Congressional Democrats Challenge CFPB Reversal On Payday Rule
Senator Elizabeth Warren (D-MA), Representative Maxine Waters (D-CA) and four other Democratic members of Congress submitted a letter to Consumer Financial Protection Bureau ("CFPB") officials questioning the agency's recent reversal of course regarding implementation of its rule on payday loans (the "Payday Rule").
As detailed in the letter, the rule was originally scheduled to become fully effective on January 16, 2018. On that same day, the CFPB issued a statement that it would undertake additional consideration of the Payday Rule and allow lenders to apply for waivers exempting them from the first compliance date. The Democrats note that the CFPB also elected to dismiss a case against installment lenders regarding their lending and collection practices and to drop an investigation into a high-cost installment lender accused of abusive business practices. Senator Warren and Representative Waters asserted that current CFPB Director Mick Mulvaney has received political donations from the industry.
The Democratic members of Congress asked the CFPB to provide information on the agency's "reversal" of its position on payday loans, including:
the basis for Director Mulvaney's reversal of his former contention that only Congress has the ability to delay or reverse the Payday Rule; the analysis conducted by the CFPB to inform its decision to halt the Payday Rule; whether Director Mulvaney met with members of the payday loan industry before dropping cases or investigations against installment lenders; and all communications pertaining to discussion of the Payday Rule as well as related cases and investigation. Commentary /StevenLofchie
Senator Warren raises fair and tough questions that deserve answers.
As discussed in a separate article...
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