmakers introduced The Fairness for Struggling Students Act of 2015 to revoke private student loans special treatment. But the bill is expected to have little chance of passage in the Republican-controlled Congress.
That is unfortunate since the 2005 law that gave private student loans parity with federal student loans is difficult to defend.
In contrast to federal student loans, private education loans do not use taxpayer funds or have government guarantees. Federal student loans also do not use credit scores or vary interest rates to reflect default risk, while private lenders do.
Private lenders typically require creditworthy co-signers, while federal loans do not.
In other words, private student lenders can and do employ methods that compensate them for the risks they take. Yet their loans get a much higher level of protection in bankruptcy proceedings than mortgages, auto loans, credit cards or any other privately-issued debt.
Another much-needed change, which likely would not require congressional action, would be to call off the watchdog-turned-attack-dog that fights the most troubled debtors efforts to erase federal student loans.
Currently, very few people are able to erase any student loans in bankruptcy court, no matter how dire their financial or personal situations. Debtors must prove not only that they cannot maintain a minimal standard of living while paying their debt, but that their situations will not improve.
The few borrowers who try to prove their financial desperation typically meet aggressive legal challenges from the Educational Credit Management Corporation, a private nonprofit hired by the federal government to monitor bankruptcy cases.
The National Consumer Law Center has denounced ECMCs over-the-top, hardball tactics, while an investigation by The New York Times found the agency has veered more than occasionally into dubious terrain.
A New Hampshire bankruptcy judge sanctioned ECMC for abusing the bankruptcy process by pursuing a woman who had already paid off her student loans. In another case, ECMC appealed a partial student loan discharge for a victim of pancreatic cancer and numerous other ailments, arguing that she failed to prove that a recurrence of the notoriously lethal cancer was a probability, rather than a mere possibility, court records show.
Advocates for overwhelmed student borrowers say ECMCs relentless assaults and appeals drive up the already-daunting costs of filing for education debt relief.
The agency says it is trying to recoup as much money for taxpayers as possible. Our employees in the loan-servicing side of our company go into work every day focused on two things: doing the job we are contracted to do on behalf of taxpayers and the federal government, and treating every student with the respect, empathy and dignity they deserve, ECMC Group president and CEO David Hawn said in an emailed statement.
In fact, ECMC was created in 1994 because another agency that guaranteed federal student loans collapsed after huge numbers of borrowers ignored their debts. But numerous reforms since then have made it much harder to walk away from education debt and provided more income-based repayment options for struggling debtors.
So those landing in bankruptcy court now are the blood from a stone cases with little if any money to be recouped. The bankruptcy standard has been set so high that there is no real need to pursue appeals with such fervor.
Bankruptcy law does not allow student loans to be erased in a regular filing. Instead, attempts to discharge education debt require an additional filing known as an adversary proceeding.
A study published in the American Bankruptcy Law Journal found that only 213 of the 170,000 people with student loans who filed for bankruptcy in 2007 took that extra step. Of those, 51 won full discharges of their loans and 30 received partial discharges.
Adversary proceedings require substantially more work for attorneys who are employed by already cash-strapped clients. Those who win discharges typically either represent themselves or have free legal help, bankruptcy attorneys note.
Given these high hurdles, ECMCs bellicose approach is simply overkill. If the federal government wants to continue using its services, the agency should be required to use common sense - and common decency - before pursuing hapless borrowers.
(The author is a Reuters columnist. The opinions expressed are her own.)
(Editing by Lauren Young, G Crosse and Beth Pinsker)
Kinder Morgan, Inc. (KMI): Chairman and CEO Richard D Kinder Bought 100,000 Shares
Chairman and CEO of Kinder Morgan, Inc. (KMI) Richard D Kinder bought 100,000 shares on 03/13/2015 at an average price of $42.12. Kinder Morgan, Inc., is a midstream and energy company formed in August 23, 2006. Kinder Morgan, Inc. has a market cap of $89.72 billion; its shares were traded at around $42.12 with a P/E ratio of 43.30 and P/S ratio of 2.90. The dividend yield of Kinder Morgan, Inc. stocks is 4.20%.
