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predatory lenders
'So Much for Lowering Costs': Fury Over Musk's Death Wish for CFPB That Returned Over $20 Billion to Consumers
"The richest man in the world wants to shut down an agency that keeps people like him from ripping off the rest of us."
Feb 08, 2025
Defenders of a Consumer Financial Protection Bureau that has returned tens of billions of dollars to duped and defrauded U.S. consumers expressed outrage overnight and into Saturday after the independent agency was declared deceased by billionaire Elon Musk and its operations were handed over to the chief architect of the far-right Project 2025 Russell Vought.
Vought, who earlier this week was confirmed as head of the Office of Management and Budget by Senate Republicans, was named acting director of the CFPB by President Donald Trump, according to various reports.
The appointment of the far-right ideologue came less than a day after reports emerged that members of the Musk-led Department of Government Efficiency( DOGE) were granted access to key CFPB systems and Musk himself posted to his online social media X that the agency should "RIP," suggesting it was in the process of being dismantled or, in his mind, already killed.
"Since its creation, the Bureau has returned $21 billion to people's wallets by fighting against illegal financial charges, junk fees, debts, and fraud," said Mike Calhoun, president of the nonpartisan Center for Responsible Lending, in a statement on Saturday. Now, when people are already struggling to pay higher prices for necessities like eggs and milk, the Trump administration appears to have decided to deepen the pain by directly taking aim at the agency that helps keep our money safe."
"When people are already struggling to pay higher prices for necessities like eggs and milk, the Trump administration appears to have decided to deepen the pain by directly taking aim at the agency that helps keep our money safe."
"'Let them eat debt' is not a strategy for making America great again," Calhoun added, "and weakening the CFPB certainly isn't the way to keep working families, our financial markets, or our economy strong."
Stacy Mitchell, co-director of the Institute for Local Self-Reliance, which challenges corporate encroachment on the common good, said, "Obviously this isn't about 'efficiency.' It's about dismantling law enforcement that protects Americans from corporate power."
Congressional Democrats also reacted with contempt to Musk's message and the news that the agency's systems—like those of other agencies DOGE has put its hands on—were under threat.
"Here is the richest man in the world bragging about eliminating an agency that has delivered $21 billion back to working-class families since its inception," said Democrats on the House Committee on Financial Services, led by Ranking Member Maxine Waters of California. "Even most Republicans want the CFPB to continue protecting them from being ripped off by abusive big banks and predatory lenders."
"Here are the FACTS: 81% of voters, both Republicans and Democrats, support the CFPB and want the agency to continue its work," said Rep. Juan Vargas (D-Calif.), also a member of the committee. "Even so, Trump has moved to freeze the CFPB to take money out of YOUR pocket to line those of his billionaire friends."
In a letter sent to the CFPB on Friday—addressed to the previous acting director, Treasury Secretary Scott Bessent, whose first act of business was reportedly to order a halt of "all meaningful work"—Waters, Vargas, and 79 other Democratic members of the House said they were "deeply alarmed and troubled that you appear to be launching the Trump Administration's plan to contravene the will of Congress and unlawfully 'delete' this popular consumer watchdog that enjoys the broad bipartisan support of four out of five Americans."
According to the letter:
... we understand that you have ordered staff to halt all meaningful work of the CFPB, including ordering staff to stop investigating violations of consumer financial protection laws or settling enforcement actions, basically letting bad actors off the hook. We also understand that you have arbitrarily ordered the suspension of all CFPB rules that have yet to take effect, which would delay billions of dollars in savings and credit opportunities for consumers, if not rob them entirely.
We urge you to immediately rescind what appears to be an illegal stop work order and allow the public servants at the CFPB to get back to work for the American people as required by law.
As of this writing, the CFPB's homepage (www.consumerfinance.gov) prominently displayed a 404 error message, though portions of the site appeared to be active.
In a Saturday statement, the Democrats on the House Finance Committee said the 404 image on the CFPB website was intentionally "deceptive," calling it "a brazen attempt to fool consumers and the public about the status" of the agency.
"As of this moment, links and pages are still up and functional on the website," the statement said, "including the Consumer Complaint portal and database and Home Mortgage Disclosure Act (HMDA) database. Various aspects of the CFPB's web content is required by statute to be published and available on the CFPB's website."
"Let's be clear: the people cheering this the loudest are scammers and people who don't want you to keep your hard-earned dollars. So much for lowering costs."
Nadine Chabrier, counsel at the Center for Responsible Lending, said the "deeply troubling" developments at the agency will "undermine the CFPB's mission to protect consumers from financial misconduct" of various kinds.
"CFPB has returned more than $20,000,000,000 to consumers since it was founded," said Rep. Gabe Amo (D-R.I.) on Friday evening in response to Musk's tweet. "Let's be clear: the people cheering this the loudest are scammers and people who don't want you to keep your hard-earned dollars. So much for lowering costs."
