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As Musk Attacks CFPB, GOP Lawmakers Take Aim at Overdraft Rule—A Gift to Wall Street
"This is just the latest broken promise from Republicans, who have used their short time in power to already cater to special interests over hardworking Americans," said one watchdog leader.
Feb 18, 2025
A U.S. watchdog group on Tuesday slammed Republicans in Congress for trying to kill the Consumer Financial Protection Bureau's overdraft rule as U.S. President Donald Trump and billionaire Elon Musk target the CFPB as a whole.
The Accountable.US statement came in response to Senate Banking Committee Chair Tim Scott (R-S.C.) and House Financial Services Committee Chair French Hill (R-Ark.) recently introducing a Congressional Review Act (CRA) resolution to overturn the rule that capped most overdraft fees at $5, which was finalized in December, near the end of the former President Joe Biden's term.
"Overdraft fees affect a huge portion of American families with 17% of households with checking accounts paying overdraft or [nonsufficient funds] fees in 2023," Accountable.US noted. "This action would open the door for $35 overdraft fees—a decision that would cost American households an average of $225 each year."
The watchdog's executive director, Tony Carrk, declared that "undoing the CFPB's overdraft fee rule is a gift to big banks and a gut punch to the wallets of millions of Americans across the country."
"Deceitful and excessive overdraft fees cost Americans billions of dollars every year, but the Trump administration and Republicans in Congress don't seem to care any longer about lowering costs for Americans now that they're in charge," he continued. "This is just the latest broken promise from Republicans, who have used their short time in power to already cater to special interests over hardworking Americans."
When the Republican chairs introduced their CRA resolution last week, Scott called the Biden-era CFPB rule an example of the "pursuit of political headlines over sound policies," and Hill described it "midnight rulemaking" and "another form of government price controls that hurt consumers who deserve financial protections and greater choice."
Meanwhile, when the CFPB finalized the rule, the agency said that it "took action to close an outdated overdraft loophole that exempted overdraft loans from lending laws." At the time, the bureau was still directed by Biden appointee Rohit Chopra, who highlighted that large banks' exploitation of the loophole had "drained billions of dollars from Americans' deposit accounts."
The rule "was scheduled to become effective in October," but "because of acting Director Russ Vought's unlawful order stalling all CFPB work, the effective date has been suspended," The American Prospectreported Monday. "If Congress passes the CRA resolution, the overdraft rule could not come back in any 'substantially similar' form. So it matters if congressional Republicans decide to support allowing banks to impose additional junk fees worth billions of dollars."
The outlet also pointed out that "because CRA resolutions cannot be stopped by a filibuster, they represent some of the most likely legislative actions of the early Trump term," given Republicans' narrow majorities in Congress."
It's not just the rule that's in jeopardy; the entire agency is at risk. Trump and Musk, the leader of the president's Department of Government Efficiency (DOGE)—though perhaps not on paper—are working to gut the federal workforce and slash spending, and they have the CFPB in their crosshairs.
An agreement reached Friday in federal court halted mass firings at the CFPB and barred the bureau and its temporary leader, Vought—who also leads the Office of Management and Budget—from purging data or defunding the agency while the case moves forward. However, Trump and Musk are expected to continue their effort.
"The same billionaires trying to kill the CFPB are the ones who profit off predatory loans, sky-high fees, and financial scams that target young people," Corryn G. Freeman, executive director of the youth-focused Future Coalition, said Monday. "The CFPB should be strengthened, not eliminated. If Musk and his allies succeed in gutting this agency, it will be open season on young consumers with no one left to protect them."
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CFPB Bans Medical Debt From Credit Reports—But GOP Wants to Reverse It
The agency "effectively dared the incoming Trump administration and its Republican allies in Congress to undo rules that are broadly popular," wrote one healthcare reporter.
Jan 07, 2025
Months after more than half of respondents to an Associated Press poll said it was "extremely or very important" for the federal government to take action to help people with medical debt, the Consumer Financial Protection Bureau on Tuesday finalized a rule to keep such debt off credit reports.
With broad public support, the rule appeared to be an uncontroversial slam dunk for the Biden administration in the last days of President Joe Biden's presidency—but Republicans, who now have majorities in Congress and are poised to take over the White House in less than two weeks, have signaled that they would take action to undo the CFPB's regulations, including the medical debt rule.
U.S. Sen. Tim Scott (R-S.C.), the new chair of the Senate Banking Committee, said last month that the CFPB should halt all rulemaking until President-elect Donald Trump takes office.
"It is paramount that President Trump can begin his administration on January 20 with a fresh slate to implement the economic agenda that the American people resoundingly voted for," Scott said.
The senator's comments suggested that Americans who voted for Trump did so in order to continue paying overdraft fees, having their personal information sold by predatory data brokers, and being penalized for owing medical bills—all of which the CFPB has taken action on since the November elections.
As Noam N. Levey wrote at KFF Health News, the CFPB on Tuesday "effectively dared the incoming Trump administration and its Republican allies in Congress to undo rules that are broadly popular and could help millions of people who are burdened by medical debt."
"People who get sick shouldn't have their financial future upended."
The new rule would remove $49 billion in unpaid medical debt from credit reports by amending Regulation V, which implements the Fair Credit Reporting Act.
