WASHINGTON– A consumer group has launched a campaign it says is aimed at identifying the “shady special interests and conflicted lawmakers” seeking to weaken the CFPB.
With the Supreme Court set to hear arguments over the constitutionality of the funding of the CFPB as part of a lawsuit brought by the payday lending industry, that case began with a challenge to a CFPB rule barring lenders from making additional efforts to withdraw payments from borrowers’ bank accounts after two consecutive failed attempts due to a lack of funds.
A three-judge panel of the U.S. Court of Appeals for the 5th Circuit rejected most of the groups’ challenges to the rule, but it ultimately struck down the rule based on the CFPB’s unique funding scheme, which operates outside the normal congressional appropriations process. Instead of receiving money allocated to it each year by Congress, the CFPB receives funding directly from the Federal Reserve.
A federal appeals court ruled in October that the funding mechanism for the CFPB violates the Constitution, but the Biden administration, which had asked the justices to weigh in, says that allowing the lower court’s decision to stand could raise “grave concerns” for “the entire financial industry.”
‘Gravest Threat’
Now, in response to what it called the “gravest threat” to the Bureau, the government watchdog group Accountable.US has launched its
As the popular and successful Consumer Financial Protection Bureau faces its gravest threat to date in the U.S. Supreme Court under a lawsuit brought by predatory lenders, government watchdog Accountable.US launched its ‘Defend American Consumers’ project, which it says answers the question: Who are the shady special interests and conflicted lawmakers trying to take away consumer protections from millions of Americans, and what’s in it for them?”
A video on the website cites the “rotten core of Wall Street,” payday lenders, “conservative billionaires” and “far-right lawmakers with deep ties to the financial industry” as the force behind the effort to “defang” the CFPB.
The First Project
According to Accountable.US, its first project as part of the new initiative is “CFSA The First-In-Focus,” which it called a “robust examination of the Community Financial Services Association of America,” which is a trade association for the payday loan industry and the plaintiff in the case now before the Supreme Court.
Accountable.US said the project “shows how lenders that sit on the CFSA board have been fined or settled lawsuits with federal regulators and have a history of contributing to Republican lawmakers who have sided with industry in its attack against the Bureau.”
All told, Accountable.US said it found CFSA board member companies and their affiliated subsidiaries and parent companies have paid more than $204 million in fines and restitution to federal and state regulators, while paying at least $3.4 million in settlements from class action lawsuits against them.
‘Beholden to Political Whims’
“The payday loan industry’s lawsuit against the CFPB has nothing to do with upholding the constitution and everything to do with obstructing the agency that holds the financial industry accountable when they harm consumers,” the organization said. “If the Supreme Court sides with predatory lenders, that will likely mean the agency’s future funding will be beholden to the political whims of Congress.”
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