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Group Behind Supreme Court CFPB Case Is Full of 'Criminals, Crooks, and Predatory Lenders'
Accountable.US warned that if the Supreme Court sides with the lending group, "it would open the door to the worst rollback of consumer protection in U.S. history and mass uncertainty for the markets and other agencies."
Oct 03, 2023
The U.S. Supreme Court on Tuesday heard oral arguments in a case brought by a payday lending industry trade group that represents companies with long histories of engaging in criminal activity and drawing hundreds of millions of dollars in fines from regulators—including the federal consumer protection agency they are now attempting to destroy.
An analysis released by the watchdog group Accountable.US ahead of Tuesday's proceedings cites a number of instances in which Community Financial Services Association of America (CFSA) board member companies were found to have taken part in "corruption and ethics scandals, including racketeering convictions, Ponzi scheme payouts, and payments to disgraced politicians."
The CFSA is before the Supreme Court on Tuesday challenging the constitutionality of the Consumer Financial Protection Bureau's (CFPB) funding structure. The bureau's funding comes from the Federal Reserve system, not annual congressional appropriations.
If the Supreme Court sides with the CFSA, the consumer bureau—which is tasked with combating corporate abuses—could be forced to rely on Congress for its annual budget, opening it up to politically motivated cuts pushed by industry-backed Republicans who have sought to abolish the CFPB.
The Supreme Court could also issue a more sweeping ruling that completely invalidates the actions the agency has taken on behalf of consumers over the past dozen years, a decision that would have far-reaching implications for federal agencies, critical programs, and the U.S. economy.
Listen to the oral arguments:
The Accountable.US analysis makes clear that the beneficiaries of any weakening of the CFPB would be companies that have unlawfully preyed on consumers.
Enova International, a financial services firm whose chief strategy officer serves on the board of the CFSA, was fined $3.2 million by the CFPB in 2019 "for debiting consumer bank accounts without their authorization," Accountable.US noted.
A year later, Progressive Leasing—a subsidiary of PROG Holdings—"paid $175 million to settle a Federal Trade Commission lawsuit alleging the lender 'frequently' misled consumers by charging consumers twice the advertised ticket price for payments on rent-to-own items," the watchdog added.
The group estimated that CFSA companies have paid more than $200 million in fines levied by U.S. regulators.
Liz Zelnick, director of the Economic Security and Corporate Power program at Accountable.US, said Tuesday that "if ever there was a time to consider the source, it's this lawsuit."
"A gang of predatory payday lenders that include convicted racketeers and accused tax cheats, embezzlers, and scam artists want the Supreme Court to tie up the CFPB in knots of political obstruction and hamper the agency's work protecting consumers," said Zelnick. "These loan sharks notorious for charging as much as 1,200% interest rates are not the honest brokers and constitutional champions the financial industry and their lackeys in Congress make them out to be."
"If the Supreme Court sides with the criminals, crooks, and predatory lenders behind this case," Zelnick warned, "it would open the door to the worst rollback of consumer protection in U.S. history and mass uncertainty for the markets and other agencies."
Accountable.US and other watchdogs have called on Justices Clarence Thomas and Samuel Alito to recuse from the case, citing their ties to the Koch network and other corporate groups and wealthy individuals that support—or stand to benefit from—the challenge to the CFPB. Both justices have refused to do so.
"It's far past time for these justices to stop putting their billionaire pals over everyday Americans," Accountable.US president Caroline Ciccone said Monday. "Recusing themselves from cases where they have glaring conflicts of interest is the very least they can do to restore some semblance of credibility and integrity to our Supreme Court."
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Existential Threat to CFPB Spotlights Massive Stakes of New Supreme Court Term
"How the court rules, and the relief it orders, will have enormous implications for the future of the agency, the validity of its past rules and enforcement actions, and its ability to continue protecting consumers."
Oct 02, 2023
The corporate forces that have been gunning for the Consumer Financial Protection Bureau since its creation more than a decade ago are set to have their moment before the U.S. Supreme Court on Tuesday, with the justices poised to hear a predatory payday lending group's challenge to the agency's funding mechanism on the second day of their new term.
The case—Consumer Financial Protection Bureau v. Community Financial Services Association of America, Limited—poses an existential threat to the CFPB, which has aggressively pursued corporate criminals under the leadership of director Rohit Chopra, who has been dubbed "Wall Street's most hated regulator."
Depending on the scope of the Supreme Court's decision, the outcome of the case could have consequences that reach far beyond the consumer agency's budget, potentially throwing the U.S. mortgage market into chaos and undermining other regulatory agencies and federal programs—including Medicare and Social Security.
"How the court rules, and the relief it orders, will have enormous implications for the future of the agency, the validity of its past rules and enforcement actions, and its ability to continue protecting consumers against fraud and abuse in the sale of a broad range of financial products and services, from payday loans to mortgages and credit cards," Stephen Hall, legal director and securities specialist at Better Markets, said Monday.
"The case also threatens the viability of other critically important agencies that have essentially the same funding structure that fuels the CFPB, including the Federal Reserve and the other banking regulators," Hall added.