Lenders are restricted from obtaining or using medical information to make lending decisions. But federal regulators have created an exception to that restriction, allowing companies to consider medical debt. The new rule ends that exception by banning medical bills on credit reports, which the CFPB said has led to a practice of using the credit reporting system to coerce payments even if bills are inaccurate, as they frequently are, according to the agency.
About 15 million people will be helped by the new regulation, said the CFPB, with credit scores of people with medical debt boosted by an average of 20 points.
An estimated 100 million Americans owe debt for healthcare they've obtained, forcing many to cut spending on groceries, housing, and other essentials.
An informal KFF Health News poll of people facing eviction or foreclosure in the Denver area in 2023 found that nearly half of people surveyed said medical debt played a role in their housing insecurity.
The inclusion of medical debt on credit reports by companies like Experian, Equifax, and TransUnion can harm Americans' ability to obtain jobs, mortgages, and rental apartments, even as CFPB research shows that medical debt is a poor predictor of whether a consumer will repay a loan.
"People who get sick shouldn't have their financial future upended," said CFPB Director Rohit Chopra. "The CFPB's final rule will close a special carveout that has allowed debt collectors to abuse the credit reporting system to coerce people into paying medical bills they may not even owe."
Billionaire Trump megadonor Elon Musk, who has become a top adviser to the president-elect and was picked to co-lead the proposed Department of Government Efficiency, has made clear that the CFPB would be a key target of the advisory body, calling for the agency to be "deleted" in November.
Despite Republicans' repeated claims that Trump will lead the party in securing an agenda that serves working families, lobbying by the credit reporting industry over the medical debt rule has made clear whose side the GOP is on.
Equifax said in August, two months after the CFPB proposed the rule, that the government is "not permitted" to regulate the industry in such a way.
House Financial Services Committee Chairman Patrick McHenry (R-N.C.) also called the proposal "regulatory overreach."
Chopra said last month that despite Republicans' objections, the CFPB would not "be a dead fish" ahead of Trump's term.
"We will continue to defend consumers' rights," he said, "and to hold companies accountable."
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Bernie Sanders Condemns Israel's Destruction of Gaza Universities
"There are no protests on the college campuses in Gaza," said the Vermont senator. "You know why? Because every one of the 12 universities in Gaza has been bombed and destroyed."
May 08, 2024
U.S. Sen. Bernie Sanders on Tuesday denounced the Israeli military's total decimation of Gaza's universities during floor remarks on protests that have broken out on American college campuses over the past several weeks.
"There are no protests on the college campuses in Gaza," said Sanders (I-Vt.), chair of the Senate Health, Education, Labor, and Pensions Committee. "You know why? Because every one of the 12 universities in Gaza has been bombed and destroyed."
Sanders' remarks came during a floor debate over a Republican resolution ostensibly aimed at condemning antisemitism on college campuses. GOP lawmakers and President Joe Biden have repeatedly smeared campus protests against Israel's assault on Gaza as antisemitic and ignored the prominent role Jewish students have played in the nationwide demonstrations.
After Sen. Tim Scott (R-S.C.) attempted to pass the GOP antisemitism resolution via unanimous consent, Sanders—who is Jewish—rose to block the measure, criticizing it as insufficient and proposing an alternative that condemns antisemitism as well as all other "forms of bigotry in this country, whether on college campuses or elsewhere, including Islamophobia, homophobia, racism, and the growing attacks against the Asian American community."
Sanders' proposed resolution also expresses support for "the right of students and all Americans to peacefully protest," whereas Scott's measure attacks recent campus protests as "hotbed[s] of blatantly antisemitic rhetoric and action."
"The fact of the matter is that 67% of Americans, according to recent polls, support the United States calling for a cease-fire, and 60% oppose sending more weapons to Israel," Sanders said. "And that's what the protesters are talking about: They are asking why it is we are complicit in the humanitarian disaster taking place in Gaza."
Watch Sanders' remarks:
LIVE: Today I offer a simple resolution:
NO to antisemitism.
NO to Islamophobia.
NO to racism and bigotry in all its forms.
YES to free speech and protest under the 1st Amendment, whether on a college campus or across our nation. https://t.co/czTwnQnz6b
— Bernie Sanders (@SenSanders) May 7, 2024
According to the United Nations, more than 80% of the Gaza Strip's schools have been damaged or reduced to ruins by Israeli forces since October, including all of the enclave's universities.
Last month, a group of U.N. experts said that "it may be reasonable to ask if there is an intentional effort to comprehensively destroy the Palestinian education system, an action known as 'scholasticide.'"
"The persistent, callous attacks on educational infrastructure in Gaza have a devastating long-term impact on the fundamental rights of people to learn and freely express themselves, depriving yet another generation of Palestinians of their future," the experts added. "Students with international scholarships are being prevented from attending university abroad."
American campus protests against Israel's assault on Gaza have offered some measure of hope to Palestinian students whose lives have been thrown into chaos by the U.S.-backed war.
Hala Sharaf, a second-year medical student who moved to Cairo to resume her studies amid Israel's assault, toldAl Jazeera that the U.S. student campus demonstrations "have made us feel so hopeful for rejecting what America and Israel are doing to us."
"The student protests in America make me feel like I'm not alone," said Sharaf. "My message to them is to keep the focus on Gaza. Don't forget about Gaza."
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