Senator Elizabeth Warren, the Senate Banking, Housing, and Urban Affairs Committee’s top Democrat is convening a forum Tuesday to investigate the President Donald Trump-Elon Musk attack on the Consumer Financial Protection Bureau. It is thanks to Warren that this important financial regulator even exists. She was instrumental in having the CFPB created as part of the Wall Street Reform and Consumer Protection Act of 2010. Since then, this independent agency has returned over $21 billion to Americans wronged by financial institutions and corporations. The Student Borrower Protection Center, Americans for Financial Reform, and the Consumer Federation of America released a series of fact sheets highlighting the CFPB’s significant impact on consumers nationwide.
Unfortunately, Trump was barely in the White House before he demanded that the CFPB be shuttered as part of his campaign to reduce alleged fraud and waste. While neither Trump nor Musk have produced any evidence of fraud or waste at the CFPB, they fired Rohit Chopra, CFPB’s former director. They also fired about 200 CFPB professionals without cause and placed the remaining employees on indefinite administrative leave. Trump and Musk have not released a detailed plan for how the CFPB can meet its goals of protecting American consumers under such stressful conditions.
According to Warren, here are some of the ways the CFPB helps American consumers:
Stopping Scams Before They Start: The CFPB is the cop on the beat reviewing big banks’ activity every day to prevent customers from being scammed. Right now, that work is frozen.
Ensuring Companies Pay What They Owe Cheated Families: The CFPB has already concluded numerous enforcement actions requiring companies to return money to Americans they cheated, but the agency is not currently monitoring whether these payments are being made.
Preventing Another Housing Crash: The CFPB is the primary watchdog for the $13 trillion mortgage market. The agency has taken 94 mortgage lending and servicing enforcement actions, resulting in over $5 billion in relief for more than 16M consumers, including victims of illegal foreclosures.
Protecting Our Troops: The CFPB has returned $363 million to servicemembers and veterans, including ordering Navy Federal Credit Union to refund $80 million for charging illegal overdraft fees.
Curbing Predatory Student Lending: Last year, the CFPB banned Navient from student loan servicing after years of abuse and ordered Navient to pay $10 million to harmed borrowers.
Voicing Consumer Complaints: 6.8 million consumers have filed complaints with the agency for action, including 4.6 million-plus about credit reporting and 170,000-plus about medical debt and student loans.
Tackling Medical Debt: The CFPB finalized a rule that will remove an estimated $49 billion in medical bills from 15 million Americans’ credit reports, making it easier for Americans to get access to the capital they need. This rule should be effective in mid-March but is held up by the freeze.
Due to the chaos that Trump and Musk have inflicted upon the CFPB, the protection of American consumers is at risk. Without the CFPB, Americans are also at risk of having their credit score adversely impacted. Presently there are 38 pending CFPB enforcement cases against large companies that could provide millions of Americans money after being wronged by financial institutions and corporations. A fact sheet released by Warren’s office, highlights a few key cases:
FROZEN: Taking on Capital One for an alleged scheme cheating millions of consumers out of more than $2 billion in interest rates on savings accounts.
FROZEN: Going after the big banks behind Zelle for $1 billion in allegedly unchecked consumer fraud on the platform.
FROZEN: Suing Walmart for allegedly forcibly opening deposit accounts for more than 1M delivery drivers and charging them $10 million in junk fees.
FROZEN: Holding Comerica Bank to account for allegedly systematically failing disabled and older Americans, hanging up on recipients of Social Security and harvesting junk fees from them.
FROZEN: Litigation against ACTIVE network, a payment platform used by YMCA camps and charity race organizers, for allegedly cramming consumers with $300M in unlawful junk membership fees using misleading links on their website.
FROZEN: Fighting for relief for servicemembers and their families by suing MoneyLion for overcharging servicemembers on loans and allegedly refusing to cancel memberships.
FROZEN: Taking on Experian for sham investigations of credit report errors that failed to address errors on reports, threatening consumers’ access to credit, employment, and housing.
DROPPED: Action against SoLo Funds for allegedly deceiving borrowers and imposing deceptive fees on more than half a million borrowers.
At 2:00pm EST on February 25, the forum’s panelists will include Attorney General of Massachusetts Andrea Campbell and former CFPB Director of Supervision Policy Lorelei Salas. The two other panelists are Stacey McCall, a retired Army veteran of 20 years from Maryland, who was being forced to pay for a Toyota vehicle she could not drive until the CFPB stepped in, and Marette Gillen, a mortgage originator from Texas, who has seen firsthand how the CFPB has positively impacted her industry. Members of the public may watch the forum here. Warren invited Musk to participate in the forum; at the time of this writing Musk had not responded.
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