The Consumer Financial Protection Bureau (CFPB) was created by the 2010 Dodd Frank Wall Street Reform and Consumer Protection Act as an independent agency to promote education, fairness and transparency for mortgages, credit cards and other consumer financial products and services. The CFPB is intended to help protect families from the predatory and abusive lending practices that ignited the economic crisis that has plagued our nation since 2007.
Sadly, since its inception in July 2011, the CFPB has been attacked by those in Congress who do not see a need to educate or protect consumers from reckless or abusive lenders. The latest salvo in these attacks is H.R. 6139, the mis-named “Consumer Credit Access, Innovation and Modernization Act”. This legislation would move oversight of all non-bank financial servicers, including payday lenders, from the CFPB to the Office of the Comptroller of the Currency (OCC), which has stated for the record that it does not feel it should regulate non-bank lenders. This bill also preempts state and local laws (such as those in Arizona, Ohio and Montana) which are intended to protect consumers and put limits on the amount of interest which can be charged. Finally, H.R. 6139 would also repeal a key protection of the federal Truth in Lending Act, in that it states that no lender would be required to quote the annual percentage rate (APR) for any loan of one year or less in term, thereby denying consumers essential cost comparison information and giving short-term lenders an unfair advantage over other lenders.
H.R. 6139 would dramatically undermine attempts to protect consumers, especially those who have traditionally been targeted by abusive short term lenders including some payday lenders. This includes low income Americans, racial and ethnic minorities and members of the Armed Services and their families.
THE NAACP OPPOSES H.R. 6139 AND URGES ALL MEMBERS OF CONGRESS TO REJECT THIS BAD LEGISLATION, AS WELL AS ANY OTHER PROPOSALS WHICH WOULD UNDERMINE OR WEAKEN THE EFFORTS OF THE CFPB.
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