DOGE'd Consumer Bureau Stands Down for Payday Predators
Legalized loan sharks win, consumers lose in Elon the Oligarch's playground
Just yesterday I mused that a new rule to help protect consumers from payday lenders set to go into effect on Sunday (March 30th) would likely have little impact.
The lack of a serious effort to rescind the rule means it WILL go into effect as planned. That should mean consumers get additional protection against the nefarious characters who debit their bank accounts multiple times for the same unpaid transaction.
This provision addressed a widespread problem of payday lending: many payday lenders debit an account repeatedly, knowing that customers would incur overdraft fees, as a means to coerce repayment. Some payday lenders used the threat of overdraft and non-sufficient funds fees as an intimidation tactic to collect outstanding loan balances.
Unfortunately, the DOGE’d CFPB announced today it will NOT be enforcing this rule:
The Consumer Financial Protection Bureau is announcing today that, with respect to the Payday, Vehicle Title, and Certain High-Cost Installment Loans Regulation, it will not prioritize enforcement or supervision actions with regard to any penalties or fines associated with the Payment Withdrawal provisions and the Payment Disclosure provisions once they become operative on March 30, 2025. The Bureau will instead keep its enforcement and supervision resources focused on pressing threats to consumers, particularly servicemen and veterans. The Bureau takes this step in the interest of focusing resources on supporting hard-working American taxpayers, servicemen, veterans, and small businesses.
The “small” businesses they are "providing relief” for are shameless predators who take from those least able to pay. Threatening a debtor with multiple overdraft charges if they don’t pay your debt only serves to further exacerbate a cycle of financial chaos.
Of course, the oligarchy doesn’t care.
As for focusing resources, the CFPB at full strength returned $21 billion to consumers in just over a decade. Their unrelenting focus on righting financial wrongs benefited working-class Americans - and leveled the playing field in the financial marketplace.
Advocate Andy now has more than 200 subscribers - thank you! If you aren’t yet a subscriber, consider becoming a free or paid subscriber today. Either way, take a moment to also like and share this post. Together, we can hold the robber barons at bay - a task more important now than ever.
While the CFPB may not be at full strength, you can take action in your state if you have a consumer protection concern.
First, start with your state’s Attorney General.
Attorneys General typically have consumer protection divisions and can apply relevant state laws to your situation. Sometimes, if an AG asks, a company will answer.
Second, let your Member of Congress know. One, they may be able to assist with a resolution. But also, it is important for Congress to know their constituents value the work formerly performed by CFPB. Congress can rescue the consumer champion from the DOGE Death Star . . . if they want to.
AdvocateAndy fights for the CFPB, which defends consumers! DOGE cares only about financial predators! You can defend CFPB, too!