CFPB: Progress over 2 Years

On July 16th, Richard Cordray was confirmed by the U.S. Senate as Director of the Consumer Financial Protection Bureau (CFPB). The CFPB, a federal agency charged with protecting consumers from harmful financial practices and products, was created as part of the Dodd-Frank Wall Street Reform & Consumer Protection Act in July 2010. In the wake of this vote, which legitimized the agency and its authority, here is a quick recap of what the CFPB has accomplished in the past 2 years.

Rule-Making, Regulations, Lawsuits, and Public Input
Much of the CFPB’s scope is focused on increasing consumer protections through rule-making and regulations of financial products and practices. These actions increased protections for many consumers including those going through foreclosures and debt collections. The CFPB has also successfully brought lawsuits challenging predatory and illegal practices of major financial institutions on behalf of consumers. By 2013, the CFPB had obtained $425 million in refunds to consumers who were wronged by credit card companies alone. In addition, the CFPB has solicited feedback from consumers and advocates on many of the issues it tackles. This feedback has informed reports on key asset building related issues like Student Loan Affordability, and their Know Before You Owe series on student loans, credit cards, and mortgages.

Resources from the CFPB for Programs and Consumers
The CFPB has steadily been increasing the resources it provides for consumers and for organizations helping consumers, including:

• Complaint Hotline: Providing avenues for consumers to report financial institution abuse has been a priority for the agency, but the issue areas they cover continues to expand. The CFPB will now receive complaints and will investigate: Bank Accounts, Credit Cards, Credit Reporting (including ChexSystems), Debt Collection, Money Transfers, Mortgages, Student Loans, and Vehicle or Consumer Loans.
• Population Specific Information: The CFPB has tailored financial education information and resources for specific populations often targeted by predatory lenders and financial scams, including: Service Members, Students, and Older Americans.
• Tools to Evaluate Financial Products: CFPB has provided consumers with documents and infographics to help navigate financial products like checking accounts and credit cards, and dissuade the use of predatory products like payday lending. These can serve as resources for program participants as a quick guide to make informed financial decisions.

Going Forward
We can expect more to come out of the CFPB in the next few years.  This includes future rule-making on pervasive issues impacting Illinois communities like predatory loans and prepaid cards are expected sometime within the next year. However, the CFPB cannot continue to effectively protect consumers unless there is a public that supports the need for an agency that protects us from predatory and dangerous financial products and practices. To help assist the CFPB’s efforts, we encourage you to submit complaints when applicable.