Glenn Greenberg (Trades, Portfolio) bought 4,193,877 shares in the quarter that ended on 12/31/2014, which is 6.2% of the $2.87 billion portfolio of Brave Warrior Advisors, LLC. Ruane Cunniff (Trades, Portfolio) bought 9,630 shares in the quarter that ended on 12/31/2014, which is 0.0021% of the $19.63 billion portfolio of Ruane, Cunniff amp; Goldfarb Inc. Ken Fisher (Trades, Portfolio) bought 9,569 shares in the quarter that ended on 12/31/2014, which is 0.0008% of the $48.37 billion portfolio of Fisher Asset Management, LLC.
VP (President, Terminals) John W Schlosser sold 0 shares of KMI stock on 12/05/2014 at the average price of 0. John W Schlosser owns at least 307,792 shares after this.
JMP Group LLC (JMP): CEO, 10% Owner Joseph A Jolson Bought 190,000 Shares
CEO, 10% Owner of JMP Group LLC (JMP) Joseph A Jolson bought 190,000 shares on 03/13/2015 at an average price of $8.75. JMP Group Inc. is a Delaware Corporation. It is an investment banking, asset management and corporate credit management firm. Jmp Group Llc has a market cap of $185.642 million; its shares were traded at around $8.75 with a P/E ratio of 17.30 and P/S ratio of 1.20. The dividend yield of Jmp Group Llc stocks is 3.40%.
Director Craig R Johnson bought 30,000 shares of JMP stock on 03/11/2015 at the average price of 7.25. Craig R Johnson owns at least 946,782 shares after this. The price of the stock has increased by 20.69% since.
Covanta Holding Corp (CVA): President and CEO Stephen J Jones Bought 50,000 Shares
President and CEO of Covanta Holding Corp (CVA) Stephen J Jones bought 50,000 shares on 03/13/2015 at an average price of $22.83. Covanta Holding Corp was incorporated in Delaware on April 16, 1992. Covanta Holding Corp has a market cap of $3.03 billion; its shares were traded at around $22.83 with and P/S ratio of 1.70. The dividend yield of Covanta Holding Corp stocks is 3.90%.
Covanta recently reported its fourth quarter and full year 2014 financial results. For the twelve months ended December 31, 2014, total revenues increased by $52 million to $1,682 million from $1,630 million in 2013. The primary driver for the increase was North America EfW revenue, which increased by $39 million.
Mario Gabelli (Trades, Portfolio) owns 243,000 shares as of 12/31/2014, which accounts for 0.028% of the $19.2 billion portfolio of GAMCO Investors. Martin Whitman (Trades, Portfolio) owns 5,956,007 shares as of 10/31/2014, which accounts for 6.4% of the $1.89 billion portfolio of Third Avenue Value Fund.
Director Peter C B Bynoe sold 13,334 shares of CVA stock on 12/02/2014 at the average price of 23.86. Peter C B Bynoe owns at least 83,956 shares after this. The price of the stock has decreased by 4.32% since.
Taubman Centers Inc (TCO): President, CEO, AND Chair BOD Robert S Taubman Bought 7,100 Shares
President, CEO, AND Chair BOD of Taubman Centers Inc (TCO) Robert S Taubman bought 7,100 shares on 03/16/2015 at an average price of $80.53. Taubman Centers, Inc. is a Michigan corporation, founded in 1950. Taubman Centers Inc has a market cap of $5.1 billion; its shares were traded at around $80.53 with a P/E ratio of 5.90 and P/S ratio of 7.50. The dividend yield of Taubman Centers Inc stocks is 2.70%. Taubman Centers Inc had an annual average earnings growth of 3.70% over the past 10 years.
TCO recently reported its fourth quarter and full year 2014 financial results. The company announced that net income attributable to common shareholders (EPS) per diluted share during the fourth quarter was $6.86, compared to $0.62 in the three months ended December 31, 2013.
Chris Davis (Trades, Portfolio) owns 97,620 shares as of 12/31/2014, which accounts for 0.024% of the $30.91 billion portfolio of Davis Selected Advisers. David Dreman (Trades, Portfolio) owns 1,158 shares as of 12/31/2014, which accounts for 0.0072% of the $1.22 billion portfolio of Dreman Value Management.
Vice Chairman AND CFO Lisa A Payne sold 1,250 shares of TCO stock on 03/10/2015 at the average price of 75. Lisa A Payne owns at least 57,311 shares after this. The price of the stock has increased by 7.37% since.
