This story was originally published on November 27, 2017.
In the latest Game of Thrones episode that is the Trump administration, two people are jockeying for leadership of the Consumer Financial Protection Bureau (CFPB), the federal agency charged with defending consumers' financial interests.
However, her role has been challenged by the president and his pick for the office, White House budget director Mick Mulvaney, "[who] arrived at about 7:30 a.m. and settled into the CFPB director's office, where he read briefing books," Politico reports. "English [...] sent the staff an emailed greeting shortly before 8 a.m. and signed it with the bureau's top title, acting director. Mulvaney quickly fired back with a memo instructing staff to ignore any instructions from English."
The CFPB may not be a top-of-mind consideration for many Americans, but the agency plays a crucial role in protecting the financial lives of Americans in a number of important ways. Here's how.
What Is The CFPB?
The CFPB was launched in July 2010 after the passage of the Dodd-Frank Act, which placed stricter regulations on the financial industry after the Great Recession.Instead of focusing "on bank safety and soundness or on monetary policy," the agency is authorized by Congress to safeguard consumers' interests when doing business with banks, auto lenders, credit card companies, credit reporting agencies, private student loan lenders, prepaid card companies, mortgage lenders, and more. The Bureau, which has the power "to both enforce existing federal rules and write new ones," has autonomy from the White House and Congress.
Concerned about exorbitant overdraft fees? The CFPB fights for greater transparency from banks and other lenders about what those fees are.
What Does The CFPB Do?
The Bureau seeks to enforce laws through independent investigations, recommendations, and lawsuits on behalf of consumers. For example, the CFPB sued student loan servicer Navient earlier this year after alleging that the company intentionally cheated and deceived borrowers for years. Or, more recently, Republicans voted last month to undo a new rule written by the Bureau, "which was set to take effect in 2019, [and] would have restored the right of individuals to sue in court [and crack] down on debt collectors, the student loan industry and payday lenders."
So, say you find out down the line that you've been impacted by the Equifax data breach. As explained, the Bureau fought for legislation that would have allowed consumers to pursue direct legal action, rather than be pushed into forced arbitration. Concerned about exorbitant overdraft fees? The CFPB fights for greater transparency from banks and other lenders about what those fees are. Worried about prepaid debit cards? The CFPB has best practices for companies and consumers. Have a gripe about your student loan servicer? An effective way to issue a complaint would be through the CFPB.
What Is Happening To The CFPB?
It's no secret that the Trump administration seeks to roll back a number of federal regulations that have consumers in mind. Now that Mulvaney, who has repeatedly called the CFPB a "sad, sick" joke may be put in charge of the agency's future, many officials worry that it is on its way out, in one fell swoop or through death by a thousand cuts.
"Under [Cordray's] leadership, the bureau extracted nearly $12 billion in refunds and canceled debts for 29 million consumers. It cracked down on abusive debt collectors, strengthened protections for mortgage borrowers and created a complaints system that helped hundreds of thousands of people resolve disputes with financial companies," the New York Times reports. One Tea Party activist told the paper "it is an agency about protecting the little guy, and that is tough to oppose" — but now that it is more entrenched in a partisan battle than ever, all gloves are off.