Last year, 5th Circuit Court of Appeals—a federal panel composed entirely of judges appointed by former President Donald Trump—ruled that the CFPB's funding structure is unconstitutional. Unlike other federal agencies, the CFPB's funding comes from the Federal Reserve system, not congressional appropriations, making it less subject to annual political fights and right-wing austerity sprees.
The CFPB
appealed the ruling, which was authored by a judge who received donations from the banking industry when he was a Mississippi state lawmaker.
As The New York Timesobserved Sunday, the 5th Circuit didn't just take aim at the CFPB's funding mechanism.
"It concluded that all actions taken by the bureau in its 12-year existence should be 'rewound,'" the newspaper reported. "If the Supreme Court agrees that the bureau's funding is improper, it could, at minimum, force the agency to rely on congressional appropriations. Or the court could follow the 5th Circuit's suggestion and obliterate everything the agency has done to date."
The plaintiffs in the case, which brought their challenge in response to a CFPB rule targeting the abusive activities of payday lenders, contend that the bureau's funding structure violates the Constitution's appropriations clause because it falls outside the annual congressional appropriations process—a claim that legal experts say is both "wrong" and "incredibly dangerous."
Such reasoning, if accepted by the U.S. Supreme Court, "would invite challenges to a host of other federal financial regulators and could wreak havoc on the nation's economy," Brianne Gorod, Brian Frazelle, and Alex Rowell of the Constitutional Accountability Center argued last year.
"And nothing in the law requires this result: The decision is at odds with constitutional text and history, Supreme Court precedent, and long-standing historical practice," they added.
Last week, the watchdog group Americans for Financial Reform (AFR) stressed that "all bank regulators and numerous other agencies and programs likewise rely on funding outside annual appropriations, such as Social Security and Medicare."
"If the Supreme Court does not turn back this unprecedented interpretation of the Constitution, it will put all of these government agencies at the mercy of the increasingly unpredictable annual appropriations process," said Elyse Hicks, consumer policy counsel at AFR. "The gears behind important financial regulatory and rulemaking work would grind to halt any time Congress reached a budgetary impasse. The judiciary too could find itself unable to meet its financial obligations during a government shutdown."
"Justices Thomas and Alito are shamelessly thumbing their noses at judicial ethics, living the high life on GOP billionaires' dime."
The Supreme Court is set to hear the case in the midst of a corruption crisis largely stemming from the activities of two right-wing justices: Samuel Alito and Clarence Thomas.
Throughout 2023,
ProPublica and other outlets have published a number of bombshell stories detailing the undisclosed gifts the two judges have received from billionaires who have had business before the Supreme Court.
Vishal Shankar, a senior researcher at the Revolving Door Project, noted in The American Prospect on Monday that "hedge fund billionaire Paul Singer—who took Alito on a luxury Alaska fishing trip—holds at least $90 million in financial companies overseen by the CFPB."
Shankar also pointed to Thomas' ties to the Horatio Alger Association, an
elite circle that the justice has granted extraordinary access to the Supreme Court.
"According to a review of the Alger Association's members conducted by the Revolving Door Project, at least 18 Alger members have either previously expressed an interest in weakening the CFPB or stand to gain from the court gutting the bureau," Shankar wrote, specifically naming Chamber of Commerce CEO Tom Donohue, Berkshire Hathaway executive Gregory Abel, and John Canning, co-founder of the private equity firm Madison Dearborn Partners.
CFPB v. CFSA is one of a number of cases before the Supreme Court that pose major threats to democracy, fundamental freedoms, and basic government functions, advocates say.
"The court is set to rule on a series of issues critical to our rights and our democracy, from gun violence prevention to the rights of Americans with disabilities, from racist gerrymandering to the ability of the government to protect consumers and enact the will of democratically elected representatives," the Just Majority coalition said in a statement Monday.
"While we do not know how any individual case will be decided," the coalition added, "we know we urgently need structural court reform, including a binding code of ethics and Supreme Court expansion, to make sure the court considers the rights of all Americans, not just billionaires who can buy special access.”
One of the pending cases,
Loper Bright Enterprises v. Raimondo, threatens to gut the federal government's ability to constrain the destructive activities of fossil fuel companies and other corporations. The plaintiffs in the case have seen vocal support from right-wing, industry-backed groups, including the Cato Institute—which was co-founded by the billionaire oil tycoon Charles Koch.
Last month,
ProPublicarevealed that Thomas has attended at least two Koch network donor events during his tenure on the Supreme Court.
"The Roberts court is unchecked and unbalanced," Brett Edkins, managing director of policy and political affairs at Stand Up America, said Monday. "Justices Thomas and Alito are shamelessly thumbing their noses at judicial ethics, living the high life on GOP billionaires' dime. While they bask in luxury, the court's conservative supermajority is ruthlessly stacking the deck in favor of the wealthy and powerful, while chipping away at the freedoms of everyday Americans."
"As this term begins," said Edkins, "it's clear that it's time for a shake-up."
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