Published April 26, 2017 17:18
CALIFORNIANS SHOULD GUARD THEIR WALLETS IF BILL MOVES FORWARD
San Francisco, CA, April 25, 2017---Today, Representative Jeb Hensarling, Chair of the House Financial Services Committee introduced a bill (“the Free Choice Act”) that would undermine key provisions of the Dodd Frank Wall Street Reform Act, and also dramatically weaken the Consumer Financial Protection Bureau (CFPB).
“Congress created the CFPB through the Dodd Frank Wall Street Reform Act in order to prevent a repeat of the mortgage meltdown, which led to foreclosures, depleted retirements and layoffs for millions of American families,” explained Paulina Gonzalez, executive director of the California Reinvestment Coalition. “There’s a unique level of cognitive dissonance to introduce a bill like this less than a week after Ocwen was sued for illegal foreclosures and was issued cease and desist orders by more than 20 states.”
Some of the more harmful provisions of Rep. Hensarling’s bill include:
· Making the CFPB Director and Deputy Director positions into a “at-will” positions;
· Taking away the CFPB’s supervisory responsibilities at banks;
· Stripping the CFPB’s authority to bring cases against financial institutions for unfair, deceptive, and abusive practices;
· Eliminating the CFPB’s complaint database that has increased transparency into the challenges consumers face and given the CFPB real-time data on concerning practices;
· Restricting the CFPB’s ability to regulate small-dollar, high cost consumer loans;
“When we submitted a Freedom of Information Act (FOIA) request to the Department of Housing and Urban Development asking about the number of complaints it had received about Financial Freedom (a reverse mortgage company), we were told it would take over 100 years for HUD to compile the data,” comments Kevin Stein, deputy director at CRC. “This was a shocking response from the regulator in charge of overseeing these companies. In contrast, any person with an internet connection can view and sort the over one million consumer complaints the CFPB has received in a matter of seconds.”
Read a letter that the California Reinvestment Coalition sent to Congress in strong opposition to the Choice Act.
Additional Background on the CFPB’s Impact in California
Student Loan Complaints Increase in California: A report released yesterday focused on student loan servicing complaints found there had been a 228% increase in student loan related complaints from California consumers as compared to the year before.
California Complaints: According to an April 2016 snapshot of complaints, California consumers had submitted over 118,000 complaints to the CFPB (about 14% of the total number of complaints). Complaints from Los Angeles and San Francisco accounted for nearly 50% of these CA complaints. Complaints from California were more likely to be about mortgages as compared to national numbers.