The Consumer Financial Protection Bureau (CFPB) Protects All Americans and Must Not Be Abolished, Weakened, or Sidelined

By Stephen Hall, Legal Director and Securities Specialist & Brady Williams, Legal Counsel

The Consumer Financial Protection Bureau (CFPB) has returned nearly $20 billion to almost 200 million Americans ripped off by the financial industry since it opened its doors on July 21, 2011. As a vigilant, effective, and powerful cop on the financial consumer beat, the CFPB has undoubtedly also deterred many more rip-offs, saving countless Americans hundreds of millions if not billions of additional dollars in losses.

Nevertheless, billionaire Elon Musk says he wants to “delete” the Consumer Financial Protection Bureau (CFPB). While it might be difficult for a billionaire to understand why the agency is so important, the 200 million Americans who have received checks from its work would disagree. The agency has proven to be one of the most effective investor and consumer protection agencies in the history of financial regulation. And precisely for that reason, Wall Street and its allies have been relentless in trying to abolish or neuter it. They opposed it on the Hill, they’ve attacked it with every possible legal argument in court, and now it faces a new threat as the Trump administration is about to take office. The industry’s singular focus will be on abolishing the CFPB or crippling the agency from within—just as they did during the first Trump administration.

These attacks are entirely wrong-headed because the CFPB is essential for ensuring that all Americans are protected from the relentlessly predatory behavior of so many financial firms. The agency has adopted strong rules aimed at eliminating abusive financial practices, increasing transparency, and promoting racial economic justice. It has also established and implemented a robust enforcement program that has produced huge benefits for financial consumers who have been victimized by predatory, deceptive, and illegal financial practices—resulting in the return of almost $20 billion to everyday Americans.

What does an effective CFPB really mean for Americans across the economic spectrum and especially for those struggling to make ends meet? It means less of their hard-earned money bled away by unscrupulous companies and more money left in their pockets for rent, groceries, and gas.

Here we highlight just a few examples of the CFPB’s accomplishments that have helped millions avoid, and recover from, financial exploitation. The bottom line is that if the new administration is truly dedicated to the well-being of all Americans, especially the diverse group of hardworking people that drive the real economy, then far from abolishing the agency, it will ensure that it has the leadership, funding, and priorities that the CFPB needs to continue fighting hard for fairness, transparency, and economic justice.

Landmark Rules

Abusive Practices- One of the CFPB’s hallmark achievements in recent years has been addressing “junk fees,” the hidden charges tacked onto everything from bank accounts to credit cards. The CFPB has addressed these abuses through rules to limit such fees, which often target lower-income and vulnerable consumers. For example, banks are now prohibited from charging excessive overdraft fees, a practice that disproportionately impacts communities living paycheck to paycheck. And the CFPB has also finalized a rule capping credit card late fees at $8, a significant reduction from the previous maximum of $30 or more (although this rule continues to face litigation). By reining in these unnecessary fees, the CFPB estimates consumers will save billions annually.

Transparency- In June 2024, the CFPB adopted a rule that requires certain nonbank financial firms to register with the CFPB if they are subject to court or agency orders involving violations of consumer protection laws. This publicly accessible registry will help the CFPB and the public track repeat offenders in sectors like payday lending, mortgage servicing, and debt collection. The initiative seeks to deter bad practices and provide a resource for regulators and consumers to identify entities with a history of violations. Similarly, the CFPB has also proposed a rule that would create a public registry for form contracts used by nonbank entities that include clauses claiming to waive or limit consumer rights. Examples include mandatory arbitration clauses, waivers of legal rights, or limits on class action participation. The registry will shine a light on potentially abusive contract terms, making them publicly accessible and helping consumers better understand the implications of such terms in financial agreements.

Aggressive Enforcement Actions

Navient and Student Loan Relief- The CFPB secured a historic settlement against Navient, one of the largest student loan servicers in the country. Navient was accused of steering borrowers into costly forbearance plans rather than income-driven repayment options, costing borrowers billions in unnecessary interest. Under the settlement, Navient was required to cancel $1.7 billion in private student loans and pay $95 million in restitution to borrowers. This action not only provided direct relief but also signaled to the student loan industry that deceptive practices would not be tolerated.

Wells Fargo’s Record-Breaking Settlement- In late 2022, the CFPB imposed its largest-ever fine — $3.7 billion — against Wells Fargo for widespread consumer abuses, including wrongful foreclosure of homes, improper vehicle repossessions, and illegal overdraft and surprise fees. This enforcement action included $2 billion in consumer redress and $1.7 billion in civil penalties, serving as a stark warning to financial institutions about prioritizing profits over consumer rights.

Protecting Elders from Abuse- In December 2024, the CFPB sued Comerica Bank for systematically failing its 3.4 million disabled and elderly cardholders—primarily unbanked seniors receiving federal benefits such as social security. The bank deliberately disconnected 24 million customer service calls, impeding cardholders from exercising their rights under the law, charged illegal ATM fees to over 1 million cardholders, and mishandled fraud complaints. The CFPB’s enforcement action seeks to stop the company’s unlawful conduct, impose a monetary civil penalty, and provide redress for harmed borrowers.

Defending Marginalized Communities

Combating Racial Discrimination in Lending- The CFPB launched several initiatives to address racial discrimination in lending, including the release of data exposing disparities in mortgage approval rates for Black and Hispanic borrowers. These efforts were bolstered by enforcement actions against lenders engaging in redlining or other discriminatory practices. One notable case involved Trident Mortgage Company, which was found to have actively discouraged minority applicants. The CFPB’s action resulted in a $24 million settlement, including restitution for affected consumers and community investment programs.

Small Business Lending Rule- In March 2023, the CFPB finalized its Small Business Lending Rule, which will increase transparency and fairness in small business lending by requiring lenders to collect and report certain demographic data on credit applications. This includes information on loan terms, approval rates, and demographic details like the race, gender, and ethnicity of applicants. The rule helps identify discriminatory practices, enabling more equitable access to credit for marginalized communities, such as women-owned and minority-owned businesses. By promoting accountability, equity, and fairness, the rule will reduce systemic barriers to credit, fostering economic growth and opportunity in underserved areas.

Conclusion

The unfortunate reality is that Trump’s likely leadership at the CFPB will be focused on a deregulating the financial industry and possibly destroying the bureau itself. That would be a terrible setback for millions of Americans who depend on basic financial products and services yet remain vulnerable to predatory, illegal, and discriminatory practices. The bottom line is that anyone who really cares about the quality of life that Americans can afford to enjoy should fully support the CFPB’s work

.