America needs the CFPB now more than ever – National Consumers League

SG-headshot.jpgGiven the multiple fusillades the week-old Trump Administration has lobbed at civil liberties, the environment, and abortion rights, the attack on the Consumer Financial Protection Bureau (CFPB) might seem rather minor. But nothing could be further from the truth. Two Republican Senators are asking President Trump to remove the director of the CFPB, Richard Cordray.

As the New York Times pointed out this weekend:

“The bureau is the only federal agency with the sole mission of looking out for Americans in their dealings with banks and other lenders. CFPB’s investigations have yielded ‘$12 billion to millions of Americans in the past five years—money that otherwise would have enriched lenders through high and hidden fees on bank accounts and credit cards, predatory mortgages, deceptive terms in student loans, illegal debt collection from military service members and unfair auto loans.”

As Liz Weston argued, the Bureau has done a tremendous amount in five short years including:

  • Created rules requiring lenders to consider people’s ability to repay a mortgage and curbed their ability to make the risky loans.
  • Ordered lenders that were illegally overcharging service members to refund millions of dollars to their military borrowers.
  • Forced multiple credit card issuers—including American Express, Bank of America, Chase, and Citibank—to pay hundreds of millions of dollars in compensation to consumers over illegal practices, including unfair billing and deceptive marketing.
  • Got the credit bureaus to finally update their dispute-processing software so that documents submitted by consumers, such as account statements or receipts, could be forwarded to companies reporting incorrect information.
  • Took steps to rein in the debt collection industry, including fining Chase $136 million for selling “zombie debts” to debt buyers that included accounts that were already settled, discharged in bankruptcy or simply not owed.

The CFPB also studied forced arbitration in consumer contracts and recommended outlawing them.

If the goal is to protect the average American from financial service exploitation, this is the most important agency we have. Cordray is an extraordinary public servant who has taken the Bureau through many challenging projects and has played the all-critical cop on the beat. This is one agency that is good for everyone across the political spectrum.