CRL in the News
A vote is expected imminently in the House on the so-called “Madden” bill, which, if it becomes law would spread predatory triple-digit loans, like a virus, to every state in America. The legislation would ensnare borrowers in financially devastating debt traps.
“The Federal Reserve sanctions show the power and importance of government oversight in holding accountable companies that engage in abusive and harmful practices,” said Deborah Goldstein, executive vice president for the financial services watchdog Center for Responsible Lending, in an email to me.
Yana Miles, senior legislative counsel for the Center for Responsible Lending, said Mulvaney "is finding new ways to sabotage the consumer bureau."
"The administration should recognize the severe harm Mulvaney is doing to the public and nominate a director who has people's interest at heart," she said.
Now that would be a wonder.
However, the bill faces political headwinds, including opposition from consumer groups that worry the plan does not go as far as the current system to support affordable housing. "The bill is kind of a nonstarter for us at this point,” said Scott Astrada, director of federal advocacy at the Center for Responsible Lending.
To consumer advocates, the defanging of the consumer bureau is the epitome of pay-to-play. “They aggressively lobby against anything that goes against the debt trap nature of their business model,” said Diane Standaert, the director of state policy at the Center for Responsible Lending. “It’s been fierce.”
“Opening up the floodgates on lending discrimination will damage the ability for people of color to build wealth,” said Debbie Goldstein, executive vice president of the Center for Responsible Lending.
The staffers who will now enforce fair-lending laws will be generalists who have their hands full with numerous other consumer issues, said Deborah Goldstein, executive vice president of the Center for Responsible Lending, a Washington, D.C., nonprofit focused on fighting predatory lending.
“Fair lending will not have an advocate in that division,” she said.
The case could have broader implications over arguments of agencies and individuals that Congress grants a degree of independence from the executive branch as well. “The important thing to keep in mind here is it’s about preserving the institution, the long-term independence of the bureau,” said Melissa Stegman, senior policy counsel for the Center for Responsible Lending, during a press call Wednesday afternoon.
Melissa Stegman, senior policy counsel on the federal policy team of Center for Responsible Lending, a nonprofit, nonpartisan organization based in Washington, D.C., said she thinks legislative action to get rid of the CFPB is “extremely unlikely. My impression is that there isn’t even much of an appetite to do that legislatively, because Mulvaney is already doing it through the administrative process,” she said. “They don’t even really need to purse anything externally. It’s like a self-sabotage as opposed to having the sabotage coming from the Congress.”
Earlier this week, Bank of America (BoA) announced that it is discontinuing its free checking product for customers with low balances and switching them to BoA Core Checking accounts that charge an upfront $12 monthly fee. The fee can be waived if the customer maintains a daily minimum balance of $1,500 or has a monthly direct deposit of $250. Further, if you are a student under the age of 24, the fee is also waived.