Today, leading Democratic lawmakers called on financial institutions to work proactively with their customers facing financial distress as a result of the shutdown of the Federal Government. Fourteen days into the shutdown, many employees have now seen their first diminished paycheck, leaving them facing short-term financial hardship and possible long-term damage to their creditworthiness through no fault of their own.
Led by Congresswoman Maxine Waters, 30 Democrats including Minority Whip Steny Hoyer and Chris Van Hollen have introduced a concurrent resolution urging institutions such as banks and consumer reporting agencies to work proactively with customers affected by the shutdown. The resolution calls on them to identify customers that have been affected and to adopt flexible, prudent arrangements to help them meet their debt obligations. For example, the resolution urges institutions to consider temporarily waiving or reducing penalties for late payments. Importantly, it also urges these institutions to work with their customers to protect the affected employees' creditworthiness.
"The shutdown of the Federal Government has forced thousands of people into financial distress through no fault of their own," said Congresswoman Maxine Waters (D-CA), Ranking Member of the House Financial Services Committee. "Financial institutions should not penalize -- or profit from -- those affected by these difficult circumstances."
"The current shutdown is reckless and irresponsible," said Congressman Chris Van Hollen (D-MD). "We should reopen the government immediately and stop playing political games with the full faith and credit of the United States. However, until that happens, we are adding our voice to the recent guidance put out by our nation's top regulators calling on our financial institutions to work in good faith with their customers who may be experiencing short term financial hardship during this shutdown through absolutely no fault of their own. It makes sense for everyone financially and is the right thing to do."
"The partisan actions of some in Congress have caused this reckless shutdown, creating real financial strain on the residents of Northern Virginia, and those across the nation, who work directly for, contract with, or receive benefits from the federal government," said Rep. Gerald E. Connolly (D-VA). "I commend those financial institutions that already are offering payment flexibility for those who were furloughed earlier in the year as a result of the painful cuts of sequestration, and I encourage all banks, credit unions, and related financial institutions to pursue similar arrangements as a result of this current situation."
"Every day, I am hearing from federal workers from across my district about the financial hardships they are facing due to this government shutdown," said Congresswoman Donna F. Edwards (D-MD). "For federal workers who have experienced three years of a pay freeze, and sequestration that forced many to take unpaid furloughs earlier this year, they should not be penalized now by their financial institutions due to circumstances beyond their control. I thank Congresswoman Waters for her leadership on this important issue to protect the creditworthiness of federal workers during this difficult time."
Original cosponsors to the legislation include: Minority Whip, Steny Hoyer, Rep. Chris Van Hollen, Rep. Gerry Connelly, Rep. Donna F. Edwards, Rep. Eleanor Holmes Norton, Rep. Jim Moran, Rep. Carolyn Maloney, Rep. Melvin Watt, Rep. Brad Sherman, Rep. Gregory W. Meeks, Rep. Michael E. Capuano, Rep. Ruben Hinojosa, Rep. William Lacy Clay, Rep. Stephen Lynch, Rep. David Scott, Rep. Al Green, Rep. Emanuel Cleaver, Rep. Gwen Moore, Rep. Keith Ellison, Rep. Ed Perlmutter, Rep. Jim Himes, Rep. John Carney, Rep. Terri Sewell, Rep. Bill Foster, Rep. Dan Kildee, Rep. Patrick Murphy, Rep. John Delaney, Rep. Joyce Beatty, and Rep. Denny Heck.