Payday Lenders Are Free to Abuse Americans under Mulvaney's CFPB
The Consumer Financial Protection Bureau deserves a more accurate name under Mick Mulvaney. Far from protecting consumers, the bureau is now loosening restrictions on the very corporations it was set up to police. Most recently, the bureau has dropped sanctions against NDG Financial Corp, a group of 21 businesses that preyed on low-income consumers in the US and Canada by offering high-interest payday loans.
Back in 2015, when the bureau was run by Richard Cordray and was still on the side of consumers, CFPB lawyers filed a complaint with the Southern District of New York against NDG Financial Corp. The payday lenders’ scheme “primarily involved making loans to U.S. consumers in violation of state usury laws and then using unfair, deceptive, and abusive practices to collect on the loans and profit from the revenues,” the lawyers argued.
The lawsuit was proceeding through the courts when Mick Mulvaney – who has received over $60,000 in donations to past congressional campaigns from the payday loan industry – took over the bureau in November.
By February, six of the defendants in the NDG Financial Corp case were inexplicably dismissed. And now, the remaining defendants, who had been court-ordered to compensate consumers afflicted by their unfair and abusive business practices, are also being let off the hook.
And this is only the tip of the iceberg.
According to Vox, investigation into unethical business practices by payday loan centers were dropped in January. And Reuters found earlier this month that four previously unreported cases of payday loan abuse, that would have returned $60 million to consumers, were also dismissed.
Under Mick Mulvaney’s leadership, the CFPB is unabashedly on the side of predatory corporate actors. Any hopes that the bureau would act as a barrier to rampant abuse of consumers have been dashed.
As we’ve seen again and again in Trump’s administration, consumers are left to fend for themselves while corporate power holders are given free reign to extort and abuse. This ‘swamp cabinet’ is in no position to act hold corporation accountable, and vulnerable American consumers are paying the price.