Special Interest Groups Urge CFPB to Pass Payday Loan Rule Before Congress Rolls Back Powers

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As the controversial Consumer Finance Protection Bureau is set to have its powers cut by a GOP-backed law going through Congress, special interest groups are urging Director Richard Cordray to act on rules regarding so-called “payday loans” as soon as possible.

Republicans have accused Cordray of running a “rogue federal agency” and have long opposed the CFPB, which was created out of the 2010 Dodd-Frank financial reform bill. Some Republicans have called for the White House to fire Cordray.

“For conducting unlawful activities, abusing his authority and denying market participants due process, Richard Cordray should be dismissed by our President,” said Rep. Jeb Hensarling (R-TX) in April. “Today, Mr. Cordray and his CFPB don’t just act as a cop on the beat, they act as legislator, prosecutor, judge and jury all rolled into one.”

Hensarling’s Financial CHOICE Act, which passed the House last month, looks to blunt the powers of the bureau and roll back some of Dodd-Frank. The CFPB will be one of the agencies hit hardest by the law should it find its way to President Trump’s desk

But as the axe sharpens against the bureau, left-wing and activist groups are keen to get a number of regulations enacted, specifically curbs on payday loans, which activists say are predatory and a debt trap.  The CFPB has proposed a rule that would impose a number of restrictions, including a requirement that payday lenders determine whether borrowers can afford to pay back their loans. Opponents say this would wipe out the industry and leave many Americans without access to credit.

According to minutes of a meeting between Cordray and his staff and a number of special interest and left-wing groups on May 18., a number of groups urged action quickly on the rule. Mike Calhoun, at the Center for Responsible Lending (CRL), urged “quick action on finalizing the payday rule,” according to the minutes. Calhoun recommended that if it is unable to issue a rule on both short and long-term rules soon, the Bureau should first focus on tackling the short-term loans.

Amanda Werner of Americans for Financial Reform (AFR), urged the bureau to finalize its arbitration rule “as soon as possible.”

Liz Ryan-Murray at People’s Action also urged the bureau to issue a final rule and said that if the bureau issues a short-term rule, then it should also signal that a “strong long-term rule” is forthcoming.

Democrats have been extremely supportive of Cordray, who is rumored to be mulling a run for Ohio governor in 2018. Corday was recruited to the post by liberal firebrand Sen. Elizabeth Warren (D-MA).

Cordray’s meetings with special interest groups are the latest in a long line in such meetings. As Breitbart News previously reported, Cordray and his staff met with a plethora of activist groups as part of a consultation on the CFPB’s proposed rule on payday lending. On March 9., Cordray and his staff met with a number of groups, including representatives from Americans for Financial Reform, John Podesta’s Center for American Progress and the National Council of La Raza.

At an April 10 meeting, attended by Cordray’s staff, present were representatives from the Center for American Progress, Progress Virginia, Americans for Financial Reform, Virginia Organizing, and Our Revolution — a spinoff group from Sen. Bernie Sanders’ (I-VT) presidential run. Cordray was not in attendance at the April 10 meeting.

The CFPB opened the rule to comment between July and October last year and so far has been unable to keep track of all the comments. A website monitoring the comments found that only approximately 200,000 of approximately a million comments had been uploaded. Most of the comments uploaded so far appear to strongly oppose the rule.

Adam Shaw is a Breitbart News politics reporter based in New York. Follow Adam on Twitter:  @AdamShawNY


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