Biden Signals He'll Have Our Backs And Won't Cater To The Banksters The Way Trump Did

I doubt anyone would have been surprised if Trump had just shut down the Consumer Financial Protection Bureau entirely. Instead, he just put it out to pasture. Team Biden is breathing new life into the bureau. As Senate Banking Committee Chair Sherrod Brown (D-OH) said as he prepared to oversee the confirmation hearings for Biden's CFPB director nominee, Rohit Chopra, "Chopra was a "bold and experienced choice... I am confident that Mr. Chopra will not only return the CFPB to its central mission-- protecting consumers-- but also ensure the agency plays a leading role in combatting racial inequities in our financial system."

On the other hand, Patrick McHenry (R-NC), the GOP ranking member of the House Financial Services Committee and one of the banksters' most subservient-- and well-compensated-- puppets, is considerably less supportive. McHenry, an extremely shady character himself, said said Chopra’s appointment demonstrates "that the Biden team is pandering to members of the far left who want to weaponize the CFPB to go after financial services companies they simply don’t like... Chopra has made it clear his agenda includes limiting consumer choice, driving up [the] cost of credit for everyone through restrictive policies, and hamstringing job creators through overregulation. If the Biden Administration is looking to foster common ground between Republicans and Democrats, Mr. Chopra is the wrong pick." On the other hand, if the Biden administration is looking to advance the interests of American working families, Chopra is exactly the right pick.

Writing for the Washington Post this morning, Tory Newmyer reported that the CFPB will once again "focus first on enforcing legal protections for distressed renters, student borrowers and others facing growing debt that its previous leadership has been lax about imposing during the pandemic. But the CFPB-- which President Biden has tapped 38-year-old Rohit Chopra to lead-- is also likely to take an unprecedentedly tough line against industry giants it finds engaging in abusive practices... That will mark a dramatic turn. Just last year, consumer complaints to the agency rose by 60 percent over 2019, agency data show, setting a record as the economic crisis wiped out millions of jobs and pushed lower-income Americans to the brink. Yet the relief the agency secured for consumers topped out at less than $700 million, a fraction of the $5.6 billion it collected in 2015, its high watermark. Kathy Kraninger, a Trump appointee who resigned as director of the agency last week at Biden’s request, signaled the outcome at the start of the pandemic. She said in late March that financial companies would not face penalties for violating consumer protections in the Cares Act if they made 'good-faith' efforts to comply."

The kindest possible way to describe the Trump Regime's attitude towards the CFPB function was a "hands off" approach towards corporate interests. "Over the course of the Trump presidency," wrote Newmyer, "the agency wrangled $2.3 billion in consumer relief, a steep drop from the $10.7 billion during its first five full years in operation under the Obama administration. And the agency shifted its crosshairs notably-- from big-money actions against major companies including American Express, Citibank, Corinthian Colleges, JPMorgan Chase, Sprint and Wells Fargo, to smaller-dollar rulings against more fringe firms.

In announcing Chopra, the Biden transition said the CFPB’s former student loan ombudsman now serving on the Federal Trade Commission “has actively advocated to promote fair, competitive markets that protect families and honest businesses from abuses.”

Former colleagues say they expect Chopra, a graduate of the Wharton School at the University of Pennsylvania and acolyte of Sen. Elizabeth Warren (D-MA), to use the agency’s enforcement authority to fundamentally shake up how big businesses interact with consumers where he perceives widespread abuse.

“Under a Director Chopra, I think you’ll see the agency looking at industry practices in a broader way, seeking systemic changes in matters harming consumers, not just one-off fraud cases,” said Hudson Cook attorney Lucy Morris, who worked with Chopra as the CFPB’s then-deputy enforcement director.

Beyond reasserting the agency’s role as the federal cop on the consumer beat, the Biden-era CFPB is set to push a number of rules changes retightening screws on corporate interests. Among them will be an effort to require that payday lenders determine potential borrowers’ ability to repay loans by checking on their income and debt. Cordray originally proposed such a standard in 2017. But Kraninger reversed the rule last year.

The CFPB is also likely to build on debt collection rules the agency finalized late last year. The regulations limit collectors to no more than seven calls a week to borrowers-- a change consumer advocates welcomed-- but they opened the door for collectors to contact borrowers through other means, including emails and text messages.

And Democrats expect the agency will revive a push Cordray launched-- and his successors abandoned-- to crack down on the fees banks charge customers when they overdraw their accounts. The effort is likely to meet with intense industry resistance: Overdraft fees generated $17 billion in revenue for banks in 2019, a study by management consulting firm Oliver Wyman found.

Shervin Aazami is the progressive candidate running for the San Fernando Valley congressional seat occupied by corporate Democrat Brad Sherman, one of the most senior members of the House Financial Services Committee."The Trump Administration, Aazami told me this evening, "gutted the CFPB while the Republican-controlled Congress showered $2 trillion deficit-financed tax cuts on Wall Street firms and executives. Meanwhile, corporate Democrats on House Financial Services like Brad Sherman-- financed by private equity, credit card companies, and commercial banks-- have spent decades voting for laws that have worsened wealth and wage inequality, opened the floodgates for high-risk financial transactions on Wall Street that drain assets from low-income families of color and worsen consumer debt, and exacerbated our housing crisis. We need champions at the head of CFPB that will act with urgency to cancel student loans, abolish payday lenders, rein in runaway credit card interest rates, and much more."