US PIRG Blasts CFPB Enforcement During Pandemic; Agency Defends Its Work

Even as the Consumer Financial Protection Bureau touts its work during the pandemic, a consumer group charged today that the agency continues to make decisions that harm, rather than help consumers.

The CFPB has received a record number of complaints since the coronavirus crisis began, US PIRG said, in an analysis of complaints submitted to the bureau.

“The record number of complaints also indicates a need for the agency established after the last financial crisis to take more powerful actions to protect consumers from unfair financial practices,” US PIRG said, in the report issued Friday. “Yet rather than expanding its consumer protection mission, the CFPB has weakened consumer protections since the start of the pandemic.”

Bureau officials have painted a vastly different picture during the past several weeks, saying that the agency has remained nimble and able to respond to new types of complaints.

“To help the Bureau monitor challenges consumers are experiencing in the marketplace, the Bureau has built tools to identify and analyze coronavirus-related complaints,” CFPB Director Kathy Kraninger said at a Consumer Data Industry Association webinar last month. “These tools have helped us understand what consumers are experiencing in the marketplace. And as the pandemic evolves, they help us see what is shifting in terms of products and issues.”

But US PIRG said Friday that the agency has weakened protection, citing the agency’s decision to rescind strict payday lending rules. In addition, the group said, the CFPB issued guidance stating that during the pandemic it will not enforce certain consumer law violations.

At the same time, US PIRG said, complaints about credit reporting increased by 86% when comparing March-June 2019 to March-June 2020. Complaints in other areas, such as issues with credit card issuers, have increased more than 300%.

CFPB officials defended the agency’s work. The agency has developed a system of “prioritized assessments,” which allows the CFPB to concentrate on complaints related to the coronavirus crisis, Bryan Schneider, the CFPB’s associate director in the agency’s Supervision, Enforcement and Fair Lending Division said, during a CFPB conference Thursday.

He said the agency has been forced to delay many of its examinations of financial services companies.

In her presentation last month, Kraninger said that the agency’s mortgage work “has been front and center” during the pandemic. Bureau officials have worked with borrowers, lenders, and mortgage servicers to ensure that homeowners receive the mortgage relief authorized under pandemic-related legislation.

She added that agency officials have worked with consumers having problems with Consumer Reporting Agencies. She said that the CFPB issued guidance outlining the responsibilities of those agencies and calling for targeted flexibility for those agencies if they are facing staffing shortages.

“Let me make clear that all [agencies] and furnishers remain responsible for conducting reasonable investigations of consumer disputes in a timely fashion,” she said. “The policy statement makes clear that the Bureau expects CRAs and furnishers to make good faith efforts to investigate disputes as quickly as possible.”


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