I admit it. I didn’t like the thought of the CFPB when it launched during the Obama administration. But, I was fair and decided to see where it would go, and sure enough, my concerns proved to be wrong. Yes, they did find tons to worry about, but no, they were not on a witch hunt. Deceptive and unfair practices brought many a bank to their knees as they tried to explain credit card “revenue enhancements.”
The big question is where are the CFPB since Trump took over in Washington?
- In the 135 days since the Trump administration took control of the nation’s consumer watchdog agency, it has not recorded a single enforcement action against banks, credit card companies, debt collectors or any finance companies whatsoever.
The numbers speak for themselves. The industry requires a watchdog of some sort. Replay some of the issues that required enforcement, such as weak disclosures, errant calculations, phantom customers, and dishonest bankers, consumers do need viable protection.
- In the roughly seven years it has been in existence, the bureau has returned $3.97 billion in cash back to American consumers through enforcement actions and an additional $7.93 billion in other types of relief, such as lower loan balances or debt relief, based on the CFPB’s records.
- The bureau estimates roughly one of every 10 Americans has received some sort of reimbursement or relief due to the bureau’s enforcement work since it was created.
No matter where you stand on the political spectrum, it is hard to ignore the Washingtonian shift.
- While consumer advocates expected fewer enforcement actions under a more business-friendly Trump administration, the fact that the database indicates they have stopped entirely raises concern that consumers have been left vulnerable.
Hopefully, we will not need to wait until the next recession to find out.
Overview by Brain Riley, Director, Credit Advisory Service at Mercator Advisory Group
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