Director, Consumer Campaign, PIRG
Director, Consumer Campaign, PIRG
New Congress Wants Wall Street to Regulate Itself
Statement by Mike Litt, Consumer Advocate, at U.S. PIRG about expected attacks against the Consumer Bureau in the 115th Congress
Several members of Congress wanted to regulate themselves for ethics violations; they reversed course when citizens everywhere spoke up. But now, they also want Wall Street to regulate itself. Have they forgotten? That already ended badly, just 8 short years ago. Weakening the Wall Street watchdog would be a big mistake.
We are seeing renewed attacks against the Consumer Financial Protection Bureau in the 115th Congress – even after an election that was largely about a system rigged against the average American. Congress should stand up to these attacks and side with consumers.
The 5 year old Consumer Bureau was created by Congress after the Great Recession to protect consumers and reduce the risk of another economic collapse. It is the poster child of a government agency that is actually working and not corrupted by the industry it is tasked with regulating. That is by design, not by accident – the Consumer Bureau was set up to avoid the trappings of other agencies that favor industry interests over the public. The main attacks against the Consumer Bureau, if carried out, would open it up to gridlock or corruption by changing the agency’s leadership structure, starve the agency by changing its funding source, or keep the rules rigged against consumers.
Since 2011, the Consumer Bureau has served as a wildly successful and accountable watchdog over unfair & greedy practices by companies offering financial products like mortgages, student loans, and credit cards. It has implemented fair rules of the road that have evened the playing field for responsible consumers and businesses alike. It is protecting students, seniors, service members and the rest of us too.
The CFPB was in the news a few months ago for its record $100 million penalty and consumer restitution against Wells Fargo for millions of fraudulent consumer accounts. But this was just the tip of the iceberg – the agency has also returned nearly $12 billion to over 27 million consumers from many other companies that have broken the law. Additionally, the CFPB’s website hosts a complaint database that has processed over 1 million complaints, and it provides educational resources to make important financial decisions.
The CFPB has also been accountable to the public, including with a small business review panel, 4 advisory boards, 36 public town halls and field hearings, and 61 visits by senior officials to testify before Congress.
The attacks against the Consumer Bureau serve the big Wall Street banks and other financial companies like payday lenders. In fact, the financial industry just spent $2.3 million a day, totaling over $1.4 billion during the recent election cycle, to buy influence in Washington and re-rig the rules in their favor.
If enough Americans contact our members of Congress, we can make sure our voices don’t get drowned out by the big Wall Street banks and other financial companies.
U.S. PIRG, the U.S. Public Interest Research Group, is a consumer group that stands up to powerful interests whenever they threaten our health and safety, our financial security, or our right to fully participate in our democratic society.