Beware justices: Undermining consumer protection board could provoke next financial meltdown

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The Consumer Financial Protection Bureau is the only federal agency that enforces federal consumer financial laws, and protects consumers against unfair, deceptive, or abusive financial practices or products. The CFPB has been fighting against law-breaking financial institutions who take advantage of people trying to survive in an ever-changing financial system since 2011. The Supreme Court is set to hear a case which could leave consumers in a vulnerable position and lead to more expensive financial crises. Wall Street banks, like Lehman, bundled predatory mortgages that families couldn’t afford for years and sold them to investment firms. In 2008, the house of cards collapsed, causing the worst financial crisis since the Great Depression. It was a nightmare for all families. The Supreme Court will soon decide the future of the CFPB. As many as 10,000,000 Americans lost their homes and nearly 9,000,000 people lost their job. Within four years, 46,5 million Americans lived in poverty. As with other crises, Black and other communities of colour bore the brunt. Even as families were foreclosed or fired, wealthy executive’s rewarded themselves excessively with bonuses and pay. Unfortunately, there was no federal watchdog focused solely on protecting consumers from Wall Street’s recklessness.

As a member of the House Financial Services Committee during this crisis, I was outraged by the behavior of Wall Street and these predatory lenders, and that not a single executive was held accountable while taxpayers were forced to foot the bill and bail out the banks.

That’s why I helped lead the legislative response to this crisis by pushing for the passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act. This historic law not only ended future bank bailouts but also created the CFPB. So far, the CFPB has returned an astounding $17 billion to 200 million consumers harmed by financial institutions.

Despite the agency’s success at protecting consumers, this year’s anniversary of the crisis is particularly significant as Republicans ramp up their attacks against the agency. Next month, the Supreme Court will hear oral arguments in CFPB v. Community Financial Services Association of America

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Extreme Republicans and predatory payday lenders have teamed up to challenge the constitutionality of the CFPB’s funding based on a fringe legal theory.

Let’s be clear, every single court — other than the radical 5th U.S. Circuit Court of Appeals has affirmed that the funding of CFPB is valid. They continue to deny the facts, just as MAGA Republicans continue to deny results of elections. The Constitution is clear. Congress has the right to fund the executive branch in any way it chooses. This includes the CFPB, the banking regulators, and other agencies. Republicans are using this attack on the CFPB to undermine important government programs such as Social Security and Medicare. The CFPB has a record that speaks for itself. The CFPB, under Director Rohit Chopra is fighting junk fees and medical debt, fighting housing discrimination, redlining and holding banks accountable for breaking the law. The CFPB is supported by 80 percent of Americans, including 75 percent Republicans. They want it to continue doing its work. Republicans should listen more to their constituents. They know what junk fees are and why they support the work of the agency. We must defend the only agency that is dedicated to protecting consumers. I led 144 former and current members of Congress in a brief sent to the Supreme Court earlier this year explaining why Congress created CFPB, and how Fifth Circuit’s decision was incorrect. Come October, the Supreme Court will have to decide whether they’ll side with consumers and the rule-of-law or with predatory lending and their allies. No one in this country should have to be the prey again of Wall Street’s greed.

Maxine Waters is ranking member House Financial Services Committee.

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