WASHINGTON, D.C. – U.S. Sen. Sherrod Brown (D-OH) today renewed his efforts to protect the Consumer Financial Protection Bureau (CFPB) ahead of its six-year anniversary this week. The watchdog agency was created as part of Wall Street Reform following the 2008 financial crisis in order to protect consumers from financial scams and predatory practices by big banks.
Since its inception, the Consumer Protection Bureau’s actions have resulted in $12 billion in relief for more than 29 million American consumers. In October, the Consumer Protection Bureau levied a record-setting $100 million fine against Wells Fargo for its fake account scandal, and last week it published a rule that will guarantee Ohioans get their day in court if they are cheated by their bank. Despite the agency’s success, Congress and the Administration are working to weaken it and dismantle other key aspects of Wall Street Reform.
“Wall Street banks, car title lenders, and big corporations have armies of expensive lobbyists and lawyers on their side – the Consumer Financial Protection Bureau is Ohioans’ cop on the beat,” said Brown. “The last thing Ohioans need is for politicians to turn back the clock to the days when Wall Street was free to prey on working families, wreck the economy, and hand taxpayers the bill.”
Last month, the House of Representatives passed a bill led by House Financial Services Chairman Jeb Hensarling (R-TX) that would roll back the Dodd-Frank Wall Street Reform and Consumer Protection Act’s consumer protections and gut the Consumer Protection Bureau.
The Trump Administration is also working to weaken Wall Street reform and the Consumer Protection Bureau. Just yesterday, the Trump Administration took another swipe at the agency, asking the agency to stall an important new rule to protect customers from fine print clauses known as forced arbitration.
Last week, Brown applauded the Consumer Protection Bureau’s long-awaited rule to restrict financial institutions’ use of forced arbitration – a practice used by Wall Street banks and predatory payday lenders to deny consumers access to the justice system when the institution engages in illegal behavior.
The rule is already under attack by a President Trump appointee who used to represent big banks, including Wells Fargo. President Trump’s Acting Comptroller of the Currency Keith Noreika has written two letters to the Consumer Protection Bureau’s Director Richard Cordray claiming unsupported concerns over the rule. Brown wrote Noreika a letter yesterday asking Noreika to provide documentation and analysis that supports OCC’s claims, and to explain why the OCC failed to raise any concerns during the two-years-long rulemaking process. Senate Republicans have also vowed to protect bank interests and overturn the rule through the Congressional Review Act.
During Brown’s conference call today, he was joined by CFPB’s Director, Ohioan Richard Cordray.
The CFPB opened its doors six years ago Friday. In March, Brown helped lead an amicus brief filed with a federal appeals court in support of the Consumer Financial Protection Bureau’s current structure as an independent agency. The brief outlines how Congress decided after the 2008 financial crisis to design the CFPB as an independent agency with a single director to protect consumers’ interests and respond quickly to changes in the marketplace. The brief also emphasizes that Congress placed numerous checks on the director’s powers to ensure accountability.
Brown has urged the CFPB to protect consumers’ right to be heard by a judge. He is leading legislation in the Senate that would give defrauded Wells Fargo customers – who were victims of a fraudulent account scheme– their day in court. Wells Fargo has used forced arbitration clauses in customers’ contracts to prevent defrauded customers from suing over fake accounts. Brown’s bill, the Justice for Victims of Fraud Act, would make sure these customers can seek their day in court, and that Wells Fargo cannot hide their fraud in secret arbitration proceedings.