Hilltop Holdings Inc (HTH): President amp; CEO Jeremy B Ford Bought 24,938 Shares
President amp; CEO of Hilltop Holdings Inc (HTH) Jeremy B Ford bought 24,938 shares on 03/13/2015 at an average price of $19.91. Hilltop Holdings Inc., was formed in 1998 as a Maryland corporation. Hilltop Holdings Inc has a market cap of $2 billion; its shares were traded at around $19.91 with a P/E ratio of 17.00 and P/S ratio of 1.50.
PlainsCapital Corp. Pres amp; COO James R Huffines bought 5,000 shares of HTH stock on 03/10/2015 at the average price of 19.21. James R Huffines owns at least 337,420 shares after this. The price of the stock has increased by 3.64% since.
Shares of JMP Group (NYSE:JMP) have been given an average recommendation of Buy by the seven ratings firms that are presently covering the company, American Banking Market News reports. One equities research analyst has rated the stock with a hold rating and six have issued a buy rating on the company. The average 1-year target price among brokers that have updated their coverage on the stock in the last year is $20.73.
Shares of JMP Group (NYSE:JMP) traded up 2.1236% during mid-day trading on Thursday, hitting $8.1801. 49,586 shares of the companys stock traded hands. JMP Group has a 1-year low of $6.0000 and a 1-year high of $8.4000. The stocks 50-day moving average is $7.48 and its 200-day moving average is $7.25. The company has a market cap of $173.55 million and a P/E ratio of 14.4270.
JMP Group (NYSE:JMP) last posted its quarterly earnings results on Friday, February 13th. The company reported $0.21 EPS for the quarter, beating the Thomson Reuters consensus estimate of $0.13 by $0.08. The company had revenue of $54.10 million for the quarter. Analysts expect that JMP Group will post $0.8500 EPS for the current fiscal year.
In other JMP Group news, CEO Joseph A. Jolson bought 190,000 shares of the companys stock on the open market in a transaction that occurred on Friday, March 13th. The shares were purchased at an average cost of $7.25 per share, for a total transaction of $1,377,500.00. The purchase was disclosed in a legal filing with the SEC, which is available at this link.
Several analysts have recently commented on the stock. Analysts at Deutsche Bank reiterated a buy rating and set a $66.00 price target on shares of JMP Group in a research note on Thursday. Analysts at TheStreet upgraded shares of JMP Group from a sell rating to a hold rating in a research note on Friday, February 13th. Finally, analysts at Zacks upgraded shares of JMP Group from a neutral rating to an outperform rating and set a $8.50 price target on the stock in a research note on Friday, January 2nd.
JMP Group Inc is a full-service investment banking, asset management and corporate credit management firm. The Company provides investment banking, sales and trading, and equity research services to corporate and institutional clients, and alternative asset management products and services to institutional investors and high-net-worth individuals.
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Bank of Uganda has awarded a license to Metropol Corporation to operate a credit reference bureau.
Metropol is a Kenyan firm established in 1996 as a business information and credit management company. Metropol and Global Credit Rating (GCR) partnered in 2006 to provide credit rating services that enable corporates to raise capital and meet their financial needs. Apart from getting the recent license from the Central Bank of Uganda, Metropol is also licensed by the Central Bank of Kenya to provide Credit Reference Bureau services to all Kenya Banks in Kenya.
In Kenya, Metropol was the first Kenyan firm to have received an agency license. The other two firms are all foreign firms. They include Global Credit Rating Company of South Africa and Agusto and Company Limited from Nigeria.
Metropol Corporation Ltd focuses on providing credit ratings to SMEs to increase their potential to access money diversified capital sources.
Compuscan was given a contract by the BOU in 2008 until 2012 when the monopoly ended. Metropol has been waiting for this license for over two years. Metropol comes on board with a strong capacity having operations in Kenya, Tanzania and Rwanda and further south in Zimbabwe.
Credit reference Bureau
The parliament of Uganda passed the Microfinance Deposit taking institution Act 2003 (MDI Act) and the Financial Institutions Act 2004 (FIA). These two acts propelled the process of establishing a Credit Reference Bureau in the country.