Why financial deregulation would hurt consumers’ wallets
Chances are your personal finances play a key role in your life. Whether it’s where to bank, what credit card to use, taking out a mortgage, or dealing with student loans — these all impact your finances. You might not realize it, but the Consumer Financial Protection Bureau has likely helped your wallet and personal finances. Its latest “Monthly Complaint Snapshot” gives many reasons why we need a strong CFPB.
The CFPB has helped 29 million consumers — that’s 1 of every 8 adults who have received direct financial relief as a result of its work since it opened in 2011. And this financial relief has cost taxpayers little for their return. According to a review by NerdWallet, for every $1 in federal spending on the agency, more than $4 has been placed back in consumers’ pockets. The CFPB costs $2.9 billion to operate and has saved or returned to Americans $12 billion over that period.
The agency’s complaint database helps the marketplace work better. Consumers can submit a complaint through the database and the agency will work to get you a response from the company. The CFPB has handled 1.1 million complaints from consumers and 97 percent of consumers get timely replies when the CFPB sends their complaints to companies. In the CFPB’s “Monthly Complaint Snapshot,” the complaints provide an open window into the marketplace; examination of complaint data by the CFPB itself, by researchers such as U.S. PIRG (our eight complaint database reports), and by consumers themselves has helped to make the marketplace work better.
The CFPB continues to effectively do its job
The CFPB has been under attack for doing its job too well. In its first five years, about nine out of every ten dollars — around $10.5 billion — in consumer refunds and forgiven debts was awarded in cases where the CFPB uncovered evidence that the company illegally deceived its customers. This action is possible because there is a watchdog with the goal and resources to enforce traditional banking laws.
“We know exactly what the landscape would look like without the CFPB,” Sen. Elizabeth Warren, D-Mass. said. “We saw it in the 1990s and in the 2000s in the run-up to the biggest financial crash since the Great Depression.”
“Not only did the bureau help the nation recover from the recession, but it also will help prevent another crash,” she said.
While special interests complain about the CFPB, it continues to effectively do its job. The monthly complaint snapshot provides a window into the myriad problems consumers face navigating the financial marketplace just eight short years after our economy collapsed, largely due to a lack of financial regulation. If you look through that window, you’ll see that the idea of the CFPB needs no defense, only more defenders.
