Recently, the Senate Banking Committee conducted a confirmation hearing for Consumer Financial Protection Bureau (CFPB) director nominee Kathy Kraninger.
The CFPB is the federal agency that many consumer and community groups pushed Congress to create after millions of Americans lost their homes, jobs and savings during the Great Recession. It was created seven years ago to protect consumers.
{mosads}The nomination of Kraninger, who lacks a track record of protecting consumers in the financial marketplace, follows troubling actions by the bureau since Mick Mulvaney took over as interim director last November, including:
- announcing its intention to reconsider and delay its payday lending rule;
- dropping its lawsuit against four online lenders it had previously accused of deceiving consumers by collecting debts not legally owned; and
- considering hiding its consumer complaint database from public view.
Kraninger’s responses to questions during the hearing provided little clarity about her positions on these or other actions that allow companies to take advantage of consumers.
If the next bureau director, whether it’s Kraninger or somebody else, continues the CFPB trajectory under Mulvaney, we can expect fewer and less forceful consumer protections from the the bureau over the next few years.
However, as I explain in a video released on Twitter and Facebook by 104 groups representing consumers, small businesses, students and workers, what the bad headlines about the CFPB fail to convey is that its ability to protect consumers is largely still intact.
That’s thanks to Americans voicing their concerns to Congress for the last seven years and making sure that enough senators block efforts funded by Wall Street to strip the bureau of its ability to protect consumers.
Some highlights of the CFPB’s first seven years include:
- Returning $12.4 billion to more than 31 million consumers cheated by illegal practices conducted by credit card and mortgage companies, banks, debt collectors and others.
- Processing more than 1.5 million consumer complaints across the country. Many of these complaints are published in the public database.
- Taking more than 180 legal actions against companies that broke the law, such as when Wells Fargo was caught creating millions of fake accounts.
- Creating special offices to protect students, seniors, service members and persons at risk of unlawful discrimination.
- Posting guides on its website to help consumers make important financial decisions, including shopping for a home, taking out a loan or planning for retirement.
The long-term threat to consumers isn’t whoever sits in the director’s chair, it’s Congress, which has introduced more than a dozen bills designed to weaken or even get rid of the agency.
Although this legislation hasn’t passed on its own, anti-CFPB legislators are trying to sneak these provisions into budget bills. In fact, the House passed a package of spending bills that snuck in these attacks on July 19.
As long as at least 41 U.S. senators are willing to filibuster and block votes from taking place on those bills, a future director who believes in the bureau’s mission will still be able to carry out that mission.
The consumer bureau will be able to keep Wall Street in check and ensure a fair and transparent marketplace for consumers and businesses alike. So let’s keep speaking up.
Mike Litt is the consumer campaign director for the U.S. Public Interest Research Group (PIRG), a consumer advocacy organization originally conceived by Ralph Nader. Litt advocates for policies that protect consumers in the financial marketplace. He can be found on Twitter at @MikeLittUSA.