Published: May 2014

In support of the CFPB: standing up in favor of more transparent banking

In response to the 11 proposals and bills that were designed to harass and undermine the authority of the Consumer Protection Bureau (CFPB), coalition advocates urged Congress to stop obstructing reasonable regulation that serves to protect consumers and the financial industry from another financial crisis. While the bills before the committee are an attempt to portray the CFPB as a too-powerful agency that threatens consumer freedom and privacy, it is clear that the CFPB is getting results for consumers and making markets work better.

The Consumer Financial Protection Bureau (CFPB) was established in 2010 in the wake of the worst financial crisis in decades. Its mission is to identify dangerous and unfair financial practices, to educate consumers about these practices, and to regulate the financial institutions that perpetuate them. To help accomplish these goals, the CFPB has created and made available to the public the Consumer Complaint Database. The database tracks complaints made by consumers to the CFPB and the responses of financial institutions to those complaints. The Consumer Complaint Database enables the CFPB to identify financial practices that threaten to harm consumers and enables the public to evaluate both the performance of the financial industry and of the CFPB.

The CFPB is working.

Twenty-five U.S. banks account for more than 90 percent of all complaints to the CFPB. If banks don't handle their complaints quickly and well, their customers will submit complaints to the agency. If they want to avoid public shaming or even enforcement action, industry lawyer Alan Kaplinsky told the American Banker, they would do well to "have a very good system in place from the get go to resolve a complaint quickly." More than one in four complaints about banking services processed by the CFPB ended with the consumer receiving some form of financial relief. However, consumers disputed the resolution of roughly 20 percent of all complaints.

What we see is an agency seriously and responsibly doing the job Congress gave it: making consumer financial markets fairer and more transparent; putting money back in the pockets of members of the public who were fleeced by illegal conduct, and policing rules of the road that make the financial system work better for responsible businesses and responsible consumers alike. Obstructing reasonable regulation only serves the interests of the worst elements of the financial industry, and encourages law breaking.

We urge Congress to oppose the bills outlined in the letter and use its time to explore ways to move forward on making sure that the U.S. financial system supports people’s ability to save, transact, and borrow prudently.

Lead Organization

Americans for Financial Reform (AFR)

Other Organizations

Americans for Financial Reform | Center for Economic Justice | Consumer Action | Consumers Union | National Association of Consumer Advocates National Consumer League | U.S. PIRG Woodstock Institute

More Information

To read the full coalition letter, please click here.

Read "Ten ways the CFPB is working for you."

For more information, please visit the AFR website.

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