By Renato Rocha, Policy Analyst, Economic Policy, UnidosUS
Today, UnidosUS joins the consumer advocacy community as we celebrate the sixth anniversary of the Consumer Financial Protection Bureau (CFPB). The crippling effects of the financial crisis led to the creation of the CFPB, which we view to be one of the most important accomplishments of Wall Street reform. Six years ago, we made the argument that consumer protection is a civil rights issue––and we feel the same way today.
Since opening its doors, the CFPB has already curbed several unfair and deceptive practices in the financial marketplace. Over these last six years, the CFPB brought transparency to the remittance industry, stopped credit card companies from adding on products that consumers never agreed to, and required mortgage lenders to ask applicants for proof of their income before making home loans to ensure that homeowners can afford them. Just last week, the CFPB issued an important final rule that restricts forced arbitration, giving consumers a way to unite and hold corporations accountable for systemic misconduct. And we are waiting for the issuing of the final rule on payday loans, which will help curb the predatory lending that drains wealth from our communities.
Aside from its regulatory protections, the CFPB has also helped put Latino families, and all Americans, on a path to greater financial security through its enforcement actions. About a dozen CFPB actions have been made against providers that demonstrate clear evidence of restricting access to or charging minority borrowers more for products. In two cases, for example, the CFPB ordered Ally Bank to pay $80 million in damages for discriminatory auto loan pricing, and National City Bank to pay $35 million for discriminatory mortgage pricing that harmed minority consumers. All in all, the CFPB has returned more than $11.8 billion in relief to more than 29 million consumers.
It is no surprise that Latinos trust the CFPB. In our recent poll, a majority (72%) of Latino voters said they trust an independent consumer protection agency to oversee banks and make sure that the financial industry is honest with the public. This trend continues across political parties: 70% of Latino Democrats, 68% of Latino Republicans, and 73% of Latino Independents trust an independent consumer protection agency to oversee banks. Our study also found that Latino voters are very skeptical of Congress’s (43%)—and even more so of the president’s (24%)—ability to keep financial institutions in check.
In six years, the successes of the CFPB have created better opportunities for Latinos to build and maintain wealth. Yet as we celebrate all the CFPB has done to protect consumers, we must also continue to defend this consumer agency against Wall Street-backed attacks from the administration, Congress, and courts.
Latinos cannot afford the type of careless financial regulation and lack of oversight that gave way to the financial crisis, and UnidosUS will continue to fight to protect CFPB’s good work on behalf of consumers.