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CFPB keeps financial services industry accountable: $12 billion returned to consumers

By Charlene Crowell

On April 5 a committee hearing before the House Financial Services Committee was supposed to be one of two mandated sessions required by the Dodd-Frank Financial Reform and Consumer Protection Act. This spring, as in past years, Richard Cordray, Director of the Consumer Financial Protection Bureau (CFPB) appeared to testify before Congress on the past year’s efforts and achievements.

Instead of affording Director Cordray the chance to speak about consumer trends and concerns captured in a 50-page report on 2016’s efforts, nearly six hours of partisan attacks called for his dismissal and an end to the CFPB as we know it.

According to committee chair, Rep. Jeb Hensarling of Texas, “Not only must Mr. Cordray go, but this current CFPB must go as well.”

Somebody needs to call a timeout for behavior that devolves a congressional hearing into an extended partisan tirade. That kind of behavior neither respects consumers nor the oaths lawmakers took to speak and act in support of the American people. As the tone of any public forum is set by those entrusted with leadership roles, shame on the committee chair and all committee members who shirked their sworn governmental duties.

For the record, either Director Cordray or his staff has appeared more than 60 times before lawmakers since CFPB began. Indulging partisan attacks while ignoring a document that attests to the real-life concerns of consumers and their finances is an inappropriate use of public resources.

What was lost in a marathon attack was CFPB’s service to America’s consumers that more reasoned minds would have heralded. Since CFPB opened its doors:

  •  $12 billion was returned to 29 million consumers harmed by financial companies;
  •  97 percent of complaints sent to businesses received timely replies; and
  •  More than 1 million consumer complaints were filed – 1,136,000 to be exact.

“With the help of complaints,” noted Director Cordray, “we dig deeply into potentially unfair practices, so we can prevent minor issues from becoming major problems. We also use complaints to identify opportunities to educate and empower consumers about the marketplace and their rights and to understand what the rules of the road should be when we consider and undertake rulemaking.”

“Through the questions they ask us, the stories they tell us, and the complaints they submit, the voices of consumers remain foundational to the Bureau’s work,” added Director Cordray.

For example, the story of a California consumer was included in the report.

“We had actually lost over $1,000… For a very frustrating month, we tried everything to reach the company for an explanation and finally put in a complaint with CFPB. Within two weeks we received a response from the company and a check for the difference. We are so grateful to CFPB and this avenue of resolution.”

“Time after time the CFPB has shown to be an effective agency and has kept our financial sector accountable to the public,” noted Yana Miles, Senior Legislative Counsel with the Center for Responsible Lending. “With Director Cordray at the helm, CFPB has helped restore financial freedom for millions of working families.”

And many of those working families included Black and Latino consumers who are frequently targeted for financial abuse. For consumers of color, CFPB’s actions are strongly welcomed. Before the Bureau’s creation, consumer protection was shared by several federal offices and holding pre-

datory lenders accountable was on a long list of other duties. With CFPB, consumer protection is the sole focus, violations are verified and enforcement actions return hard-earned monies to families.

“The CFPB leveled the playing field between consumers and financial companies in a way that no other regulator had previously,” said Paulina Gonzalez, Executive Director of the California Reinvestment Coalition. “It stopped scammers, created real consequences for illegal behavior by corporations, and increased transparency into the marketplace so that people are better equipped to make important financial decisions. Consumers want, need, and deserve a strong agency that stands up for their interests,”

A similar reaction came from Wade Henderson, President and CEO of the Leadership Conference on Civil and Human Rights. “It is disappointing but not surprising that payday lenders, debt collectors, for-profit colleges, and other industry groups have turned to their allies in Congress and the courts in an effort to weaken the Bureau so they can keep exploiting financially vulnerable Americans.”

In the throes of the foreclosure crisis, consumers and their advocates spoke up, stood up and insisted on changes to ensure that never again would irresponsible lending practices jeopardize the nation’s economy.

Director Cordray and his staff have worked to bring financial justice to the millions who have been harmed. Perhaps now is the right time for people to stand up and be heard once again.

According to Congresswoman Maxine Waters, the Ranking Member on the House Financial Services Committee, “The Consumer Bureau and Director Cordray are doing exactly the job they are supposed to do, and they are doing it well.”

Charlene Crowell is the communications deputy director with the Center for Responsible Lending. She can be reached at [email protected]

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