President Trump’s appointees at the Consumer Financial Protection Bureau (CFPB) are facing heat in news outlets across the country for siding with predatory payday lenders. Just in the past few days, Military and Veteran Service Organizations called out Director Kraninger for ending CFPB supervision that ensures military servicemembers aren’t fleeced by lenders, a CFPB political appointee admitted to Congress that they have no new evidence to justify rolling back a rule designed to stop payday loan debt traps, and, with the end of the comment period on that proposal, CFPB leadership faced a flood of opposition. Included below are some of the stories on these developments. If you’d like to speak with an expert from the Stop The Debt Trap coalition about the assault on consumer protection ironically perpetrated by the Consumer Financial Protection Bureau, please let me know, and I would be happy to connect you.
Via Americans for Financial Reform: “At 10am in Washington, Percy the Payday Loan Shark will deliver a thank-you card to CFPB Director Kraninger for moving to cripple consumer protections on payday loans. (You can see him here.)’”
The Consumer Financial Protection Bureau did not conduct new research to justify rescinding borrower ability-to-repay requirements on payday loans, a top official said.
“We did not do any new research. We did not do anything,” Thomas Pahl, a policy associate director overseeing the CFPB’s Research, Markets & Regulations division, told House lawmakers May 16.
In the comment, which calls on the CFPB to withdraw its proposal to scrap the payday lending underwriting requirements, the coalition argues that the proposal “is based on speculation, summary and unreasoned rejections of the rule’s findings, and ludicrous counterarguments.”
The attorneys general said that the proposal would also undermine states’ ability to enforce their own laws. They said the 2017 rule granted them an additional enforcement mechanism for preventing illegal lending, and that maintaining a federal floor on lending activities is “crucial” to supporting state oversight.
Feeling misled, ripped off and eventually threatened by high-interest rate payday and car title lenders, Virginians are pleading with federal regulators not to rescind a proposed groundbreaking rule to rein in abuse.
Advocates from across the country are sounding off on what they say are efforts by the Trump administration to weaken protections against predatory payday lending, which sees borrowers pay skyrocketing interest rates, locking them into an inescapable cycle of debt.
By reversing course, Kathy Kraninger, the CFPB director and a Trump appointee, is signaling to lenders that protecting their profits is a higher priority than fulfilling the bureau’s mission of protecting consumers.
Americans of all political stripes have made it clear that they expect the bureau to uphold its mission to put American consumers first.
Payday loans are insidious. CFPB actions are keeping low-income borrowers in a cycle of debt.
Advocates from six military and veterans organizations renewed their push for a key federal consumer agency to resume monitoring lenders to protect service members and their families from predatory practices.
Organizations such as the Veterans of Foreign Wars, National Military Family Association, American Legion, Military Officers Association of America (MOAA), Iraq and Afghanistan Veterans of America and Veterans Education Success said the oversight is necessary to ensure that lenders continue to comply with [the Military Lending Act].