Since its enactment in 2010, the financial reform policies included in the Dodd-Frank Wall Street Reform and Consumer Protection Act have been under constant attack by an industry that benefits financially from fewer regulations at the expense of consumers. Last week we saw the Trump Administration take its first steps to dismantle many of the protections put in place after the devastating financial crisis of 2008.
To recap, Dodd-Frank put in place a number of key policies that Illinoisans are benefiting from today. This includes:
- Prohibiting the type of risky lending that led to the 2008 financial crisis
- Increasing compliancy and reporting standards of banks
- Establishing much needed standards for approving home loans
- Creating the Consumer Financial Protection Bureau (CFPB), which through it’s actions has provided about $11.7 billion in relief for over 27 million impacted consumers.
Given the fact that many families are still feeling the devastation of the financial crisis, we were very disappointed to see the following actions taken by the Trump Administration last week:
- Through a broad Executive Order, President Trump directed the Treasury Secretary (former Golman Sachs banker, Steve Mnuchin, is awaiting confirmation), to review regulations associated with Dodd-Frank and find areas to be amended. The Executive Order provides a set of “core principles” for regulations. Given promises made on the campaign trail and the tone that President Trump is setting, we anticipate that any changes to the implementation of Dodd-Frank related rules will support potentially dangerous deregulation and/or a halt the enforcement of many financial regulations.
- Through a memorandum, President Trump calls on the Department of Labor to defer implementation of the Fiduciary Rule. This Rule requires financial advisers to act in the best interest of their clients in retirement planning. In other words, it prohibits financial advisers from benefiting financially from the advice they give to people planning for retirement.
Many Illinoisans impacted by abusive student loans, home loans, or payday loans, have benefited from the actions of the CFPB. In the coming weeks and months ahead, we anticipate that Congress will play a larger role in attempts to weaken financial regulations, including weakening the powers of the CFPB. We are preparing to defend the CFPB and other vital consumer protections put in place by Dodd-Frank. In order to do that, we need to hear your stories.
We are looking for people willing to share about how the CFPB has helped them or how predatory loans have impacted their life. This will help us be prepared to respond to any attacks on the CFPB. Please email Jody Blaylock and she can help you document the story.