Future of the CFPB in Question
I have written a lot about the Consumer Protection Financial Bureau(CFPB) and all that it does to help protect consumers. The newly appointed treasury secretary has signaled that he may be trying to limit the CFPB’s authority. How this will effect consumer protection litigation in South Florida is unclear at the moment. Few CFPB actions are actually filed in Florida, but the guidance and rules that they issue are often interpreted by local courts when issuing rulings on consumer protection matters. Some of the well appreciated, but less well known CFPB rules are about the content of monthly bills for credit cards, mortgages and car loans, forbidding them from being intentionally deceptive and confusing. They also regulate some of the content of certain common consumer agreements, like credit card applications and try to make it harder to charge outrageous fees. Other CFPB rules govern how payments on certain loans are applied. A previously common, and despicable practice in banking was that if a consumer owed money on an account and a bank received a charge and a deposit in the same day, they would apply the charge first, causing the consumer to go over their lending limit and wrack up penalty fees.
Whether or not the CFPB’s rule making authority is cut or restricted, its funding may also be under attack. Right now the CFPB gets its funding from the Federal Reserve and even if its budget is not big, it is not reliable. The newly appointed treasury secretary, Steve Mnuchin indicated that he may seek to have funding shifted to being funded by Congress directly and if it is included in the general budget, it will probably have its budget cut significantly.
This document has been provided for informational purposes only and is not intended and should not be construed to constitute legal advice. Please consult your attorney in connection with any legal issues related to the matters discussed in this article as the applicability of state, local and federal laws may vary.