The Trump administration’s efforts to dismantle the risks of the Consumer Financial Protection Agency have brought Americans with fewer oversight and regulations to nearly $18 trillion.
A CFPB staff said Monday that all meetings and work items on the calendar, including reviews of research actions, had been removed.
“I think at some point the machine will start jam-up,” the employee said. “What is the industry going to do for itself?”
On Monday evening, the CFPB homepage stated “404: No page found”, but the rest of the site appeared to be working.
The confusion comes after a turbulent weekend at the CFPB. On a fierce weekend at the CFPB, deputy director Russell told employees late Saturday to halt most of their work activities, and on Sunday they would not report it to the office for the rest of the week. He also said in X’s post that the agency “will not withdraw any inappropriate funds next, as it is “not reasonably necessary” to perform its duties.”
Meanwhile, staff from the Elon Musk-led Government Efficiency Bureau project are part of an effort pushed by the world’s wealthiest persons to re-create or eliminate the entire federal agency, from the education sector to the country’s major foreign aid agencies. We are seeking access to human resources information from a CFPB.
Both moves targeting the CFPB have already filed lawsuits from federal unions.
Since its founding in 2011, the CFPB has been a target of GOP and Wall Street critics. This includes Vought, co-author of Project 2025. The independent body, the creator of Senator Elizabeth Warren, was established by the Federal Reserve in the wake of the 2008 financial crisis. Last year it survived the business collateral challenge to fundraising that was caught up in front of the Supreme Court.
During his first term, Trump set up Mick Mulbany as director of the agency. He previously called the CFPB “a joke,” stripping the agency of its ability to pursue discrimination cases. He also stopped litigating against payday lenders and fired the agency’s 25 consumer advisory board.
The bureau was shot again by Trump officials after a four-year active run during the Biden administration.
Congress grants the CFPB the authority to oversee banks on assets of more than $10 billion and to regulate loans by non-bank entities, including mortgages, automobiles, paydays and private student loan issuers. I did. In addition to creating and implementing rules to make consumer financial products fair and efficient, agents seek, track and publish consumer complaints.
One of the agency’s biggest wins against industry players is to limit overdrafts or insufficient financial fees. After years of CFPB scrutiny of these additional charges, many banks began withdrawing fees themselves. In fact, revenue banks derived from overdraft fees fell by more than $6 billion between 2019 and 2023. The agency had limited overdraft fees for large banks to $5 in its final rule in December, but its fate is uncertain.
Consumer advocates told NBC News shortly after the election that the popularity of the CFPB overdraft crackdown could lead to Trump officials enforcing those protections. However, last week, the Republican-led House Financial Services Committee presented a resolution that overturned the department’s overdraft rules.
The CFPB issued another rule last March, which appears to have been largely defeated. The move reduced the typical credit card deferral fee from $32 to $8, resulting in a quick legal pushback from the card issuer. A federal judge in Texas recently rejected the CFPB’s request to lift the injunction, except for rules.
“I think the new approach is “I don’t even bother to formally change an effective (rule) date,” CFPB staff said. “We just don’t do anything and we hope that the industry knows that we don’t do anything.”
Its pathway is more steep and narrower than the typical rules-making process of CFPB, but some relief for cardholders could come legislatively.
Earlier this month, I-Vt. Senator Bernie Sanders and R-Mo. Josh Hawley of the company introduced a bill that would curb credit card rates at 10%, reflecting one of Trump’s campaign promises. However, the measure is expected to meet fierce opposition in Congress and in the financial industry. Lindsay Johnson, president and CEO of the Consumer Banks Association, said in a statement that the effort reflected “socialist pricing policies,” which is “the best way to increase consumer costs.” He said that.
Agents have made other advances to protect borrowers’ credit health, including the emergence of student loan services violations and detection of errors in reporting medical debts.
Three major reporting bureaus in 2023 (following the CFPB report on medical debt complications) wiped out a health collection of under $500 from consumer credit reports, with an estimated 22.8 million people experiencing at least one medical expense. We have announced that it has been deleted from the file. Last month, the agency completed rules to remove an estimated $49 billion in medical expenses from credit reports of around 15 million consumers.
Consumer advocates point out that medical debt rules are vulnerable to being overturned by Congress, like the rules that close out credit card fees.
Under the Biden administration, the CFPB had established itself as a supervisor of technology and artificial intelligence as the industry sneaked deeper into consumer wallets. We have created “buy now, pay later” installment loans on guardrails, increasing scrutiny of high-tech companies that have expanded to digital payments.
Musk himself called for the “removal of the CFPB” following Trump’s victory, and joined the latter trend. In January, his social media platform X announced a deal with Visa, the largest credit card network in the United States, allowing X users to move money between bank accounts and make peer-to-peer payments.